Econintersect: While there is much talk of sanctioning Russia for the Crimea and Ukraine crisis, there are some who claim that proposed financial actions to “bailout” Ukraine will simply be sending money to Russia. Two sources included in the article, economist Michael Hudson and Gonzo Journalist Reverse Engineer both present the rationale behind this thinking. Both of these sources have contributed to Global Economic Intersection.
From Michael Hudson:
From Reverse Engineer (Frostbite Falls Daily Rant #21, 30 March 2014):
- “This amounts to a bail-out for Russian state banks and Western funds accused of propping up the previous regime and for vulture funds that bought Ukrainian debt cheaply for quick gain.” Ambrose Evens-Pritchard in The Telegraph.
- “Ukraine has been the ultimate moral hazard play and it’s cavalier to expect taxpayers to cover this.” Tim Ash, Standard Bank, quoted in The Telegraph.
- “The international rescue for Ukraine was in sharp contrast to Western measures to isolate Russia diplomatically and charge it an economic price for the annexation of Crimea, home to Moscow’s Black Sea fleet and an ethnic Russian majority.” Natalia Zinets and Elizabeth Piper, Reuters.
- Who in Ukraine benefits from IMF bailout? (Michael Hudson, RT, YouTube)
- Frostbite Falls Daily Rant #21: Ukraine, IMF & Russia Circle Jerk (Reverse Engineer, Doomstead Diner)
- Windfall for hedge funds and Russian banks as IMF rescues Ukraine (Ambrose Evans-Pritchard, The Telegraph, 27 March 2014)
- Ukraine wins IMF lifeline as Russia faces growth slump (Natalia Zinets and Elizabeth Piper, Reuters, 27 March 2014)