re: Hat's off to Putin - he knows what he is doing

The US floats on natural gas, if we can tap into the EU need its going to be good times for us.

Putin is testing the West's resolve. His intelligence agencies and state department have been hard at work buying governments and starting insurgent groups against governments that don't toe the Russian line. Ukraine was meant to be a test at how far Putin could go without provoking a response.

The problem is that he's not winning. He has succeeded in not provoking a military response from the West, but the sanctions are hurting his economy as well as the bank accounts of the oligarchs who prop him up. To make matters worse, his insurgency has not been successful in regaining control of the Ukrainian government.

The idea was to keep using the Crimean strategy to gradually annex much of non-Nato Eastern Europe before testing NATO's resolve against one of the smaller members in the Baltic or potentially Finland. The idea was to slowly shorten the distance between Putin's controlled borders and those of his primary economic and military rivals. The fewer countries between him and the West, the fewer people he has to keep happy to manipulate gas prices in Europe. The less distance between himself and the Western Capitals, the less distance his tank battalions have to travel in order to defeat NATO in a land war.

NATO is only as strong as its willingness to check aggressive actions towards its members. If Putin can successfully pick off a NATO country without a response, NATO renders itself worthless.

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But the former KGB agent’s bluster ignores an underlying key fact that ultimately threatens his might on both fronts: The Russian economy is anemic, and indicators show it could remain that way for a long time.

Putin is facing a perfect storm of bad financial news. His economy continues to suffer under the weight of Western penalties imposed for his actions in Ukraine. The price of oil, a lifeblood of Moscow’s economic engine and already at historic lows, won’t go back up until the market makes its way through millions of barrels of oversupply. All of this has sent the value of Russia’s currency, the ruble, down 44 percent against the U.S. dollar in the last year, leading to a spike in inflation.

“The pressure is on,” Tina Fordham, Citigroup chief global political analyst, said on Bloomberg television last week. “The currency is weakened. Oil prices are looking soft, probably for a long time. The multiplier effect of these two things happening at the same time is significant.”

With the value of their currency depressed, Russian companies and regional governments are stuck with billions of dollars in debt they’re struggling to pay. Add growing doubts that the Arctic will yield an oil windfall Russian oil companies desperately need to fulfill future promises, and Russia’s economic future is looking increasingly blighted.

All of this comes as Putin, who depends on an estimated $366 billion in reserves to remain financially afloat, launches ambitious plans in an effort to end the civil war in Syria and combat Islamic extremism. On Wednesday, Moscow launched its first airstrikes in the campaign against the Islamic State; those same attacks are also meant to keep Syrian President Bashar al-Assad in power.

Russia’s economic woes were especially acute last year when Putin invaded Ukraine. As the chart below shows, the 2014 drop in Russian GDP coincides with the start of the war along its border with Ukraine. The World Bank projects Russia’s economy will shrink by 3.8 percent this year and only moderately rebound in 2016. In August, the country’s Federal State Statistics Service announced its economy shrank 4.6 percent in the second quarter compared with the same period the year before. It’s the largest drop since 2009.

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“Internal governance, the rule of law, getting court decisions done quickly, lack of property rights: All the things that make business easy to do, Russia’s doing poorly on,” Miller said.

This is evident in the chart below. It shows a clear downward trend in the amount of money foreign firms are reinvesting back into Russia, regarding profits made in the country. Since 2012, it has been trending down, with 2015 on pace to be the worst year since 2009, when the Great Recession was at its peak.

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“The biggest problem that Russia faces is stagnation,” Miller said. “They’re going to be in recession this year; there’s a good chance they’re going to be [in recession] next year. And the three- to five-year timeline isn’t looking promising.”

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LINK

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...the US economy still remains poised to grow 2.6% this year, which would be its best year since 2006 as the economy's most powerful force — consumers — enjoys the spoils of low oil prices and more purchasing power because of the strong dollar.

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LINK

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MOSCOW — Hundreds of long-distance truckers blocked a lengthy section of the ring road circling the capital on Friday to protest a new national toll, in the first sign that Russia’s economic woes might be eroding the broad support for President Vladimir V. Putin’s government.

The direct object of their ire was Igor Rotenberg, the scion of a billionaire oligarch clan close to Mr. Putin, who owns half of a new, GPS-based system that, when fully operational, will charge truckers fees on all federal highways.

Their larger anger, however, was reserved for what they called the government’s failure to alleviate the devastating effects of inflation and recession over the past year, prompted by the steep drop in oil prices, sanctions the West imposed over Ukraine and retaliatory sanctions the Kremlin imposed on Western food imports.

The Russian economy is deeply troubled and shows few signs of escaping from its rut, at least as long as prices for oil and other commodities remain depressed. Inflation is running at 15.6 percent and the economy has shrunk nearly 4 percent in the last year. The ruble has lost about half its value against the dollar, and foreign reserves were hovering around $366 billion, compared with $419 billion a year ago.

The truckers are widely dispersed and hence difficult to control, and their sentiments reflect those of the entire middle class, Mr. Petrov said. “They feel that the government is trying to fix budgetary problems by increasing taxes and taking money out of their pockets,” he said.

Some analysts consider the protests proof that what is widely called the “television” — government propaganda about Russia’s rising status in the world — is losing its edge over the “fridge,” or economic problems.

“The reserves are not limitless,” said Alexander Auzan, the economics dean at Moscow State University, speaking on Dozhd television. “What we see now, the situation with the truckers, is the first rumble of thunder somewhere far away.”

The government evidently hopes to ride out the protests, which went unreported on the main state-run television news channel.

Some of those watching had other ideas. All across Moscow, the movement of the trucks circling the city was being monitored on various social media, inspiring a lively stream of criticism and support.

“Why only the ring road?” said one, “Why not Red Square?”

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Game. Set. Match. Putin. LOL

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Russia is on the brink of economic collapse yet Putin knows what he's doing? 

The unhealthy hatred and obsession some of y'all have for Obama is entertaining yet sad at the same time.

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Melt, cuck

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ukraine has somethings putin wants

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What is there that is cheaper to get via an expensive military invasion rather than simply buying?