In fact what has happened in the last 30 days demonstrates what Russia is all about -- as long as you're a friend of Uncle Vlad and you do what Uncle Vlad tells you to do, you make out pretty good.
But if you're an enemy of Uncle Vlad and particularly if you're trying to run one of the opposing parties, then you’re going to have a problem. That was Khodorkovky's downfall. But after 10 years of imprisonment, he got the message. Now he's being let out and as the Chinese Communists used to say, he’s been “rehabilitated.”
Of course all of Khodorkovsky's stake in Yukos was taken away from him, even as he still pressed the issue in court since it was illegally confiscated from him. Nevertheless he continued to press a legal action for years in Russian courts. He even tried to get it into court in the United States where there was some jurisdiction because of the contracts his oil company had signed. But now part of the deal was that he dropped all that litigation.
Khodorkovky had actually pressed the issue while he was in prison and that was a big mistake. He should have just written it off. Now he finally just dropped the litigation and all Putin was really waiting for was for this guy to "fall in line with the regime," as they used to say. After all Khodorkovsky had the keys to his own jailhouse door all along. All he had to do is drop the litigation. He still has enough money in Switzerland to live off of for the rest of his life. He doesn’t have that much because he spent a lot on the litigation – but probably about $300 million that he squirreled away in Switzerland.
It's also been reported that Russian stocks are at a three-week high. Markets always rally when you remove uncertainty and reduce tensions. Stocks in Moscow that really rallied were mostly manufactured export related companies which do business with Ukraine.
Meanwhile in the EU, there's a lot of sour grapes because Russia at least stepped up to the plate with a guarantee from the central bank in Russia, even though it’s just a $15 billion Euro junk bond issue – but Ukraine was already rated “junk” anyway.
At any rate, it's a win-win for the Russians and the Ukrainians – despite what anyone thinks -- because the EU was making Ukraine jump through hoops. The problem with the EU is that these negotiations for loans or lines of credit can drag on for years when you're dealing with the EU. On the other hand Putin stepped up and said -- you can have the 15 billion next week. If the EU had stepped up and said that, it would have been a different story...
For the rest of this column by Independent Political, Economic & Market Analyst Al Martin, please click here -- Al Martin Raw
* AL MARTIN, author of "The Conspirators: Secrets of an Iran Contra Insider," is an Independent Political-Economic Analyst with 25 years of experience as a trader on NYMEX, CME, CBOT and CFTC. He is also currently trading the commodity futures market day and night and has a teleconferencing service to facilitate transactions in the markets. This is a service for independent experienced traders.
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