It's a peacekeeping mission!

 So... after a solid month of combat, Russia still hasn't taken Kyiv. Even after Putin commanded back in early March that Kyiv be taken within 3 days, Russian troops have only entered the suburbs and been driven back when their supply lines were cut. Sure, Russia bombed and fired missiles at civilian targets within Kyiv. They shelled the suburbs of Kyiv relentlessly, causing the maximum damage to non-military targets. Russian battalions tried, but failed to encircle Kyiv and impose a Grozny-style siege on the capitol. They continue to pursue this strategy. 

 As unlikely as it probably sounds, Russia has now announced that the world misunderstood their advances. Day after day, Russia smiled as their paid trolls predicted an imminent collapse of Kyiv, and by extension, the entire Ukrainian military. Western media, of course, obliged Putin. Over and over again, the 'news' about the war was reduced to "explosions heard in Kyiv". Oh dear, people are trying to flee from the mighty Russian juggernaut! Week after week, the implied narrative was as inane as it was consistent: Kyiv is doomed, and we will bravely wring our hands as it is unfortunately crushed by the overwhelming might of the unstoppable Russian military. Again and again, we heard reports that Russia was "prioritizing" the occupation of Kyiv. There was, after all, a long convoy of vehicles north of the city, which 'proved' that doom was nigh. Never mind that these were almost entirely the equivalent of untrained National Guard troops tasked with the occupation of a city that would supposedly already be 'liberated' and 'pacified'. Never mind that this convoy was burning up scarce fuel simply to keep warm as they were stalled. Never mind that Ukrainian troops constantly used hit-and-run tactics to whittle away at this convoy's threat. Never mind that these troops were slowly figuring out that their pay was in worthless currency. 

 We were instructed to be frightened and to expect the worst. Many stuck to that script and wrung their hands endlessly and daily over the imminent collapse of Kyiv. And, as always,  that was conflated with the destruction of the Ukrainian military. 

 Remember when Hanoi was bombed into rubble every week and the Vietcong surrendered? Me neither. Remember when Soviet forces taking Kabul destroyed the Afghan resistance and ended all combat? Me neither. Remember when American troops took Baghdad and withdrew in victory? Me neither. 

 In modern warfare, a capital city isn't a huge prize. Sure, command and control over a regular military is often surrendered. But the regular military is just the first layer of opposition. In Ukraine, there are well-armed and well-organized Territorial forces that are perfectly capable of operating independently of a central command in Kyiv. Also, well-trained civilian militias exist that don't need commands from Kyiv as to whether they should attack a supply convoy or not. Or shoot collaborators. 

 Yet, all of this is for naught. Russia has now announced that everything previous was never designed to take Kyiv. You silly fools thought the Russian military was trying to destroy and occupy Kyiv. But that was never the goal. All of that hand-wringing and braying about the imminent fall of Kyiv was just stupid.  The Russian military never wanted that. 

 Instead, it was all about a peacekeeping mission in Donbas. 

That whole convoy, and the siege of Mariupol, was just a ploy to weaken the Ukrainian military so that it couldn't take action against Russian troops in Donbas. Hah-hah, you morons fell for it!

 Never mind that Donbas is still contested. Never mind that 10k Russian troops are encircled around Irpin. Never mind that Russian forces have relentlessly shelled Russian-speaking areas (including most civilian targets) of Donbas. Never mind that Russian armored battalions are still operating west of Kyiv, and only control the ground they are currently standing on. 

 Sadly, Russia will gladly throw all of those forces in the vicinity of Kyiv to the wolves. They were merely a distraction. Because they (now) only care about Donbas, in the east. Let the Ukrainian military waste precious time starving those Russian battalions into submission. Let them wipe out tank formation upon tank formation. Let them shell Russian positions and use drones at night to decimate their numbers. It's always been about Donbas, Putin now says. Where did you get the idea that it was about anything else? 

 Putin wants a 'victory' to brag about for the May 9 celebrations in Russia. But I expect a cruel April, as more and more military aid arrives from the West and Russian supply lines in the east come under attack. Russia still has to defend marginal gains in the south, while maintaining troops in other theaters like Syria and Georgia. The Russian naval forces in the Black Sea will be increasingly threatened. And even Russian-leaning civilians in Donbas will become disaffected by occupation measures. Once street fighting in Mariupol starts, the Russian artillery and air strikes won't be factor. They will be reluctant to bomb their own troops. 

 The simple reality is that Donbas and Luhansk aren't particularly attractive prizes. Russian troops will be needed to occupy it for years. Harsh measures will be employed. Russian-backed mercenaries will continue to wreak havoc. Nothing will be "peaceful". Arms and special forces will continue to pour into Ukraine. 

 Remember, Russia went in to this disaster with Donbas and Luhansk under nominal control of pro-Russian separatist forces. They would have basically gained nothing.

The financial war

 

 As the invasion of Ukraine started, there were a large number of pundits and experts who smugly noted that Russia had been hoarding a huge stockpile of money, and could do just fine with sanctions in place. 

 Just as we see with some military 'analysts', none of these people are overtly "pro-Russian". Many of them 'support' Ukraine. Instead, the tone is one of smug resignation, paraphrased as "Russia is very powerful, very wealthy, and very smart. Ukraine will put up a good fight, and the West will attempt to hurt Russia economically. But Russia will prevail. So sad".

 But that huge stockpile of assets just got a lot smaller. And, knowing the level of corruption in Russia, sensible people can wonder how large it really was to begin with. We've already seen that military intelligence was deathly afraid to tell Putin anything he didn't want to hear. Could it be that Siluanov (Finance Minister) also fudged some numbers? How much of this is simply accounting gimmickry? We don't really know, but it should soon become clear in the months ahead. 

 As far as Siluanov's plan to make debt payments in rubles, this is indirect proof that the 'very wealthy' Russia doesn't have the money it claims to possess. Any loan agreement of this type specifies that payment is to be made in the lender's own currency (or possibly U.S. dollars). Even 'friendly' countries are likely to balk at this suggestion. It is, quite simply, a lever to control these countries: remain "friendly" or suffer the financial consequences. Of course, within a month or two, being "friendly" will entail these countries accepting payment in rubles anyway. 

 Russia can, of course, print up all the million-ruble notes it needs to make these debt payments. That means hyper-inflation. But that was always inevitable. Realistically, that $300B of frozen assets will just be sold off to pay the debt. 

 That leaves Russia with a hypothetical $340B to keep its economy afloat. As the nominally pro-Russian pundits note, Russia has a big military. It's losing tanks and other equipment daily. It's firing rockets, missiles, and artillery shells that will need to be replaced. It's burning up and transporting vast amounts of fuel. Russia is paying, feeding, and sheltering large numbers of troops -- both domestic conscripts and foreign mercenaries. Estimates at the start of the invasion were that it cost Russia $250M a day to field its force. 

 If Russia is so rich and so powerful, why is it draining its allies in Belarus, Chechnya, and Syria? Because it can 'pay' these countries with its worthless currency. 

 

 Hmm. Russia is selling off its gold. I'll wager they aren't taking rubles for it, though. Weird thing to do when you allegedly have a huge stockpile of assets that allows you to cruise to victory and thumb your nose at sanctions. 

 

 Why aren't people jumping at the chance to buy this gold at fire sale prices? 

 

 Okay. All you need to do is drive an armored car full of hard currency across the Russian border, which will result in corrupt officials seizing it. Seriously, even if you did make it Moscow with your cash intact, who thinks that the Russian Central Bank won't just confiscate your hard currency anyway? What have they got to lose? You'd sit in prison for months and probably be held hostage for more hard currency. Maybe that's why nobody is stepping up to buy this gold. 

 The sad reality is that border guards, and their corrupt commanders, who haven't been paid for weeks in anything resembling real money, would undoubtedly see your armored car as their payday. A bullet would be unceremoniously put in your skull, and everyone would deny you were ever there. Countries that are 'very wealthy' don't do things like this. Countries that are desperate for money do, though. 

 Gee, this is a strange thing for a country that has a huge stockpile of money to do. Also strange for a country that has rule of law. Anyone that has stashed away some hard currency will see it confiscated. Why, if they are sitting on $340B in assets? Because they aren't sitting on those assets, that's why. 

 Of course, these are one-time actions designed to work only in the short-term. The very short-term, in fact. Once these ploys are used, they become useless. It also is indirect proof that Russia is seeing diminishing returns from putting the screws to their allies. Also, China must not be as financially supportive as we have been led to believe.

 

ALLIANCES: 

 We all know that China and Russia have formed an alliance. China wants Russian military power and diplomatic support for its invasion of Taiwan. But we've already seen that Russian military power has been greatly exaggerated, and that it will take a long time for Russia to replenish its stocks. They have a serious problem buying raw materials, and their munitions industry is almost completely geared toward producing guns and ammo for guns. China needs whatever black-market chips and raw materials it can scrounge for its own needs. A whole lot of the titanium that Russia produces will go to China -- presumably at a big discount.

 The Russian Navy is still a valuable asset. Its primary strength is in its submarine fleet, however. They can defend the Russian coastline adequately, but things like naval aviation have been allowed to deteriorate relative to the other services. And Russia has a lot of coastline to defend in both the Baltic and Black Sea. 

 Russia has long been the primary weapons supplier for the Indian military, but that looks likely to fade. Any arms sales to India will just mean less for their own forces. As a "friendly" country, Russia will continue to demand more and more from India, while offering less and less. While Pakistan is the primary adversary, China is increasingly becoming a problem in the north. The two countries nearly went to war several years ago, and China has been steadily building roads and railways almost up to the border of Nepal, Bhutan, and Assam. Nepal is already tacitly controlled by China. Bhutan has no military to speak of. China officially claims the whole of Arunachal Pradesh as part of "South Tibet", and further has claims around Kashmir. 

 Obviously, Russia is in no position to oppose China on these claims. China is in the position to bribe Pakistan with weapons and use it as a proxy to tie up Indian forces while easily moving into "South Tibet". Nepal would be eagerly gobbled up, with Maoist partisans welcoming their new overlords. Modi, the "Trump of India", would naturally cave to China if Russia tells him to. 

 It's possible that this could replace China's obsession with Taiwan in the short-term. India's position of setting itself up as a country "friendly" to Russia will win it no support in the West. Russia will essentially eat up Indian financial assets while hanging India out to dry. And this will not go unnoticed by other countries "friendly" to Russia. 

 Diplomatically, it's hard to see Russia as an asset on that front. Yes, Russia has a seat on the Security Council -- but so does China. Russia also has a depopulation problem. It has fewer young men to call up year after year. And they're in the process of squandering those numbers in Ukraine. They are also draining their allies of money and manpower, and cutting deals with Gulf monarchs that will be expensive over the long-term. Increasingly, Russia's role will be in sitting out conflicts -- while demanding a heavy price for their inaction. They need to conquer Ukraine to make this strategy credible. "Do you want us to make your country the next Ukraine?" will ring hollow if Ukraine prevails.

 There are also territorial conflicts between Russia and China in the East, and Russia will have to concede a lot to their Chinese 'ally'. Russia will have a dwindling number of proxies to use as time goes on, while China will have an increasing number of financially-dependent countries to drain for its purposes. And the ability to hire trained mercenaries that are already familiar with Russian tactics, capabilities, language, and weapons systems. 

 Regardless of how the invasion of Ukraine goes, Russia will find itself as a vassal state to China within five years. They have a huge area to defend, with many porous borders. Any perceived Russian weakness will induce challenges in Georgia, Tajikistan, and even Iran. Any conflict with NATO will only accelerate those challenges. 

 The wars of the future will not be fought over Russian territory, but over Russian economic might. Russia has already shown itself to be ill-equipped for such economic warfare. It seems far more likely that Russia will end up selling off its gas and oil at bargain prices -- just to gain precious hard currency needed to finance its crumbling military. Will the "friendly" Gulf states like that? Probably not.

 Last, but not least, our steadfast 'ally' Israel has chosen a path of neutrality in this conflict. This is an 'ally' that we give about $0.5M each day. They sat out Desert Shield. They sat out the invasion of Iraq. They shrugged for decades when asked to help out in Afghanistan. Now, Israel is concerned about 'provoking' Russia. This might cause problems on their borders. Unlike, I guess, Poland or Latvia or Lithuania. So, they launder Russian money instead. Sure, they could take out Russian positions in Syria. And, yes, that would weaken Russia's stature. But they can make a lot of money trading rubles for hard currency and supplying Russia with critical materials. So, gosh, this ally will have to sit this conflict out, too. 

Obviously...

 I will just point out a few obvious things about the invasion of Ukraine here. 

 Putin originally claimed that this was a "peacekeeping" mission in Luhansk and Donetsk, after declaring what are basically cities to be independent countries. Oddly, it's questionable if Russian forces are really even in control of those two areas at the moment. 

 Of course, it's also worth noting that a week before Putin made his "peacekeeping" claim, he stated that Russia would not invade Ukraine.

 Instead, Russian troops have leveled large areas of these newly-recognized 'independent countries' and killed a lot of civilians as part of their "peacekeeping" efforts. A shortage of food and fuel has also meant that these "peacekeeping troops" are looting and stealing supplies from civilians. 

 Everyone knew Putin's excuse for the invasion was a complete lie. As soon as the "peacekeeping mission" began, Russia began attacking from the north and south -- far from Donetsk and Luhansk. 

 As I've said previously, this was planned as three-day affair and supplied as such. Obviously, it stalled badly. Of course, Russian media is just today stating that Ukraine is "peaceful", with no fighting going on. This is so blatantly false that no one trusts Russian reports. Ukraine has totally won the information war, almost by default. Western media has relied completely on Ukrainian reports, but that hasn't stopped them from their typical "both-sides" habit. 

 Rather than state the obvious -- that Russia badly miscalculated and has already suffered more casualties than the U.S. did in Afghanistan -- the narrative is one of constant hand-wringing over the imminent demise of Kyiv, with the implied corollary that the fighting will stop if Kyiv is taken. 

 Of course, Putin decreed that Kyiv must be taken by Monday, regardless of the human cost. It's now Tuesday, and that hasn't happened. Instead, artillery is shelling Kyiv indiscriminately from a safe distance, while a massive convoy to the north is mysteriously stalled. This WW2 notion that taking a capital city signifies victory is patently absurd. Did the Afghan war end when alliance troops took Kabul? The idea that "command and control" can only operate out of a capital has been proven wrong in multiple conflicts. The U.S. bombed Hanoi into rubble several times. How did that work out? 

 But, yeah... if Kiev falls, it's all over, we're told. 

 Here's the obvious thing: Russian troops haven't entered the damn city yet. You really don't want to indiscriminately shell a city where your own troops are present. Tanks aren't particularly useful in situations like this, other than to provide mobile cover for troops. Ukrainian troops aren't drones fighting for a faceless dictator. They're fighting against an invader, and one that speaks their own language. This particular invader also uses unencrypted comms, and gives their troops expired rations. This particular invader pays those troops with currency that is now basically worthless. 

 Meanwhile, the narrative from the media is that shelling Kyiv means the end of Ukrainian independence. Ukraine fought bravely, we are told, but the Russian military is just too strong. Sure, they're bad and cruel and evil. But they're shelling Kyiv! 

 Combined with this defeatist mindset is the promise of aid that never really comes. In a few weeks, Javelins, drones, NLAWs, and non-lethal aid will arrive. Countries have made public promises of aid, but there's just so much red tape and logistical problems before it can arrive. You understand, right? If only Ukraine can hold out for another month (or two), then a fraction of what they need will arrive. 

 We should also be prepared for some unraveling of sanctions before long. Already, countries like Mexico have stated that they won't even participate in sanctions. Money laundering will soon become a big part of Mexico's economy, flooding Russia with precious hard currency from fake real estate developments and oil industry 'investments' that will simply end up in corrupt pockets on both sides. Soon, Europeans will see that they're missing out. And the rush will be on to avoid being the last to benefit by dropping sanctions. 

 There's a relatively brief moment here for the West to step up with real, material aid. Let's do that.