Forbes published a rather extravagant if typical article entitled, Farewell Putin written by a very serious and insightful investor, who claims that Putins days are over -- primarily because Russian money-elite would overthrow him in its desire to embrace the West. I dont find such triumphalism convincing (and neither do many other commentators on this article) , and therefore could not resist to comment on it. Here it is. Mr. Avi Tiomkin is a money man. He advises hedge funds and large fund firms. No wonder he thinks like a money man. Fortunately or not, most people do not think like that: neither common people nor politicians. What happened with Crimea has very little to do with President Putin. It was the will of the Russian people who wanted to correct the historical wrong executed by the former Soviet leader, Nikita Khruschev, who gave Crimea to Ukraine. The fact that Putin’s popularity dramatically jumped after the annexation of Crimea despite all the sanctions is the testimony to that. Had Putin not protected the Russian military base in Sevastopol, his chances of staying in power would have been very slim indeed. Indeed, the Russian economy is slowing down, but so is the European one with which Russia is very much integrated. But the economy is not everything. So far, Russian people consistently supported Putin’s foreign policy, and common Russian people do not think like money men. For them, standing up to the aggressive west or defending from Ukrainian shelling their numerous relatives in Donetsk or Lugansk is much more important than the exchange rate. Mr. Tiomkin is clearly aware of the mood within Russian money circles. These people are clearly losing a lot of cash and are not happy. But so what? The only thing that these people know is how to rob Russia’s resources, facilitated by the corrupt system clearly condones by Putin himself. Without him they would be nothing. And now is the important part. Mr. Tiomkin is convinced that President’s Putin time is up. But who will replace him? A pro-western candidate? Based on my knowledge of Russian mood which I have described both on these pages and elsewhere, Putin is the best bet for both the West and for the Russian oligarchs. Whoever replaces him will most likely get much tougher with the corrupt money and the corrupt oligarchs, and will most likely get more nationalistic and assertive. Very few Russians are willing to tolerate the expansion of NATO, slicing up Serbia, or creating the giant military base in Kosovo to the degree that Putin did. And in that case, a new Russian leader would spend much more than 4, 2% of GDP on defense that seems to scandalize Mr. Tiomkin. But let’s humor Mr. Tiomkin and imagine that some sort of pro-western leader will become the Russian leader, ushered in either by a “Color Revolution” or by some inner coup. How will China react, with the possibility of NATO and US controlling the territory all the way to Sakhalin and Vladivostok? China would never tolerate the weak Russia and the threat of Western control over Siberian resources. What we’ll have on our hands is a war with China. Mr. Tiomkin is supposed to be a specialist in macro investing and major reversals. Is this the reversal from which he expects to benefit? China fighting NATO over a weakened Russia doesn’t sound like a winning investment to me. And who will be there to collect? forbes/sites/nathanvardi/2014/12/08/farewell-putin/
Posted on: Tue, 09 Dec 2014 19:19:47 +0000
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