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    Russian Economy General News: #2

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    Post  magnumcromagnon Thu Jul 17, 2014 7:55 pm

    sepheronx wrote:Some expert believes the Russian energy industry will lose 150 - 200B over these sanctions. But it seems US stock took a dive over this. BP will be hurt since they own 20% stock in rosneft.

    Actually this is a diamond in the rough moment, I'm already seeing positive indications of this especially concerning Russia-Iran, Syrian, Cuban relations. U.S. was not a big consumer of Rosneft Oil, and sanctions only work when all sides agree to it. *cough, Europe, cough* By sanctioning Gazprombank, and Rosneft it means that Russia can work with Iran oil and gas production at a much higher capacity, and Gazprombank can give Iran much needed loans and can work oil/gas barter deals that are more numerous and at greater quantities. I could definitely see Gazprombank playing the middle man role between Rosneft and Iran, the oil/gas barter could help greatly for Iran, Syria, Cuba to obtain the food, medicine, advanced technology, and defense equipment that they desperately need! Time to pull out of the Military Technology Control Regime, long range cruise missiles for everyone! Twisted Evil  Twisted Evil  Twisted Evil  Also with the sanctioning of KRET it means more ECM equipment will flow towards Iran, Syria, Cuba meaning I could definitely see more Autobaza's jamming/hacking in to more advanced U.S. stealth drones, or possibly see Israeli F-16's being jammed and crashing violently in to Syrian desert territory, as punishment for constant military incursions and military provocations over Syrian airspace. Twisted Evil Twisted Evil Twisted Evil
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    Post  fragmachine Thu Jul 17, 2014 8:08 pm

    What Russians should do is to sh it all over these *sanctions* and start delivering S-400 to Iran, Syria and whoever country that uncle sam doesn't like. If a country wants to pay then what's a problem? If Russia will follow these silly sanctions it will became even more silly in the eyes of the WORLD. Screw US/EU, building relationship with countries that counts is what counts.
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    Post  syxthtysyxthsyx Fri Jul 18, 2014 4:35 am

    All of these actions are modes of economic warfare committed against the Russian state, though concealed in their natures.  The primary economic dynamic that has consisted throughout the cold war has been food versus oil; the West's breadbasket and inferior access to oil deposits versus the East's oil and gas-rich reources and poor agricultural clime.

    It is a sordidly inadequate and weak stance from which the US attempts to commit these sanctioning actions against the Russian state.  Observe increasing US gas prices driven by the onset of unrest in the Ukraine:

    Russian Economy General News: #2 - Page 11 G

    'U.S. to Sell 5 Million Barrels in Test for Oil Reserves'
    '30 million barrels of oil from the Strategic Petroleum Reserve'
    '30 million barrels of oil from International Energy Agency partners'

    The response to these increasing costs to the general US population was the initial sell-off of 5 million barrels of crude oil and large amounts of lng reserves, which stopped the constantly increasing cost of gasoline...  the advanced sell of 30 million additional barrels of oil is being used to attempt to offset the cost already levied against the US.

    Only the use of oil affords a valid response to the goliath that oil represents as a resourse.  The US will continue to capitulate its reserve supply of oil until it has no more oil to capitulate.  Why are they attempting to auspice, to pose as an agency with trillions of dollars of debt, that they can commit these actions (sanctions, etc.) against the Russian state with effectiveness?

    A partial answer is evidenced by an observation of the Russian economic dynamic prior to the first US engagement in Iraq.  To that point in time, large international investments were held by russian industrial sectors.  The Russian ruble collapsed when those investments failed; I posit that those investments were sabotaged as preparation for US actions in Iraq, just like the Ukraine is being sabotaged now, and just as Iraq is being prepared for an extended 'occupation' that insures a continued flow of oil from that country to the US.  Will they depopulated the US citizenry the same way, through the use of deception and subtrefugal means?
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    Post  Viktor Fri Jul 18, 2014 6:09 pm

    Nice  thumbsup 

    MAYOR: Russian foreign trade surplus in June rose 19.9% ​​to $ 16.3 billion
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    Post  Cyberspec Sat Jul 19, 2014 3:00 am

    Viktor wrote:Nice  thumbsup 

    MAYOR: Russian foreign trade surplus in June rose 19.9% ​​to $ 16.3 billion


    The link leads to a different article on agriculture

    ----

    As I suspected, Russia is going to increase defense spending not reduce it....they're talking about 21% of GDP

     Arrow Russia to boost defense budget by 2017 - newspaper
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    Post  GarryB Sat Jul 19, 2014 12:17 pm

    Hopefully the increased domestic spending on critical items will encourage more volume production not only in the military sector but also the civilian sector.

    Computer chips that are reliable and have Russian backdoors instead of US ones could be adapted to create a Russian Play station equivalent gaming console that Russian gaming companies can develop software for... perhaps storming a US airport and mowing down US citizens, or a game where you are a US high school student and you buy a gun and go on a rampage.

    More interestingly you could have a game based around a Russian Mistral helicopter carrier that is on an anti piracy mission off the coast of Africa where elements like resource management (missile and helicopter stocks, fuel and ammo etc), plus a neat flight simulator and boat simulator.

    You could even have high speed small boats like Serna, and of course a range of helicopter options and of course the boat itself to position and defend.

    You could have special forces units you could deploy to rescue hostages and attack targets so you have a mix of Counterstrike, that game about PT boats, Comanche/Hokum + Apache Havok, and a boat simulator all rolled in to one.
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    Post  Viktor Sat Jul 19, 2014 4:26 pm

    Cyberspec wrote:
    Viktor wrote:Nice  thumbsup 

    MAYOR: Russian foreign trade surplus in June rose 19.9% ​​to $ 16.3 billion


    The link leads to a different article on agriculture

    ----

    As I suspected, Russia is going to increase defense spending not reduce it....they're talking about 21% of GDP

     Arrow Russia to boost defense budget by 2017 - newspaper

    Thats probably a mistake. 21% of the budget certainly not GDP
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    Post  Austin Sat Jul 19, 2014 6:50 pm

    I doubt they can afford to spend 21 % of Budget on Defence its very high and considering the economic crisis it tough.

    My suggestion would be about 20 Trillion spent for Defence ~ $600 Billion  and MIC 3 trillion ~ $90 billion.

    Reduce the spending to $400 billion for Defence and  $70 Billion for MIC , thats still a good 470 Billion  and saving of $ 220 Billion.

    If they can invest $220 billion in other revenue generating project it would help the economy in crisis.
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    Post  Hannibal Barca Sat Jul 19, 2014 8:19 pm

    Haven't read anything but from the numbers you throw it must be a 21% increase in year to year plans, or a 21% compare to the previous 2017 estimation (the latter more possible).
    The chick who was typewriting simply doesn't know mathematics and lost in the translation, happens way too often  Laughing 


    AND THERE IS NOT A F@CKING CRISIS IN RUSSIA UNLIKE USA IS STILL IN POSITIVE FIGURES!!!!!!!!! COMPRENDO?
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    Post  sepheronx Sun Jul 20, 2014 7:24 am

    At one point, they spent 40% but that lead to collapse.

    Bug thing now is that Russia is becoming an agricultural power, which makes it farther ahead as people always need food and having it available. lack of it will bring economic fallout.

    So what is the plan? what can Russia do now especially when furtger sanctions hit? well, they can start by using domestic robotic and automation industries to start modernizing the MiC to get them to build civil products. everything from TV's to computers, smart phones, tablets etc, and Elbrus or module or even upcomin Baikal arm processors can do that.

    as well, invest heavily in energy saving equipment as well as diversify the electrical grid.
    Biggest one will be changing the social system. Increase wages to promote domestic consumption and standard of lving. Make decent options for its citizens to have much more freedom and access to the resources needed to increase living standards, as well, possibly introduce a private education and medical care for people of a higher income level. Which will help levy the heavy demand for medical care attention from the state run, as well reducing costs.

    and for the failing state run agencies, make them publicly owned or sell majority shares to privatize it. Maybe increase taxes for all mineral mining and reduce for actual manufaturers to promt a demand.

    Seek other customers. India is one of the largest markets and is in demand for oil and gas. Seek them. They are also in demand for high tech, look into JV's. Iran and Egypt are major potential markets that are up for grabs thanks to US foreign policy, so Russia should seek to gain access to both markets for Rus companies.

    last but not least is Africa. they can help improve standards of living in African countries and seek for more Rus enterprises to go their. build these places up and they will be happy to continue buying from you. Add to that, it will be good pubicity because the west is already well known in Africa as deceivers and liars.
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    Post  syxthtysyxthsyx Sun Jul 20, 2014 7:43 am

    The Soviet knew the path to economic, military, social success for Russia...  they put it on the flag for everyone to see:

    Russian Economy General News: #2 - Page 11 Ussr

    Russia's two foremost needs are manufacturing infrastructure and iron ore mining/processing represented by the hammer, and development and extension of the agricultural base represented by the sickle.  Of course, the star represents the strong need for a military defense...
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    Post  Cyberspec Sun Jul 20, 2014 8:12 am

    Austin wrote:I doubt they can afford to spend 21 % of Budget on Defence its very high and considering the economic crisis it tough.

    My suggestion would be about 20 Trillion spent for Defence ~ $600 Billion  and MIC 3 trillion ~ $90 billion.

    Reduce the spending to $400 billion for Defence and  $70 Billion for MIC , thats still a good 470 Billion  and saving of $ 220 Billion.

    If they can invest $220 billion in other revenue generating project it would help the economy in crisis.

    Doubt all you like...you have it in black & white. All this figures you throw around are absolutely meaningless if you can't defend yourself.


    Hannibal Barca wrote: AND THERE IS NOT A F@CKING CRISIS IN RUSSIA UNLIKE USA IS STILL IN POSITIVE FIGURES!!!!!!!!! COMPRENDO?

    Absolutely  Smile  And they'll do everything they can to save the greenback...however, the wheels of history are unstoppable


    Another link in the chain

     Arrow Turkey Proposes Switching to National Currencies Payments in Trade with Russia
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    Post  KomissarBojanchev Sun Jul 20, 2014 2:46 pm


    That's the saddest thing about China and Russia, neither of them offer anything substantively different from what the USA offers, economically speaking. The economies and political leadership of both countries came into being and were made possible by US neo-liberalism.
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    Post  sepheronx Sun Jul 20, 2014 3:37 pm

    I agree with you to an extent. Russia's economic system is entirely derived based upon a model done in USA as well, which served USA well because they have puppets in other countries that purchase their goods. But the model is based off of more likely a 1960's variant rather than 80's to now, where Russia is becoming reliant in its manufacturing and agriculture, which US relied on back in the 60's. This model is good to an extent.

    It's banking sector is entirely made up of whatever Yeltsin deemed appropriate and some people think that Central Bank of Russia is heavily influenced by USA, thus that could very well be an issue.

    China is a different case. It is a centralized economy like Russia, but not as vast in land/resources but vast in human capital. Thus the West took advantage of the vast human capital and used it as cheap labour. Chinese government took advantage as well and used the money to expand itself but uses a lot of US economic policies (fabricating numbers, over inflating cost of certain goods like luxury items, etc) in order to grow its economy. But what the west does not realise is that the human capital of China, they may not be able to bank on forever due to increasing costs of labour over in China, and China holds the population which in this case, if they have a high middle class society, they will become the number 1 profit gain for Chinese authorities in terms of taxation, as they will become the main consumers (add in another 145M population that is Russia, maybe another 80 that is Iran, etc). That in itself makes a bigger market than USA and Europe. India is the wild card in all of this. They want to make change and build themselves up even further, but local politics usually stand in the way.

    So it all depends on how Russia plays it out. It all depends on how they will deal with the economic fallout between them and the west. Trade with most western countries are not that huge, but EU as a whole, is huge for Russia, and Russia may lose out on a huge chunk of that, which will indeed lose out in terms of $. But if you break it down by per country (EU countries like Germany vs China), you will see that trade with China is much higher. After all of this, it will only increase. Add to that, there are other countries interested in Russia's economy and gas/oil like Vietnam. It is no secret that Russian gov is pushing both defence industries and 1 product industries in diversifying its production and increase its export. Developing countries like Vietnam, Indonesia, Sri Lanka, etc could very well be the target and could use the massive capital investment from Russia, in turn Russian industries get a chance to operate in the countries. Major failing industries like Mechel would need to drop a lot of production or seek ways to reduce costs in their production, and start looking into other products other than raw metals. Maybe like car parts, or tractor parts, or maybe rolled steel/aluminium and synthetic or hybrid materials for various industries.

    Then maybe look into opening up joint production/manufacturing in other countries. Like Lada automobiles to be produced in Sri Lanka and China, or maybe create a JV in terms of a FAB to build Elbrus and future Baikal processors in India (since India really wants to get into the semiconductor industry). Or a energy HQ in Hong Kong. All of these will end up with higher profits for Russian companies abroad. Only a few Russian companies actually sell products abroad, so many Russian manufacturers are heavily reliant on domestic consumption, so if domestic consumption goes down, they will lose a lot in terms of profit. Thus they need other markets.

    Hell, Africa can be one major project. And my friend from South Sudan was telling me today, that Africa would probably be more than happy to accept Russian industries and investments, as Russia does not have a bad history with Africa like the west does. And any country that dealt with Russia, it was mutual more than anything, thus they continue to do heavy business with them today (Angola is a perfect example. A huge portion of their wealth now is from oil/gas being extracted by western countries, but they still insist to spend money in Russia).
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    Post  sepheronx Sun Jul 20, 2014 3:44 pm

    http://en.itar-tass.com/economy/741287

    It seems that Japan is possibly fearing sanctions thus they are not wanting to do luxury brands in Russia. Which means that Nissan will lose a lot of $ from lack of sales of Infinity. This will bode well for Zil when they try to restart their luxury brand automobiles.

    Although, I think it has more to do with the down of sales of automobiles, espcially luxury in Russia. Russia is more interested in cheap models hence why many manufacturers are opening up the $10,000 line and cheaper production. Maybe seek a new luxury brand from China or maybe try to work with TATA motors India in producing cars in Russia or CIS market.
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    Post  Regular Mon Jul 21, 2014 9:39 pm

    sepheronx wrote:http://en.itar-tass.com/economy/741287

    It seems that Japan is possibly fearing sanctions thus they are not wanting to do luxury brands in Russia.  Which means that Nissan will lose a lot of $ from lack of sales of Infinity.  This will bode well for Zil when they try to restart their luxury brand automobiles.

    Although, I think it has more to do with the down of sales of automobiles, espcially luxury in Russia.  Russia is more interested in cheap models hence why many manufacturers are opening up the $10,000 line and cheaper production.  Maybe seek a new luxury brand from China or maybe try to work with TATA motors India in producing cars in Russia or CIS market.

    Japan and luxury doesn't mix. They won't be missed.
    Russia is big according to statistics when it comes to luxury cars. It's not Dubai, but money is massive in Moscow, people who afford luxury items buy more of them, change them to new ones quicker than for example peasants who drive their rustbuckets for years.
    Go and visit Russian auto forums and see what New Russians and now Golden Youth of Russia drive. And how long they keep their cars until they wreck last living crap our of it.

    Luxury is not always only about quality, but the name, the style and image as well.    
    Zil is automatically associates itself with a truck. Just like Kamaz. What luxury Zil can offer when they have zero technical experience with modern cars. Who will make components to them?  
    Chinese cars are... terrible.

    Sometimes it seems that Russians are crazy about luxury items. I can't imagine sanctions because of that. My Russian friends know more about luxury than me even if they earn less. I can't afford to buy Brunello Cucicinelli shirts for £320 every week, I can't buy as much premium alcohol, I can't afford to have Rado, Rolex collection. Don't even get me started about their women... I've married one..
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    Post  sepheronx Tue Jul 22, 2014 12:42 am

    Regular wrote:
    sepheronx wrote:http://en.itar-tass.com/economy/741287

    It seems that Japan is possibly fearing sanctions thus they are not wanting to do luxury brands in Russia.  Which means that Nissan will lose a lot of $ from lack of sales of Infinity.  This will bode well for Zil when they try to restart their luxury brand automobiles.

    Although, I think it has more to do with the down of sales of automobiles, espcially luxury in Russia.  Russia is more interested in cheap models hence why many manufacturers are opening up the $10,000 line and cheaper production.  Maybe seek a new luxury brand from China or maybe try to work with TATA motors India in producing cars in Russia or CIS market.

    Japan and luxury doesn't mix. They won't be missed.
    Russia is big according to statistics when it comes to luxury cars. It's not Dubai, but money is massive in Moscow, people who afford luxury items buy more of them, change them to new ones quicker than for example peasants who drive their rustbuckets for years.
    Go and visit Russian auto forums and see what New Russians and now Golden Youth of Russia drive. And how long they keep their cars until they wreck last living crap our of it.

    Luxury is not always only about quality, but the name, the style and image as well.    
    Zil is automatically associates itself with a truck. Just like Kamaz. What luxury Zil can offer when they have zero technical experience with modern cars. Who will make components to them?  
    Chinese cars are... terrible.

    Sometimes it seems that Russians are crazy about luxury items. I can't imagine sanctions because of that. My Russian friends know more about luxury than me even if they earn less. I can't afford to buy Brunello Cucicinelli shirts for £320 every week, I can't buy as much premium alcohol, I can't afford to have Rado, Rolex collection. Don't even get me started about their women... I've married one..

    Technically, Lexus and Infinity falls under luxury brand. Although, myself having the had the opportunity to drive Infinity, I do not see the big difference from any other vehicle (I like my Dodge Journey far more).

    That being said, Zil has a history of making luxury type cars http://en.wikipedia.org/wiki/ZiL in the past, and is the one contracted to build the new limo for the Russian president. Rumor has it, they will make a car variant of the limo for domestic consumption. In that case, guaranteed that it will fall under as luxury brand. Although, the issue is, the brand will not probably expand more than that line. MaRussia has the chance to be in the sports and luxury brand, but their production will probably remain very low for quite sometime.

    I would say that maybe now with Avtovaz becoming popular again, and quality is up significantly, maybe they should build a luxury brand of automobiles, but open up the plant somewhere else, somewhere where people are in need of work and thus keeping production costs down a bit. Have you seen the new interior for the upcoming Lada Vesta's interior: http://sdelanounas.ru/blogs/51389/ So they do have the ability but, here is my #1 question:

    What is luxury automobiles? Is it features like leather, heated seating with camera in the back, auto parking, big ass monitor for a display, and a high powered audio system? Is it the logo? How about the design? Design wise, I do not understand as most BMW's, Audi's, Mercedes and the like all look alike. In the past I could say that luxury cars were unique and provided something new, now days? No, because you can find the same functions in a cheaper automobile. I got a lot of features in my Dodge Journey that my sister has in her Camero or my wifes cousins Audi. Nothing special about them other than the possibility it has a more powerful engine.
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    Post  sepheronx Tue Jul 22, 2014 1:02 am

    Gold mining in Transbaikalia in the 1st half of the year increased by almost 40%
    Mining of gold was 1,816 tons , and placer gold - 1,748 tons.
    Gold mining in the Trans-Baikal region in the first six months of 2014 increased by 39% over the same period last year and reached 3,564 tons of gold. These preliminary data reported Thursday ITAR-TASS in the ministry of natural resources and industrial policy in the region.
    The Ministry clarified , that the mining of gold amounted to 1,816 tons , and placer gold - 1,748 tons.
    The bulk of the gold mine in the Transbaikal provide "Aprelkovo" ( included in Nordgold), «Novo-Shirokinskiy Mine" ( included in Highland Gold), LLC " Daura ", LLC " Balci "and others.
    By the end of 2014 Trans-Baikal Territory intends to produce more than 10 tons of gold thanks to the power which opened in September 2013, the mine " Alexander "in the Transbaikal area Mogochinsky , whose potential production capacity is estimated at 1.8 tons of the precious metal.
    In 2013, gold production in the Trans-Baikal region was 9.5 tons.

    Maybe with fear of the inevitable sanctions from the west, the rouble will more than likely drop in value, so in this case, they will have to tie it to something or come out with alternative mints like gold roubles and what not, to help elevate the potential devaluation of the rouble.
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    Post  zino Tue Jul 22, 2014 1:49 am

    Sepheronx wrote: "I like my Dodge Journey far more"
     Shocked Holy crap! That's a FIAT!  Shocked 

    http://www.alvolante.it/prova/fiat_freemont_1_2_0_multijet_140_cv_urban
    Even italian press is loud and clear: it's crap!

     Wink Joking! I need to distract myself from the war..I hope you enjoy your italian SUV in the great Canada.
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    Post  sepheronx Tue Jul 22, 2014 1:55 am

    zino wrote:Sepheronx wrote: "I like my Dodge Journey far more"
     Shocked Holy crap! That's a FIAT!  Shocked 

    http://www.alvolante.it/prova/fiat_freemont_1_2_0_multijet_140_cv_urban
    Even italian press is loud and clear: it's crap!

     Wink Joking! I need to distract myself from the war..I hope you enjoy your italian SUV in the great Canada.

    Actually, it isn't Italian, both are based off of a mitsubishi.  Transmission is mitsubishi, engine though is Dodge.  At least on the Journey.  So far, it is a good vehicle.  took it from Calgary to Nanaimo then to Victoria and then back.  Long drive.  Only complaint is it is a gas guzzler.  Outside of that, it fit 7 people in it without it being classified as a van. I noticed braking has low rating for that fiat, mine stops very smooth and fast compared to my Santa Fe.
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    Post  Hannibal Barca Tue Jul 22, 2014 11:47 am

    I don't know where to post this so I will post it here:



    Can Putin Survive?
    Geopolitical Weekly
    Monday, July 21, 2014 - 16:05 Print Text Size
    Stratfor

    By George Friedman

    There is a general view that Vladimir Putin governs the Russian Federation as a dictator, that he has defeated and intimidated his opponents and that he has marshaled a powerful threat to surrounding countries. This is a reasonable view, but perhaps it should be re-evaluated in the context of recent events.
    Ukraine and the Bid to Reverse Russia's Decline

    Ukraine is, of course, the place to start. The country is vital to Russia as a buffer against the West and as a route for delivering energy to Europe, which is the foundation of the Russian economy. On Jan. 1, Ukraine's president was Viktor Yanukovich, generally regarded as favorably inclined to Russia. Given the complexity of Ukrainian society and politics, it would be unreasonable to say Ukraine under him was merely a Russian puppet. But it is fair to say that under Yanukovich and his supporters, fundamental Russian interests in Ukraine were secure.

    This was extremely important to Putin. Part of the reason Putin had replaced Boris Yeltsin in 2000 was Yeltsin's performance during the Kosovo war. Russia was allied with the Serbs and had not wanted NATO to launch a war against Serbia. Russian wishes were disregarded. The Russian views simply didn't matter to the West. Still, when the air war failed to force Belgrade's capitulation, the Russians negotiated a settlement that allowed U.S. and other NATO troops to enter and administer Kosovo. As part of that settlement, Russian troops were promised a significant part in peacekeeping in Kosovo. But the Russians were never allowed to take up that role, and Yeltsin proved unable to respond to the insult.

    Putin also replaced Yeltsin because of the disastrous state of the Russian economy. Though Russia had always been poor, there was a pervasive sense that it been a force to be reckoned with in international affairs. Under Yeltsin, however, Russia had become even poorer and was now held in contempt in international affairs. Putin had to deal with both issues. He took a long time before moving to recreate Russian power, though he said early on that the fall of the Soviet Union had been the greatest geopolitical disaster of the 20th century. This did not mean he wanted to resurrect the Soviet Union in its failed form, but rather that he wanted Russian power to be taken seriously again, and he wanted to protect and enhance Russian national interests.

    The breaking point came in Ukraine during the Orange Revolution of 2004. Yanukovich was elected president that year under dubious circumstances, but demonstrators forced him to submit to a second election. He lost, and a pro-Western government took office. At that time, Putin accused the CIA and other Western intelligence agencies of having organized the demonstrations. Fairly publicly, this was the point when Putin became convinced that the West intended to destroy the Russian Federation, sending it the way of the Soviet Union. For him, Ukraine's importance to Russia was self-evident. He therefore believed that the CIA organized the demonstration to put Russia in a dangerous position, and that the only reason for this was the overarching desire to cripple or destroy Russia. Following the Kosovo affair, Putin publicly moved from suspicion to hostility to the West.

    The Russians worked from 2004 to 2010 to undo the Orange Revolution. They worked to rebuild the Russian military, focus their intelligence apparatus and use whatever economic influence they had to reshape their relationship with Ukraine. If they couldn't control Ukraine, they did not want it to be controlled by the United States and Europe. This was, of course, not their only international interest, but it was the pivotal one.

    Russia's invasion of Georgia had more to do with Ukraine than it had to do with the Caucasus. At the time, the United States was still bogged down in Iraq and Afghanistan. While Washington had no formal obligation to Georgia, there were close ties and implicit guarantees. The invasion of Georgia was designed to do two things. The first was to show the region that the Russian military, which had been in shambles in 2000, was able to act decisively in 2008. The second was to demonstrate to the region, and particularly to Kiev, that American guarantees, explicit or implicit, had no value. In 2010, Yanukovich was elected president of Ukraine, reversing the Orange Revolution and limiting Western influence in the country.

    Recognizing the rift that was developing with Russia and the general trend against the United States in the region, the Obama administration tried to recreate older models of relationships when Hillary Clinton presented Putin with a "restart" button in 2009. But Washington wanted to restore the relationship in place during what Putin regarded as the "bad old days." He naturally had no interest in such a restart. Instead, he saw the United States as having adopted a defensive posture, and he intended to exploit his advantage.

    One place he did so was in Europe, using EU dependence on Russian energy to grow closer to the Continent, particularly Germany. But his high point came during the Syrian affair, when the Obama administration threatened airstrikes after Damascus used chemical weapons only to back off from its threat. The Russians aggressively opposed Obama's move, proposing a process of negotiations instead. The Russians emerged from the crisis appearing decisive and capable, the United States indecisive and feckless. Russian power accordingly appeared on the rise, and in spite of a weakening economy, this boosted Putin's standing.
    The Tide Turns Against Putin

    Events in Ukraine this year, by contrast, have proved devastating to Putin. In January, Russia dominated Ukraine. By February, Yanukovich had fled the country and a pro-Western government had taken power. The general uprising against Kiev that Putin had been expecting in eastern Ukraine after Yanukovich's ouster never happened. Meanwhile, the Kiev government, with Western advisers, implanted itself more firmly. By July, the Russians controlled only small parts of Ukraine. These included Crimea, where the Russians had always held overwhelming military force by virtue of treaty, and a triangle of territory from Donetsk to Luhansk to Severodonetsk, where a small number of insurgents apparently supported by Russian special operations forces controlled a dozen or so towns.

    If no Ukrainian uprising occurred, Putin's strategy was to allow the government in Kiev to unravel of its own accord and to split the United States from Europe by exploiting Russia's strong trade and energy ties with the Continent. And this is where the crash of the Malaysia Airlines jet is crucial. If it turns out -- as appears to be the case -- that Russia supplied air defense systems to the separatists and sent crews to man them (since operating those systems requires extensive training), Russia could be held responsible for shooting down the plane. And this means Moscow's ability to divide the Europeans from the Americans would decline. Putin then moves from being an effective, sophisticated ruler who ruthlessly uses power to being a dangerous incompetent supporting a hopeless insurrection with wholly inappropriate weapons. And the West, no matter how opposed some countries might be to a split with Putin, must come to grips with how effective and rational he really is.

    Meanwhile, Putin must consider the fate of his predecessors. Nikita Khrushchev returned from vacation in October 1964 to find himself replaced by his protege, Leonid Brezhnev, and facing charges of, among other things, "harebrained scheming." Khrushchev had recently been humiliated in the Cuban missile crisis. This plus his failure to move the economy forward after about a decade in power saw his closest colleagues "retire" him. A massive setback in foreign affairs and economic failures had resulted in an apparently unassailable figure being deposed.

    Russia's economic situation is nowhere near as catastrophic as it was under Khrushchev or Yeltsin, but it has deteriorated substantially recently, and perhaps more important, has failed to meet expectations. After recovering from the 2008 crisis, Russia has seen several years of declining gross domestic product growth rates, and its central bank is forecasting zero growth this year. Given current pressures, we would guess the Russian economy will slide into recession sometime in 2014. The debt levels of regional governments have doubled in the past four years, and several regions are close to bankruptcy. Moreover, some metals and mining firms are facing bankruptcy. The Ukrainian crisis has made things worse. Capital flight from Russia in the first six months stood at $76 billion, compared to $63 billion for all of 2013. Foreign direct investment fell 50 percent in the first half of 2014 compared to the same period in 2013. And all this happened in spite of oil prices remaining higher than $100 per barrel.

    Putin's popularity at home soared after the successful Sochi Winter Olympics and after the Western media made him look like the aggressor in Crimea. He has, after all, built his reputation on being tough and aggressive. But as the reality of the situation in Ukraine becomes more obvious, the great victory will be seen as covering a retreat coming at a time of serious economic problems. For many leaders, the events in Ukraine would not represent such an immense challenge. But Putin has built his image on a tough foreign policy, and the economy meant his ratings were not very high before Ukraine.
    Imagining Russia After Putin

    In the sort of regime that Putin has helped craft, the democratic process may not be the key to understanding what will happen next. Putin has restored Soviet elements to the structure of the government, even using the term "Politburo" for his inner Cabinets. These are all men of his choosing, of course, and so one might assume they would be loyal to him. But in the Soviet-style Politburo, close colleagues were frequently the most feared.

    The Politburo model is designed for a leader to build coalitions among factions. Putin has been very good at doing that, but then he has been very successful at all the things he has done until now. His ability to hold things together declines as trust in his abilities declines and various factions concerned about the consequences of remaining closely tied to a failing leader start to maneuver. Like Khrushchev, who was failing in economic and foreign policy, Putin could have his colleagues remove him.

    It is difficult to know how a succession crisis would play out, given that the constitutional process of succession exists alongside the informal government Putin has created. From a democratic standpoint, Defense Minister Sergei Shoigu and Moscow Mayor Sergei Sobyanin are as popular as Putin is, and I suspect they both will become more popular in time. In a Soviet-style struggle, Chief of Staff Sergei Ivanov and Security Council Chief Nicolai Patryushev would be possible contenders. But there are others. Who, after all, expected the emergence of Mikhail Gorbachev?

    Ultimately, politicians who miscalculate and mismanage tend not to survive. Putin miscalculated in Ukraine, failing to anticipate the fall of an ally, failing to respond effectively and then stumbling badly in trying to recoup. His management of the economy has not been exemplary of late either, to say the least. He has colleagues who believe they could do a better job, and now there are important people in Europe who would be glad to see him go. He must reverse this tide rapidly, or he may be replaced.

    Putin is far from finished. But he has governed for 14 years counting the time Dmitri Medvedev was officially in charge, and that is a long time. He may well regain his footing, but as things stand at the moment, I would expect quiet thoughts to be stirring in his colleagues' minds. Putin himself must be re-examining his options daily. Retreating in the face of the West and accepting the status quo in Ukraine would be difficult, given that the Kosovo issue that helped propel him to power and given what he has said about Ukraine over the years. But the current situation cannot sustain itself. The wild card in this situation is that if Putin finds himself in serious political trouble, he might become more rather than less aggressive. Whether Putin is in real trouble is not something I can be certain of, but too many things have gone wrong for him lately for me not to consider the possibility. And as in any political crisis, more and more extreme options are contemplated if the situation deteriorates.

    Those who think that Putin is both the most repressive and aggressive Russian leader imaginable should bear in mind that this is far from the case. Lenin, for example, was fearsome. But Stalin was much worse. There may similarly come a time when the world looks at the Putin era as a time of liberality. For if the struggle by Putin to survive, and by his challengers to displace him, becomes more intense, the willingness of all to become more brutal might well increase.

    Read more: Can Putin Survive? | Stratfor
    Follow us: @stratfor on Twitter | Stratfor on Facebook



    Start to become evident that Zionists losing big time, probably collapsing, and they are desperate to change something immediately.
    GarryB
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    Post  GarryB Tue Jul 22, 2014 12:48 pm

    Putin is far from finished. But he has governed for 14 years counting the time Dmitri Medvedev was officially in charge, and that is a long time.

    Hahahaha... why not claim he has governed for 100 years... surely it was putin that was in control rather than the Tsars and then Lenin and then of course Stalin etc etc...  Rolling Eyes 

    Those who think that Putin is both the most repressive and aggressive Russian leader imaginable should bear in mind that this is far from the case.

    Hahaha... that is the image of Putin the west tries to project to western audiences, if he really was aggressive then Iran would have serious Russian SAMs and Syria would have Russian special forces assistance and lots of new Russian toys to play with.

    Aggressive is what the US is... sending direct military "aide" and troops on the ground at the drop of a hat. Aggressive is threatening sanctions when countries next door to the countries you are interested in don't do as you tell them even though you have no right to tell them how to behave in the first place.

    The international findings on this aircrash have already been determined by western media and it will take strong evidence to the contrary to slowly leak out in 6 months time or later to change anything. It is the same as it was with the Georgian invasion of South Ossetia... which today is still called the Russian invasion of Georgia..

    Perhaps Putin should become the aggressive repressive person the west paints him as and actually send real weapons to the Ukraine... and perhaps impose a unilateral no fly zone the way the US certainly would.
    sepheronx
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    Post  sepheronx Tue Jul 22, 2014 2:31 pm

    Putin does not have anything to do with the debt ridden provinces or the failing of some metal and mining companies. But what he should do is sell off the state run companies that are failing and let someone else take control of it. The regions with high debt? Well, their reserves are in the billions, so why not ease their debt burden by paying part of it off for each of them? Problem is, the economy is too centralized and thus they do not have the investments needed. Moscow can take care of itself. They need the money eastwards. As for southern parts like Chechnya, well, the gravy train should come to an end.

    Whatever Putin does, that is anything besides licking the boots of west, they will continue to throw sanctions at Russia. Capital flight sucks, but besides freezing these oligarches funds, they cant do much.  Maybe persecute people.

    As well, who do they owe the debt to? IMF or world bank? They can sanction those two agencies amd dont have to pay it back, watch as the economies of west crumble. Russia at this point does not have to play fair, like US. Or Russia over inflates virtually the value of the Ruble and just pays back what they deem necessary like UK does.
    magnumcromagnon
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    Post  magnumcromagnon Tue Jul 22, 2014 2:42 pm

    sepheronx wrote:Putin does not have anything to do with the debt ridden provinces or the failing of some metal and mining companies. But what he should do is sell off the state run companies that are failing and let someone else take control of it. The regions with high debt? Well, their reserves are in the billions, so why not ease their debt burden by paying part of it off for each of them? Problem is, the economy is too centralized and thus they do not have the investments needed. Moscow can take care of itself. They need the money eastwards. As for southern parts like Chechnya, well, the gravy train should come to an end.

    Whatever Putin does, that is anything besides licking the boots of west, they will continue to throw sanctions at Russia. Capital flight sucks, but besides freezing these oligarches funds, they cant do much.  Maybe persecute people.

    As well, who do they owe the debt to? IMF or world bank? They can sanction those two agencies amd dont have to pay it back, watch as the economies of west crumble. Russia at this point does not have to play fair, like US. Or Russia over inflates virtually the value of the Ruble and just pays back what they deem necessary like UK does.

    The Glazyev Plan is the way to go!
    sepheronx
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    Post  sepheronx Tue Jul 22, 2014 3:07 pm

    magnumcromagnon wrote:
    sepheronx wrote:Putin does not have anything to do with the debt ridden provinces or the failing of some metal and mining companies. But what he should do is sell off the state run companies that are failing and let someone else take control of it. The regions with high debt? Well, their reserves are in the billions, so why not ease their debt burden by paying part of it off for each of them? Problem is, the economy is too centralized and thus they do not have the investments needed. Moscow can take care of itself. They need the money eastwards. As for southern parts like Chechnya, well, the gravy train should come to an end.

    Whatever Putin does, that is anything besides licking the boots of west, they will continue to throw sanctions at Russia. Capital flight sucks, but besides freezing these oligarches funds, they cant do much.  Maybe persecute people.

    As well, who do they owe the debt to? IMF or world bank? They can sanction those two agencies amd dont have to pay it back, watch as the economies of west crumble. Russia at this point does not have to play fair, like US. Or Russia over inflates virtually the value of the Ruble and just pays back what they deem necessary like UK does.

    The Glazyev Plan is the way to go!

    Agreed. And it seems they are interested in it. Limit exposure of foreign funds, and only accept investments from cointries interested to work with Russia, like China, Brazil, India, etc. As well, massive infrastructure development in central Russia, Siberia to be exact. That is where the mobey lies. Siberia is full of riches in resources and huge potential for energy sector and agriculture with newer greenhouses. Biggest drawback is central ban, which uses foreign funds to obtain long term, low interest loans. Nationalize the bank. All other banks which have large assets like Gazprombank or Sberbank, should give their own interest and loan rates, but at least have a small minimum average loan rate through CB. This can be done. Rosneft funds itself now, do they have a bank? Since Rosneft and gazprom are gov assets, they should create a joint bank through their assets before privatization.

    In terms of isolation (in this case, Russias isolation would only revert to western world), they can become self reliant. How they can benefit from it is the fact they have the resources. Only other thing is to look at energy sector and try to diversify that and cut costs at same time. Possibly by creating more hydroplants, nuclear power plants, coal slushy plants and windfarms/solar plants so that they can build up a reserve of energy. Build more lines. More roads, like a trans Russian roadway that will lead east west (i know they have it already, but expand the highway and modernize it) and then lead to Kazakhstan, Mongolia, China etc. This will improve econony big time.

    Only problem is the cost of all of this. If it was not too centralized, cost would be lower. But because it is, much more further from Moscow it is to Vladovostok. Only a few major markets inbetween.

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