https://amgreatness.com/2022/04/02/trading-realpolitik-for-a-puppet-show/
A week, as the British Prime Minister Harold Wilson is supposed to have said, is a long time in politics. Poor Joe Biden would doubtless agree, assuming that he remembers what a week, what a long time, and what politics are. It was just about a week ago, on March 26, that he said, “As a result of our unprecedented sanctions, the ruble was almost immediately reduced to rubble.”
I wonder who thought of that play on words? The ruble is rubble. Ha, ha, ha.
The Russian currency did take a sharp dive. But then, almost immediately, it recovered. Why? There are several explanations. The conventional headscratchers hold that it is largely because the nefarious Vladimir Putin has nefariously blackmailed the weak-willed Germans and others who prefer bucking the sanctions in order to heat their homes. What cowards.
A better explanation, I think, is that Putin, having played this game before, more or less knew what to expect when he invaded Ukraine. The Western press was full of gloating stories about how Mastercard and Visa stopped handling transactions when Biden announced the sanctions. That’ll show ’em. But those companies had done the same thing back in 2014 when, with Barack Obama at the helm in the United States, Putin gobbled up Crimea. This time, Putin was ready. He had already implemented his own card payment system. Mastercard and Visa piggybacked on it. One irony of the situation, as the web site Daily Reckoning observes, is that “instead of Visa and Mastercard getting the fees, Russia’s central bank collected 8.2 billion rubles in net profit, or about $94 million at current exchange rates. Russia actually profited from Visa and Mastercard sanctions.”
File that under “unintended consequences.”