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Testosterone Pit – Home – The “Sanction Spiral” Elegantly Spirals Out of Control

Testosterone Pit – Home – The “Sanction Spiral” Elegantly Spirals Out of Control.

The “Sanction Spiral” Elegantly Spirals Out Of Control

THURSDAY, MARCH 20, 2014 AT 11:41PM

Attorneys with the SEC’s Investment Management Division are exhorting managers of registered investment funds, such as your mutual fund, to disclose their holdings in Russia and warn of the risks associated with them, now that the Crimean debacle has turned into a magnificent sanction spiral. “Several people familiar with the matter” had been talking toReuters. The SEC is apparently fretting that the funds aren’t truthful with investors and aren’t even thinking about how to respond to the possible outcomes of the crisis.

Investment Management Division Director Norm Champ, when contacted by Reuters, didn’t even deny it. “We want to be proactive,” he said.

The Division contacted asset managers on other occasions when civil unrest erupted or when things threatened to blow up; it wanted to make sure managers weren’t omitting or misrepresenting material information – for example, during the uprising in Egypt in 2011, when the Cairo stock market simply shut down. But this time it’s different: the lawyers at the Investment Management Division were joined by another group of SEC lawyers who focus on risk examinations.

Would the White House be trying behind the scenes to give investors second thoughts about plowing money into Russia? Would it be trying to demolish Russian stocks, bonds, and the ruble? Naw.

The efforts by the SEC, which started “over a week ago,” were accompanied by a White House announcement that 5 million barrels would be released from the Strategic Petroleum Reserve. WTI tanked. Russia, a huge energy exporter, depends on its oil and gas revenues, and knocking down the price of oil could wreak havoc on the Russian economy. It was a declaration that commodities would be used as a weapon against the Putin Regime. 

Then on Tuesday, White House spokesman Jay Carney launched another attack on the Russian markets at a press briefing. In light of the sanctions the US and the EU were slapping on Russia, its economy would pay the price, he said. “I wouldn’t, if I were you, invest in Russian equities right now, unless you’re going short.”

Shaken to its roots by these threats, Russia annexed the Crimea and picked a new target: Estonia. A Russian diplomat told the UN Human Rights Council in Geneva on Wednesday that Russia was “concerned” by the treatment of the ethnic Russian minority “in Estonia as well as in Ukraine” … even while Vice President Joe Biden was in Lithuania to calm tattered nerves in the Baltics and the EU.

On Thursday, German Chancellor Merkel announced in Parliament, shortly before the EU summit in Brussels, that the EU would come up with new sanctions, such as expanding the list of Russians subject to travel limitations and freezing assets. And if the situation escalates, there would be “without doubt” economic sanctions, she said. Russia was “largely isolated in all international organizations.” And the G-8, which includes Russia, and whose upcoming shindig has already been cancelled, “no longer exists.”

She was immediately attacked by the parliamentary leader of the opposition Left Party, Gregor Gysi, who accused the government of double standards; the separation of Kosovo too had been a breach of international law, he said, but it had been supported by the German government at the time. The transitional Ukrainian government wasn’t legitimate, he said. “Fascists are part of this government, and we want to give them money?!” Under pressure from the US, Merkel was imposing sanctions on Russia to the detriment of Europe, he said. That’s “moral cowardice.”

The “Putin Doctrine” was what SPD parliamentary leader Thomas Oppermann, who is part of Germany’s governing Grand Coalition, was fretting about. Under that doctrine, Russia could intervene if ethnic Russians were perceived to be in danger outside Russia. It would give Russia an automatic right to intervene anywhere, he said. “Such a right does not exist, and such a right cannot exist.”

Hours later, President Obama announced he’d slapped new sanctions on a “number” of oligarchs, additional Russian government officials, and a bank that provides services to them. The White House was working “closely” with the EU “to develop more severe actions that could be taken if Russia continues to escalate the situation.” Then he urged US Lawmakers to approve the aid package for Ukraine and urged the IMF to put its aid package together pronto. Alas, read…. Aid for the Ukraine “Will Be Stolen” – Former Ukrainian Minister of Economy

As Obama’s words were still echoing around the world, the Russian Foreign Ministry shot back: nine US officials, including Speaker of the House John Boehner and Senate Majority Leader Harry Reid, would be barred from entering Russia. And it published the list on its website.

Delicious irony: that boring list with nine names on it, issued by a Russian ministry whose website rarely gets shared in the social media, lit up a mini-firestorm on VK.com, the second largest social network in Europe after Facebook, and one of the most popular sites in Russia. The list got, as I’m writing this, 538 VK “likes.” Not sure if Obama’s list got anyFacebook likes.

Not to be left out, Standard & Poor’s slammed Russia by lowering its outlook to Negativefrom Stable. “In our view, heightened geopolitical risk and the prospect of US and EU economic sanctions following Russia’s incorporation of Crimea could reduce the flow of potential investment, trigger rising capital outflows, and further weaken Russia’s already deteriorating economic performance.”

The Sanction Spiral works in a myriad ways and performs, as we can see every day, outright miracles. It spirals elegantly higher and higher and takes on grotesque forms. And by the looks of it, no one at the top has a clue how to back out of it. Yet stock and bond markets in the US and Europe, stuffed to the gills with central-bank liquidity and intoxicated by free money, the only thing that really matters anymore these crazy days of ours, are blissfully ignoring the entire drama, and what may eventually come of it.

The first official warning shot was fired. Not by a Putin advisor that can be brushed off, but by Alexey Ulyukaev, Russia’s Minister of Economy and former Deputy Chairman of the Central Bank. A major escalation. Read…. Kremlin: If The US Tries To Hurt Russia’s Economy, Russia Will Target The Dollar System

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Petrodollar Alert: Putin Prepares To Announce "Holy Grail" Gas Deal With China | Zero Hedge

Petrodollar Alert: Putin Prepares To Announce “Holy Grail” Gas Deal With China | Zero Hedge.

If it was the intent of the West to bring Russia and China together – one a natural resource (if “somewhat” corrupt) superpower and the other a fixed capital / labor output (if “somewhat” capital misallocating and credit bubbleicious) powerhouse – in the process marginalizing the dollar and encouraging Ruble and Renminbi bilateral trade, then things are surely “going according to plan.”

For now there have been no major developments as a result of the shift in the geopolitical axis that has seen global US influence, away from the Group of 7 (most insolvent nations) of course, decline precipitously in the aftermath of the bungled Syrian intervention attempt and the bloodless Russian annexation of Crimea, but that will soon change. Because while the west is focused on day to day developments in Ukraine, and how to halt Russian expansion through appeasement (hardly a winning tactic as events in the 1930s demonstrated), Russia is once again thinking 3 steps ahead… and quite a few steps east.

While Europe is furiously scrambling to find alternative sources of energy should Gazprom pull the plug on natgas exports to Germany and Europe (the imminent surge in Ukraine gas prices by 40% is probably the best indication of what the outcome would be), Russia is preparing the announcement of the “Holy Grail” energy deal with none other than China, a move which would send geopolitical shockwaves around the world and bind the two nations in a commodity-backed axis. One which, as some especially on these pages, have suggested would lay the groundwork for a new joint, commodity-backed reserve currency that bypasses the dollar, something which Russia implied moments ago when its finance minister Siluanov said that Russia may regain from foreign borrowing this year. Translated: bypass western purchases of Russian debt, funded by Chinese purchases of US Treasurys, and go straight to the source.

Here is what will likely happen next, as explained by Reuters:

Igor Sechin gathered media in Tokyo the next day to warn Western governments that more sanctions over Moscow’s seizure of the Black Sea peninsula from Ukraine would be counter-productive.

 

The underlying message from the head of Russia’s biggest oil company, Rosneft, was clear: If Europe and the United States isolate Russia, Moscow will look East for new business, energy deals, military contracts and political alliances. 

 

The Holy Grail for Moscow is a natural gas supply deal with China that is apparently now close after years of negotiations. If it can be signed when Putin visits China in May, he will be able to hold it up to show that global power has shifted eastwards and he does not need the West.

More details on the revelation of said “Holy Grail”:

State-owned Russian gas firm Gazprom hopes to pump 38 billion cubic meters (bcm) of natural gas per year to China from 2018 via the first pipeline between the world’s largest producer of conventional gas to the largest consumer.

 

“May is in our plans,” a Gazprom spokesman said, when asked about the timing of an agreement. A company source said: “It would be logical to expect the deal during Putin’s visit to China.”

Summarizing what should be and is painfully obvious to all, but apparently to the White House, which keeps prodding at Russia, is the following:

The worse Russia’s relations are with the West, the closer Russia will want to be to China. If China supports you, no one can say you’re isolated,” said Vasily Kashin, a China expert at the Analysis of Strategies and Technologies (CAST) think thank.

Bingo. And now add bilateral trade denominated in either Rubles or Renminbi (or gold), add Iran, Iraq, India, and soon the Saudis (China’s largest foreign source of crude, whose crown prince alsohappened to meet president Xi Jinping last week to expand trade further) and wave goodbye to the petrodollar.

As reported previoisly, China has already implicitly backed Putin without risking it relations with the West. “Last Saturday China abstained in a U.N. Security Council vote on a draft resolution declaring invalid the referendum in which Crimea went on to back union with Russia. Although China is nervous about referendums in restive regions of other countries which might serve as a precedent for Tibet and Taiwan, it has refused to criticize Moscow. The support of Beijing is vital for Putin. Not only is China a fellow permanent member of the U.N. Security Council with whom Russia thinks alike, it is also the world’s second biggest economy and it opposes the spread of Western-style democracy.”

This culminated yesterday, when as we reported last night, Putin thanked China for its “understanding over Ukraine.” China hasn’t exactly kept its feelings about closer relations with Russia under wraps either:

Chinese President Xi Jinping showed how much he values ties with Moscow, and Putin in particular, by making Russia his first foreign visit as China’s leader last year and attending the opening of the Winter Olympics in Sochi last month.

 

Many Western leaders did not go to the Games after criticism of Russia’s record on human rights. By contrast, when Putin and Xi discussed Ukraine by telephone on March 4, the Kremlin said their positions were “close”.

The punchline: “A strong alliance would suit both countries as a counterbalance to the United States.” An alliance that would merely be an extension of current trends in close bilateral relations, including not only infrastructure investment but also military supplies:

However, China overtook Germany as Russia’s biggest buyer of crude oil this year thanks to Rosneft securing deals to boost eastward oil supplies via the East Siberia-Pacific Ocean pipeline and another crossing Kazakhstan.

 

If Russia is isolated by a new round of Western sanctions – those so far affect only a few officials’ assets abroad and have not been aimed at companies – Russia and China could also step up cooperation in areas apart from energy. CAST’s Kashin said the prospects of Russia delivering Sukhoi SU-35 fighter jets to China, which has been under discussion since 2010, would grow.

 

China is very interested in investing in infrastructure, energy and commodities in Russia, and a decline in business with the West could force Moscow to drop some of its reservations about Chinese investment in strategic industries. “With Western sanctions, the atmosphere could change quickly in favor of China,” said Brian Zimbler Managing Partner of Morgan Lewis international law firm’s Moscow office. 

 

Russia-China trade turnover grew by 8.2 percent in 2013 to $8.1 billion but Russia was still only China’s seventh largest export partner in 2013, and was not in the top 10 countries for imported goods. The EU is Russia’s biggest trade partner, accounting for almost half of all its trade turnover.

And as if pushing Russia into the warm embrace of the world’s most populous nation was not enough, there is also the second most populated country in the world, India.

Putin did take time, however, to thank one other country apart from China for its understanding over Ukraine and Crimea – saying India had shown “restraint and objectivity”.

 

He also called Indian Prime Minister Manmohan Singh to discuss the crisis on Tuesday, suggesting there is room for Russia’s ties with traditionally non-aligned India to flourish.

 

Although India has become the largest export market for U.S. arms, Russia remains a key defense supplier and relations are friendly, even if lacking a strong business and trade dimension, due to a strategic partnership dating to the Soviet era.

 

Putin’s moves to assert Russian control over Crimea were seen very favorably in the Indian establishment, N. Ram, publisher of The Hindu newspaper, told Reuters. “Russia has legitimate interests,” he added.

To summarize: while the biggest geopolitical tectonic shift since the cold war accelerates with the inevitable firming of the “Asian axis”, the west monetizes its debt, revels in the paper wealth created from an all time high manipulated stock market while at the same time trying to explain why 6.5% unemployment is really indicative of a weak economy, blames the weather for every disappointing economic data point, and every single person is transfixed with finding a missing airplane.

Petrodollar Alert: Putin Prepares To Announce “Holy Grail” Gas Deal With China | Zero Hedge

Petrodollar Alert: Putin Prepares To Announce “Holy Grail” Gas Deal With China | Zero Hedge.

If it was the intent of the West to bring Russia and China together – one a natural resource (if “somewhat” corrupt) superpower and the other a fixed capital / labor output (if “somewhat” capital misallocating and credit bubbleicious) powerhouse – in the process marginalizing the dollar and encouraging Ruble and Renminbi bilateral trade, then things are surely “going according to plan.”

For now there have been no major developments as a result of the shift in the geopolitical axis that has seen global US influence, away from the Group of 7 (most insolvent nations) of course, decline precipitously in the aftermath of the bungled Syrian intervention attempt and the bloodless Russian annexation of Crimea, but that will soon change. Because while the west is focused on day to day developments in Ukraine, and how to halt Russian expansion through appeasement (hardly a winning tactic as events in the 1930s demonstrated), Russia is once again thinking 3 steps ahead… and quite a few steps east.

While Europe is furiously scrambling to find alternative sources of energy should Gazprom pull the plug on natgas exports to Germany and Europe (the imminent surge in Ukraine gas prices by 40% is probably the best indication of what the outcome would be), Russia is preparing the announcement of the “Holy Grail” energy deal with none other than China, a move which would send geopolitical shockwaves around the world and bind the two nations in a commodity-backed axis. One which, as some especially on these pages, have suggested would lay the groundwork for a new joint, commodity-backed reserve currency that bypasses the dollar, something which Russia implied moments ago when its finance minister Siluanov said that Russia may regain from foreign borrowing this year. Translated: bypass western purchases of Russian debt, funded by Chinese purchases of US Treasurys, and go straight to the source.

Here is what will likely happen next, as explained by Reuters:

Igor Sechin gathered media in Tokyo the next day to warn Western governments that more sanctions over Moscow’s seizure of the Black Sea peninsula from Ukraine would be counter-productive.

 

The underlying message from the head of Russia’s biggest oil company, Rosneft, was clear: If Europe and the United States isolate Russia, Moscow will look East for new business, energy deals, military contracts and political alliances. 

 

The Holy Grail for Moscow is a natural gas supply deal with China that is apparently now close after years of negotiations. If it can be signed when Putin visits China in May, he will be able to hold it up to show that global power has shifted eastwards and he does not need the West.

More details on the revelation of said “Holy Grail”:

State-owned Russian gas firm Gazprom hopes to pump 38 billion cubic meters (bcm) of natural gas per year to China from 2018 via the first pipeline between the world’s largest producer of conventional gas to the largest consumer.

 

“May is in our plans,” a Gazprom spokesman said, when asked about the timing of an agreement. A company source said: “It would be logical to expect the deal during Putin’s visit to China.”

Summarizing what should be and is painfully obvious to all, but apparently to the White House, which keeps prodding at Russia, is the following:

The worse Russia’s relations are with the West, the closer Russia will want to be to China. If China supports you, no one can say you’re isolated,” said Vasily Kashin, a China expert at the Analysis of Strategies and Technologies (CAST) think thank.

Bingo. And now add bilateral trade denominated in either Rubles or Renminbi (or gold), add Iran, Iraq, India, and soon the Saudis (China’s largest foreign source of crude, whose crown prince alsohappened to meet president Xi Jinping last week to expand trade further) and wave goodbye to the petrodollar.

As reported previoisly, China has already implicitly backed Putin without risking it relations with the West. “Last Saturday China abstained in a U.N. Security Council vote on a draft resolution declaring invalid the referendum in which Crimea went on to back union with Russia. Although China is nervous about referendums in restive regions of other countries which might serve as a precedent for Tibet and Taiwan, it has refused to criticize Moscow. The support of Beijing is vital for Putin. Not only is China a fellow permanent member of the U.N. Security Council with whom Russia thinks alike, it is also the world’s second biggest economy and it opposes the spread of Western-style democracy.”

This culminated yesterday, when as we reported last night, Putin thanked China for its “understanding over Ukraine.” China hasn’t exactly kept its feelings about closer relations with Russia under wraps either:

Chinese President Xi Jinping showed how much he values ties with Moscow, and Putin in particular, by making Russia his first foreign visit as China’s leader last year and attending the opening of the Winter Olympics in Sochi last month.

 

Many Western leaders did not go to the Games after criticism of Russia’s record on human rights. By contrast, when Putin and Xi discussed Ukraine by telephone on March 4, the Kremlin said their positions were “close”.

The punchline: “A strong alliance would suit both countries as a counterbalance to the United States.” An alliance that would merely be an extension of current trends in close bilateral relations, including not only infrastructure investment but also military supplies:

However, China overtook Germany as Russia’s biggest buyer of crude oil this year thanks to Rosneft securing deals to boost eastward oil supplies via the East Siberia-Pacific Ocean pipeline and another crossing Kazakhstan.

 

If Russia is isolated by a new round of Western sanctions – those so far affect only a few officials’ assets abroad and have not been aimed at companies – Russia and China could also step up cooperation in areas apart from energy. CAST’s Kashin said the prospects of Russia delivering Sukhoi SU-35 fighter jets to China, which has been under discussion since 2010, would grow.

 

China is very interested in investing in infrastructure, energy and commodities in Russia, and a decline in business with the West could force Moscow to drop some of its reservations about Chinese investment in strategic industries. “With Western sanctions, the atmosphere could change quickly in favor of China,” said Brian Zimbler Managing Partner of Morgan Lewis international law firm’s Moscow office. 

 

Russia-China trade turnover grew by 8.2 percent in 2013 to $8.1 billion but Russia was still only China’s seventh largest export partner in 2013, and was not in the top 10 countries for imported goods. The EU is Russia’s biggest trade partner, accounting for almost half of all its trade turnover.

And as if pushing Russia into the warm embrace of the world’s most populous nation was not enough, there is also the second most populated country in the world, India.

Putin did take time, however, to thank one other country apart from China for its understanding over Ukraine and Crimea – saying India had shown “restraint and objectivity”.

 

He also called Indian Prime Minister Manmohan Singh to discuss the crisis on Tuesday, suggesting there is room for Russia’s ties with traditionally non-aligned India to flourish.

 

Although India has become the largest export market for U.S. arms, Russia remains a key defense supplier and relations are friendly, even if lacking a strong business and trade dimension, due to a strategic partnership dating to the Soviet era.

 

Putin’s moves to assert Russian control over Crimea were seen very favorably in the Indian establishment, N. Ram, publisher of The Hindu newspaper, told Reuters. “Russia has legitimate interests,” he added.

To summarize: while the biggest geopolitical tectonic shift since the cold war accelerates with the inevitable firming of the “Asian axis”, the west monetizes its debt, revels in the paper wealth created from an all time high manipulated stock market while at the same time trying to explain why 6.5% unemployment is really indicative of a weak economy, blames the weather for every disappointing economic data point, and every single person is transfixed with finding a missing airplane.

Putin Signs Crimean "Absorption" Law As Visa, MasterCard Halt Payment Services For Bank Rossiya | Zero Hedge

Putin Signs Crimean “Absorption” Law As Visa, MasterCard Halt Payment Services For Bank Rossiya | Zero Hedge.

Moments ago the “absorption” of Crimea into the Russian Federation was completed after Putin signed the final previously passed by parliament. And with that, in less than a month, the Crimean “question” has been answered. The only question is whether Putin will stop here or will the ease with which he just expanded the Russian political map leave him hungry for more.

In other news, as part of the Western escalations against Russia, Bank Rossiya, the one bank exclusively identified in the sanctions list, announced that Visa and MasterCard have stopped, without notification, providing services for payment transactions for clients. Another bank that saw the drop of merchant credit card services was SMP bank, co-owned by brothers Boris and Arkady Rotenberg, who were also on the latest U.S. sanctions list.

SMP bank said in a statement that it considered the credit card giants’ move unlawful, because the U.S. sanctions targeted shareholders and not the bank itself, Reuters reported Friday.

Earlier in the day, Bank Rossiya said it was working in a “stable regime” and was taking all the necessary legal measures to defend its rights and its clients’ rights and legal interests.

“In connection with the information about U.S. sanctions being imposed on Rossiya we can report that the bank is working in a stable regime. The bank is meeting and will, without a doubt, fully meet all its obligations to its clients and partners,” the bank said in a statement.

“The management of Rossiya understands the difficulties of clients in the current situation and will do all it can to solve them,” the bank said in a statement.

These moves in turn promptly led to Putin announcing that he wants to open an account with the Bank Rossiya. From Moscow Times:

“I don’t have an account there, but I will certainly open one there on Monday,” Putin said Friday, while speaking at a Security Council meeting, Interfax reported.

Putin later asked for his salary to be transferred to Bank Rossiya and ordered Russia’s Central Bank to take the sanction-hit lender’s clients under protection and provide all possible assistance to them, The Associated Press reported.

U.S. President Barack Obama on Thursday announced that Washington was levying a new round of sanctions affecting 20 Russian officials and businessmen, but also Bank Rossiya, which is chaired and part owned by businessman Yuri Kovalchuk, who is one of the 20.

Why was the bank singled out?

The United States Treasury Department stated that Bank Rossiya is used by senior Russian officials and that its shareholders include members of Putin’s inner circle.

Putin Signs Crimean “Absorption” Law As Visa, MasterCard Halt Payment Services For Bank Rossiya | Zero Hedge

Putin Signs Crimean “Absorption” Law As Visa, MasterCard Halt Payment Services For Bank Rossiya | Zero Hedge.

Moments ago the “absorption” of Crimea into the Russian Federation was completed after Putin signed the final previously passed by parliament. And with that, in less than a month, the Crimean “question” has been answered. The only question is whether Putin will stop here or will the ease with which he just expanded the Russian political map leave him hungry for more.

In other news, as part of the Western escalations against Russia, Bank Rossiya, the one bank exclusively identified in the sanctions list, announced that Visa and MasterCard have stopped, without notification, providing services for payment transactions for clients. Another bank that saw the drop of merchant credit card services was SMP bank, co-owned by brothers Boris and Arkady Rotenberg, who were also on the latest U.S. sanctions list.

SMP bank said in a statement that it considered the credit card giants’ move unlawful, because the U.S. sanctions targeted shareholders and not the bank itself, Reuters reported Friday.

Earlier in the day, Bank Rossiya said it was working in a “stable regime” and was taking all the necessary legal measures to defend its rights and its clients’ rights and legal interests.

“In connection with the information about U.S. sanctions being imposed on Rossiya we can report that the bank is working in a stable regime. The bank is meeting and will, without a doubt, fully meet all its obligations to its clients and partners,” the bank said in a statement.

“The management of Rossiya understands the difficulties of clients in the current situation and will do all it can to solve them,” the bank said in a statement.

These moves in turn promptly led to Putin announcing that he wants to open an account with the Bank Rossiya. From Moscow Times:

“I don’t have an account there, but I will certainly open one there on Monday,” Putin said Friday, while speaking at a Security Council meeting, Interfax reported.

Putin later asked for his salary to be transferred to Bank Rossiya and ordered Russia’s Central Bank to take the sanction-hit lender’s clients under protection and provide all possible assistance to them, The Associated Press reported.

U.S. President Barack Obama on Thursday announced that Washington was levying a new round of sanctions affecting 20 Russian officials and businessmen, but also Bank Rossiya, which is chaired and part owned by businessman Yuri Kovalchuk, who is one of the 20.

Why was the bank singled out?

The United States Treasury Department stated that Bank Rossiya is used by senior Russian officials and that its shareholders include members of Putin’s inner circle.

Two Steps Forward, One Step Back — Paul Craig Roberts – PaulCraigRoberts.org

Two Steps Forward, One Step Back — Paul Craig Roberts – PaulCraigRoberts.org.

Two Steps Forward, One Step Back

Paul Craig Roberts

Washington’s plan to seize Ukraine and to evict Russia from its Black Sea naval base has come amiss. But as Lenin said, “two steps forward, one step back.”

Do you remember all the tough talk coming from John Kerry, the White House Fool, Hilary Clinton, and the lickspittle Merkel about the harsh sanctions that would “badly damage” the Russian economy unless Russia prevented the referendum vote in Crimea? Well, it was all bullshit, more hot air from the White House sock puppet and the lickspittle German chancellor who is a disgrace to the German nation. As the Russians kept telling John Kerry, sanctions on Russia would destroy Europe and do little damage to Russia.

I wish the Russians had kept this to themselves. I was looking forward to the Washington morons destroying NATO by closing down the European economy.

Of course, after pretending that they were macho tough guys, something that Washington’s presstitute media could hype as sanctions had to be imposed, so Washington came up with sanctions, not on Russia, but on eleven individuals: the deposed Ukrainian president, an advisor to the deposed president, 2 Crimean officials, and 7 Russians.

The choice of the officials is an utter mystery. The seven Russians are a Putin aid, a Putin adviser, four members of the Russian parliament (Duma) and a deputy prime minister. What any of these people had to do with the referendum in Crimea, no one knows.

Moreover, the sanctions only apply to foreign bank accounts that these 11 individuals might have outside Russia. Most likely, that means only the deposed Ukrainian president, if we are to believe all the propaganda about him. Other reports say that the sanctions are only for the next six months.

If the Washington and EU criminals steal any money from these persons, the Russian central bank can replenish their stolen accounts.

The people who decided that Crimea would disassociate from Ukraine and return to Russia were the people themselves. Under the wording of Obama’s stupid sanctions, his sanctions should apply to the Crimean people who voted to disassociate from the US stooge government in Kiev.

Additionally, Obama’s sanctions apply to himself and to his regime and to its NATO puppets as it was the West that overthrew the elected government of Ukraine, not Russia or Crimea. The Americans, of course, never apply law to themselves.

In other words, the sanctions are totally meaningless. Yet, the White House Fool declared: “If Russia continues to interfere in Ukraine, we stand ready to impose further sanctions.”

Obama’s hypocrisy makes a person want to puke. It is the White House Fool who is interfering in Ukraine. It was Washington that financed and organized the overthrow of the elected Ukraine government, using well organized and well armed neo-nazis to intimidate the unarmed police and ruling party, thus clearing the way for Washington to set up an unelected government of its well-paid stooges.

What the incompetent White House Fool overlooked is that southern and eastern Ukraine are Russian, not Ukrainian, so the fool’s coup has caused Crimea to depart and is causing widespread protests in eastern Ukraine against Washington’s stooge unelected government in Kiev. Washington’s stooge Kiev government has appointed unelected Ukrainian multibillionaire oligarchs, who have their own private security forces, as mayors of the Russian cities to put down the protests. If the oligarchs use violence against the Russian people, the likely result will be that the Russian Army will take control of eastern Ukraine, which in every essential way is Russian.

If eastern Ukraine returns to Russia, Washington will be left with the ultra-nationalists of western Ukraine, people who fought for Hitler during World War 2. The EU doesn’t want ultra-nationalists as the EU is busy stamping out nationalism and the sovereignty of European countries. Nevertheless, Washington will have gained a strategic advantage over Moscow, as Washington can place anti-ballistic missile and other military bases on western Ukraine’s border with Russia, thus completing Washington’s encirclement of Russia with hostile military and missile bases.

Russia will neutralize the US bases by targeting them with Iskander missiles, which cannot be intercepted by ABMs.

All that the White House Fool will have achieved is to further make clear to Russia, and to China, that Washington has both on its target list, because both are in the way of Washington’s world hegemony.

One can only wonder why Putin doesn’t preempt the coming US military attack on Russia by destroying NATO economically without firing a shot. All Putin needs to do is to cut Europe off from energy. It would take Washington three years to create the capability to deliver US natural gas, achieved by fracking’s destruction of US water supplies, to Europe. By that time NATO governments would likely have been overthrown by mass unemployment and economic suffering. Putin could also seize all foreign assets in Russia and rapidly complete the arrangements with China, India, Brazil, and South Africa to abandon the use of the US dollar in international settlements.

The US dollar as world reserve currency is the source of American imperialism. The five countries that comprise the BRICS have half of the world’s population. They can conduct their economic affairs without the dollar.

The world needs to understand that the neoconservative US government is the Third Reich on steroids. It is a malevolent force with no sense of justice or respect for truth, law, or human life. Just ask the residents of Iraq, Afghanistan, Libya, Syria, Palestine, Pakistan, Yemen, Somalia, Lebanon, Honduras, Venezuela, Cuba, Iran. Even the deluded western Ukrainians will soon catch on.

Obama himself declared that the US is “the exceptional nation.” This is the neoconservatives version of Hitler’s declaration that the German nation was exceptional and, therefore, above all others. The only difference between Washington and National Socialist Germany is that Washington has a far more powerful police state and nuclear weapons.

The hubris and arrogance that arises from Washington’s belief that it is the government of the “indispensable and exceptional nation” means Washington has no respect for any other country, nor for law whether its own or international. Washington can invade countries without cause, a war crime. Washington can kidnap and torture people, a crime under US and International law. Washington can ignore the self-determination of peoples, such as Crimeans. Who are mere Crimeans to vote on their own future without Washington’s consent, without Washington determining the outcome? Washington declares the Crimean people’s self-determination “illegitimate and illegal,” and refuses to recognize self-determination, while pretending to be the home of “freedom and democracy.”

No government in human history can come close to the hypocrisy and malevolence of Washington. Armed with nuclear weapons and a military doctrine of pre-emptive nuclear first strike, Washington alone stands as the threat to life on earth.

Ukraine Hikes Tensions Again, Says Russian Army Concentrated Near East Border For “Quick Invasion” | Zero Hedge

Ukraine Hikes Tensions Again, Says Russian Army Concentrated Near East Border For “Quick Invasion” | Zero Hedge.

On the heels of reports that:

  • *UKRAINE WON’T RECOGNIZE CRIMEA JOINING RUSSIA: INTERFAX

The Eastern Ukraine Kharkiv region’s governor Baluta warns:

  • *RUSSIAN ARMY CONCENTRATED NEAR ROADS FOR QUICK INVASION: BALUTA
  • *RUSSIA BOOSTS ARMY PRESENCE AT UKRAINE BORDER: KHARKIV GOVERNOR

And all of this after Putin confirmed that West’s sanctions are “irresponsible and aggressive and we will respond properly.”

Via Interfax:

Ukraine will not recognize the Autonomous Republic of Crimea’s and Sevastopol’s accession to the Russian Federation, nor will it recognize independence of the self-proclaimed Republic of Crimea, the Ukrainian Foreign Ministry said.

“We do not recognize and will never recognize either Crimea’s so-called independence or the so-called agreement on its accession to the Russian Federation,” Ukrainian Foreign Ministry spokesman Yevhen Perebyinis said at a news conference on Tuesday.

Ukraine Hikes Tensions Again, Says Russian Army Concentrated Near East Border For "Quick Invasion" | Zero Hedge

Ukraine Hikes Tensions Again, Says Russian Army Concentrated Near East Border For “Quick Invasion” | Zero Hedge.

On the heels of reports that:

  • *UKRAINE WON’T RECOGNIZE CRIMEA JOINING RUSSIA: INTERFAX

The Eastern Ukraine Kharkiv region’s governor Baluta warns:

  • *RUSSIAN ARMY CONCENTRATED NEAR ROADS FOR QUICK INVASION: BALUTA
  • *RUSSIA BOOSTS ARMY PRESENCE AT UKRAINE BORDER: KHARKIV GOVERNOR

And all of this after Putin confirmed that West’s sanctions are “irresponsible and aggressive and we will respond properly.”

Via Interfax:

Ukraine will not recognize the Autonomous Republic of Crimea’s and Sevastopol’s accession to the Russian Federation, nor will it recognize independence of the self-proclaimed Republic of Crimea, the Ukrainian Foreign Ministry said.

“We do not recognize and will never recognize either Crimea’s so-called independence or the so-called agreement on its accession to the Russian Federation,” Ukrainian Foreign Ministry spokesman Yevhen Perebyinis said at a news conference on Tuesday.

Crimea Annexation Into Russia: Putin Approves Draft Treaty To Absorb Peninsula

Crimea Annexation Into Russia: Putin Approves Draft Treaty To Absorb Peninsula.

Reuters
Posted: 03/18/2014 2:57 am EDT Updated: 03/18/2014 3:59 am EDT
President Vladimir Putin approved a draft treaty to make Crimea part of Russia, the  Kremlin announced on Tuesday. (Photo by Sasha Mordovets/Getty Images)


MOSCOW, March 18 (Reuters) – President Vladimir Putin has approved a draft treaty to make Crimea part of Russia, the Kremlin said on Tuesday, confirming that Russia plans to make the southern Ukrainian region part of Russia. It said he would sign the treaty with Crimea’s leader.

Putin signed an order on Monday “to approve the draft treaty between the Russian Federation and the Republic of Crimea on adopting the Republic of Crimea into the Russian Federation”.

The order was part of a series of steps to bring Crimea into Russia after voters there approved the move in a weekend referendum that Ukraine and the West have called denounced by Ukraine and the West as illegal.

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Putin calls for three languages in Crimea — Russian, Ukrainian, Crimean Tatar — to be under equal footing. http://t.co/kjYPpSM5kf

— CNN Breaking News (@cnnbrk) March 18, 2014

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Putin: “When Crimea wound up in another state, Russians thought they’d not just been stolen, but robbed”

— max seddon (@maxseddon) March 18, 2014

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7:09 AM – Today

Standing Ovation For Putin

Thundrous applause in the Federal Assembly as Putin addresses Crimeapic.twitter.com/wjVe8CZbX5

— Joseph Weisenthal (@TheStalwart) March 18, 2014

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Russian President Vladimir Putin is addressing Russia’s parliament. Here is a live feed of it on Russia Today:

–Luke Johnson

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Ukrainian Prime Minister Arseniy Yatsenyuk gave a televised address Tuesday in Russian, seeking to assure speakers of the language.

“Association with NATO is not on the agenda,” he said. “Despite the armed aggression of Russia against Ukraine, I will do everything possible not only to keep the peace but also to build a genuine partnership with Russia and good neighbor relations.”

Many Ukrainians speak Russian, and it is predominant in the South and East of the country.

–Luke Johnson

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6:15 AM – Today

Crimea Currency To Change

Crimea’s deputy prime minister announced on Tuesday that the region plans to adopt the Russian ruble as its official currency, RTE reported.

The region, which declared itself independent from Ukraine yesterday, will drop the hyrvnia in April.

For more, click here.

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5:07 PM – 03/17/2014

PHOTO: Lenin Square In Simferopol

ukraine

A few people walk through a nearly empty Lenin Square in central Simferopol on March 17, 2014. Crimea declared independence today and applied to join Russia while the Kremlin braced for sanctions after the flashpoint peninsula voted to leave Ukraine in a ballot that has fanned the worst East-West tensions since the Cold War. (FILIPPO MONTEFORTE/AFP/Getty Images)

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Philipp Missfelder, foreign policy spokesperson for German Chancellor Angela Merkel’s government, told CNN’s Christiane Amanpour his country could function if Russia were to cut off its gas supplies to the European economic dynamo.

“If the Russians would stop the gas supply for us, or we would raise sanctions on the oil and gas sector, we will be able to have in the interconnected and linked European energy market – of course with higher prices – the energy supply for Germany,” Missfelder said.

Read the entire report here.

— Ryan Craggs

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Ukraine will sign a deal for closer political association with the European Union on Friday, according to a statement from E.U. foreign ministers.

The political provisions are part of an E.U. association agreement rejected by former President Viktor Yanukovych in November, sparking months of protests that preceded his downfall.

Reuters reports the economic and trade cooperation portion of the association agreement will be addressed after Ukraine’s presidential elections, scheduled for May 25.

Find the full statement here.

— Charlotte Alfred

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The Daily Beast reports Russian President Vladimir Putin plans to fire back at the United States with sanctions targeting U.S. officials. The Russian sanctions come in response to U.S. President Barack Obama’s announcement Monday the U.S. was imposing sanctions on high-level Russian officials and fugitive Ukrainian President Viktor Yanukovych. More from The Daily Beast:

Putin is expected to release his retaliation list as early as Tuesday and while the final list is still being crafted, it will include top Obama administration officials and high profile U.S. senators, in an effort to roughly mirror the U.S. sanctions against Russian officials and lawmakers, according to diplomatic sources. At the top of the list in Congress is Senate Majority Whip Dick Durbin, who recently co-authored a resolution criticizing Russia’s invasion of Crimea.

Read the full text here.

— Ryan Craggs

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4:14 PM – 03/17/2014

What Does Putin’s Declaration Mean?

According to The New Republic’s Julia Ioffe, Putin’s declaration of Crimea as an independent state doesn’t mean any one thing, for now.

The way Ioffe sees it, Crimea faces two options: A replay of the 2008 land dispute over Abkhazia between Russia and Georgia, or annexation by Russia. But, as Ioffe writes:

What we know now is that we know nothing now. Putin, as always, is moving slowly, but deliberately, carefully leaving his options open while testing the waters of international response. He may decide to keep Crimea as a vassal state stuck in the limbo of Abkhazia and South Ossetia, or he may move to make it another republic inside the Russian Federation.

Read the full article on The New Republic.

— Ryan Craggs

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Tati Cotliar for L’Officiel Ukraine http://t.co/aPlYKqPWmN

— Next Models (@NextModels) 9 months ago

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From Reuters:

The White House said on Monday the United States was reviewing Ukrainian requests for military aid but insisted that Washington for now was limiting its assistance to economic support as it seeks a diplomatic path with Russia.”We’re reviewing requests by the Ukrainian government and military,” White House spokesman Jay Carney told reporters. “Our focus is on steps that Russia can take to de-escalate.”

— Charlotte Alfred

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Reuters reports Ukraine has begun digging a defensive trench in the region of Donetsk, near the country’s border with Russia.

The trench includes concrete barriers, according to governor Sergei Taruta, and is intended to restore order in the aftermath of Russia’s takeover in Crimea. Like all regional leaders, Taruta was appointed by Ukraine’s central government.

“Our border is not a castle. But it is equipped so that vehicles cannot cross it in either direction,” Taruta said. “This is not based on one or another scenario, but rather intended to maintain a solid border.”

Read the full report here.

— Ryan Craggs

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2:44 PM – 03/17/2014

Putin Declares Crimea Independent

Russian President Vladimir Putin signed a decree making Crimea a “sovereign and independent” state Monday. It was not immediately clear whether the 37-word decree, which takes effect immediately, was a precursor to annexation or a shift in strategy to make Crimea an independent country.

–Luke Johnson

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BREAKING: Crimean Prime Minister says #Putin just signed order making #Crimea an independent state. http://t.co/l9WxgpyePk

— Julia Ioffe (@juliaioffe) 4 years ago

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crimean parliament
A couple hold a Russian flag outside the Crimean parliament building in central Simferopol on March 17, 2014. (DIMITAR DILKOFF/AFP/Getty Images)

Click here for more photos of celebrations in Crimea.

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Vadislav Surkov, a top adviser and spinmeister to Vladimir Putin known as a “grey cardinal” inside the Kremlin, brushed off U.S. sanctions with particular aplomb.

“I see the decision by the administration in Washington as an acknowledgment of my service to Russia. It’s a big honor for me. I don’t have accounts abroad,” he told the Moskovsky Komsomolets. “The only things that interest me in the U.S. are Tupac Shakur, Allen Ginsberg, and Jackson Pollock. I don’t need a visa to access their work. I lose nothing.”

–Luke Johnson

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White House spokesman Jay Carney did not rule out direct U.S. sanctions against Russia’s Putin during a press conference on Monday.

“The authority exists to apply sanctions to a variety of individuals and entities,” Carney told reporters, according to Reuters. “We’re not going to rule out individuals or rule out actions.”

Putin is currently not on the list of individuals targeted by U.S. sanctions, nor is Russia foreign minister Sergey Lavrov.

— Eline Gordts

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crimea
Cossack men install a Russian flag and a Crimean flag on the roof of the City Hall building on March 17, 2014 in Bakhchysarai, Ukraine. (Dan Kitwood/Getty Images)

Putin Responds To US, European Sanctions: Signs Order Recognizing Crimea As Sovereign State | Zero Hedge

Putin Responds To US, European Sanctions: Signs Order Recognizing Crimea As Sovereign State | Zero Hedge.

So much for de-escalating:

  • RUSSIAN PRESIDENT VLADIMIR PUTIN SIGNS ORDER ON RECOGNITION OF CRIMEA AS SOVEREIGN STATE – RIA

Surely to precede Putin’s own executive order recognizing Crimea as the latest member of the Russian Federation. And as for those “crippling” sanctions, via the FT, here is the locals reall think and why the Russian stock market is soaring as we reported earlier.

Moscow investment banker on US sanctions: “It’s as innocuous as we’d hoped”

— Courtney Weaver (@courtneymoscow) March 17, 2014

One also wonders: how long until Russia freezes all assets of McDonalds restaurants operating in Russia.

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