Though the outcome of tensions in Russia and Ukraine remain uncertain, as well as the impact of additional U.S. sanctions announced Monday, former NATO Supreme Allied Commander Wesley Clark sounds sure about one thing: When it comes to financial markets, the situation "shouldn't make a difference to the United States."
It's not clear how much tensions in this Eastern European region are responsible for some recent market weakness, but they do seem to weigh heavily on U.S. markets as a macro concern or risk. Investors are getting this right, according to Clark.
"This is an assertion of U.S. leadership. That's what the markets are looking for," says Clark, a retired four-star general, now chairman and CEO of Wesley K. Clark & Associates, an international consulting firm.
In the region late Monday, the mayor of Ukraine's second-largest city was shot while jogging, according to local reports. He was a supporter of the ousted prime minister.
The U.S. earlier Monday imposed additional sanctions against seven Russian government officials and 17 companies deemed close to President Vladimir Putin after concluding Russia failed to abide by the agreement meant to de-escalate the situation in Ukraine. The U.S. did not go so far as to enact tougher measures such as freezing Putin’s assets or sanctioning sectors.
While some officials have suggested targeting Putin directly Clark says that would amount to a "nuclear" escalation. He adds that sanctions didn't go further because "sometimes sanctions are more powerful if you leave a little bit in reserve."
"I hope they will take this seriously, not just the sanctions," says Clark. "It's an expression of intent -- where one sanction starts many can follow, as Iran has discovered. You start messing with sanctions you can end up with your economy being broken."
In a Financial Times editorial focused on why "punishing an aggressive Russia is a fool's errand," former senior director for Russia at the U.S. National Security Council Thomas Clark said containment won’t work as a policy towards Russia, nor will it advance U.S. interests. He writes that economically, Russia is impossible to isolate -- big developing nations are not on board and NATO allies will not cooperate in cutting Russia off.
Wesley Clark disagrees. He says the current strategy of the U.S. shows leadership that the situation calls for, as implications go well beyond the borders of Ukraine. Clark was in Bulgaria two weeks ago and says the president there is very concerned, for example.
American troops arrived in Latvia Friday as part of a U.S. force of 600 sent to the region to reassure the Baltic states amid concern over Russia's actions in Ukraine.
Clark tells us that Russia has started mobilizing doctors in St. Petersburg, which is typically a precursor to additional action. He wouldn't go so far as to say whether he thinks Russia will in fact invade Ukraine but having spent time in Ukraine recently he says authorities there believe May 9 - 11 would be the most likely time for a Russian attack.
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