Ukraine

A quick round-up of initial thoughts

I did not use the term ‘Dark Times’ lightly in my update yesterday, all indicators were on red and Putin’s full invasion of Ukraine is a fact. No long analysis, but some quick takes:

• Putin’s unhinged. It’s him and his core supporters, not Russia. We have been warned for a long time that this was coming, but the world appeased and thought it would be fine. Remember George Bush after meeting Putin ‘I looked into his soul’ ? Right.

• All indications are it will be a brutal conflict: death, destruction, refugees, immense suffering. For nothing.

• So the response is: real sanctions, cripple the regime, no exceptions. It will not be easy: the Italians want an exception to sell luxury goods, Germany wants to be careful in blocking payments (lot of talk about cutting Russia off from SWIFT this morning) and the Dutch basketball team will still play its game in Russia tonight … etc. etc. Unity will be hard to find.

• And: fully arm and support Ukraine, to the fullest, wherever we can. At the same time also fully roll out plans for refugees, medical care etc.

• The real game changer will have to come from within Russia. No one there wants or needs this war. If it is going to be a protracted and costly adventure for Russia the time will come to start to undermine and remove Putin. No warmongering dictator has ever retired peacefully.

• Next is to think why we should be so resolute and that is simple. The West has been weak (Iraq, Afghanistan, Hong Kong and now divided over Covid, climate etc). The authoritarians are taking full advantage of this ‘looking inward’ attitude. Wait for China and Iran to make their move, that is the danger that can destabilize the entire world. Think Taiwan, Israel, Lebanon and other unwanted adventures.

• Politics domestically will re-align. Biden’s popularity was tanking, same for Johnson, Trudeau and Macron, everybody really. That may change if they play their cards right. History is being made right now and all of them know it.

• Asset Prices: big changes. Natural resources will be in demand, notably oil & gold up, tech is wobbly. The Covid fueled stock market boom is over and this will spill into private markets. Housing prices (in particular in US & Canada) will continue to rise, Europe and Asia are increasingly not great places to be. We saw this coming in 1999 when we picked Canada, but could never have predicted that it would be Putin in 2022 who would realize our fears.

Finally: think of all those people in Ukraine in particular those that lived through WWII and Communism. They should never have to live through another war. Ukraine was starved in the 1930s, almost destroyed by Nazi Germany and then under Soviet rule until the early 90s. They deserve more than just a 30-year break from war and terror.

That’s it for now. I will try and get back to more frequent updates.