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  • Writer's picturePimm Fox

Whose Sanctions Are These Anyway?


The Pimm Fox Show - Episode 1

PF: “Welcome to The Pimm Fox Show - Your weekly source of strategic satire and tactical tantrums.”

First some ground rules for this podcast. I put my name on it for a reason. I’m responsible for the content. But I’m not responsible for whatever reaction you may or may not have. Of course I hope you find the programming interesting and provocative. I hope to raise questions about, and offer different perspectives on financial markets, global economics and how businesses and governments interact to create the world we live in.

Clearly, every program is biased.

Anyone who tells you different is, well, let’s just say I was once upon a time on a LASH freighter

going east to Cadiz in Spain. And here’s what I learned: “The only difference between a fairytale and a sea story is - a fairy tale begins “Once upon a time,” while a sea story starts: “This ain’t no shit.”

Which helps you frame my own outlook to a certain extent.

Do not take anything you hear on this podcast as advice to do anything. In fact, you can make the

argument that this is the place in the podcast universe in which you don’t have to DO anything. Nothing. Don’t change a thing. Don’t move your money from A to B, because of something you heard.

If something moves you to learn more, to investigate in more detail or to actually go and see a potential investment, great, that’s a job well-done.

Because it adds another level of participation and connection.

Here’s an example concerning today’s program about sanctions placed on Russia by the US and its allies because of Russia’s invasion of Ukraine.

I searched on Youtube to find a channel that offers videos and rather benign travel commentary about living in Russia. I found one from a video blogger - a vlogger named Eli. Through her 30-minute video in Moscow of her trip to Russia’s largest mall, you can see that prices have gone up.

Nike store, as well as a closed Starbucks and shuttered


She explains how to get around the ban on Instagram, she laments the fact that she can’t access her bank account because her Youtube account is outside of Russia. I’m just as interested in her story - and how it fits into the big picture of sanctions, as I am stories from media outlets such as The New York Times, The Wall Street Journal and Bloomberg. All places where I spent more than 3 decades as a journalist.

Over the next 26 minutes you will hear why the question of whether sanctions work or don’t work to bring a bad actor to heel, may be overshadowed by the effects sanctions have on global supply chains and capital allocation. That means money. Big money.

What Goes Around, Old friends, Stalin, Molotov and Ribbentrop

First, you’ll hear about companies who are literally turning on the lights in Europe with U.S.-sourced natural gas. Also, you’ll understand how Germany’s vision of Nordstream 2 bringing Russian gas to Europe has turned into a $2 billion pipe dream.

That was quick.

Martin Wolf, Economics Correspondent FT
Martin Wolf of the FT

Then we have Martin Wolf of The Financial Times about the reserve status of the U.S. dollar during what is not just a military war, but a commercial war as well. The issue there is if the U.S. prevents a government from accessing its own dollar reserves, what’s the point of having U.S. dollar reserves? Actually, there are lots of reasons.

And in part three of today’s program you’ll hear from Trip Mackintosh, he is one of the most well-respected legal experts on U.S. non-proliferation controls and trade sanctions. He can explain in detail the global legal infrastructure that is designed to monitor and enforce sanctions and embargoes, and how that can reshape whole industries.

That’s all coming up. I hope you stick around.

You’re listening to The Pimm Fox Show.

You’re listening to The Pimm Fox Show.

The U.S., its allies and countries around the world have hit Russia with sanctions designed to cut the country off from global financial, trade and cultural institutions.

From barring the U.S. import of Russian oil, to the blacklisting of President Vladimir Putin and his associates, the use of sanctions is, on the surface, is designed to get Russian forces to stop. Just stop. Stop and withdraw to the lines that existed prior to February 24.

Burned by the sun

On the surface that seems like a very clear goal.

But I put it to you that it is not.

The sanctions are designed for a variety of purposes and effects, and are sometimes complimentary to military operations, but more often than not, they are an independent source of motivation and morale.

There’s no evidence that links sanctions with foreign policy successes.

In fact a new book by Nicholas Mulder reports that sanctions have worked only 13% of the time, according to his analysis.

So why do sanctions exist? Is it just to make people feel good about buying their Starbucks? That’s part of it.

But I propose that sanctions are a way to weaponize money.

Sometimes it works. For example, when the U.S. government froze the Russian Central Bank’s access to its overseas U.S. dollar reserves and pushed for Russian banks to be bar

red from the SWIFT system, that doesn’t sit very well with any business person who is thinking of investment in Russia.

So the risk level for all foreign investors in Russia just shot up.

Additionally - and potentially more importantly for the future of the Russian economy - is its lack of access to Western technology.

As more and more components are assembled using bits and bytes from a variety of sources, technology that has a U.S. - sourced component - be it software or hardware - is now in the deep freeze when it comes to sales or support in Russia.

Sure, the Russian’s could try to build everything themselves, but even their own military equipment shows their dependency on the global supply chain. Tires from China.

Which brings up the potential new friendship between China and Russia.

This has been pitched before, and makes great copy, because the whole point of the media is to get you riled up about us vs. them.

Well, if the Russians go to the Chinese for all their tech gear, they are now trading a competitive market (German, Finnish, Italian, American, French or British IP or hardware), for dependency on one country.

And by the way, China’s export control bureaucracy works very well. Though unlike in the U.S. you won’t be needing a lawyer, because China unilaterally sets its own trade policy. Public comment periods? I don’t think so.

OK, so let’s stay with the notion that sanctions are an additional weapon to be wielded against a country - in this case Russia.

Coming up, why do people talk about the U.S. dollar and its status as the world’s reserve currency.

Well, try paying for your oil in rubles and you’ll find out.

That's next.

So people that give humans a bad name.
Her face says it all

You’re listening to The Pimm Fox Show.

A weekly source of strategic satire and tactical tantrums.

Emmanuel Macron said good bye Mali - hello Wagner Group. That’s right. The same bunch of guns-for-hire that you’ve read about in Syria and Ukraine, have set up shop in Africa. Nice huh? But here’s the really

nice part- it’s a one-two punch. What is the likelihood that Macron and Putin had a conversation about letting the Wagner Group go bounty hunting in Mali in return for the French pull-out? Mali has been kicking out other troops - from Denmark for example - and replaced them with Wagner boots.

And remember that trip Macron made to Moscow to get the Russians to consider a ceasefire in Ukraine?

You have to imagine that Macron feels a little deceived at this point.

It will be interesting to see how the French elections change the calculus in Ukraine - if at all. In fact, - France is the number 1 foreign employer in Russia and is the second-largest source of foreign investment in Russia.

Where’s Napoleon when you need him?

This is the Pimm Fox Show.

The topic is sanctions, financial sanctions, trade sanctions - sanctions having to do with money - how to move it and use it - my guest is Martin Wolf - Mr. Wolf is associate editor and chief economics commentator at the Financial Times.

Martin thank you for being with us - can you first define money so we learn a little about what what’s at stake when for instance the U.S. and its allies cut you out of the global financial system.

Coming up , Trip Mackintosh, one of the most well-respected legal experts on U.S. non-

proliferation controls, trade sanctions and money as a weapon.

Coming up, find out who made the most money by evading sanctions.

You’re listening to The Pimm Fox Show - A Strategic, Satirical and Tactical View of Global Events and Markets”

In this episode, you’ll hear how international sanctions and trade blockades affect the global economy as well as the cost of the device you’re using to listen to this podcast.

We’ll also explore the question of whether sanctions are an effective tool to coerce nations or individuals.

Trade blockades and wars for commodities and markets continue to bedevil humans. From Ancient Greek Wars seeking copper and silver, to the Arab Oil Embargo in 1973-74 and the

Russian oil fields
Baku oilfields in Russia

current sanctions against Russia for its invasion of Ukraine, commercial wars have taken many different forms.

Find out what this means for you, a consumer and an investor, next.

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