I’m going to keep this short because the situation is fluid. Besides, this one doesn’t need much research or even deep thought. It’s actually quite simple. Here are the facts;
Biden tried to screw with Putin. Putin showed Biden that geopolitics is a game that only adults should play. Ball is now in Biden’s court after Putin snagged 2 provinces that absolutely no one else wanted.
What can Biden do? Maybe he can issue some more sanctions? Maybe he goes and cries to the UN?? He’s not going to start a war over these provinces. Biden has been had.
What happens when the sanctions hit?? Ask yourself, where do palladium, nickel, natural gas, oil, uranium, grain, fertilizer and a bunch of other goods we depend upon come from?? Yeah, the guys that Biden wants to sanction. What do you think sanctions do to inflation? There’s an election coming up in November and it already looks like Biden gets steamrolled. Does he want to make it even worse?? Literally no one in Europe wants any part of this train-wreck that Biden started. They all need Putin’s energy far more than they need our politics.
As you can guess, these sanctions are going nowhere. We need these goods, and Europe needs the gas even worse. Inflation is already roaring. There is no Biden plan from here. He never had a plan.
Basically, this is your cue to be reckless. We’re at peak angst and Russian assets are for sale. I had a starter position going into this weekend. I intend to be an absolute pig about it on Tuesday. Go look at their market, almost all the top companies are resource stocks. What do you think happens to their profits as the periodic table goes positively mental?? What about when their costs are priced in Rubles that are down 10% this month? Putin always wins. He’s winning again.
Betting against Biden has been the winning trade for over a year. This is yet another chance to press the same bet. I’m keeping it simple. The VanEck Russia ETF (RSX – USA) is a collection of highly liquid Russian assets. It should hopefully be immune to Biden randomly sanctioning companies and forcing my broker to liquidate me. RSX is where I’m focusing.
Remember, Putin always wins…
Disclosure: Funds that I control are long RSX , Rubles and short RSX puts.
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