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| Can Putin Recover from This? (The Atlantic): Here's a readable account of how Russian financial sanctions work, and why they hold formidable power against Russia. (Sun Tzu would approve.)
Investor takeaway: Since a global economy means "all economies are connected," expect the unexpected in your investments in the months ahead. Diversify, diversify, diversify. |
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While Russia has closed its stock market to avoid further financial panic, Russian ETFs are continuing to trade in the U.S., such as the VanEck Russia ETF (RSX), which has lost nearly 30%: |
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| (Courtesy CNBC)
Financial sanctions are immensely preferable to war, because they don't kill human beings. As Sun Tzu advised in The Art of War, the successful warrior avoids going into battle at all, but rather cuts off the enemy's resources and patiently waits.
Investor takeaway: Still, expect the aftershocks to be unpredictable on your own investments (crypto or otherwise). In a global economy, we're all connected. |
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| Hi Everyone,
Send out your best soldier and we will present ours. Let them fight so the rest of us can live.
This unique "winner takes all" method of resolving what might otherwise become a very messy battle was apparently quite common in a more civilized age.
Goliath the giant may have been afflicted by some kind of illness that made him blind and possibly slow. So despite his towering height of "six cubits and a span" and his impressive hardware, anyone looking close enough could see the odds stacked in David's favor.
Even though he was a young poetic shepherd, David was an excellent marksman and was accustomed to dealing with vicious wild animals.
More importantly, David had just been anointed by Samuel as the next king of Israel, and this Philistine insulted his G-d. It's no wonder so many are invoking this tale in relation to Ukraine.
After Crimea was captured without a bullet fired and relatively little repercussions, Russian President Vladimir Putin took what must have seemed like a reasonable gamble to take back some easy territories.
Four days later, Putin's convoy has not yet made the four-hour drive from Belarus to Kyiv, and the heaviest fighting so far is all taking place in cities that border Russia. |
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| So long, SWIFT
No matter how much ground Russia manages to capture, the cost will no doubt be devastating.
One thing Putin probably wasn't counting on was the amount of solidarity and assistance the entire world seems to be providing Ukraine. It's not just ammo either.
The hacker group Anonymous has resurfaced to counterattack Russian intelligence, Elon Musk is providing state-of-the-art satellite internet to regions that need it, and on Saturday night, this happened. ... |
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| In my mind, this is the real nuclear option. Even though SWIFT is old, centrally run, tedious, confusing, and everything we don't like about the traditional financial system, its messaging system is the railroad used to facilitate bank-to-bank transfers.
The measures haven't even been finalized yet. We don't know which banks will be affected or when. Even so, many Russian citizens at home and abroad are already claiming that some of their credit cards aren't working.
Here's a fascinating conversation analyst Jason Deane had with the CEO of a Russian bitcoin mining company, where he provides great insight into what it's like for Russians right now. In short, it's not good. |
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| Dollars, oil and bitcoin
Ultimately, the West has essentially cut off all financial ties with Russia, except for the exchange of petrodollars.
Due to Europe's suddenly embarrassing dependence on Russian energy, it seems they will leave enough infrastructure to continue extracting oil from Russia and the bare minimum financial services required to pay for it.
Fearing they might be trapped in a freefalling ruble, some Russians are reportedly queuing up to buy U.S. dollars, making the problem even worse for the Bank of Russia, which is struggling to keep the ruble afloat, even after increasing its key interest rate to 20%.
Why Russians are buying up U.S. dollars rather than bitcoin is beyond me. Perhaps it's a sign that we're still early.
If Russian citizens widely understood that sanctions can be avoided by using bitcoin, we may have seen a spike in the price by now. However, like gold, oil and the U.S. stock market, things haven't really moved much at all from where they were before the fighting started.
Here we can see all four of the above-mentioned assets. The vertical dotted line is the day before Putin's invasion. As we can see, prices have moved a bit, but they are basically back where they started. |
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Wishing you an amazing week ahead! |
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| Mati Greenspan Analysis, Advisory, Money Management |
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Bitcoin is helping provide freedom at a time when freedom seems increasingly scarce. |
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Drop rubles, not rockets. |
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| Bitcoin Market Journal is a daily newsletter that makes you a better crypto investor. It is created by Evamarie Augustine, Charles Bovaird, Mati Greenspan, John Hargrave, and Alexandre Lores.
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