History is repeating itself. With the ruble worth just 17 cents, the Russian people are facing 25% and higher inflation. So they are spending all the money they have on food and consumer goods, because soon they wont be able to afford anything. This happened in Germany in the early 1930s. When the people were hungry and afraid, there was a man who facilitated the suspension of the German legislature and grabbed dictatorial power for himself. He gave wonderful speeches. Hitler. The entire capitalization of the Russian stock market is now less than the value of Google. Why? Because the Russian economy is based entirely on oil and gas, always has been. They never diversified into technology, pharmaceuticals, etc. The fortunes of the Russian people have always rose and fallen on the price of oil. Enter Putin. He believes he and Russia are one. The security of his position of power over Russia IS the security of Russia in his mind. Threats to his power is the same as someone parking an aircraft carrier on the Russian coast and lobbing missiles inland. When he wanted Russia to appear stronger, he did a photo op riding a horse shirtless. His popularity is still high among the Russian people. This week he gave a 3-1/2 hour speech on television blaming the west for the woes of his economy, namely, the sanctions the US placed on Russia for invading Ukraine. By the way, why invade Ukraine? Because Ukraine supplies oil to Europe, and Putin would like to have some control over his neighbors. What do you do when your economy tanks and your people cant afford to buy food, or no one will import food into your country for fear of not getting paid? (Did you see that Apple has closed down operations in Russia?) You do what countries have always done--invade neighboring countries and take their resources. Hitler annexed Austria and invaded Poland. Putin has already annexed Ukraine and Crimea. A hungry bear, especially a Russian bear, is a dangerous thing. The closer you are to it, the more danger youre in.
Posted on: Sat, 20 Dec 2014 15:02:55 +0000
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