As for the Russian economy, it has slowed from an average growth rate of 7 percent throughout the last decade to the aforementioned 1.3 percent last year. Its expected growth rate in 2014 is zero. Ruchir Sharma of Morgan Stanley Investment Management, writing in the Wall Street Journal the other day, noted that "wealthy Russians have been moving money out of the country at one of the fastest rates in two decades." He notes that they have been moving their wealth out of Russia at $60 billion a year since 2012. Now foreign investors are pulling out. And Sharma adds that the value of the ruble has fallen 22 percent against the U.S. dollar since 2011. Ever since Putin began his kerfuffle in Crimea, the Central Bank of the Russian Federation has been in a panic to prevent the ruble's collapse.
Thinking back on Putin's conversation with Bush in Beijing in 2008, possibly Putin had it right. He is hot-blooded. His recent tirades to the press about how he has suffered at the hands of the West sound heartfelt. He did not have to invade Crimea. He could have worked out a very agreeable lease on his warm water naval base of Sebastopol. Yet he chose to invade out of genuine indignation, and no one knows where his invasions will end. With the klutz we now have in the White House, all we can count on is Russia's projected growth of zero this year, and if we are lucky even slower growth next year.