The apparent relapse into a new Cold War between Russia and the Western nations over the annexation of Crimea by Moscow  will almost certainly have grave repercussions for the global economy. Starting with Russia, the tensions with Ukraine and her Western allies have resulted in economic sanctions, with more threatened. The World Bank has just released a report, suggesting that increased sanctions could result in capital outflows from Russia of $ 133 billion for 2014, with GDP contraction of 1.8 percent, resulting in a recession.

The tit-for-tat sanctions and increased tensions will also hammer Western economies, however. Europe is highly dependent on Russian-supplied oil and natural gas, Furthermore, the already fragile Eurozone will also be hurt by sanctions, either imposed  on Russia or by Russia. The politicians of the world it would seem are not satisfied with all their past blunders-they now want to start a new global crisis, which among other things, will likely exacerbate the still ongoing global economic crisis.

If Hillary Clinton runs for President of the United States  in 2016, see the video about the book that warned back in 2008 what a second Clinton presidency would mean for the USA:

Hillary Clinton Nude

Go to YouTubePlay video Chilling video about Hillary Clinton and the 2016 presidential election from the author of the provocative book, “Hillary Clinton Nude: Naked Ambition, Hillary Clinton And America’s Demise.”

HILLARY CLINTON NUDE

For the past fourteen years, Vladimir Putin has been at the center of Russian power politics, either as president or prime minister. When he succeeded his predecessor, Boris Yeltsin, Russia was economically in freefall, and on the verge of permanent anarchy in the wake of the chaotic dissolution of the Soviet Union. Mr. Putin brought stability to Russia, and to some extent has rebuilt the nation’s economy. However, there has been a darker side to Putin’s governance of the Russian federation. Political pluralism in Russia has been increasingly marginalized, and a raw edge to Moscow’s foreign policy has been in evidence, witnessed most deploringly by Putin’s indispensible support for the barbarous war Syria’s discredited president, Basher Assad, has been waging against his own people. All that, however, pales in comparison with what is now unfolding in Ukraine, which unless wisdom soon prevails, may spark a renewal of the Cold War.

It has been said by diplomats and foreign leaders who have met Putin that he harbors designs of rebuilding the territorial continuity that existed within the former Soviet Union. Ukraine was not only an integral part of the U.S.S.R., but for hundreds of years was the indispensible bread basket of the Russian Empire. Putin’s decision to intervene militarily  in the internal political phenomena unfolding in the sovereign Ukrainian nation arouses grave concern that Putin may be willing to risk global instability and possibly worse for the sake of forcing Ukraine to come again under Russian domination, either overtly or in more subtle forms. If that is Mr. Putin’s intention regarding Ukraine, he would be wise to learn from a previous Russian ruler, one far more ruthless and calculating than President Putin will ever be.

Joseph Stalin ruled the Soviet Union as dictator for nearly three decades with an iron grip. He was frequently ruthless, and merciless in purging his enemies. Yet, at times, he could display a surprising ability to learn from his mistakes and exercise restraint and wisdom in dealing with issues that touched on core Russian national interests.

When World War II broke out, Russia was in its early phases a neutral country, having signed a non-aggression pact with Nazi Germany. Stalin saw the distraction created by a new global war as an opportunity to recover territories that had formerly been part of the Russian Empire, but had slipped away after the Russian revolution of 1917. Making aggressive use of his military, Stalin seized part of Poland and Romania, and at gunpoint brought the three Baltic republics back under Russian control. There then remained Finland, another former part of the Russian Empire that became an independent nation after the Russian revolution. Convinced his massive army could easily overcome a country of only four million, Stalin launched an unprovoked attack on Finland. His official justification bares comparison to contemporary claims made by Putin to justify his interference in the Ukraine; an exiled Finnish communist was permitted to form a “government” on Russian soil, which Moscow promptly recognized as the legitimate government of Finland. That same rump regime then “requested” that Stalin “liberate” the suffering people of Finland, and restore them to the Soviet motherland.

The cynical political maneuver by Stalin could not cope, however, with the patriotism of the Finnish people, who tenaciously resisted the Russian invasion. In the early months of the war that followed Russia’s invasion, the tiny Finnish army inflicted a humiliating defeat on the much larger Soviet army. It was only after accumulating hundreds of thousands of casualties that Stalin’s army slowly began to penetrate Finnish defenses.

A treaty was signed, requiring Finland to surrender substantial territory to the Soviet Union. This left a deep feeling of bitterness and hatred towards Russia. When Nazi Germany broke its non-aggression pact and invaded Russia in 1941, Finland had the distinction of being the only democracy to ally itself with Hitler, hoping to reclaim its lost territories.

At an unimaginable human cost, the Russians eventually repelled the German invasion. As a German defeat became inevitable, the Soviets were in a position to conquer Finland or impose a communist government, as they were to do in Eastern Europe. However, based on the costly lesson he had learned earlier, Stalin chose a different track. He granted Finland a peace treaty with surprisingly lenient terms. The Finns did have to return to the original border that existed before the German invasion of Russia, and pay an indemnity. However, Finland was permitted to remain a free, sovereign nation, with the political and economic system determined by its own people, without interference from Moscow. The only requirement Stalin imposed on Finland was that the country adopt a neutral foreign policy, and not join any military alliance hostile to Russia.

The policy Stalin enacted towards Finland, which came to be known as Finlandization, served Russia’s supreme national interests well for decades, while preserving Finland as a sovereign, democratic country with an economy characterized by a strong private sector.

As Vladimir Putin ponders his next move in the potentially calamitous crisis over Ukraine’s political evolution, he would render a great service to his own country and world peace if he were to reflect on a costly lesson, well learned, by Russia’s greatest and most ruthless Tsar.

If Hillary Clinton runs for President of the United States  in 2016, see the video about the book that warned back in 2008 what a second Clinton presidency would mean for the USA:

Hillary Clinton Nude

Go to YouTubePlay video Chilling video about Hillary Clinton and the 2016 presidential election from the author of the provocative book, “Hillary Clinton Nude: Naked Ambition, Hillary Clinton And America’s Demise.”

HILLARY CLINTON NUDE

According to a survey recently conducted by Reuters of 945 Chinese companies outside of the banking  and financial services sector, corporate debt in China increased by 260 percent over a 5-year period. This rate of increase within the corporate sector that is occurring in China is unprecedented; no other nation’s example demonstrates such a cascade of corporate debt among any other major economy over a similar period of time.

At present, corporate debt in China outside financial services has reached the staggering level of 12 trillion dollars. This is equal to 120 percent of China’s GDP, and about 15 percent of global GDP. This is a startling figure of corporate leverage in China, and comes on top of the rapid rise  in local government debt in China, which I discussed in a previous blog post. There are implications of a worldwide character for this massive accumulation of private and public debt in China, which cannot have its impact in the entire global economy.

If Hillary Clinton runs for President of the United States  in 2016, see the video about the book that warned back in 2008 what a second Clinton presidency would mean for the USA:

Hillary Clinton Nude

Go to YouTubePlay video Chilling video about Hillary Clinton and the 2016 presidential election from the author of the provocative book, “Hillary Clinton Nude: Naked Ambition, Hillary Clinton And America’s Demise.”

HILLARY CLINTON NUDE