Transcription
Vladimir Putin has just ordered the Russian central bank to blow up the Russian economy. Just why is the worst damage to Russia in this war coming from Russia itself? Plus, we are going to talk about, uh, Putin's trolling of the Trump-Elon Musk feud. I'm Paul, US Army combat veteran. Let's get into it.
Okay, so this seems like one of those stories that's boring, but I promise you it's not. Russia has cut its interest rate for the first time since 2022. Now, the overall story is that this Russia's central bank today lowered its interest rate from 21% to 20%. Which is generally something you do when there is easing inflation. You might recall President Trump is tweeting like it's going out of style at, uh, Jerome Powell, the Fed chair, to lower interest rates, to improve borrowing costs. And ultimately, that is this is a huge slash in the, uh, rate because it is a 100 basis point. To give you an idea for context, in the 2022 hiking cycle right from a few years ago, the Fed raised rates faster than any time in history, and every single quarter it was raising between point between 25 and 50 basis points. So a 100 basis point swing is pretty massive, right? But what's more significant is that it's not clear that the inflation problem in Russia is going anywhere.
Now, the official Russian state data claims that inflation is actually plummeting, dropping from 10% in January, nearly 11% in January to just 6.2% in April. But this is so dramatic a shift that it is all it is difficult to believe that this data hasn't been manipulated. And let me show you why. Here is some somewhat more independent Russian core inflation data. And you can see now this chart is not well laid out, but you can see the highest bar here is 9.5%, and the absolute lowest is about 8.1. Right? So this October number is 8.18%. All right, but this is the context I want you guys to have. So in April, the inflation rate was 9.23. This is down from 9.65 and up from 9.55. So you can see that basically the the inflation rate has been above 9% the core inflation rate since December 2024. Right? And you can see even this low, this local low in the inflation rate is still 8.1%. So the odds that it dropped from literally 9% in March to 6%, a literally off-the-charts drop, was almost unbelievable. And the central bank themselves seem to confirm this. Listen to this statement, and we'll translate it from econ speak to actual speak. Quote, "While domestic demand growth is still outstripping capabilities to expand the supply of goods and services, the Russian economy is gradually returning to a balanced growth path," the central bank said in a state in its official statement. But here's the thing. What I want to point out is that when demand is growing faster than supply, prices rise. They inflate. This is very simple economics. If I have five people that want one apple and I have five apples, the price of apples is going to be pretty stable. But if I double that number and have 10 people that want those five apples, the price of apples is going to rise. It is going to inflate. So when the central bank comes out and says demand growth is outstripping supply, i.e., inflation's still happening, they say, "but you know it's returning to a balanced growth path." Guys, the only thing the central bank is trying to balance right now is staying on Putin's good side because Putin has made it eminently clear by opening actually an investigation into Elvira Nabiullina, the central bank chief of Russia, um, that she is on the chopping block. And in Russia, when you run afoul of Vladimir Putin, you don't end up on a proverbial chopping block, right? You end up literally pushed out of a window.
Now, what is worth pointing out is that the Russian economic minister, right, this is a Putin lackey, uh, urged—but you should read that as instructed—the central bank to cut rates to boost growth, aiming to achieve a 3% growth target set by Vladimir Putin. Here's the problem with this—is the fundamental problem with dictatorships—is that oftentimes when a dictator stays in power long enough, he believes that just because he can order his chef to make him any food he wants that he has that same power over the economy. You cannot order a country to grow economically, especially not when you're like Russia and you are spending huge amounts of your money and huge amounts of your labor force to fight a war in a that is increasingly looking well increasing that is a quagmire. Now, privately, it says Putin has expressed displeasure with the decline in private investment due to the high cost of credit. Right. Russia has been forced to slash key projects across various sectors in the face of an economic slowdown, brought in part by plummeting oil prices because remember oil prices represent the ability of the state to spend. Major Russian exporters have cut down on rail shipments of metals and oil products beyond earlier projected reductions. This is the problem—is that what Putin's war economy runs on is credit. But more importantly, what the the oligarchs of Russia who control these business assets, what they run on is also credit. They need the ability, right? Private investment means somebody is buying stakes in your company. And so if you are a Russian oligarch, remember Vladimir Putin needs two entities to be okay with him that he needs to balance to remain in power. The first is the state security apparati, right? These are the military, the police, the FSB, right? And certainly they are compliant because they are tied up fighting in Ukraine. But you also have the Russian oligarchs. Russia's oligarchs control major business interests and they are beholden to Putin, but they are also propping him up. And if enough of them get together and decide that the way he's running the country is unacceptable, they will vote him out via a good shove out a window. So the fact that this private investment is in decline, right? Because the idea is, of course, a Russian bank will take out a loan and then it will invest that money into, uh, commercial enterprises that will grow. So if you take out a loan at 2% and you invest it in a company that's going to grow 4%, you make a little money. But more importantly, the other people making that money are the oligarchs. The oligarchs need constant influx of cash, right? not just to fund their projects and expand their businesses but also to fund their own lifestyle. Right? So the fact that the Russian central bank has interest rates at 20%, guys, there is no investment in the United States that you can count on to reliably produce a 20% return. It literally doesn't exist, and it's unlikely that there's such an investment in Russia. Certainly not given the collapse in many of these of oil prices. That means that if you want investment to go into Russian state companies, state-affiliated companies like gas and oil concerns, you need that interest rate to be really low. And so this is a gimme to the Russian oligarchs. There's just one problem. When you cut rates and you have a high inflation environment, inflation is going to get supercharged. And that's the direction things are headed. Right? We already saw the Russian central bank was already ordered not to hike interest rates beyond 21%. Now they're being ordered to cut interest rates. I think it is a a disaster for the Russian economy in the making.
But before we talk about Putin trying to exploit the US—well, it's not even a disaster—the US beef between Trump and Elon Musk, plus the, uh, White House's own cope for the Ukrainian drone strike, uh, that they didn't get told about, I want to mention one thing, and that is combatvetnews.com. If you guys are, uh, fans of the channel, you know that I am really constantly, um, getting demonetized. I'm getting I get very few sponsors, and it's because I am willing to speak truth to power. This is not a great time to be criticizing the person in the White House today, and I was also critical of the person in the White House before. So, I am not sitting here saying, "Oh, I have this grand, uh, uh, uh, no one is out here, uh, really saying, "Oh, let's affiliate ourselves with this guy." But that's okay because I have you guys backing me up. Best of all, every Tuesday and Thursday, I find uncensored combat footage. Some of it sent to me from units on the front line, and we do a deep dive analysis looking at the raw unfiltered combat footage. So if you want to support the channel, become a member at the specialist tier. If you want access to the weekly Q&A and the shout-outs at the end of video, become a lieutenant or colonel here. I appreciate all you guys that support me over there, and the link is in the description if you're interested.
Okay. So, one of the things, guys, I want to point out that Vladimir Putin claims to be sincerely and genuinely interested in peace, but then none of his actions reflect a sincere desire for peace. And I want to point out that Elon Musk is now beefing pretty hard with President Donald Trump, right? And so, it's fair to say though that Elon Musk has no role in government. He's just a rich guy now. And Putin is out here taking Musk's side. Do you think, right, uh, this is according to Dmitri S. Medvedev, deputy chair of Russia’s Security Council, who says, quote, "I think Musk is playing a different game. He won't need political asylum, although if he did, Russia could certainly provide it." Right? This is a fascinating kind of role. Uh, again, he also said, hey, you know, Dmitri Medvedev, the deputy chair of Russia's state security council, uh, also said that Moscow would broker a peace deal between Donald and Elon. FYI, guys, uh, he added, "Don't fight, guys," Medvedev wrote. Uh, this is important, I think, because remember this is a country that is involved in negotiations, ostensibly committed to achieving peace, um, and simply cannot find a way to do it, uh, you know, to to to get around the, uh, you know, officially the Russians say the Ukrainians are the ones who are the obstacle to peace. So, do you think if you were interested in peace, you would go around trolling, uh, the president of the United States, the person who keeps organizing these peace talks? Don't you think it's a little weird that despite constantly organizing round after round of peace talks that only Russia snubs and Ukraine takes seriously, that the Russians are now out here trolling him, offering asylum to his political adversaries? That should be that's what's called a clue, guys. But we've talked about that on this channel ad nauseam that Vladimir Putin's actions are those of a guy who has no interest in peace. All he does is do these performances in which he talks a big game but then does absolutely nothing.
Right now, I want to point out two things. First, also, the White House reportedly reconsidering Ukraine support, to which I say, what Ukraine support after drone strikes on Russian bases, right now. This is annoying because the White House was mad because no one told them. Gee, I can't imagine why you wouldn't tell them. Is it possible that I don't know the White House leaks classified information about strikes all the time, right? And that Donald Trump literally has said he came out and tweeted, "I protected Vladimir Putin from bad things happening to him." Right? Why would the Ukrainians give information to someone who says, "I protect Vladimir Putin." Guys, that's this is a level of absolute preposterousness that is just difficult to to even conceive of. And also, I want to point out that in a Truth Social post, Trump said the two discussed Ukraine's drone—this is the call between Trump and Putin—said that they discussed Ukraine's drone attacks on docked airplanes. Airplanes don't dock. They are in a hanger. They're landed. It's it's it's one of those things that if you are the commander-in-chief of the Air Force, you should probably know that you dock a ship. Um, but, uh, I think this is just sort of a, uh, this is just this is just more Trump administration nonsense. Even Keith Kellogg, Trump's sidelined envoy for for Ukraine, warned the strikes may provoke a significant Russian response. He says, quote, "The risk levels are going way up." Right? This is fascinating because the one person who should be blamed for this but won't, uh, is Trump himself, who has actually managed to destabilize the situation by not helping Ukraine, forcing Ukraine to take ever more aggressive tactics to try to achieve a strategic stalemate with Russia, and his own, uh, the fact is that the friendlier, um, the friendlier Trump has gotten with Putin, the more Putin has expanded the war, right? When Trump—since Trump has taken office—you have Russia's strategic nuclear arsenal has been damaged in the form of this drone strike against bombers; you have a large-scale Russian operation now taking place in Sumy Oblast, an entire different Oblast that is now opened up; um, you also, of course, have North Korea, uh, who has entered the fight more explicitly and reaffirmed their partnership. In almost every dimension, the war has expanded and escalated thanks to Trump's so-called peace efforts. Anyway, Anyway, guys, that is all I had. Huge thank you to our colonel-tier members. Folks like Peter Fucci, Dan M, Peter, Henry Russier, Idis guy called Chris Rossi, Al90, Sergey Zenchenko, D Stewart, James Porsche, and B Himmerling, as well as all of our lieutenant members. Couldn't do it without you guys. Appreciate you all so much. And I will see each and every one of you in the next one. Hit that subscribe button, by the way. I appreciate you. Cheers.