Putin: Hey, maybe we can all get along now

Russia has “no ill intentions towards its neighbors,” Vladimir Putin insisted a short time ago in a call for re-normalization of relations. Nice words from the first guy in history to order an artillery strike and an assault on a nuclear reactor complex. In a press conference, Putin held out an olive branch at the same time he seized control of the largest nuclear reactor in Ukraine, continued bombing Kyiv and other cities, and appeared to be “ramping up” ground assaults on major population centers in an attempt to obliterate Ukraine.

Is this a plea for face-saving talks, or just another propaganda ploy?

If Putin wanted a face-saving way out of this conflict, he would have floated it before seizing Zaporizhzhia. He also wouldn’t have his army on the move in preparation to attack multiple cities with questionable-at-best military value:

Key cities under assault: Russia is laying siege to the key Ukrainian city of Mariupol. The southeastern city’s deputy mayor said it was “surrounded” by Russian forces and in desperate need of military and humanitarian aid. In northeastern Ukraine, 34 civilians were killed by Russian attacks on the Kharkiv region within a 24 hour period, emergency services said. Kharkiv’s mayor said the Russian military is “intentionally trying to eliminate Ukrainian people” as it targets civilian spaces. Russian troops are also advancing toward Odessa, the strategically significant city on the southern coast.

It’s safe to say that Putin’s neighborliness doesn’t extend to Ukrainians. It doesn’t extend to the Baltic states either, nor to any countries within the former Iron Curtain that prefers its own neighbors to the West over Putin’s charms. So what’s the point of this pitch?

Putin needs to get business back to normal — or at least in operation again. For the fifth straight day, the Russian stock market remained closed as valuations of Russian companies remain mired in junk-bond status. Trading on other boards for Russian firms went just as badly:

Russia’s central bank has ordered the Moscow stock exchange to stay closed for a fifth day Friday, sheltering local equities that global institutions now see as “uninvestable.”

Meanwhile, the London Stock Exchange froze trading in eight Russian companies on Friday, adding to the 28 already suspended. …

Global institutional investors see the Russian equity market as currently uninvestable, MSCI and FTSE Russell said Thursday. The two companies plan to remove Russian stocks from their indexes and reclassify them “at a price that is effectively zero.”

In Russia, Moscow’s MOEX exchange has been shut all this week, after crashing as much as 50% last Friday after the country’s forces attacked Ukraine. Its central bank ordered the closure, seen as an attempt to avoid further losses as pressure on Russian equities builds.

The LSE announced that all Russian trading had been locked out:

The LSE suspended global depositary receipts (GDRs) – which represent shares in a foreign company – for eight Russian companies on Friday, including Magnit and Sistema, after it froze trading in 28 firms on Thursday. read more

“The London Stock Exchange notes the ongoing deterioration of market conditions since March 2 2022, and in order to maintain orderly markets, the exchange has suspended the admission to trading of the instruments,” it said in a statement.

There are no Russian securities trading on the LSE following Friday’s move.

“This captures all Russian GDRs on our markets,” a spokesperson said.

The ruble still remains valued below a US cent on currency markets as of today, too. There is nowhere for Russia’s oligarchs to turn, and thanks to lockouts from Western banking systems, probably no easily accessible cash with which to operate either. Earlier this week, members of Congress began floating the possibility of issuing letters of marque and reprisal to allow private citizens to seize Russian assets wherever they may be found, which would escalate the current Cold War into a Pirates of the Caribbean status of sorts.

Putin may be strong enough to stare down his oligarchs, but that can’t last forever. The seizure of the nuclear plant overnight was likely intended to force the West to back away from its economic sanctions in time to save his own skin. Hence the sudden desire for re-normalizing relations, and especially trade.

Will it work? Probably not; like everything else Putin’s doing, the seizure of Zaporizhzhia will almost certainly backfire as Europeans finally figure out just how dangerous Putin actually is. The time for sweet words and neighborliness passed ten days ago. Now we’re faced with a potentially genocidal tyrant, and the only way forward is to turn the screws until Putin’s oligarchs get motivated enough to bring an end to the crisis on their own.

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