More Ineffective Russian Sanctions

Back in April, we wrote that, “our wish for the Ukrainian people is for peace, prosperity, and self-determination.”  We also wrote that the existing anti-Russian sanctions were ineffective, were reducing the value of the dollar as the world’s reserve currency, and are hurting American citizens.  Today, Barron’s reported the G-7 was adding to the sanctions by banning Russian gold.  This is not going to be effective.  There is no way to identify “Russian gold”.  Gold mined and processed in Russia may carry a Russian stamp, but that can easily be changes by melting the gold and re-pouring it at which point it ceases to be Russian gold and simply becomes gold.

Most of the countries in the world including some very large ones with significant GDP have not joined the US and the G-7 in sanctioning Russia.  Should Russia decide to sell any of its substantial gold supply, there are somewhere in the neighborhood of 150 countries that will be happy to accept the gold and pay Russia in a mutually agreeable currency.  Again, we’d like Russia to exit Ukraine and leave the Ukrainian people to manage their own affairs, but more ineffective headline-grabbing sanctions aren’t going to have that effect.

We’ll be discussing this topic this Wednesday, June 29th at 4pm eastern time with the Institute for World Politics.  If you’d like to understand this important and timely issue in greater detail, please feel free to register (at no cost) here:  https://www.eventbrite.com/e/the-strategic-and-economic-implications-of-anti-russian-sanctions-tickets-356391826547.

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