Economic sanctions on Putin and his people

RENO, Nev. (KOLO) - The Russian ruble exchange with the American dollar sits at 99 to one. Increase that amount to say 100 American dollars, which would require more than 11,000 rubles. Clearly, the ruble’s value has fallen with the everyday Russian having to use more and more of them to buy everyday items like food.

Worldwide sanctions have caused the collapse of the Russian currency. Perhaps the biggest economic impact on the country came when Russia was removed from SWIFT.

“More countries are relying on each other transferring assets from one country to another,” says Richard Jay, senior vice president of investments with Wells Fargo Advisors. “The Swift is one way to move money around. They aren’t using that for Russia anymore. So, the ability to move cash around is not as much,” he says.

Money, its declining value and the inability to gain access to it, has certainly had an impact on the Russian people. “It’s like, all of a sudden, somebody calls you up and says ok you can’t get access to your checking account, your ATM card doesn’t work. What does that do to you?” says Jay. Another question, will these moves have an impact on President Putin--enough to change his plans for Ukraine?

Pressure could be put on him from some of his country’s richest citizens who are finding their assets frozen in participating countries. Yachts, properties, money are all being seized.

Oil companies like BP and Shell have dropped out of partnerships with Russian companies. That means fewer taxes and investments. But it doesn’t stop there.

Apple, Nike, Google, major airlines, have all pulled their technology, service, and parts support which will soon bring certain industries to a halt in Russia.

What could that mean to the Russian Army? And will these foreign industries return to Russia once the dust has settled?

Jay says for major and minor investors this is not the time to make significant changes. That advice could change, however, if the conflict goes beyond three months.

He says consider however the American economy has made a significant rebound after major world events. The most recent example is the pandemic. He says the U.S. economy was down 40%. But it is now operating at pre-pandemic levels.

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