The Russian economy (catch all)

[OUTLAW 09]

Firn,

Thanks for the graphs. I don't the West is the target of the purpose of the Russian sanctions. The target remains Moscow's domestic audience to demonstrate the country's resolve in facing down the U.S. The people will be called to sacrifice for their patriotic duty.

As to the effectiveness of U.S. sanctions, I came across Economic Sanctions Reconsidered by Hufbauer, Schoot, and Elliot. In their analysis of sanctions, they cite Leyton-Brown in stating that "compellant purposes of sanctions are the most difficult to achieve..." based upon the ineffectiveness of sanctions to change the foreign policies of Cuba, Iraq, and North Korea. And they assessed that the overall effectiveness of sanctions (regardless of purpose; i.e. coercion, signalling, etc) is about 34% (as of 2007). The success rate for coercive sactions is 30%.

The countries of Cuba, Iraq and NK have never been as tied into the globalized world as is Russia---noticed you did not mention Iran and the effectiveness against them which has virtually closed down their internal economy.

The sanctions have been far more successful than many had anticipated and actually have worked quicker than many thought possible---Russia plays a shell game ie Ponzi scheme in a number of their state owned businesses and have been living deeply on 90 day lines of credit and or financed major projects off of USD bond debts which will come due next year to the tune of 45B USD and now cut off from the international banking world damages their internal economy to an extent they themselves never calculated. Those companies hit by sanctions are now starting to ask for government assistance.

This year VTB has to pay 14B USD on a debt line that is due.

The food sanctions that Putin wanted to damage the west with will in fact damage his own economy as prices have raised 45% just in the last two days regardless of how his propaganda spins it---which is to protect their own manufacturing base for food.

Watch what happens to Russia oil and gas earnings if the Ukraine via their own sanctions stops all transit of oil and gas to the west--right now the west is sitting on solid gas storage amounts and oil is easily replaced from other sources---but the loss of even three months of earnings will hurt especially if they take the transit stoppage up to say December.

Right now watch the steady eroding of the world price of sour oil which is what Russia exports---several leading oil experts have been startled by the over supply of sour and the low demand which has the rates now at around 95-98n USD and is going lower---they are predicting a potential lowering to around 90 USD and even breaking under 90 and if that happens then the price will go lower.

Russia has often stated they need a minimum of 85 USD in order to finance they national budget and had raised that to 89 USD so if it breaks lower they are in serious trouble