"Borrowed bread lies heavy on the stomach."
- Ukrainian Proverb
There is a (temporary) sigh of relief now that Ukraine has seen its latest strongman leader flee to parts unknown, but anxiety remains. And why not; the nation has a history of struggle with self-determination. Actually, that comment is an understatement as Ukraine, at the crossroads of Europe and Asia, seems to have spent its entire existence fighting off one conqueror or another. There was a short period during World War I when several nations took control over a period of weeks:
- Bolsheviks
- Germans
- Bolsheviks
- White Army
- Germans
- Polish Army
- Bolsheviks
Extermination by Hunger
There have been several attempts to completely snuff out the Ukrainian culture from the late 1700s, and most recently, the Holodomor or Extermination by Hunger. This period of genocide saw man-made starvation inflicted on the people of Ukraine from 1932 to 1933 by Russia, as part of a larger multi-year program to remove Ukrainian language, culture, and customs.
The slaughter took up to 7 million lives; killed through orchestrated starvation, which has recently been recognized by the world for its true horror.
In the past, such efforts to wipe out the culture saw certain elites, authors, educators, and others flee the nation, while others succumbed and melded into a Russian identity like author and playwright, Nikolai Gogol in the 19th century.
Divine Fire Still Burning
"The current generation now sees everything clearly, it marvels at the errors, it laughs at the folly of its ancestors, not seeing that this chronicle is all over scored by divine fire, that every letter of it cries out, that from everywhere the piercing finger is pointed at it, at this current generation; but the current generation laughs and presumptuously, proudly begins a series of new errors, at which their descendants will also laugh afterwards." -Dead Souls
Nikolai Gogol, Dead Souls
The people that first domesticated the horse have been on the other end of the spectrum, where their sovereignty and spirit has been broken over and over again, only to come back stronger.
Even though Ukraine became independent in 1991, most people of the world considered it a part of Russia.
In fact, most opinions of Ukraine are unflattering and undignified. This latest attempt at real-self-determination will be watched by the world after this brave stance of ordinary people.
Yes, errors have been made generation after generation, but chasing a corrupt president from his palace sets the stage to break away from history. What will Russia do now that its puppet is on the run? The worst case scenario is an attempt to patrician that part of Ukraine that sees kinship with Russia. Beyond this military possibility, the economic tug of war is a reality, and could still tilt Ukraine away from its elusive goal of true freedom.
Apparently, Ukraine needs $35.0 billion over the next two years, in part to cover $13.0 billion in debt due this year.
Ukraine finished January with $17.0 billion, and probably will have $12.0 billion at the end of this month. The clock is ticking, and wherever the funds come from; like borrowed bread, it will lay heavy on the stomach.
The Market
It was an interesting session where bulls and bears could feel a little empty. Broad indices were higher, but closed well off intra-day highs, yet bears were angry and bewildered. In fact, the media has been parading bears that keep simplifying the market and the complexities of a $16.0 trillion economy into the same old sound bites, and rationale that cost them and millions of others to miss the sixth-longest rally in history. It's true the rally is long in the tooth, and hasn't been tested like previous long-term rallies.
It's also becoming harder to find pure value ideas, but that's doesn't mean there aren't great companies, in which people should want to be part owners. Yes, great companies can have overpriced stocks, but in the long run, even those are worth holding.