The Sanctions Delusion

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Sertorio
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The Sanctions Delusion

Post by Sertorio » Mon Apr 18, 2022 1:05 am

'Whisper it quietly' … But Russia’s financial situation looks better than the West’s
by Alastair Crooke - 17 Apr 23:09
https://english.almayadeen.net/articles ... -looks-bet

Despite the barrage of sanctions that the Russian economy got hit with at the start of the Russian military operation in Ukraine, the West's economy seems to be taking the brunt of these sanctions instead of its intended target.

On Friday, Russia’s Central Bank cut interest rates by 3% (from 20 to 17%). And, though overall economic activity in Russia has declined, industrial production was up 4.5% in March. The Russian Prime Minister said that he expected that supply line problems caused by sanctions would be solved within the next 6–12 months. Inflation is at 14.7%, but the Central Bank suggested the worst of this inflationary impulse was over; bank deposits were growing and financial stability was returning.

Even London’s Financial Times notes signs that Russia’s “financial sector is finding its feet after the initial barrage from the sanctions”. And Russia’s oil and gas sales - at more than $1b a day in March - mean that it continues to accumulate foreign earnings that will help compensate for the reserves seized by the West. As things stand (i.e. barring a complete EU energy import ban), Russia should be able to replace those seized reserves - in short order.

The domestic banking sector also seems to have stabilised. The need for central bank liquidity has faded sharply and the commercial banking sector as a whole could soon end up having surplus deposits with the CBR, the Financial Times notes, quoting the Institute of International Finance analysis.

So, contrary to the G7’s expectation that western sanctions would collapse the Russian economy, the FT is saying: “Whisper it quietly ... Russia’s financial system seems to be recovering from the initial sanction shock”.

Ironically, Russia’s prospects in some respects look better than those of the West. Like Russia, Europe either already has – or soon will have - double-digit inflation. The big difference being that Russian inflation is falling, whereas Europe’s is spiking to the point (notably with food and energy prices), that these price hikes likely will spur popular outrage and protest.

Well … having got that wrong (the political crisis was pencilled-in for Russia, not for protests in Europe), EU states seem intent on doubling down: ‘If Russia hasn’t collapsed as expected, then Europe must go ‘the full Monty’: Just strip them of everything: No Russian ships entering EU ports; no trucks crossing EU frontiers; no coal; no gas – and no oil. ‘Not a euro reaching Russia’ is the cry.

On the face of it, this would be ‘nuts’. Take the experts’ words for it: there is no way for Europe to replace Russian energy from other sources in the next year -- not from America; not Qatar; nor Norway. But the European leadership, consumed by a frenzy of outrage at a flood of 'atrocity' images from Ukraine, and a sense that the ‘liberal world’ at any cost must prevent a loss in the Ukraine conflict, seems ready to go ‘whole hog’.

The higher energy costs implicit in stripping out Russian energy simply will eviscerate what remains of EU competitiveness – but what the heck! Zelensky! Ukraine!

Charles Moore, (a longstanding editor of mainstream British newspapers and The Spectator) says: “If Russia wins, this means not only the destruction and enslavement of Ukraine, but also the overthrow of the world order by something infinitely crueller – an unholy alliance… From this, it follows that Ukraine must win, not just to secure its national rights, but for all our sakes. I know Ukraine is not in NATO, but Russia’s attack on that one country definitely amounts to an attack on all”.

"Whisper it quietly": The EU holds to a haughty conviction that it is the monopsony that can never be ignored. It is the market: the 400 million EU market. And monopsony (the opposite to a monopoly) is a market structure in which a single buyer (i.e. the EU) can control the world simply through exclusion from its market. Brussels bureaucrats believe it. This is how, they believe, they’ll bring down Russia, and save ‘our democracy’.

But, as Alexey Gromov, Chief Energy Director of the Institute of Energy and Finance in Moscow, explains: “Russia [has] changed the logistical supply chains to Asia already”. And that applies for gas and oil as well: “You can impose sanctions if there’s a surplus in the market. Now there’s a shortage of at least 1.5 million barrels of oil a day. We’ll be sending our supplies to Asia – with a discount”.

So why is Brussels so convinced that it can strip out Russian energy, and survive without riots in European streets at hyper-inflationary food and heating prices? Their thinking is a panglossian judgement that the EU can just about survive an energy squeeze through summer, and then by the autumn, a new ‘regime’ will be taking office in Russia in the wake of Putin’s ‘Ukraine débacle’ (of which they are convinced), which will be only too delighted to sell energy to Europe at discounted prices, for long enough to allow the EU to wean itself off Russian energy – for good. End of story (so they seem to believe).

But, say it quietly: The more the West execrates Russia in Ukraine and the more it parades its loathing of President Putin, the more determined are Russians to persevere in Ukraine, and fully to support Putin. The more the EU sanctions Russia, the more sentiment in Russia will favour depriving Europe of those myriad of key commodities (mostly unfamiliar to us as supplied from Russia) on which Europeans depend – but never knew it.
It's hard to believe that westerners could be so stupid. If any of us falls for the sin of wishful thinking, that's not much of a problem. But when politicians do it it can be catastrophic. Well, I think I will just get the popcorn out...

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Milo
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Re: The Sanctions Delusion

Post by Milo » Mon Apr 18, 2022 12:26 pm

It was only yesterday when the deadline for Russian trucking in the EU passed; that promises to have major consequences for the Russian economy.

Furthermore, it will be just under two weeks before Russia has to make a large bond payment or face default. The impact there will be colossal.

International trade arrangements take weeks to months to settle, Russia will face more and more consequences in the months ahead. They are running on fumes right now.

For someone who is constantly admonishing us to wait for Russia’s military victory, this ‘analysis’ is very much jumping the gun here.

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Mon Apr 18, 2022 12:48 pm

Milo wrote:
Mon Apr 18, 2022 12:26 pm
It was only yesterday when the deadline for Russian trucking in the EU passed; that promises to have major consequences for the Russian economy.

Furthermore, it will be just under two weeks before Russia has to make a large bond payment or face default. The impact there will be colossal.

International trade arrangements take weeks to months to settle, Russia will face more and more consequences in the months ahead. They are running on fumes right now.

For someone who is constantly admonishing us to wait for Russia’s military victory, this ‘analysis’ is very much jumping the gun here.
Soon there will be no imports in Russia from the EU. Russia can buy just about anything it needs from outside the EU. The EU must continue buying some oil and gas (and other mineral and agricultural resources) from Russia. The EU can sanction whatever it wants, but it will only be hurting itself.

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Milo
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Re: The Sanctions Delusion

Post by Milo » Mon Apr 18, 2022 1:05 pm

Sertorio wrote:
Mon Apr 18, 2022 12:48 pm
Milo wrote:
Mon Apr 18, 2022 12:26 pm
It was only yesterday when the deadline for Russian trucking in the EU passed; that promises to have major consequences for the Russian economy.

Furthermore, it will be just under two weeks before Russia has to make a large bond payment or face default. The impact there will be colossal.

International trade arrangements take weeks to months to settle, Russia will face more and more consequences in the months ahead. They are running on fumes right now.

For someone who is constantly admonishing us to wait for Russia’s military victory, this ‘analysis’ is very much jumping the gun here.
Soon there will be no imports in Russia from the EU. Russia can buy just about anything it needs from outside the EU. The EU must continue buying some oil and gas (and other mineral and agricultural resources) from Russia. The EU can sanction whatever it wants, but it will only be hurting itself.
Yes, the sanctions aren’t doing anything, except when they only benefit Russia!


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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Fri Apr 22, 2022 1:18 am

LONDON, 21 April. /TASS/. The UK Treasury has granted a general license valid until May 31, allowing it to conduct transactions with Gazprombank, which fell under the sanctions. This is stated in a statement released on Thursday by the Financial Sanctions Administration of the United Kingdom. "The license comes into force on April 21, 2022 and expires on May 31, 2022," it says. The agency clarified that the permit was issued taking into account the interests of companies from EU member states that make payments for Russian gas through Gazprombank.
https://smoothiex12.blogspot.com/

Image

:lol:

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Fri Apr 22, 2022 1:26 am

Some EU members say will veto any collective ban on Russian oil
https://tass.com/economy/1441393

PARIS, April 22. /TASS/. The European Union currently has no plans of introducing a collective ban on Russian oil supplies, because several EU members threatened to veto this initiative, EU High Representative for Foreign Affairs and Security Policy Josep Borrell told the LENA news alliance in an interview.

"It will be very hard [to reach consent on embargoing Russian oil deliveries or raising tariffs], because some member states have already announced they would veto any collective decision," Le Figaro quoted him as saying in its Friday edition.

According to the paper, in the wake of a ban on Russian coal supplies, some European countries, including Poland and France, press for a full embargo on fuel from Russia. At the same time, Germany, Austria and Hungary are against it.
:D

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Fri Apr 22, 2022 10:01 am

European Commission says EU companies can pay for gas in rubles
Apr. 22, 2022
https://seekingalpha.com/news/3825797-e ... -in-rubles

The European Commission said Friday that EU companies may be able to comply with Russia's proposed gas payment system, without running afoul of sanctions against Moscow.

Shortly following the war in Ukraine, President Putin issued a decree mandating that Russian gas exports to "unfriendly" nations be paid for in rubles.

Several EU leaders pushed back on the decree, indicating it would mark a contract violation, and insisting that gas transactions be settled in euros or dollars.

Friday's comment from the Commission could bolster Russia's domestic currency market, which has now fully recovered from the invasion-induced selloff.

The EU has proposed banning both Russian coal (BTU) and Russian oil imports (USO) (XLE) in coming months; however, the concession on currency payments likely points to continued Russian gas flows (EQNR) (SHEL) (VET) (NRT) for the duration of 2022.
Did anyone ever doubt that this is what was going to happen?... :D

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Fri Apr 22, 2022 10:08 am

US warns against Russian energy ban
https://www.rt.com/business/554334-us-e ... nergy-ban/

US Treasury Secretary Janet Yellen said on Thursday that a complete European ban on Russian oil and gas imports would “clearly” raise global oil prices and may inflict harm on Europe and other parts of the world.

Speaking to reporters following a meeting with Ukrainian Prime Minister Denys Shmyhal and Finance Minister Sergiy Marchenko in Washington, Yellen said that such a ban could ultimately cause more harm than good.

“It could actually have very little negative impact on Russia, because although Russia might export less, the price it gets for its exports would go up,” she said, as quoted by AFP.

Yellen’s warning comes as major European countries, including Germany, have been calling for a complete stop to Russian energy imports. This month, the EU approved a ban on Russian coal, but could not reach an agreement on an oil and natural gas embargo.

Berlin said on Wednesday that it will stop importing oil from Russia by the end of this year. A stoppage of gas imports is tougher for Germany, which relies heavily on Russian supplies. Moscow provides around 40% of the EU’s natural gas and around a third of the bloc’s oil.
As foreseen, Russia will be bankrupt in a couple of weeks time, following which the Russian army in the Ukraine will collapse. Putin will be overthrown and hung from a lamp post in Red Square. Following which the major American banks will take over the Russian economy...Following which... :lol: :lol: :lol: :lol: :lol:

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Sat Apr 23, 2022 12:55 am

How sanctions crush the Russian economy

Image

:lol: :lol: :lol: :lol: :lol:

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Sertorio
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Re: The Sanctions Delusion

Post by Sertorio » Sun Apr 24, 2022 1:40 am

Argentina won’t impose sanctions against Russia, says country’s Prime Minister
https://tass.com/world/1442159

BUENOS AIRES, April 24. /TASS/. The Argentine government does not consider sanctions against Russia an effective way to resolve the conflict in Ukraine, Argentine Foreign Minister Santiago Cafiero said in an interview with the Telam agency, which was published on Saturday.

The Foreign Minister noted that Argentine laws, even in theory, do not allow the country to impose "unilateral sanctions."

"On the other hand, Argentina proposes a return to dialogue, calming the situation. We do not believe that the imposition of sanctions and blockades is a productive way to achieve peace, dialogue and diplomatic negotiations," he said, answering a question about the situation around Ukraine.

Cafiero also noted that for Argentina, the interests of Latin America are a priority, and now there are problems in the region that deserve attention. The Argentine Foreign Minister also drew attention to the fact that other countries are currently facing humanitarian crises as well.

"It's true that the war in Europe has kind of captured all the public's attention, but the humanitarian crisis in Haiti is no less real, and it doesn't go away because the media isn't focused on it," the minister noted.

In the context of preparations for the ninth Summit of the Americas, which will be held in June in Los Angeles, Cafiero announced the need to discuss the topic of food security in the region and noted that "the United States cannot stand aside."

"Judging countries and imposing sanctions and blockades is not Argentina's method and never has been, and it seems to us that such actions in the region have only led to greater inequality and a setback in social development," the Argentine minister said.

He also stressed that the forthcoming Western Hemisphere Summit should raise "topics relating to Latin America and the Caribbean, and not continue to discuss only topics that go beyond the region."

"The lack of discussion of our pressing issues does not solve them, but only makes them invisible," he added.

Earlier, the press secretary of the President of Argentina, Gabriela Serruti, said that Argentina would not support the indiscriminate exclusion of Russia from all international organizations, including the G20, because of the situation in Ukraine, as it does not believe that this contributes to the resolution of the conflict.
But the western countries think that the whole world is obeying them and are imposing sanctions on Russia... That must be one of the last of the Empire's delusions...

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