The War in Ukraine

[SalesServiceGuy]

Sanctions have sharply raised chance of a Russian default, JPMorgan warns


Russia’s stock market remains shut down. The ruble is worth less than a penny. And Western businesses are fleeing. JPMorgan warns a Russian default could be next.

“Sanctions imposed on Russia have significantly increased the likelihood of a Russia government hard currency bond default,” JPMorgan emerging markets strategists wrote in a note to clients on Wednesday.

It’s not necessarily that Russia doesn’t have the cash to make its debt payments. The Central Bank of Russia lists a staggering $643 billion of international reserves.

However, JPMorgan said sanctions leveled by the United States on Russian government entities, countermeasures within Russia to restrict foreign payments and the disruption of payment chains “present high hurdles for Russia to make a bond payment abroad.”

For instance, sanctions on Russia’s central bank and the exclusion of some banks from SWIFT, the high-security network banks used to communicate, will impact Russia’s ability to access foreign currency to pay down debt, according to Capital Economics. That includes Russia’s stockpile of reserves as well as cash from export revenue.

Russia has more than $700 million in payments coming due in March, mostly with a 30-day grace period, according to JPMorgan.

Some believe the Kremlin could be setting the stage for an intentional default to punish the United States and Europe for crushing its economy.

“Putin is 100% going to default,” hedge fund manager Kyle Bass told CNN in a phone interview on Wednesday. “The West is strangling him. Why would he agree to pay the West interest right now?”

Capital Economics noted that Russian authorities have already prohibited the transfer of coupon payments on local currency sovereign debt to foreigners, underscoring the point that authorities are “acting with scant regard for foreigners’ holdings of Russian assets.”

“Russia could use default as a way of retaliating against Western sanctions to inflict losses on foreign lenders. It’s not far-fetched to think that the Russian authorities could ban foreign debt repayments,” Capital Economics wrote.

Russia, currently the 12th largest economy in the world, last defaulted on its debt in 1998, setting off a crisis that spread overseas.

[SalesServiceGuy]

Bank of Canada hikes key interest rate to 0.5%

More small rate hikes expected as central bank tries to rein in inflation

The Bank of Canada raised its benchmark interest rate to 0.5 per cent on Wednesday, a move that's expected to be the first of a series of small rate hikes this year in an attempt to tame inflation that has risen to its highest point in decades.
It's the first time the bank has raised its rate since 2018. Before the pandemic, the bank's rate was 1.75 per cent, before it quickly slashed the rate down to 0.25 per cent to help the economy.
The Bank of Canada's rate affects the rates that Canadian consumers get on things like mortgages, lines of credit and savings accounts at their own banks.
While the bank has been telegraphing its plans to raise its rate to fight inflation for a while now, the bank acknowledged in its announcement Wednesday that inflation is heating up even faster than anticipated.


War in Ukraine a factor

The Bank of Canada cited the ongoing invasion of Ukraine as yet another factor that could influence inflation, or other parts of Canada's economy.

Among other things, Russia's unprovoked attack on its neighbour has caused the price of commodities like fertilizer, natural gas and oil to skyrocket, as the country is a major producer of these items.

[SalesServiceGuy]

White House reiterates sanctions on Russian oil and gas "not something we're prepared to do right now"


US President Joe Biden's senior adviser Cedric Richmond reiterated Wednesday that “everything is on the table,” including sanctions targeting Russia’s oil industry, while acknowledging “it’s not something we’re prepared to do right now.”

“When you talk about oil, you talk about increasing pain here at home for Americans and raising the price of gas and everyday expenses,” Richmond told CNN’s Ana Cabrera in an interview. “It's something we're definitely looking at; it is not something we're prepared to do right now. But I think the President was very clear when he said everything is on the table and he's not prepared to take anything off the table.”

Richmond took the opportunity to highlight the administration’s climate proposals, which he said “would lower energy prices for the average American family by $500 a month,” pointing to provisions in Biden’s Build Back Better legislation that he suggested would “lower Americans’ everyday costs.”

[BillyCarpenter]

The thing that sticks out the most is your almost guarantee that inflation would be "temporary." Obviously you were wrong. Obviously, you'll never admit it.

The second thing that sticks out is that all these sanctions could paint Putin in a corner and escalate to a World War.

[slimslob]

Lack of fuel and food hinders Russian advance on Kyiv, Pentagon says - Washington Times

[slimslob]

The Ukraine invasion is the first social media war - The Spectator World

[SalesServiceGuy]

KYIV ASSAULT - UKRAINE JAVELIN vs T-72 SIMULATION

KYIV ASSAULT - UKRAINE JAVELIN vs T-72 SIMULATION - YouTube

[BillyCarpenter]

Liberals have historically been weak on national defense. Always wanting to cut funding for the military and divert said monies to some social program.

About the only good thing that may come from the war on Ukraine is that liberals across the world are now willing to invest in national defense.

Make no mistake. Biden is weak. His weak actions in Afghanistan resulted in 13 dead marines and emboldened Pution to invade Ukraine. If not for the Biden blunders in Afghanistan, I don't believe Putin invades.


We also have a rising problem in China. Biden and democrats in general are in bed with China. They will be silent on this:

China on Wednesday said it would not consider sanctioning Russia for its illegal invasion of Ukraine and said it will continue with "normal trade cooperation."


And China abstained during a United Nations General Assembly vote Wednesday on a nonbinding resolution calling on Russia to halt its war on Ukraine and withdraw its military forces. Just five nations opposed the resolution – Russia, Belarus, Eritrea, North Korea and Syria – which passed with 141 aye votes.


Russian President Vladimir Putin ordered a "special military operation" last week, and Ukraine has endured seven days of brutal fighting that has resulted in the death of roughly 2,000 Ukrainians and 5,000 Russian soldiers, according to Ukraine's State Emergency Service.

In response to the deadly invasion the U.S., Canada, Japan, Australia, New Zealand and dozens of European nations slapped severe sanctions on Russian banks, businesses, Putin and other elite members of Russia's government and society.
But despite its repeated claims that it respects a state’s sovereignty, China has refused to outright condemn Russian aggression or institute sanctions.


"China firmly opposes all illegal unilateral sanctions, and believes that sanctions are never fundamentally effective means to solve problems," spokesman for China’s Foreign Ministry Wang Webin said Wednesday. "They will only create serious difficulties to the economy and livelihood of relevant countries and further intensify division and confrontation."

Don't hold your breath waiting on Biden and Trudeau to stand up to the Chinese.

[slimslob]

Ukraine says kill squad sent to assassinate president has been 'destroyed' - TheBlaze

[copier addict]

Liberals have historically been weak on national defense. Always wanting to cut funding for the military and divert said monies to some social program.

Really?? It sure doesn't look that way.


The national defense budget request crafted during Trump's final year in office was for $752.9 billion. Congress then increased that number by $25 billion, ultimately landing at $778 billion for fiscal 2022