There is an app to play Connect 4 I recently discovered and it’s great. Set the level to hard and give the computer the first counter and it’s a real challenge. You must try to work out what the opponent is trying to achieve and stymie that whilst achieving a winning strategy yourself.

This seems like the situation playing out currently between Russia and the majority of the rest of the world, ex China and India. The West has decisively responded to Putin by weaponising money. It has no intention of fighting Russia physically but rather financially. It’s hit Russia and its power brokers with an avalanche of sanctions and asset seizures. They may be able to weather it but it’s going to hurt.

As an aside it’s interesting to see that three of the BRIC countries (Russia, China and India) which, in the noughties, came to represent the globalisation paradigm are actually not at all Western friendly.

The on-shoring of manufacturing seen as necessary post pandemic and the build out of new energy storage post Ukraine in the West are both going to be high priorities.

Complex adaptive systems

Accurately forecasting future events is undoable due to the complexity of the systems already in place but more importantly how each will adapt and reintegrate if something changes.

This is the reason no one can predict markets. Even if you know ahead of time what will happen, you can’t anticipate how everything will then react. You’d need to think in terms of thousands of individual elements, how they all individually respond and then how those thousands react to the reactions etc etc.

This can be observed in how the West has increasingly come together in response to Russia. Was this a certainty, absolutely not. Europe is remaking itself at warp speed. The boldness of actions gaining momentum with perceived barriers of self-interest being no impediment to doing all that can be done, and that’s grown into a lot. Nor was it predictable that the new German Chancellor would effectively call an end to their post war thinking and signal a massive rearmament drive. It’s a lot of history making in a week.

It appears all are mindful that China is watching, and weakness now makes a Taiwan incursion much more likely, so have pretty much thrown the financial kitchen sink at Putin. The Rouble is collapsing, the Russian stock market is in freefall. BP have just walked away from a £25 Billion investment in Rosneft as unsustainable. No sporting governing body will be able to include any Russian participation. The populations of the West plus allies came together everywhere to demonstrate solidarity with Ukraine and the abhorrence of the Russian actions, the list is long and mighty.

So, you’d have to think that Putin has not factored all these reactions into his cost benefits analysis of invading Ukraine.

The price to be paid is going to be extreme.

The question now though is what happens next.

Does he push on to achieve his minimum goal of regime change in Ukraine? Does he escalate further, or does he blink?

It’s a complex adaptive system and we can’t know, but what I do know is I’m proud of the West today which is something.

Note: This is written in a personal capacity and reflects the view of the author. It does not necessarily reflect the view of LWM Consultants. The post has been checked and approved to ensure that it is both accurate and not misleading. However, this is a blog, and the reader should accept that by its very nature many of the points are subjective and opinions of the author. Individuals wishing to buy any product or service as a result of this blog must seek advice or carry out their own research before making any decision, the author will not be held liable for decisions made as a result of this blog (particularly where no advice has been sought). Investors should also note that past performance is not a guide to future performance and investments can fall as well as rise.