The newest sanctions on Russian energy are nothing less than a paradigm change: For the first time, the goal is to cut Russian export volumes. Before, the goal was to make oil exports less profitable for Russia, but to keep the volumes intact. The US did not just target any export volume, but made sure to hit Russia's most profitable export routes the hardest: Oil from Russia's Pacific ports had a small discount and low shipping costs, making it much more profitable then exports from the Baltic/Black Sea to India.

Great text: Bitcoin is a fascinating Ponzi-like / pyramid scheme. More and more people jump on the bandwagon, hoping to profit. Early adopters get rich. Late adopters now hope that governments will create "reserves", i.e. join the Ponzi scheme, to keep the party going...

https://twitter.com/jp_koning/status/1870107164913873231

Bitcoin doesn't appear to be a Ponzi scheme - because there is no Ponzi! The system is decentralized. In the early years of Bitcoin, there was a lot of talk of possible use cases of Bitcoin. That has almost disappeared, now it is just the hope of the value going up up up.

A few notes on Sam Charap's latest article: Charap and I have a fundamentally different views of Russia, Putin's interests and goals, and the history of the war in Ukraine. I still like to check where exactly the disagreements materialize in the arguments and the conclusions. It is not difficult to find interpretations in the text that I violently disagree with: For example: that the Istanbul negotiations were anywhere close to ending the war. The re-framing of the process as "almost successful" initally began in conspirational corners of the debate.

I really recommend this new report on #Russia's economy from CASE Center. The authors argue that the economy is much more resilient than commonly assumed. The conclusions are a bit too fatalistic in my view, but it is definitely worth reading. case-center.org/wp-content/upl… The authors explain why - in their view - a lot of the earlier predictions for Russia's economy have not come true. It is not just an analysis "in hindsight": Already in March 2022, Dmitry Nekrasov wrote a forecast for Russia's economy that turned out to be very accurate.

More Russian voices push back against the idea of a ceasefire in Ukraine. Not surprisingly, Russia has zero interest in ending the war before it has defeated Ukraine. Apparently, ceasefires only existed in some Western dreams.

https://twitter.com/francis_scarr/status/1854552763549499472

Similarly, Trenin says Russia is first and foremost interested in "the character of Ukraine's future regime and military potential".
kommersant.ru/doc/7283219

Es gibt keinerlei Anzeichen dafür, dass es in der Ukraine in absehbarer Zeit Frieden geben könnte. Dass hierzulande so viel darüber gesprochen wird, zeigt nur den Realitätsverlust und Anmaßung der deutschen Debatte. Wir können den Krieg nicht von oben "befrieden". Wir können den Ausgang das Krieges nur durch unsere Ukraine-Unterstützung beeinflussen (und ein stückweit über Sanktionen). Wir können aber nichts dirigieren oder erzwingen, und auch der globale Süden wird uns nicht aushelfen (wollen oder können).

For the past two years, it often seemed like sanctions could not hurt Russia. The Russian economy was on a massive sugar high, fueled by booming energy markets. But now things are changing. Russia's struggling coal industry is the best example. After two crazy years, world market prices for coal have returned to something closer to normal. Suddenly it turns out that Russian coal can no longer break even at these more normal market prices. What happened? tradingeconomics.com/commodity/coal

The average regional signing bonus for Russian soldiers is 596k rubles, it more than tripled from the beginning of the year. The average total bonus increased from 363k to 996k. But can the increase change people's minds about fighting in Ukraine?

storage.googleapis.com/istories/stori…
When you enlist in the Russian military, your family can expect three different types of payments over the course of your (often literally short-lived) career:
- Signing bonus
- Monthly pay
- Compensation for death/injury.

How do sanctions affect the war in Ukraine? The simplistic explanation that "Russia is running out of money" is not wrong, but it is also not quite right. To understand the impact of sanctions, it helps to think of Russia's trade with the outside world as a big machine. 1/5 On one side of this machine, Russia puts in oil, metals, grain etc, and on the other side, this machine puts out computer chips, cars, and machinery. Sanctions sabotage this "trade machine" in many ways. As a result, Russia has to put in more barrels of oil to make it work. 2/5

Russia apparently cannot find enough men for its military. Today Putin doubled the federal signing bonus from 195,000 to 400,000 rubles. The regions are supposed to add at least 400,000. Many regions pay much more. 1/4
kommersant.ru/doc/6864822?fr…
In some places, the total signing bonus will buy you an apartment. Signing bonuses make up a significant part of the budget: Russia claims it mobilizes 100k soldiers in 3-4 months. If we assume total bonus is 1 mio, this is 400 billion rubles (4.5 billion dollars) per year. 2/4

When Russia started its full-scale invasion, it had three major resources:
1.) Huge stocks of old weapons
2.) Poor & unemployed men
3.) Super solid finances
This has allowed Putin to fight a big war while keeping most Russians in their comfort zone: Lots of guns AND butter. 1/5

https://twitter.com/verekerrichard1/status/1814284243465368063

All three are not limitless, and the economic consequence of that is inflation. Inflation is the result of urgently ramping up military production, pulling men from the labor market and sending them to the front, and from weakening trade and fiscal balances. 2/5

The West needs to rethink sanctions and move from ad hoc measures to long-term economic containment. Russia will remain a threat to Europe for many years to come. The future of European security depends on the future of Russian economic might. 1/
brookings.edu/wp-content/upl…
After two years of unprecedented sanctions, the Russian economy has exceeded expectations. Yes, sanctions have had a clear impact, but they leave Putin with enough resources to militarize Russia in the coming years and turn it into a conventional military threat to Europe. 2/

Ein sehr gutes und wichtiges Gespräch zum Thema "Verhandlungen und Einfrieren" von @AliceBota und @MichaelOThumann. Es geht um die alten Mythen der Russlandpolitik, die gerade durch Wagenknecht und Mützenich eine Renaissance erleben, aber auch um die Verhandlungen von 2022. 1/6 Der Text von Charap&Radchenko ist dabei ebenfalls Thema. Michael Thumann berichtet von seinen Gesprächen mit Unterhändlern in Istanbul. Alice Bota beobachtet gut, dass alle russischen Äußerungen von den Autoren des Textes (geradezu ahistorisch) für bare Münze genommen werden. 2/6

The key problem I have with this piece is the assumption that Putin agreed to, or even cared much for, the Istanbul Communique at the time. The authors seem to have their own doubts (Putin agreed to debate the status of Crimea with Ukraine?).
1/4

foreignaffairs.com/ukraine/talks-… The authors fail to point out that Putin didn't appear to be deeply involved in the process at the time and only began bringing up the supposed "almost deal" much later, with the rather obvious intention to discredit the West and improve his image with the Global South. 2/4

Although it will take many more attacks on refineries to create a real gasoline shortage in Russia (and even then, Belarus has available capacities), it is an effective strategy for many reasons:
1.) A gasoline shortage would be a political nightmare for Putin, because it would..

https://twitter.com/jakluge/status/1767814255573684253

.. be felt and discussed by everyone. Gasoline prices are political, even in Russia. Average Russians are not willing to pay a price for the war.
2.) Refineries are important for the military. Of course the military will not feel shortages, but refineries are legitimate targets.

Why won't the Kremlin agree to a compromise in Ukraine? The answer lies in Putin's motives. Initially, it may have been imperialism and a desire to control Ukraine. That was bad enough, and difficult enough to stop. But after the full-scale invasion began, the motives changed. The reason is that the Ukrainian military exposed the weakness of Putin's regime. Russia was humiliated on the world stage. Since then, it is not about domination: Putin needs to destroy Ukraine and humiliate the West because they openly challenged him and exposed his weakness.

There are two dominant arguments in the Western discourse on Russia's war against Ukraine:
1.) Russia is weaker than it seems, the war and Putinism will go away once Ukraine kicks Russia out.
2.) Russia is stronger than it seems, so some kind of deal with Russia is necessary. It is difficult to go beyond these lines of thought: If you point out Russian strength, there's an automatic suspicion that you want to porpose a deal with Russia, or that you're not loyal to the Ukrainian cause.

What are the effects of #sanctions on the opinions of Russians about the West and the war? There is a naïve pro-sanctions view: Sanctions lead to economic hardship which is then attributed to the war and leads to anti-war sentiment. This is certainly not happening. 1/ There is also a naïve anti-sanctions view: Sanctions lead to economic hardship, which is attributed to the West's hostility and leads to a "rally-round-the-flag" effect and stronger support for Putin. This is also not happening. 2/

Can Vladimir Putin drag the world into the abyss of West-China escalation? Maybe. The secret to Putin's long-term survival in power is his skill in taking everybody hostage. He excels in creating settings in which you go down if he goes down, if you like him or hate him. 1/ He did it in Russia, in Russia's neighbourhood, with many in the West, and he is of course also trying to do it with Xi Jinping. Putin's tactic should not be confused with actual "madman" behaviour. Putin will not choose nuclear armageddon. It is calculated and rational. 2/

Great thread by @AlexGabuev, the best source on everything related to Russia-China! The way the use of the yuan has increased in #Russia over the last year really is remarkable. I still wonder how far it can grow from here, and if it is a local or a global phenomenon. 1/

https://twitter.com/AlexGabuev/status/1636074487807463424

Let's look at what the yuan can and cannot offer to Russia.

1.) Yuan is a store of value with low sanctions risk. Yuan has become the most important element in Russian foreign exchange reserves. Russia does not have any alternative if it wants to implement its budget rule. 2/

How are Russians sending money abroad? Raiffeisen has become the most important channel. On OhMySwift.ru, Russians are reporting about their experiences with wire transfers abroad (~4700 datasets), the picture is pretty clear. Here are recent transfers to Germany: 1/ You can also order entries by bank, which is conclusive in the case of recently sanctioned Tinkoff: It stopped working, except for one yuan transfer to Hongkong. 2/