Yanukovich Sulking in Hideout

Over the past several days, more and more of his political supporters have deserted Ukraine's president Yanukovich in light of the bloody confrontations between police and protesters in Kiev. In the end, all of them decided they would be better off without him. The final straw seems to have been news that Moscow wouldn't send any money after all until calm was restored in the Ukraine and a political solution to the conflict was found (we imagine the Russians were concerned their money might end up getting stolen, not an entirely unreasonable fear). Yanukovich thereupon apparently decided that he would be best served by disappearing in the presidential helicopter and was last seen heading toward an unknown retirement hideout by air. However, from there he immediately resumed complaining:

 

“Yanukovych was removed in a 328-0 vote in the 450-seat chamber. As protesters took control of central Kiev and flooded into his luxury estate, Yanukovych said in a speech from an undisclosed location that attempts to remove him from power were a “coup d’etat.”

The peace agreement, signed on Feb. 21 after all-night talks in Kiev with EU foreign ministers, envisioned a national-unity government within 10 days. Lawmakers approved a return to the 2004 constitution, curbing presidential powers.

Polish Foreign Minister Radoslaw Sikorski, who helped negotiate the EU deal signed by Yanukovych and the opposition, said there was “no coup in Kiev,” and that parliament is acting legally. Yanukovych had said in a statement published on his presidential website that he wouldn’t resign and deemed all of the new acts illegal.”

 

(emphasis added)

In spite of this rather feeble last-ditch show of defiance, Yanukovich can probably be safely regarded as history. It was an interesting development that Russia decided to ditch him by refusing to send the financial aid it had only promised to release a few days earlier. We would point to this interesting little news item in this context:

 

“U.S. Treasury Secretary Jacob J. Lew and Russian Finance Minister Anton Siluanov agreed on the importance of promoting economic and financial stability in Ukraine and the need for reforms that could be supported by an IMF program, according to the Treasury Department. “There needs to be stability in the Ukraine,” Lew told reporters in Sydney yesterday, adding he’d had a “very good conversation” with Siluanov.

Lew spoke with Arseniy Yatsenyuk, leader of ex-Premier Yulia Tymoshenko’s Batkivshchyna party, and encouraged Ukraine to begin discussions with the IMF as quickly as possible, the Treasury Department said.”

 

(emphasis added)

If they had 'a very good conversation', we conclude that A) Russia decided it would be a lot cheaper to let the IMF pay and B) there must be some way in which the Russians think they will be able to forestall NATO expansion into the Ukraine (the main reason why the Russian government lent its support to Yanukovich in the first place was very likely to ensure that the Ukraine would not sign any 'security agreements' with Europe). Just guessing of course – it is impossible to tell what is really going on, but it is absolutely certain that Russia is set dead against being encircled via its 'near abroad', i.e., the former Soviet Republics.

 


 

iznogoud(Image by Jean Tabary)

 


 

TurchynovMeet the Ukraine's interim Caliph, former parliamentary speaker Alexandr Turchynov

(Photo via tymoshenko.com.ua)

 


 

And guess who has appeared on the scene moments after all of this happened, accompanied by the US ambassador and some EU minion?

 


 

YULIA_2831816cJulia Tymoshenko was immediately released from prison – here in a photo op with US ambassador Geoffrey Pyatt shortly after her release (yes, this Pyatt).

(Photo via saltspringnews.com / Author unknown)

 


 

According to European media reports, Tymoshenko is already plotting her political comeback. Never mind that she was twice in coalition with Yanukovich, or that there continue to be considerable doubts about her past energy deals – even though it is very likely true that her imprisonment was mainly politically motivated.

According to the AP:

 

“In 2011, she was arrested and charged with abusing power as premier in a natural gas deal with Russia. Tymoshenko said the proceedings were naked revenge, and Western governments voiced concern about a politically motivated prosecution. International criticism of Ukraine grew after she was convicted, received a seven-year sentence, and sent to prison.

Long before achieving global fame, Tymoshenko was already a high-profile figure in Ukraine. She and her husband took early advantage of former Soviet leader Mikhail Gorbachev's perestroika reforms by creating a popular video rental business.

The couple founded a fuel distribution company and she became head of Unified Energy Systems, a wholesale broker of natural gas. In that post, she became one of Ukraine's richest and most powerful oligarchs — and was dubbed "The Gas Princess."

 

(emphasis added)

There can probably be little doubt that her prosecution was a case of political revenge, or at least about the removal of potential competition (although she did lose the last election, and even her former 'Orange Revolution' partner, ex-president Viktor Yushchenko testified against her), but only insofar as her accusers were quite possibly even bigger thieves. As our friends at 'Oilprice.com' noted at the time of her trial, her past in the energy business is, let us say, not likely to be entirely spotless:

 

During 1995- 1997 Timoshenko was the president of Ukraine’s natural gas trading company United Energy Systems of Ukraine, which became Ukraine’s main importer of Russian natural gas to Ukraine. Accusations swirled that she was reselling enormous quantities of stolen gas and avoiding tax, having given former Prime Minister Pavlo Lazarenko kickbacks in exchange for her company's access. In August 2006 Lazarenko was convicted and sentenced to prison in the United States for money laundering, wire fraud and extortion.

Interesting company the Ukraine’s “gas princess” keeps, along with her personal wealth estimated in the millions. That said, Ms. Timoshenko is simply a product of her environment, and the 2009 natural gas deal that she cut with Russia was pragmatic, which raises the question of why she’s on the rack now. Speaking of personal fortunes – in the past two decades it has been impossible for anyone in the post-Soviet space to become rich. Why?

Simple – because theoretically, according to Marxism, “property is theft” and in December 1991 every Soviet citizen following the collapse of the USSR started out on the same starting line. Not – those with connections prospered, those on the assembly line did not. Timoshenko, cagey about her private wealth and reinventing herself as a populist politician, was nonetheless one of the former.

 

(emphasis added)

Well, who knows. Maybe she's really the only honest oligarch in all of the former Soviet Republics who became a millionaire in no time at all with the help of formerly state-owned assets purely due to her dedication to hard work. Right.

It will be interesting to see who gets closest to the place at the trough next, and whether they will behave any better than the kleptocrats preceding them. We wish the people of the Ukraine all the best, but we have our doubts on that count.

 

Ethnic Russians May Want to Split

Meanwhile, it is actually too early to state that peace has broken out, as there have been reports of clashes between the new (mainly same old, actually) revolutionaries and pro-Russian demonstrators. It seems possible that contrary to the wishes of the US and the EU, the Ukraine will eventually end up splitting along ethnic lines:

 

“Pro-Russian demonstrators have clashed with anti-government protesters in Ukraine’s south and eastern regions. Several attempts by opposition supporters to hold rallies over this weekend’s historic events have been roundly shut down.

In the poor industrial city of Donetsk, pro-Russian protesters made their feelings clear over their allegiances. A scene repeated in several other cities like Kerch in Crimea where some Ukrainians have spoken openly of their desire to see the country split along political lines.”

 

(emphasis added)

Western powers wasted no time warning Russia not to actively support such desires for the independence of the ethnic Russian part of the Ukraine:

 

“U.S. officials insisted on Sunday that Ukraine should remain unified and cautioned that any military intervention by Russia would be a mistake after bloody street protests ousted the pro-Moscow president.

In an appearance on the NBC TV program "Meet the Press," National Security Adviser Susan Rice was asked about a scenario in which Russia would send troops to restore a government more friendly to Moscow, or for the country to be carved up.

"That would be a grave mistake. It is not in the interests of Ukraine or of Russia or of Europe or the United States to see the country split. It's in nobody's interest to see violence return and the situation escalate," Rice said.

[…]

"The message has to be sent to him (Putin) that let the Ukrainian people determine their own future, and a partition of Ukraine … is totally unacceptable," Republican Senator John McCain, a key Republican voice on foreign policy, told the CBS program "Face the Nation".

"And we need to act immediately to give them (Ukrainians) the economic assistance that they need, based on reforms that are going to be required, as well. So it's going to be tough sledding."

Bob Corker, the top Republican on the Senate Foreign Relations Committee, said in a statement: "The United States should do everything possible to ensure Ukraine remains one country and that their territorial and political integrity is maintained, allowing them the freedom to choose a future within Europe."

 

(emphasis added)

Excuse us for asking, but who cares? What business is it of the US, EU, or Russia for that matter, whether the Ukraine 'remains a unified country'? What makes a unified Ukraine better than a split one? Wouldn't it be best to avoid future conflict along ethnic lines by allowing Ukrainians to decide this for themselves? What makes a bigger country inherently better than two smaller ones?

We would argue that on the contrary, statism is automatically reduced when political territories become smaller, and it would actually be best if not only the Ukraine, but every large nation state territory broke apart into smaller ones. Big is definitely not beautiful when it comes to nation states – except for the people  forming the ruling elite of said states. Citizens are generally far better off the smaller the political entity they inhabit is. We conclude that there is nothing to worry about in the event the Ukraine splits in two – from the point of view of the inhabitants it may be the best solution actually.

 

Addendum: Hryvnia Unmoved

Interestingly, there is no rejoicing yet in the currency markets about the latest developments – the Ukrainian currency has even weakened slightly further:

 

HryvniaThe Hryvnia has failed to recover so far … – click to enlarge.

 


 

The stock market has however rallied sharply over the past three trading days – the old saying has once again been proven true, somewhat sooner than expected in this case (i.e., 'buy when there is blood in the streets'):

 


 

UAXThe Ukraine's stock market soars – click to enlarge.

 


 

 

Charts by: Investing.com


 

 
 

Emigrate While You Can... Learn More

 
 

 
 

Dear Readers!

You may have noticed that our so-called “semiannual” funding drive, which started sometime in the summer if memory serves, has seamlessly segued into the winter. In fact, the year is almost over! We assure you this is not merely evidence of our chutzpa; rather, it is indicative of the fact that ad income still needs to be supplemented in order to support upkeep of the site. Naturally, the traditional benefits that can be spontaneously triggered by donations to this site remain operative regardless of the season - ranging from a boost to general well-being/happiness (inter alia featuring improved sleep & appetite), children including you in their songs, up to the likely allotment of privileges in the afterlife, etc., etc., but the Christmas season is probably an especially propitious time to cross our palms with silver. A special thank you to all readers who have already chipped in, your generosity is greatly appreciated. Regardless of that, we are honored by everybody's readership and hope we have managed to add a little value to your life.

   

Bitcoin address: 1DRkVzUmkGaz9xAP81us86zzxh5VMEhNke

   
 

Your comment:

You must be logged in to post a comment.

Most read in the last 20 days:

  • The Coming Debt Reckoning
      Licking the Log American workers, as a whole, are facing a disagreeable disorder.  Their debt burdens are increasing.  Their incomes are stagnating.   There are many reasons why.  In truth, it would take several large volumes to chronicle all of them.  But when you get down to the ‘lick log’ of it all, the disorder stems from decades of technocratic intervention that have stripped away any semblance of a free functioning, self-correcting economy.   Happy...
  • How to Stick It to Your Banker, the Federal Reserve, and the Whole Doggone Fiat Money System
      Bernanke Redux Somehow, former Federal Reserve Chairman Ben Bernanke found time from his busy hedge fund advisory duties last week to tell his ex-employer how to do its job.  Namely, he recommended to his former cohorts at the Fed how much they should reduce the Fed’s balance sheet by.  In other words, he told them how to go about cleaning up his mess.   Praise the Lord! The Hero is back to tell us what to do! Why, oh why have you ever left, oh greatest central planner of all...
  • India: Why its Attempt to Go Digital Will Fail
      India Reverts to its Irrational, Tribal Normal (Part XIII) Over the three years in which Narendra Modi has been in power, his support base has continued to increase. Indian institutions — including the courts and the media — now toe his line. The President, otherwise a ceremonial rubber-stamp post, but the last obstacle keeping Modi from implementing a police state, comes up for re-election by a vote of the legislative houses in July 2017.  No one should be surprised if a Hindu...
  • The Triumph of Hope over Experience
      The Guessers Convocation On Wednesday the socialist central planning agency that has bedeviled the market economy for more than a century held one of its regular meetings.  Thereafter it informed us about its reading of the bird entrails via statement (one could call this a verbose form of groping in the dark).   Modern economic forecasting rituals.   A number of people have wondered why the Fed seems so uncommonly eager all of a sudden to keep hiking rates in spite...
  • What is the Buffet Indicator Saying About Gold?
      Chugging along in Nosebleed Territory Last Friday, both the S&P 500 and the Nasdaq composite indexes closed at record highs in the US, with the Dow Jones Industrial Average only a whisker away from its peak set in March. What has often been called the “most hated bull market in history” thus far continues  to chug along in defiance of its detractors.   Can current stock market valuations tell us something about the future trend in gold prices? Yes, they actually...
  • Moving Closer to the Precipice
      Money Supply and Credit Growth Continue to Falter The decline in the growth rate of the broad US money supply measure TMS-2 that started last November continues, but the momentum of the decline has slowed last month (TMS = “true money supply”).  The data were recently updated to the end of April, as of which the year-on-year growth rate of TMS-2 is clocking in at 6.05%, a slight decrease from the 6.12% growth rate recorded at the end of March. It remains the slowest y/y growth since...
  • The 21st Century Has Been a Big, Fat Flop
      Seeming Contradiction CACHI, ARGENTINA – Here at the Diary we have fun ridiculing the pretensions, absurdities, and hypocrisies of the ruling classes. But there is a serious side to it, too. Mockery makes us laugh. And laughing helps us wiggle free from the kudzu of fake news.   Is it real? Is it real? Is it real? Above you can see what the problem with reality is, or potentially is, in a 6-phase research undertaking that has landed its protagonist in a very disagreeable...
  • A Cloud Hangs Over the Oil Sector
      Endangered Recovery As we noted in a recent corporate debt update on occasion of the troubles Neiman-Marcus finds itself in (see “Cracks in Ponzi Finance Land”), problems are set to emerge among high-yield borrowers in the US retail sector this year. This happens just as similar problems among low-rated borrowers in the oil sector were mitigated by the rally in oil prices since early 2016. The recovery in the oil sector seems increasingly endangered though.   Too many oil...
  • Will Gold or Silver Pay the Higher Interest Rate?
      The Wrong Approach This question is no longer moot. As the world moves inexorably towards the use of metallic money, interest on gold and silver will return with it. This raises an important question. Which interest rate will be higher?   It’s instructive to explore a wrong, but popular, view. I call it the purchasing power paradigm. In this view, the value of money — its purchasing power —is 1/P (where P is the price level). Inflation is the rate of decline of...
  • Rising Oil Prices Don't Cause Inflation
      Correlation vs. Causation A very good visual correlation between the yearly percentage change in the consumer price index (CPI) and the yearly percentage change in the price of oil seems to provide support to the popular thinking that future changes in price inflation in the US are likely to be set by the yearly growth rate in the price of oil (see first chart below).   Gushing forth... a Union Oil Co. oil well sometime early in the 20th century   But is it valid to...
  • Silver Elevator Keeps Going Down – Precious Metals Supply and Demand
      Frexit Threat Macronized The dollar moved strongly, and is now over 25mg gold and 1.9g silver. This was a holiday-shortened week, due to the Early May bank holiday in the UK. The lateral entrant wakes up, preparing to march on, avenge the disinherited and let loose with fresh rounds of heavy philosophizing... we can't wait! [PT]   The big news as we write this, Macron beat Le Pen in the French election. We suppose this means markets can continue to do what they wanted...
  • Warnings from Mount Vesuvius
      When Mount Vesuvius Blew   “Injustice, swift, erect, and unconfin’d, Sweeps the wide earth, and tramples o’er mankind” – Homer, The Iliad   Everything was just the way it was supposed to be in Pompeii on August 24, 79 A.D.  The gods had bestowed wealth and abundance upon the inhabitants of this Roman trading town.  Things were near perfect.   Frescoes in the so-called “Villa of the Mysteries” in Pompeii, presumed to depict scenes from a...

Support Acting Man

Austrian Theory and Investment

Own physical gold and silver outside a bank

Archive

j9TJzzN

350x200

Realtime Charts

 

Gold in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Gold in EUR:

[Most Recent Quotes from www.kitco.com]

 


 

Silver in USD:

[Most Recent Quotes from www.kitco.com]

 


 

Platinum in USD:

[Most Recent Quotes from www.kitco.com]

 


 

USD - Index:

[Most Recent USD from www.kitco.com]

 

THE GOLD CARTEL: Government Intervention on Gold, the Mega Bubble in Paper and What This Means for Your Future

 
Buy Silver Now!
 
Buy Gold Now!
 

Oilprice.com