RUBLE. After the excitements of the past few days, it seems to have settled down at about 60 to the USD: in short, half the value it was at the beginning of the year. I have seen a number of reasons put forth for its decline; mix and match to your taste. Certainly, the principal cause is the decline in oil prices: compare for example, the Canadian dollar which is now at a a 5-year low. (By the way, contrary to popular opinion, energy is only about 20% of Russia’s GDP). Other explanations. Russian companies, affected by sanctions on their ability to raise loans, are buying foreign currency to pay off their loans. The Central Bank fumbled it. Speculators and hostile action from the USA are other candidates. Take your choice on the implication: Russia has lost the economic war; on the contrary, it is following the strategy that defeated Napoleon and Hitler. And more “out there” theories – my favourite being the “Samson defence”, an attack to weaken Russia before the Eurasian Union kicks into gear next month and the ever-popular Putin soon to be brought down by coup. (But wasn’t Russia Finished years ago?) At any event, it is very dangerous to fool around with a top-ten economy – plenty of downstream effects. It’s not over by a long shot and Beijing has yet to weigh in. By the way, the ruble cost of a barrel of oil is pretty much unchanged and it should be remembered that Russian oil companies spend rubles and earn dollars.
PUTIN SPEECH. As usual, most of the content (68.9% by word count) was domestic: for my money the two most important were a “holiday from inspections” for ordinary companies (Russian officials and legalisms can be pretty predatory) and an amnesty for returning capital (Putin pointed out that the “Cyprus haircut” showed their money isn’t safe outside). He complained about corruption in the military procurement system (not that the former Defence Minister is in jail. On the contrary). Externally, long-stated themes: for Russia, “either we remain a sovereign nation, or we dissolve without a trace and lose our identity”; for the world: “It is imperative to respect the legitimate interests of all the participants in international dialogue.” He’s had enough: “the more ground we give and the more excuses we make, the more our opponents become brazen and the more cynical and aggressive their demeanour becomes” but never closes the door, “Our goal is to have as many equal partners as possible, both in the West and in the East.” English, Russian.
PUTIN BIG ANNUAL PRESS CONFERENCE. Today – here’s Sputnik News’ summary. “Our partners never stopped. They decided they were the winners, they were an empire, while all the others were their vassals, and they needed to put the squeeze on them.” No “equal partners” there.
FRACKING. The drop in oil prices is not going to help the fracking business. One Australian company has gone down already and Chevron has pulled out of Ukraine. More to come, no doubt. And not just fracking – North Sea “close to collapse” shrieks the BBC. How much of Washington’s policy is based on the assumption of energy independence? But the price may go up again.
WAR. US House and Senate. Not my interpretation, Ron Paul’s, Dana Rohrbacher’s and Pat Buchanan’s. And, says another former ally, the USA is a “dangerous ally”. (Note that we never see this criticism from serving politicians, only from formers. Why would that be, Dear Readers?)
REGIME CHANGE. Are the Czech Republic, Hungary, Slovakia next in line? Note the references to Viktor Orban – “Putin Mini-Me”, “neo-fascist dictator”, second-last para; he’s on the hit list for sure.