Europe Furious That Putin Dares To Retaliate To Sanctions, Blames Economic Slide On Kremlin

Tyler Durden's picture

Either Europe is run by a bunch of unelected idiots, or... well, that's about it.

After blindly doing the US' bidding over all propaganda matters Ukraine-related, and following just as blindly into round after round of US-inspired sanctions, sanctions to whose retaliation Europe would be on the frontline unlike the largely insulated US, Europe appears to be absolutely shocked and is apoplectic that after several rounds of sanction escalations, Russia finally unleashed its own round of sanctions and yesterday announced a 1 year ban on all European food imports, something which will further push Europe into a triple-dip recession as already hinted by Italy yesterday.

In fact, Europe is so stunned by this unexpected "politically-motivated" retaliation by Russia, it issued a press release.

Statement by Commission spokesman on the announcement of measures by the Russian Federation

 

The European Union regrets the announcement by the Russian Federation of measures which will target imports of food and agricultural products. This announcement is clearly politically motivated. The Commission will assess the measures in question as soon as we have more information as to their full content and extent. We underline that the European Union's restrictive measures are directly linked with the illegal annexation of Crimea and destabilisation of Ukraine. The European Union remains committed to de-escalating the situation in Ukraine. All should join in this effort. Following full assessment by the Commission of the Russian Federation's measures, we reserve the right to take action as appropriate.

Surely, Putin is waiting for the European Commission to also issue a #hashtag before he starts shaking in his boots.

For an indication of just how clueless Europe is, we also read that it is ready to appeal to the World Trade Organization to have the Russian agriculture import bans lifted, a European diplomatic source told ITAR-TASS.

“Politically motivated large-scale trade restrictions are a direct violation of WTO rules, which Russia pledged to comply with,” the diplomat said. “These measures will be thoroughly analyzed, and then relevant claims will be submitted with the WTO.”

 

The source added that the European Commission would start analyzing Russia’s ban on imports from EU states as soon as the official list of banned goods would be published.

 

The EU Council may convene an urgent meeting in connection with Russia's response to European sanctions.

 

It is early to say whether the EU will take measures in response to the Russian ban on imports of food products from Europe, source told.

 

“First, it is necessary to see and analyze the official list of product that Moscow intends to ban. After that, decisions will be made both at the European and the national level,” the source stressed.

The punchline: "The Russian ban on agricultural imports from the European Union is an “irresponsible measure” that can lead to losses of billions of euro for European as well as Russian consumers, the source told ITAR-TASS."

In other words, Europe actually thought it would keep escalating without Russia retaliation. If confused, see the first sentence of this article again.

In the meantime, Europe counter-retaliating to Russia's retaliation to European sanction aggression is sure to make the already bad trade war, worse. A trade war so bad in fact, that what snow was to Q1, "evil Putin" will be to Q3. From Bloomberg:

The crisis in eastern Europe is showing signs of disrupting Mario Draghi’s economic outlook.

 

Evidence is building that the conflict in Ukraine and European Union sanctions against Vladimir Putin’s Russia are undermining a euro-area recovery that the European Central Bank president already describes as weak. With the ECB expected to keep interest rates on hold near zero today and refrain from any new policy measures, Draghi is likely to face questions on how he plans to keep the economy on track.

 

The ECB may have few tools left to mitigate the impact of political turmoil that European companies from Anheuser-Busch InBev NV (ABI) to Siemens AG (SIE) say is hurting their business. A volley of measures introduced in June will take time to work, and policy makers have so far shied away from wheeling out a full-scale asset-purchase program.

 

“The euro-zone recovery is very fragile and the macro situation fluid,” said Andrew Bosomworth, managing director at Pacific Investment Management Co. in Munich. “Expect Draghi to elaborate on spillover risks from the Russia-Ukraine crisis.”

Ironic, because this is just as we said would happen when we predicted that Putin will soon become Draghi's best friend and as a result of Putin "aggression" Draghi will have "no choice" but to boost Europe's monetary insanity, which recently crossed into the NIRP twilight zone, even beyond the rabbit hole.

Finally, Bloomberg actually did touch correctly on what the recent trade war escalation is all about in "Russia Sanctions Accelerate Risk to Dollar Dominance."

U.S. and European Union sanctions against Russia threaten to hasten a move away from the dollar that’s been stirring since the global financial crisis.

 

One place the shift has become evident is Hong Kong, where dollar selling has led the central bank to buy more than $9.5 billion since July 1 to prevent its currency from rallying as the sanctions stoked speculation of an influx of Russian cash. OAO MegaFon, Russia’s second-largest wireless operator, shifted some cash holdings into the city’s dollar. Trading of the Chinese yuan versus the Russian ruble rose to the highest on July 31 since the end of 2010, according to the Moscow Exchange.

 

While no one’s suggesting the dollar will lose its status as the main currency of business any time soon, its dominance is ebbing. The greenback’s share of global reserves has already shrunk to under 61 percent from more than 72 percent in 2001. The drumbeat has only gotten louder since the financial crisis in 2008, an event that began in the U.S. when subprime-mortgage loans soured, and the largest emerging-market nations including Russia have vowed to conduct more business in their currencies.

"No one is suggesting"? We are!

As for the propaganda landscape, the scene is already set:

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firstdivision's picture

If they don't the plebs may well figure out that open economic trade only benifits the few at the cost of many.  Cannot have that now, can we

NoWayJose's picture

Lower food prices help unleash Draghi's Demon - something hated even more than Putin - Deflation!

cowdiddly's picture

Well yes, I hope you like it cold. But look on the bright side you can drive a nail with a frozen banana.

Kirk2NCC1701's picture

Europe,  have no fear.  GMO is here.

Bullish for Monsanto. Euro-bitchez.

 

MFL5591's picture

And what was Putin to do?  Just take it like all the pansies of the world have over the past 50 years? 

Eyeroller's picture

That's exactly what he was supposed to do.  

This magazine cover is no different than how anyone in the US who criticizes Barry gets labeled as a racist. 

falak pema's picture

Looks like Mutti and the EU commission don't have a common vision of what to do with Putin's strategy as response to US strategy.

Uncomfortable to be sitting between two stools. Only for fools. 

Kirk2NCC1701's picture

"Torn between two lovers, feeling like a fool, loving both of you is breaking all the rules..."

Old song.

Smegley Wanxalot's picture

How dare Putin not capitulate!  Dammit!

 

But as obama said that "Russia doesn't make anything" I am at a loss to see how it can have an effect on all those productive EUSSR countries and their wildly expanding centrally planned economies.

HardAssets's picture

Putin cannot capitulate.

He sees that the neocons are trying to destroy him and Russia.

At minimum, they want to start up another Cold War.  Its a nice diversion. It would feed the war industry; the only industry America seems to be good at today.  But in the thermonuclear age, that's a very dangerous game to play. Black swan events can be fatal.

yogibear's picture

Putin raised the penalties against the EU Goldman soldier,  Mario Draghi.

Russia's Putin decided he didn't want to play Goldman's/Federal Reserve bankster games so now they gang up on him.

 

 

Urban Redneck's picture

Who's the Eurotrash quota monkey/campaign donor/inbred relative of SuperMario who didn't see the irony in:

“Politically motivated large-scale trade restrictions are a direct violation of WTO rules, which [the EU] pledged to comply with,” the diplomat said. “These measures will be thoroughly analyzed, and then relevant claims will be submitted with the WTO.”

(Russia already mentioned WTO submitting a WTO claim)

Medvedev told a law conference in Russia’s northern city of Saint Petersburg on Friday that Russia has sent a “communiqué” to the organization declaring that the United States “politically motivated” sanctions in response to the integration of Crimea into Russia and the developments in Ukraine are “illegal” under the WTO regulations.

“Such sanctions violate WTO rules, including the most favored nation status, as they show discrimination to service providers and suppliers from another country and violate restrictions of the second article of the WTO’s General Agreement on Trade in Services,” Medvedev said.

http://www.presstv.com/detail/2014/06/21/367920/russia-files-wto-complai...

AdvancingTime's picture

 Nightmarish World War II memories linger in Moscow, Ukrainian neo-fascists were among those who seized control in the new government in Kiev yet the U.S. rushed to give its blessing to what the Kremlin later described as a "coup d'etat". Sergei Lavrov, the Russian Foreign Minister, reflected these worries when he voiced "most serious concern" over Ukraine in phone calls to the French, German and Polish foreign ministers. The EU, knowing this was what Washington wanted did nothing.

Regardless of who shot down the plane the Russians are furious at what they see happening in Ukraine. Don't hold your breath for Putin to back-off or back-down, he has put down his marker and is now playing both Obama and Kerry for fools in a contest that cost Russia little. It is likely that if If Putin doesn't get Eastern Ukraine next week he will next month or next year at the latest. More on this subject in the article below.

http://brucewilds.blogspot.com/2014/07/putin-holds-all-cards.html

Eyeroller's picture

Puzzled as to what Putin is waiting for...

Bollixed's picture

Probably just waiting for more rope to appear for the West to have enough to hang itself. Putin may be a lot of things, but his pinnicle of experience wasn't being a community organizer...

Day_Of_The_Tentacle's picture

All according to Bogeyman-Scapegoat Plan - it is getting embarrasingly clear. I wonder if they really truly believe that people will not notice. What I am curious about is how they will spin back the "pariah" to being oh an so good friend, once the economy post delevering crash and Bogeyman-Scapegoat Plan conclusion will require resumption of trade with Russia.

NotApplicable's picture

Politicos worldwide breath a heavy sigh of relief, escaping blame yet again. As for the future, I'd guess that the NWO will be ushered in by the winning rational actors in this drama, while the losers will enjoy a nice cup of STFU, as demonstrated by the previous two world wars.

NoWayJose's picture

Europe - ya ain't seen nuttin' yet - better get ready for some natty gas price increases or 'temporary disruptions'

orangegeek's picture

and now we have the excuse for the first leg down in the markets - markets were heading this way regardless, but MSM needs a fabrication to write about it - looks like Putin is the fall guy

 

damn, and I thought China or France insolvency would be the excuses (not that there's anything wrong with that)

 

Rootin' for Putin's picture

Interesting how everyone says this "committed to de-escalating the situation in Ukraine. All should join in this effort." And yet no one actually does anything

Sudden Debt's picture

a Typical European actionplan.

wait a bit longer... maybe the rest will do our work for us... wait for it... wait for it... fuck this... let's wait untill next month.

Dr. Engali's picture

No nails can stand above another in the NWO. Any nail that does must be hammered into place.

huggy_in_london's picture

Ohhh excellent... i look forward to a glut of cheap EU grown food sending prices in the supermarket lower!!

Thanks European Commission!!

plongka10's picture

From the UK telegraph:

"Janusz Piechocinski, Poland's deputy prime minister and economy minister, warned: "We are close to a war which has never been in Europe before. This is a trade war. Both sides will suffer losses."

His comment came as Rheinmetall, the German maker of auto parts and defence technology, warned it would cut it full-year targets after the German government blocked a major contract with Russia to build a combat training centre.

James Ashley, Chief European Economist, and Timo del Carpio, European Economist, at RBC Capital Markets said in a note: "For the larger EU economies – Germany included – the costs are bearable; for some of the smaller EU economies the pain will be more acute."

Finnish prime minister Alexander Stubb said the indirect impact of the sanctions could be significant for the eurozone nation, adding: "This has the potential - and I stress potential - to become economic crisis 2.0." "

Omen IV's picture

poland IS FUCKED big time - they will not stand the test of time!

there will be so much unemployment they will be able to change a lightbulb with ten people

buzzsaw99's picture

without globalism europe is fucked

gcjohns1971's picture

Newsweeek.  Seriously?

It is a progressive rag worth considerably less than the paper it consumes.

The National Enquirer has more credibility.

Renfield's picture

Heh. I remember all the handwringing when Newsweak ended their print edition. The only time I noticed them was when they finally 'died', but in the New Normal, here they are still walking around as a zombie. Fuck Newsweak, and send them back to the obscurity that all propaganda deserves. Let them continue preaching to their 6 regular readers.

vyeung's picture

these criminals eurocrats are promoting such horse shit its not even funny anymore. The EU is farked and it isn't Russia's fault. Blaming it on them is like little children. People, look at the pathetic arseholes that are in power. Total loosers and criminals.

A82EBA's picture

Odd: If the S&P drops 960 from here, it will be at 960..(2009 pre-QE support)

and today is the 7th

NoWayJose's picture

On Ransquawk - Ukraine National Security guy resigns (Parubi). It looks like the West has found out who really gave the order on MH17 and wants a little distance before releasing hard evidence.

yogibear's picture

Russia can just turn the screws on Europe and drastically raise prices, winter is coming. What timing.

Watch Europe start screaming when that happens. Looks like Obama is about to lose some allies.

JohninMK's picture

I doubt Putin will do anything on that Gas Contract. He has been making the point for years that Russia is a reliable partner. Keeping that contract as it is will be important in confirming that. He also wants to keep South Stream under construction.

Putin is reacting to EUSA sanctions on the few in Russia by hitting the many in the EU. The many are voters who are likely to see through this charade as the screw tightens.

ziggy59's picture

Typical; EU plays the Victim Card...US does same ...

Bunch of lying, sick hypocrits...

Anarchy 99's picture

they are experts at this (6mil?)

Dr. Engali's picture

Maybe the EU should tell Zero to shove his little crusade.

blabam's picture

No war with Russia.... but the bankstas now have someone to blame for when it goes tits up. 

blackbeardz's picture

USSA - better get ready for 2008 all over again, we'll go the way europe goes.

LoneStarHog's picture

And...then there is this posted by a freelance journalist:

 

Russia really CAN make things difficult

I wondered how Russia could possibly enforce economic sanctions that would actually hurt, and got a good laugh when I saw one method: All Russia has to do is deny overflying of airspace for Asia/Pacific routes, and it will cost European airlines over a billion USD per month. If at the same time Russia allows Asian air carriers full access, by default European airlines will be put out of business in huge portions of the world, and Russia's allies will be GREATLY helped.

That gave me a good chuckle, yes, geography alone will allow Russia, which is the world's largest nation geographically, to totally hammer issues home . . . . . no more trans polar routes or other routes that use the curvature of the earth to gain advantage . . . . unless you are a friend.

SoDamnMad's picture

Russia needs to take a lesson from the USSA and package all it's food in different size packaging to mask the inflation that has hit and will really slam them as soon as the sanctions take effect.  The extra 3% tax to be applied regionally is also goign to go over like a wet fart in church.

schatzi's picture

Smaller packaging for the same price has been part of the global processed food industry for at least 25 years. Nothing new. How to push margins with stagnant top line growth. If that fails to get your targeted margin, you can always fire some workers. Once you've done that, you start buying back shares and cash in on your options package. The blueprint for every successful CEO.

the not so mighty maximiza's picture

I am sure Putin will drop sanctions when Obunghole drops his sanctions

Two dogs's picture

Anyone make anything shorting airlines yesterday?

Sudden Debt's picture

Are they actually that stupid to believe that a country that is on a militairy side 10 times stronger than europe wouldn't do anything?

man O man... and what will happen when they keep pushing him and they send armed forces?

America won't step in.

We don't have a army.

What? But equippement for 500 billion and hope the guys who'll have to operate it know what they're doing?

 

agent default's picture

America wouldn't step in even if it had an army.  Like fuck the US will get 60M of its own population killed instantly over some shit in Europe. 

Sudden Debt's picture

that Obama started...

SEND US YOUR MEXICAN CANON FODDER AND WE'LL SEND YOU OUR BEER!!

yogibear's picture

LOL, Putin not playing the Goldman/bankster game.

jay28elle's picture

The stupid, clueless majority of American's get their news strictly from their morning & evening network news channel, that strictly runs the talking points of this admin and strictly show the short news clips of politicans making totally-out-of-context comments to support the talking points.

As long as the MSM is running front for this admin, the stupid public will remain as such and will know no different. Certainly not the truth about anything.

Kina's picture

Winter is coming...hope it isn't a real bad winter for Europe.

Of course EU knows that Russia would do something of this nature sooner or later as the US kept on with its sanctions and ways to deliberately provole Russia into action.

There must be enough Oligarch owned and fucked European leaders that they willing sacrifice their citizens to satisfy the arrogant tantrums of the US.

There is NO win situation for Europe at al in going along with the US, none at all, they will suffer all the while. There is no US partnership scenario that sees Europe coming out of this without a lot of pain and trouble...

AND the US in making sure Europe gets fucked over in various ways will itself reap the bitter results of their arrogant greed.

 

The EU is in the process of sacrificing its economy and citizens for god knows who...whoever these Oligarchs are, it must be someone of great power for them to be such fuck-dolls.