The end?

Right, some nerdy missile stuff for people that like that kind of thing.
And some "Russia is fecked" stuff too.

"Saturday Missile Missive!
I thought it would be a good idea to debate the impotency missiling of Russia in somewhat more detail.

What Missile?
Since there seems to be somewhat of a confusion in this regard with everyone scratching their heads and mentioning various missiles all the way from Putin, White House and the ever- glorious Punderati, it befalls upon me to explain what is what and where.
There has now been 3 IRCBMs lofted against Dnipro City. Let me first start with explaining the terminology, the European nomenclature is Intermediate Range Continental Missile (IRCBM), whereas the US use the term Intermediate Range Ballistic Missile (IRBM). Same **** different name.
IRCBM, pronounced Irkbam) is the STANAG term, but Muricanos as per usual are confused and use IRBM, pronouned Urbam. Now I have reached a level of nerdery that even I find staggering, so let us continue in kind.
The first IRCBM was indeed a RS-26 Rubezh, well at least of sorts. The RS-26 program was started in 2011 when they adapted the RS-24 Yars from ICBM (Icebam) to IRCBM by removing the last rocket stage.
Around 2018 the money was reallocated into producing the Vanguard Hypersonic Multiple Warhead re-entry Vehicle. I will return to the erroneous usage of the word hypersonic by Russia below.
Somewhere along the line Russia decided that it needed a conventional multiple warhead re- entry vehicle for their expensive ICBMs and IRCBMs. We think they started to develop this in 2020 or 2021, but we are not sure.
It is interesting that they chose to do this, it sort of implies that they all of a sudden decided that they needed a new conventional deterrence weapon to rely on, instead of nuclear arms. This is psychologically interesting.
Firstly, they never mentioned it to us that they were going to go non-nuclear in their deterrence weapons. And since we don’t know we would react as if they had launched a nuke and strike back with nukes.
Obviously Russia must have understood this little point. I bet that their plan was to tell us before they attacked us.
But I got stuck on something that “Putin” stated. “…with nuclear weapons like effect…”. It definitely sounds like a replacement for nukes to me. Now let us return to the payload setup of the IRCBMs that Russia used so far, I will return to the nukes later on.
Russia developed in secret a brand-new payload/warhead that contained 6 Re-entry vehicles containing 6 bombs each. Delivering 36 bombs is impressive, but if you start to divide up the
brisance of each bomb you end up with 36 bombs on the small side. Likely at weight of 75kg each.
Here we need to note that Russia previously have used Short-range ballistic missiles (SBMs), and Medium-range Ballistic Missiles (MBMs) carrying much larger unitary warheads. Apparently they wilfully picked carpet bombing over a big unitary one.
Carpet-bombing is more efficient as a terror-weapon compared to a big unitary warhead. Another reason can be lack of precision.
Now let us debate each missile at a time, there has after all been 3 of them.
Dnipro City 1 was a RS-26 with the new warhead, seemingly in this configuration renamed into Oreshnik by the Russians. We do know that it was an SR-26 from the debris that was recovered. My guess is that Russia had figured out that having a missile pronounced “Rubbish” in the West is not good when you are trying to “wag your penis”.
Mystery Missile 2 we do not know a lot about, the initial trajectory was sufficiently similar that we suspect it was another Oreshnik/Rubbish pair. It failed and dunked down in Russia at the midway point.
Dnipro City 2, now here it is getting interesting. This does not seem to be a RS-26 missile, instead it seems to have been a Kedr (Cedar) Medium-range Ballistic Missile that was used with an Oreshnik Payload strapped onto it. Now what in the name of feck is a Kedr?
Here is where it becomes interesting and let us just say that the Russian missile-penis just shrivelled substantially.
Of 4 known RS-26 launches, half of them have failed. 2 tests came with 1 failure, and when used “sharply” the same thing happened. It seems like Russia is far from as good at building missiles as the Soviet Union was, even when just cutting them down from 3 stages to 2 stages and reprograming the trajectory computer.
Now for the new Russian Kedr missile that somehow sprouted forth from nowhere. Let us begin with saying that it is “Russian” and not Russian. Except for the Payload it is a Qadr 1, or as it is also known, Ghadr-110.
It is an Iranian Medium Range Missile fitted out with a unitary warhead and was last used on Israel. It has a range of 1 800 to 2 000km. And it seems to actually achieve a stable trajectory 9 out 10 times judging from the Iranian attacks on Israel.
And 90 percent is a lot better than 50 percent. Who would’ve thunk that Iran had a bigger missile-penis compared to Russia? The old Soviet Cosmonauts and rocket engineers must be rotating in their graves over this lack of erectile functionality in the missile department.

Numbers
After the Astrakhan Missile Factory and the Astrakhan Fuel Factory blossomed into fiery night- flowers Russia has a huge problems. And lacking the ability to build more missiles of this type is just one of them.
Fuel is the worst part. RS-26 used solid fuel stages, unlike the big Russian ICBMs that still use liquid fuel. The same factory supplied solid fuel to the entirety of the Russian missile program,
and until they either get it up and running again, or build a new one at a better location, they are somewhat in the pickle.
As the first RS-26 came lumbering we believed that they had between 1-3 of them in storage, and it now seems like the answer was 2, unless of course they do not want to use the third due to No 2 failing.
We do know that there are 2 more facilities producing the more short-ranged ballistic stuff, but those got the fuel from Astrakhan. Only the Astrakhan factory was tooled up for the medium- range and intermediate-range stuff.
This leaves Russia with 2 options, they can use RS-24 Yars, or they can shop for other missiles. Using an ICBM would truly be frown upon by NATO since this is their only true ICBM that uses solid state fuel, it is their main weapon in a nuclear war as a fast response strike weapon if we would start a nuclear war.
Russia currently has 50-60 RS-24 Yars at around 60M€ a pop, and being the main Russian nuclear deterrent carrier it is highly unlikely that they would use them for hitting Ukraine with a bunch of small conventional bombs.
From a Western standpoint it would though be hilarious if they rage-missiled away their main deterrence weapon against our nuclear strike capacity, by using it with conventional low-yield bombs.
Obviously this would be far less fun for Ukraine. And since there is a potential that this might happen, we will need to do something about that.
The other option is obviously that Russia bites down on the sour grape and buy missiles from Iran and North Korea. So far North Korea has even crappier stuff than Russia has, but beggars can’t be choosers.
No, Iran is the preferred option from a Russian perspective. They produce fairly good, albeit stodgy, missiles that are proven in battle. Well, proven in the manner that Israel blew up most of them.
How many have Russia purchased? We know that 10 has been delivered as of now, and one has been used, so 9 are remaining in inventory.
Iran has used up a lot of them on their own by rage-missiling Israel, so it is sort of expected that they will be less willing to sell more to Russia, what remains is assumed to be kept in storage for when Iran needs them if a big war with Israel kicks off.
Helping Russia is of a far less importance to Iran compared to being able to strike Israel, and so far they have used around 50 against Israel, and sold 10 to Russia. That would leave them with around 90-120 for their own use. And, that is almost certainly not enough already, in a war with Israel.

Future
I fully expect that Russia will use up the remaining 9, and then go and beg like donkeys to buy more from Iran, and if they decline Russia will look at those RS-24 Yars, or their ageing SS-27 Topol-M. The latter are of unknown function nowadays.
Let us say that those SS-27s still are operational, than Russia has around 150 missiles to pop. Now this is a lot when carrying nukes, but carrying conventional low-yield bombs? The destructive equivalent is similar to 150 cruise missiles.

Answer
Problem here is that Ukraine has a decided lack of tools to respond with. Currently Ukraine has Patriot PAC-3s and SAMP/T Aster 30 Block 1NT’s that are capable of taking down Ballistic Missiles.
There are though two problems. The first is that they do not have enough launchers to cover all of Ukraine. The second problem is a general lack of PAC-3 missiles for the Patriot. More SAMP/Ts are on the way, but production is not enough of complete systems to solve it quickly.
On top of that we are reticent to send more Patriot systems due to El Humpo, and even without him the missile production rate is way to low on the PAC-3s.
The final problem is that going after high altitude ballistic missiles is an add on feature on the Patriots, and only a secondary feature on the SAMP/T. We need a more dedicated system like the THAAD or the Israeli/Boeing equivalent.
US is not about to deliver a THAAD, and even if they did we would end up with 1 system, and very few missiles, and then El Humpo happens, and we stand there with a 1.2 Billion Euro pile of garbage.
The other thing would be to buy a system from Israel, but they are right now kind of occupied, and on top of that they are currently not picking up the phone when EU is calling due to the ICC wanting to send Netanyahu and Golant to The Hague together with the leader of Hamas.
There is though 1 THAAD system available that we are trying to borrow from the US that is stationed in Romania. We could then station that in Kyiv and protect everything 200km out from Kyiv.
But that we fully expect to run out of missiles in the not to distant future due to the El Humpo- effect.
No, the only real answer is saturating Ukraine with SAMP/T systems, but that will take such a long time that many of the ballistic missiles will dunk down in cities.
The only “good thing” is that so far Russia is giving us warnings 15 minutes before launching them, and with 15 minutes of travel time that gives Ukrainians 30 minutes to run down into the bomb shelters, so far that has been enough to protect lives.
I do though suspect that as soon as the El Humpo-effect takes hold that they will stop being “that nice”.

Response
What goes around, comes around.
Yesterday Defence Minister Umerov visited Sweden to get some morale-boosting for Ukraine. And what better country to visit, Sweden is already hellishly mad with Russia over the cut cables, and they do not give a single **** about US/German de-escalation politics.
And with Sweden being the de facto leader of the NB8 Group it comes with sway nowadays. It was a carefully crafted meeting against the steady beating of war drums. “The defeat of Russia is our number one priority”, how’s that as an opening statement by a country?
Next came the news that Sweden has founded a ballistic missile factory in Ukraine, that also produces cruise missiles. After that came “Sweden is preparing a substantial financial package to purchase Ukrainian missiles for use by the Ukrainian army”.
I’ve seen “the factory”, it is a series of monster factories inside and outside of Ukraine. In a Joint Venture between Sweden and Ukraine, and SAAB/Ukroboronprom, Sweden/Ukraine is now the worlds largest producer of Ballistic Missiles with a capacity of 300 MRBMs per year, with IRCBMs entering production in late 2025.
The first two MRBMs rolled off the production line a couple of weeks ago, and was used in the field upon Astrakhan, how’s that for an irony?
I wish I had been able to see the Russian faces on the other side when NATO relayed the message from Ukraine: “Missile launch notification. In 15 minutes two MRBMs will be launched by Ukraine, target Astrakhan, please acknowledge notification.”
I’m very certain that the word “blyat” was used to acknowledge the notification.
Anyway, in Ukraine there was much rejoicing that they now have the power to strike back with even the most vaunted of weapons. I’m also certain that Russia is feeling the weight of Swedish love coming their way.

Potatoes
No, this has nothing to do with missiles, or perhaps everything.
Nothing says Russia more than a big bag of spuds. As long as a Russian has potatoes, flour, sugar and beats he is a happy Russian. From that he will not starve, and if needs be he can make homemade vodka.
Russia has never ran out of potatoes, not even during the worst Soviet times. Other things may have run out, like butter and eggs. But potatoes? Unheard of.
Last year in December Russia had an egg shortage, and a couple of egg riots, now the eggs are a thing again, a full month earlier. And butter is so pricey that Russia is having butter-heists. This has led to egg and butter being on the way to be rationed.
But with the almighty potato Russians should be happy Russians. Just one small problem. Russia is forced to import potatoes already.
Russia is obviously not importing that from the West. Yes, there’s nothing stopping them from doing it, food is not sanctioned after all, but they do not have any way to pay for it. Instead, they have turned to Egypt, UAE and Saudi Arabia for their spud-needs.
These are the same countries that is already supplying Russia with butter, so they are already customers there, and figured out ways to pay for things to those countries.
Now, anyone with half a farming brain will say, “what now countries?” Egypt farm quite a bit of spuds and do actually produce butter. But UAE and Saudi Arabia? Not so much, they import these things themselves in large quantities, and at considerable cost.
Guess from where? Yup, Ukraine. And it is getting even more hilarious. Let me explain.
Ukraine obviously knows how much these countries import each year for their own needs. Previously they sold the butter and spuds at dock-price in Odesa, and the price in UAE and SA was dock-price plus shipping, easy peasy.
As Ukraine noticed that they started to order more, they rapidly figured out where that was going. So, after a bit of haggling came to an agreement. The usual amount is sold at the usual pricing system, but any excess is sold at a higher price, and UAE and SA is then forwarding that price hike onwards to Russia.
Everyone making extra profit, everyone happy, except for Russians that has to pay more for the goods. This has obviously driven up butter and potato prices in Russia. Butter is now 150 percent more expensive, if even available out in the smaller cities.
Potatoes are now 67.5 percent more expensive, and the price is ricing sharply. I will though give Ukraine that they are not overly taking advantage of the Russians on the potato part, they are just hiking the cost 30 percent.
The rest is due mainly to shipping, and middle-man profits. And now that Ruble is dropping like a stone prices will go up even further in the next few weeks.
So far it is just fun and games, but in the end things will start to run out in large parts of Russia. Nobody ever expected that the mighty potato would be one of those things. Putin is having a big problem on his hands.

Freezing
As I predicted the Russian heating systems started to break down with sizeable numbers of Russians being turned into icicles. Novosibirsk alone now has 30 000 inhabitants without heating.
And Russia is now openly telling people to get diesel-generators and wood stoves to survive the winter and telling them to hoard firewood.
Problem is just where they will get those generators and wood stoves from, and the even bigger issue is that firewood is cut during winter, then drying over the summer, and cut and chopped during the following autumn.
You just can’t go out and chop down a tree in a park and expect it to burn in your cobbled together fire hazard of a wood stove. And even if you get it burning it will be smoking like nothing you’ve ever seen before.
Winter is now a dark, cold and hungry reality in Russia. "
 
Brief from the General

"Lt. Gen. Christopher T. Donahue is the US pick to become the new SACEUR and NATO Commander in Chief after retiring Cavoli. The US Senate is refusing to ratify him as a 4 star general. Feck..."

There is a good reason that he's somewhat alarmed by this.
 
Most likely end game is Russian economic collapse to such a degree that the people get angry.
That will be brought about by continued sanctions and eroding their ability to wage war.
Now Budanov has the means at his disposal to hit the factories producing arms, missiles and heavy mech, that process will accelerate.

I think western troops will go into Ukraine, but most likely west of Dnipro and under the auspices of the EU, not NATO.

But, if Russia gets stupid in the Baltic, the more "aggressive" Nordic and Baltic countries might take the fight to Russia.

And following our friend's visit to UK HQ last week

India, China and Iran are still buying up Russian oil and gas..this is keeping them in the fight and sanctions are not having the desired effect they should have.
 
India, China and Iran are still buying up Russian oil and gas..this is keeping them in the fight and sanctions are not having the desired effect they should have.

Well smarter folk than me disagree on the sanctions front. India and China are buying oil and gas at "skinning" prices. No idea about Iran.
But even a cursory glance at Russia's inflation and interest rates (state published) would tell you that the economy is in bits.
And just seemingly minor stuff like pretty much all Airbus A32os that were stolen by Russia are now grounded, because the parts aren't available.

Arms and oil/gas/mineralas aside, Russia didn't have a very productive industrial economy. They imported stuff rather than make it, because they used to have the money.
Now, not really.

But these things take time. Paper cuts. Thousands of them.
 
On victories and bonds. Are you sitting comfortably. You may nod off.

"The Battle of Kursk + Russian Economy
As you lot know I am basically an ogre walking on my knuckles while grunting (BL259 - no he isn't). My main strength is to find brilliant minds and have them explain “stuffs” to me and follow their advice. It may be my only strength in life. (baloney - he is very very clever)
Over the course of my life I have, mostly by accident, become friends with some of the most brilliant minds of my time. Something that I shamelessly take advantage of when I inevitably run it problems in my professional life.
It also comes with the added bonus that you end up in very interesting discussions on topics that interest me a lot, but that I am generally clueless about. Turns out that people who are brilliant love to talk about their line of work if you ask them.
And you never know when, how, or why, someone’s expertise might literally become a lifesaver. Nowadays I mostly fall asleep reading dry reports and do nothing useful and ponder my life’s misfortune of being promoted beyond any sort of “fun”. So, I go spelunking for stories about other peoples “fun”.
I should probably here state that I’m just moaning about it, I do have a lot of fun, but I miss riding a tank in the dark into harms way. And unless something goes spectacularly wrong I will never again get to do that.
Anyway, here are two brilliant minds talking about two very different subjects, and indeed battlefields.

Situation report Kursk
The Third Phase of the Second Batlle of Kursk is coming to an end. Tank Girl has very succinctly divided up the battle into 3 distinct phases.
The first phase was the invasion of Russia, that is when she got to have a lot of fun and could pretty much direct things her own way without a lot of opposition, but all good things must inevitably come to an end.
The second phase was when Russia stabilized and consolidated their defence against Ukraine’s counter-invasion of Russia. It was by far the longest phase so far into the Second Battle of Kursk. During this phase things mostly went into stationary fighting, incursions, and somewhat ineffective offensive pushes by both sides.
During the second phase Russia built up large depots and reserves, openly planning for a final push to hurl Ukraine out of Russia. It should here be noted that Putin stated a date during the 2 nd Phase where Ukraine would be pushed out, but that was just pure bravado, and he knew it.
While Russia was getting ready for an offensive Third Phase, Ukraine did the same. Rotating out tired and battered units, rotating in fresh units with better equipment, dug down, laid minefields, got reserves brought up, built up stores, etcetera.
At the same time Europe finally got its **** together and started to deliver enough munitions of all sorts, especially shells and drones came flooding like if the Hoover Dam had burst. Obviously we still have a ******** of heavy work to do in Europe, but we are finally making some headway.
And since we live in a point in history where you can’t truly build up forces undetected, at least at this scale, Russia noticed that it did not get the needed edge to be able to perform Putins glorious plan to yeet Ukraine out of Russia by the 20 th of January 2025.
This is when Putin went and had an ugly cry against the shoulder of whatever Kim is truly leading the Hermit Kingdom. He got his bottom whipped, snot removed, and told to not worry, the mighty legions of Kim’s would come and save him.
Sidenote: Here’s the point where people should have said, what the hell is wrong with Russia. A major military power and second army of the world should not in any way sort or form have had to debase itself to the point of having to grovel before a third-rate simpleton like whatever Kim is truly leading the stinking state. This is not in any way showcasing Russian strength, quite the opposite. Now back to the story…
So, 12 000 starving North Koreans showed up in Russia. Russia being Russia they rapidly got divided up and sent to 4 separate places, Zhaporizhzhia, Donetsk/Kurakhove, Kharkiv/Vovchansk and into Kursk.
Russia truly should have kept them as a unified unit in Kursk, that would have been a better solution, instead Russia mixed them up with Russians, and hilarity and language barrier problems ensued as they rapidly started to fire upon each other as the Third Phase began.

Third Phase
This became the bloodiest part so far in the war for Russia, and it was to date the largest offensive that they have performed during the war. The Russian offensive was even larger than Ukraine had anticipated.
They simultaneously pushed in Zhaporizhzhia, Donetsk, Luhansk, Kharkiv and in Kursk. The first four of these had two objectives.
One was to tie down all resources for Ukraine in defending their own territory. And in the case of Donetsk and Luhansk the secondary goal was to take as much territory as possible, preferably by making distinct breakthroughs in the Ukrainian lines.
Before we go to Kursk we need to debone these parts of the offensive. In Zhaporizhzhia the Russians achieved nothing at all, same goes for Kharkiv. If anything, they got marginally pushed backwards.
In Donetsk and Luhansk, they did indeed achieve some gains but compared to the last few months prior to the Offensive the gained less territory somehow. The obvious answer to that is that they ran into increased supplies for the Ukrainian army.
In Kursk Ukraine had one goal, and that was to hold as much territory as possible and grind Russian and North Koreans as hard as humanly possible. Each day that passed Russia ratcheted things up a notch as they noticed that their attacks gained no momentum.
In the end they stormed every 15 minutes from sunup to sundown, and they casualty rates shot through the roof with October being the deadliest month, and we already know that November was even deadlier.
First they tried with mostly manpower, but when that didn’t work out they also chucked in large numbers of armour and artillery. This was the moment that Ukraine had waited for. Massive numbers of barrelled artillery swung into place and opened fire with all those brand-new shells that they had received, wave after wave of missiles and drones created impenetrable walls of steel and shrapnel that tore men and machines asunder.
The casualty numbers just went up and up and up as Russia pushed harder and harder. And then they ran out of steam. It was a very sudden thing. Last week we had record numbers, this week the numbers are dropping to the halfway point, with yesterday being one of the lowest numbers in 6 months, with only 1 020 casualties and 5 artillery pieces boofed.
And out of those 1 020 casualties half is in a single strike behind the lines in what is so far the largest mass casualty event in the war. 500 NK soldiers and 18 officers was killed in a single Storm shadow strike. It was a total KIA event; we know this from the hysterical messages we decoded out of Russia.
We even know the number and names of the 5 North Korean soldiers that survived, they had been sent out to buy cigarettes, only to return to the combined ground beef that remained of their fellow soldiers and Russian officers. Among the officers was a Russian general, icing on the **** cake.
Question is then why Russia ran out of steam. In the postmortem we can find 4 distinct reasons.
The first is obviously timely and reliable deliveries of shells, drones and other munitions. In here we should also put the effectiveness of the Ukrainian defences.
This in turn caused unsustainable losses in equipment and soldiers, not even Russia and North Korea can take these insane casualty rates indefinitely. In the end there was no reserves left, and not enough equipment. In fact, they ran on fumes out of the gasoline tank the entire week before this one and started to use up forces that was holding the line.
How unsustainable was this for Russia? When you are sustaining a casualty ratio of 20:1 in an offensive of attrition you truly need a staggeringly much bigger army to be able to win a battle than Russia had.
Normal military wisdom is that you need 3 to 5 times more soldiers when attacking fortified positions, but this time that was not nearly enough. Did Russia have even 3 times as many soldiers? No, they had a ratio of 1.5:1 as the attack started, in the end they sustained an attack with the ratio having been reversed due to their combat losses.
The third factor was somewhat unexpected, but welcome still. It didn’t decide the battle, but it shortened it with at least two weeks. And that was the release of more long-ranged missiles. This enabled Ukraine to take out two key arsenals of Russian artillery ammunition, glide bombs and missiles.
It also enabled Ukraine to strike command centres in the rear with spectacular results. It eroded Russia from behind.
The fourth and most perplexing reason is the timing of the Russian offensive. They full well knew that they were attacking against Rasputitsa, and over the weeks they slowly got bogged down by mud.
Their soldiers had to slowly wade through mud, instead of briskly walk or even run. Their armour got bogged down or had to move very slowly and carefully in columns to stay afloat on semi-rigid roads.
This gave the Ukrainians ever more time to arrange nice firetraps for the ponderously moving Russian meatwaves.
And here we get to the WHY part of the story.
Russia knew almost everything beforehand; they knew that Ukraine was ready for them, they could see that Ukraine received a higher and more steady supply of ordinance. They knew that Rasputitsa was coming.
They knew that their chances to achieve the goal of yeeting Ukraine was slim to none. Obviously they did not know that Ukraine would receive permission to use long-range missiles, but this was not decisive in the battle, albeit helpful to shorten it.
The WHY is simple. It was a purely political decision made by people who do not understand the realities of war. They set the exact date for when it should be completed to match when the Russian President Donald Trump takes power in the US.
This is based on their belief that he will somehow give them the victory on the first day of him coming into power. And they believe that this will be achieved by freezing the conflict along the frontlines based on “territorial realities on the battlefield”.
So, the more of Ukraine they hold, the better. And conversely they do not want to leave Ukraine in Kursk, since that would give Ukraine a trading card to regain Ukrainian land. In the end that failed due to not taking realities on the battlefield into account.
Also, this is a huge misjudgement on the part of Russia, Ukraine will not give up, and neither will Europe. Putin is overplaying his Trump-card, and by doing so he lost a lot.
Because after the third phase, inevitably their will be a fourth phase, and that is not dictated by Russia at all, but here is where I leave the story for another day.

Russian Economy
In the last couple of days, the Russian Ruble has fallen like a stone. And the reason is to be found in the dreary field of bonds.
90 percent of a banks investments are in bonds, 90 percent of those in turn are in state bonds. Banks are normally very conservative and are happy to make small profits over time with no, or very low risks, instead of making huge profits with high risk.
This means that at the large investment banks of the world, the largest departments are the bond departments, and this is where their sharpest minds work.
No bank is larger than Morgan Stanley, and no bond trading department is larger than their London Branch (for historical reasons).
Through a pure fluke I know the head of the bond trading there, and he painstakingly told me why Russias economy is prolapsing at an increased rate now.
A bond is rated against the likelihood that the investor will get his money back sometime in the future, and preferably with a little profit on top.
So, when a bond is put up on the market for auction, the banks deploy a supercomputer running formulations so complex that even my mind goes into a tailspin, they have after all fiddled with the formulations for centuries.
What comes out is called the bond-spread. 1.00 and the bank will get the money back, but make no gain, and everything above and they make profit. Governments know this, and they make certain that the terms will give a bond-spread above 1.00.
Strong economies and strong countries need less incentives since they are deemed as more secure, and less stable economies incentivise things so hard that they get above 1.00 anyway.
This means that in theory a bond will at the time of the purchase never be below 1.00, because then you can’t close the bond in an auction.
The main incentive is obviously interest, Russia has a whopping 21% interest. And a laymen might here assume that for a 5-year fixed-interest bond he/she would make a bargain with more than 100 percent profit.
But when the banks ran their calculations they came up with numbers below 1.00, and that made it impossible for the Russian government to close any bond-auctions. At the end the banks were willing to pay 0.93 of the nominal bond value, and Russia refused the terms.
In the last 2 months Russia has failed to place every single bond loan. All of them. The main reason is that the banks know that the Ruble is overvalued, and they know that in the end Russia can’t artificially hold it up, and that **** up the formulation.
And after two months Russia ran out of liquidity due to not being able to borrow money, and that meant that they could not hold up the Ruble buy purchasing Ruble with gold or foreign currency any longer.
The other tool Russia had was to raise the interest, but that no longer had any effect, in fact it was already at a level that was hurting those bond-spread formulations. So, raising the interest to keep the Ruble propped up was not a working tool.
Yes, they could have raised the interest further to defend the Ruble, but that would just put in a spinning wheel of interest-doom into the economy since not even 30 percent was enough any longer.
Problem is that if Russia let the Ruble devalue the cost of imported goods will increase rapidly, causing social unrest. So, they truly fought a long battle, but it was always a battle they would in the end lose.
As the markets closed on Saturday it was a Ruble bloodbath. In the final hour of trading the Ruble dropped 3 percent, and that came on the back of a week of slow decline.
Since June until yesterday the Ruble has dropped from 1:85 against the dollar all the way to 1:104.31 against the dollar, and just 3 days ago it was 1:92… Oops.
So far the bond-spread has not budged, but it at least has stopped dropping. My friend believes that it need to hit at least 1:120 before Russia can close a bond loan again.
Problem is now that Russia is not a free market, so it is likely that Putin will order Vera Nabiullina to hike the interest to put a break on the drop. She obviously knows that this will not work, she is after all a very respected economist who knows these things very well.
So, it is likely that she will try to minimize the risks of raising the interest as much as possible and drip-feed the interest hikes, expect the interest to be lifted to 23% the coming week. That will slow the plunge a tad, but not by much.
Anyway, short story. Russian inflation will skyrocket, especially on imported electronics and imported food. To counter this inflation Russia will increase the interest rate. And the Ruble will continue upwards and will probably hit the 1:150 barrier between April and June. Interest? That will land above 30 percent.
This will obviously cause a cascading effect of bankruptcies across Russia, stalling the economy even further as Stagflation takes hold over Russia.
The Risk here is that the Russian President of America will use US money to purchase bond loans in Russia after cancelling the sanctions.
It is likely at this point that European Central Bank will start to dump US Bonds as a retaliation, after all, that is our Doomsday weapon over the US, we own the bulk of the US National Debt, and by dumping even a fraction of the bonds, we would devaluate the US dollar considerably.
This is coincidentally why the US can never win a trade war with EU.
Anyway, who knew that something so boring as state bonds was so important, I for one didn’t know that before getting to know my friend by a fluke in Madrid, many years ago when he was on a celebratory trip to celebrate his first job as a minor clerk at a bond office in London.
Oh, you lot fell asleep? Mea culpa! "
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News in brief. Sweden has just announced sending 14 JAS Gripen to Ukraine, together with long range missiles. There are 10 trained pilots already and a new batch are training now. Plus Sweden is working with the UK on a long range ballistic missile, capable of carrying conventional AND nuclear warheads.
Odesa was hit pretty bad this morning. The answer was a swift 6 x ATACM raid on a key Russian airfield.
The Odesa hit was a bit close to home for Sneaky. But he was in the capital city of Sneakyland at the time.
 
Brief missive. Long one incoming.

"In Russia diamonds are not forever! Russian diamond producer Alrosa is closing down its mines effective immediately. "

This is due to high interest payments on loans, meaning they can no longer afford to pay the wages of their mine workers.
 
For a Swede, less than enamoured with his own government, my mate appears to be of a Swedophile persuasion this week. Still loathes Stockholm though.
I know some of you reading this will be less than enamoured with some of the contents of this missive.


"Swedish Week
To all points and purposes this will be a very Swedish week. With the Nordic Summit to be held on Wednesday and Thursday between Poland and the NB8 in Stockholm, Sweden is levelling up the war-hawking to a level that can mildly be described as frenetic, and it is only Monday.
I will be attending that summit as an observer for EU, but the topic is already known and supported by EU. To go gung-ho mental on Russia in literally every way possible. Most important part is to continue to build up a force presence in Ukraine.
I think I have not succeeded with transferring the image of how much average Swedes and Sweden hates Russia, and how deep that hatred goes. If you would give a Swede a button and said, “push it and Russia will cease to exist”, the normally peace-loving Swede will sturt to froth from his mouth and push the button so many times that it would break.
This is a sentiment shared by Swedish governments for the last few centuries. After all, we did our best to pre-emptively solve the problem of Russia’s existence many a good time, and sadly failed.
From a Swedish perspective the time has finally come when Sweden can nudge things into the direction of ending Russia once and for all.
So, what has Sweden done now?

Actions and Steps
The latest campaign has obviously been going on since day one of the renewed invasion of Ukraine, and somewhat even since 2014. But let us go through the decision in the last 14 days and see how Sweden ramped up the snarling.
It began with the well-hidden notification that Sweden was sending a Coast Guard detachment to safeguard civilian traffic in and out of Ukraine. The few that noticed that statement took it as a few coast guard people lolling about.
The reality was that somehow Sweden snuck in the HM Missile Corvette Malmö into the Port of Odesa. Built in the 90s it was modernized into an inch of its life and returned to service in 2022, gaining 100 tons during refit, and now briming with the latest and greatest of boomsticks, among them Gungnir Cruise Missiles.
Someone had a bit sloppily spraypainted Swedish Coastguard on it, and not a single coast guard person was around as I walked past it.
Next up came last week as Sweden let out the news that it had built a missile factory in Ukraine, and that Sweden would fund the production from said factory so that it could start churning out medium range ballistic missiles.
At this point most countries would have called it a year and gone to bed, but Swedes are made of sterner stuff, and it was just the warmup. Now, get some popcorn and cold beverage, because now things go into hyperdrive of deranged Russia-hating.
The day began with a dry notice that Sweden has restarted training Ukrainian pilots on the Gripen fighter jets, and when Sweden states something, it has been going on for a long time already.
These pilots are obviously beyond the 10 pilots already trained, because there will be quite a substantial need for more pilots.
Next was the funds declaration of a first tranche of 14 Gripen C/D-fighters together with armament. No upper limit was set, just that this was the first tranche. And as you know, 14 fighter jets require 28 pilots. How much and many in the end is right now written in the stars, but over time probably all of the C/Ds and with A/Bs to be converted. But that is so far a hunch from my side.
Surely this would be the point even Sweden would call it at least a month? No… not at all. It gets better/worse, depending on your point of view.
Next of todays news was that UK and Sweden has signed an agreement to jointly build Long- range ballistic missiles able to carry both conventional and non-conventional warheads from the stockpiles of respective country.
Both obviously have medium-range ballistic missiles, and the UK ones are able to carry non- conventional payloads. So, this is a rather sizeable upping of the game, and most likely a direct response to the US potentially removing the nuclear shield over Europe.
Okay, at this point one would assume that it was at least over until after lunch. Sounds reasonable? No, it was at that point that Sweden went apeshit on the bonkersometer.

The Psychology of Status
At exactly 1200 hours the unit designation on the Vidsel Missile Base changed, and an old-time fax machine coughed into life in NATO HQ, and presumably a lot of other places around the world of note.
It was as for all of these things an extremely short message. “Sweden hereby declare status.” That was it.
First a short historic recap. In the early nineties Jane’s Defence Weekly cointed the term “5- minute state”. It was the time they felt that Sweden would need to obtain nuclear capacity. It was obviously a quip, but it was close to the truth.
For decades we had been fiddling with building nukes, but never taken that final step, and we were so close that the moniker was not off by more than half an hour, it would be the time it took from going from non-nuclear power to a nuclear power.
Officially this ended in 1996 as Sweden and South Africa signed an agreement to disarm their respective nukes, and South Africa handed over their two operational nukes, and material to build more. They handed this over for destruction by Sweden.
And since nobody was monitoring what Sweden did with that, nor what we did with our own stuff, things rapidly grew very murky. But, for a while no funding was sent into the program, at least we know that.
Next date that is important is 2014, that was when Sweden said to itself in a dark corner of a very deep basement, screw it let’s go. The reason was the Russian invasion of Crimea and Donbas.
Back then Sweden was neutral, and we calculated the cost of building up an army that was strong enough to act as a deterrent, and how long time it would take. The conclusion was “crap”.
The only thing Sweden could get into place fast enough and without completely breaking the piggy bank, was to kickstart the old program again, and mysteriously fissile material etcetera was found sitting in storage, and drawings, material, and other stuff.
Four years ago, the first units were ready, and the initiator stage was tested deep down in the ocean in a very small double-clap event. It registered as an M4.2 between Norway and Iceland. Why only the initiator stage? You do not need to test the rest.
The data and specifications, drawings, etcetera, was handed over in an envelope to Russia, who secretly said blyat, and tried to look like it was raining. Equally quietly NATO itself was informed.
This is why I usually say that Europe has 2.95 nuclear states. All that remained was to change designation of the base itself, and to declare the status.
So, why now? There are 3 distinct reasons for this. The first one is that on the 20 th of January 2025 the US Nuclear Shield over Europe will cease to be a thing. To be safe, you need to be a nuclear state, that is something that we have learned the hard way from 2022 and onwards.
The second reason is that Sweden via NB8 Group is going for the leadership position of the Coalition of the Willing that is forming. And that leader must be able to safeguard the security of the other Willing nations.
This would be even more important if neither France, nor UK, would join the Willing. And that was not assured when Sweden decided to go for it, so the date of declaration was set months ago. Also, even if they became Willing, it does not hurt to have another nuclear state among the Willing.
Poland was trying to take the position of leadership, but they are not the best option. They are after all not entirely trusted by either Germany, or Ukraine, the latter being more important. But trying when a more trusted neighbour just became a nuclear state ended that discussion, hence why Poland had to come to Stockholm when called.
But the most important reason of this hectic activity is psychological. With the US gone there is desperate for an almost insane Warhawk nation oozing unpredictability. The idea is mainly to sow fear and uncertainty in Russia about what is happening.
If you fear someone you are far more malleable to take things seriously, and when the country that is unpredictable and fearsome is creating a Coalition of the Willing to go to war against you… things will become even worse for you.
There’s cold rationality behind the perceived insanity. And the media in Sweden is tagging along with article headlines like “How Swedish weapons kill Russians” with an image of ghoulishly smiling colonel.
The idea is also to push Trump as hard as possible and make it clear to him that he is inheriting a Europe on the brink of war, and a war that Europe is on the brink of entering. Backing out would then make him look both weakling and a looser.
And having Sweden declare war on Russia, that would just make it psychologically even worse for him. I do not think it will work; he is way to far gone, and the picks he has made for defence and security speaks loudly. He is pulling out of Europe, the first time he pulled out of anything really.
Otherwise, I think that the actions taken by Sweden are prudent, and sound psychology, and also showing leadership. May be the Swede in me talking but, still.
So, what will come next? I have a good inkling obviously, but that can wait a few days.

Ukraine
Putin missed my apartment by roughly ~~~~~~~~. So, I feel rather of a Swedish disposition today in regards of Russia.
There are though good things on the horizon, US is gifting JASSM to Ukraine as a parting gift, a considerable amount of them even, and a part of it is the long-range version. That will help a lot and make things very costly for Russia.
During the night Ukraine worked hard at boofing things, so an airfield was hit numerous times, an S-400 system was taken out together with officers and technicians. The Cyclops Weapons Factory is no more, and the refinery in Kaluga was also bombed for good measure.
Russia claimed that they shot down every missile and drone, but that debris hit every intended target. Olamky indeed was used on one of the targets, and if you remember, Ulamkyy is the Ukrainian word for Debris.
Anyway, tomorrow should be quiet on the Swedish front, tomorrow is the day that France, Italy and UK will state what they cooked up together.
Little me? Observing. To the joy of some, and horror of others."
 
Morning brief.
Rouble now trading at over 108.

Steam pipes exploding in St Petersberg

And the "Chino/Russian" cable cutting ship is now surrounded. "Live firing exercise" announced. Swedish prosecutors now have enough evidence to arrest the ship and take it into Swedish waters.

 
Any insight on this and how much of a problem this will cause going forward?


I'll ask. He's busy observing in Stockholm at the moment.

Meanwhile.
Rouble now down to around 115 per $

Ukrainian successes in chasiv TYar and Kupyansk

 
@Lefty
Your answer "Not a lot, it sounds like a lot, but it isn''t really. Also, the mortars will be tested, and the functional ones will be reissued. They are all from one company. 90% are working".
 
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