Checkmate.

Remember when conservatives were gushing about Putin and telling anyone who would listen that they wanted him to be their president? And, that he was playing "chess while president Obama played checkers"?


Well, sadly for my wingnut friends , it seems that Mr. Putin wasn't such a genius after all.


But you have to wonder where all this Putin love came from. Maybe it was seeing him riding bareback on a horse. All that macho imagery. It must have reminded them of their other hero, Ronald Reagan. Or, maybe it was because he was picking fights with their enemy, Barack Obama, and he seemed to be winning at the time. (Seemed to be.)  


Anyway, things haven't been going so well for Vladi of late.


"A funny thing happened on the way to Vladimir Putin running strategic laps around the West. Russia's economy imploded.


The latest news is that Russia's central bank raised interest rates from 10.5 to 17 percent at an emergency 1 a.m. meeting in an attempt to stop the ruble, which is down 50 percent on the year against the dollar, from falling any further. It's a desperate move to save Russia's currency that comes at the cost of sacrificing Russia's economy.


But even that wasn't enough. After a brief rally, the ruble resumed its cliff-diving ways on Tuesday, falling another 14 percent to a low of 80 rubles per dollar. It was 60 rubles per dollar just the day before. The problem is simple. Oil is still falling, and ordinary Russians don't want to hold their money in rubles even if they get paid 17 percent interest to do so. In other words, there's a well-justified panic. So now Russia is left with the double whammy of a collapsing currency and exorbitant interest rates. Checkmate.


It's a classic kind of emerging markets crisis. It's only a small simplification, you see, to say that Russia doesn't so much have an economy as it has an oil exporting business that subsidizes everything else. That's why the combination of more supply from the United States, and less demand from Europe, China, and Japan has hit them particularly hard. Cheaper oil means Russian companies have fewer dollars to turn into rubles, which is just another way of saying that there's less demand for rubles—so its price is falling. It hasn't helped, of course, that sanctions over Russia's incursion into Ukraine have already left Russia short on dollars.


Add it all up, and the ruble has fallen something like 22 percent against the dollar the past month, with 11 percent of that coming on Monday alone. As you can see below, the Russian ruble has fallen even further than the Ukrainian hryvnia or Brent oil has this year. The only asset, and I use that word lightly, that's done worse than the ruble's 50 percent fall is Bitcoin, which is a fake currency that techno-utopians insist is the future we don't know we want.


And this is only going to get worse. Russia, you see, is stuck in an economic catch-22. Its economy needs lower interest rates to push up growth, but its companies need higher interest rates to push up the ruble and make all the dollars they borrowed not worth so much. So, to use a technical term, they're screwed no matter what they do. If they had kept interest rates low, then the ruble would have continued to disintegrate, inflation would have spiked, and big corporations would have defaulted—but at least growth wouldn't have fallen quite so much." [Source]


So maybe he isn't the grandmaster wingnuts perceive him to be. Maybe he exposed his Queen and Obama took it with a checkers move. It wouldn't be the first time. Obama has been beating wingnuts at their own game for eight years.