Tag: Russia

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Luc Vancraen: Can the EU still prevent an open war between Ukraine and Russia?

Interesting proposal from Luc Vancraen, an entrepreneur in Kyiv who holds a masters degree from Boston University:

If there is no Novorussia today it is because of the ferocious fighting of the Ukrainian armed forces. If the EU wants the Ukrainians to stop fighting after Donbas is liberated it will have to come up with a plan that convinces even the volunteer battalions that it is just a matter of time before Crimea returns to Ukraine.

The only way I can see this happen is through a Crimean Occupation Tax on all energy imported from Russia into the EU and all other countries that want to participate. President Putin will not like this tax at all but strangely enough it might be enough for him to belief that this could stop the Ukrainian army. It buys him time and he can speculate on convincing the EU to drop it later through good behaviour even though this won’t be easy with a name like this.

The tax will be paid on all Russian gas, oil and coal sold in the EU. Who pays this tax? Initially it will be EU citizens through their energy bills. This allows Putin through the Russian propaganda to trivialise these sanctions and to laugh with the stupidity of the EU that sanctions itself. But don’t underestimate the creativity of the energy companies. They will find other suppliers and this helps the EU to reduce dependency from a supplier they can no longer trust. Russia will be faced very fast with a serious dilemma. Lowering energy prices to include the tax so that it remains competitive with suppliers that don’t need to pay this or totally losing the biggest customer on earth. Simulations show that after just two years it is Russia that is paying this tax to avoid totally losing the EU as a customer.

Read more at Luc Vancraen: Can the EU still prevent an open war between Ukraine and Russia?.

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Garry Kasparov: It’s a War, Stupid! | TIME

From Gary Kasparov:

As always when it comes to stopping dictators, with every delay the price goes up. Western leaders have protested over the potential costs of action Ukraine at every turn only to be faced with the well-established historical fact that the real costs of inaction are always higher. Now the only options left are risky and difficult, and yet they must be tried. The best reason for acting to stop Putin today is brutally simple: It will only get harder tomorrow.

Read more at Garry Kasparov: It’s a War, Stupid! | TIME.

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EU moves to ramp up Russia sanctions | Al Jazeera

From AlJazeera:

French President Francois Hollande stressed that a failure by Russia to reverse a flow of weapons and troops into eastern Ukraine would force the bloc to impose new economic measures.”Are we going to let the situation worsen, until it leads to war?” Hollande said at a news conference. “Because that’s the risk today. There is no time to waste.”

Read more at EU moves to ramp up Russia sanctions as Ukraine calls for NATO membership | Al Jazeera America.

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War in Europe

Vladimir Putin has escalated the conflict in Eastern Ukraine with new incursions of tanks backed with artillery, anti-aircraft missile systems and up to 15,000 Russian troops. Intent on seizing as much territory as possible, he is banking on the US/European coalition responding with another slap on the wrist. Each weak response has only made Putin bolder. But where he may miscalculate is that the coalition is aware that its “stick-and-carrot” policy has failed and will be looking for a new approach.

Willingness of the Europeans to endure immediate economic pain in the belief that this will avert a long-term calamity is yet to be tested. Success will depend on France, Spain and Italy’s support for their Northern and Central European neighbours, who face a more immediate threat.

A significant step-up in sanctions is likely and the initial response from European markets will be negative. Sanctions are a two-edged sword and likely to hurt Europe almost as much as they do Russia. But NATO rearmament in the medium-term would somewhat offset the initial cost. Never underestimate the stimulus effect of war on local industry — provided the war is fought outside one’s borders

Germany’s DAX is running into stiff resistance as it approaches 9750. And 13-week Twiggs Money Flow below zero warns of selling pressure, threatening a reversal. Retreat below 9250 would strengthen the signal and failure of support at 8900/9000 would confirm a primary down-trend.

DAX

* Target calculation: 9000 – ( 10000 – 9000 ) = 8000

Dow Jones Euro Stoxx 50 reversal below 3100 and 13-week Twiggs Money Flow below zero would add further weight to the (bear) signal.

Dow Jones Euro Stoxx 50

* Target calculation: 3000 – ( 3300 – 3000 ) = 2700

The S&P 500, unfazed by recent developments in Europe, broke resistance at 2000 to signal an advance to 2100*. A 21-Day Twiggs Money Flow trough above zero indicates rising (medium-term) buying pressure. Reversal below 1990 is unlikely, but would warn of another correction.

S&P 500

* Target calculation: 2000 + ( 2000 – 1900 ) = 2100

CBOE Volatility Index (VIX), shown here on a ten-year chart, indicates low risk typical of a bull market.

S&P 500 VIX

Shanghai Composite Index, responding to PBOC stimulus, is testing resistance at 2250. Rising 13-week Twiggs Money Flow indicates medium-term buying pressure. Breakout would confirm a primary up-trend, signaling an advance to 2500*. Respect of resistance is less likely, but would suggest further consolidation.

Shanghai Composite Index

* Target calculation: 2250 + ( 2250 – 2000 ) = 2500

The ASX 200 is testing resistance at 5650. Continued strength in US and Chinese stocks would improve the chance of an ASX 200 breakout, suggesting an advance to 5850*. Bearish divergence on 13-week Twiggs Money Flow — shown here on a monthly chart — continues to warn of long-term selling pressure. But failure to cross below zero would negate this and completion of another trough above zero would indicate that buyers are back in control. Reversal below 5450 is unlikely, but would warn of a test of primary support.

ASX 200

* Target calculation: 5650 + ( 5650 – 5450 ) = 5850

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Russians see war cost as their army invades

From Oleg Sukhov:

While previously Russia mostly sent fighters who had been formally discharged from the military or on official leave, earlier this week an invasion of eastern Ukraine by the regular Russian army began, making it much harder to hide the truth. …On Aug. 26 Ella Polyakova, head of the St. Petersburg Committee of Soldiers’ Mothers, said that hospitals in Rostov-on-Don and nearby regions were filled with injured soldiers.

Valentina Melnikova, head of the Union of the Committees of Soldiers’ Mothers, said on Aug. 27 that about 15,000 Russian soldiers, including both mercenaries and the regular army, were currently fighting in eastern Ukraine. She lambasted the authorities for hiding the truth and effectively denying assistance to the killed soldiers’ families, comparing it to similar situations during the Soviet invasion of Afghanistan and the first Chechen War.

On Aug. 27, the Stavropol Committee of Soldiers’ Mothers published a list of 400 killed and injured Russian troops.

These people are as much victims of an authoritarian Russian regime as the people of East Ukraine.

Read more at Russians see war cost as their army invades.

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Margaret Thatcher: Russia

She’s ruled by a dictatorship of patient, far-sighted determined men who are rapidly making their country the foremost naval and military power in the world. They are not doing this solely for the sake of self-defence. A huge, largely land-locked country like Russia does not need to build the most powerful navy in the world just to guard its own frontiers. No. The Russians are bent on world dominance, and they are rapidly acquiring the means to become the most powerful imperial nation the world has seen. The men in the Soviet politburo don’t have to worry about the ebb and flow of public opinion. They put guns before butter, while we put just about everything before guns. They know that they are a super power in only one sense — the military sense. They are a failure in human and economic terms.

~ Margaret Thatcher (1976)

In response to this speech, the Soviet Army newspaper Red Star labelled Thatcher “the Iron Lady”. Intended as an insult, Thatcher welcomed the moniker that would stick for the remainder of her political career.

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Novorossiya Is Coming Apart at the Seams

From Anna Nemtsova:

Pro-Kremlin think tank analyst and insider Yuri Krupnov explained the shift to me: “There’s a crisis of management in Russia,” he said. “Moscow elites have managed to convince Putin to give up the idea of Novorossiya. Many in Moscow can’t wait for European Union sanctions to be lifted, so Putin will meet with [Ukrainian President] Poroshenko and [E.U. Commission President] Barroso soon and most probably cut a deal.” But Krupnov hastens to add that Russia’s willingness to bargain with Kiev does not signal an end to the conflict: “Moscow has betrayed Novorossiya,” he says, “but that doesn’t mean it will guarantee peace.”

Read more at Novorossiya Is Coming Apart at the Seams.

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