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Is GOLD About To Start A Vicious Rally?

I am not sure about “vicious” , but Gold does look very good at this juncture. While it is likely to come down over the next two weeks to close the gaps it left behind, the short-term technical picture looks very good for all involved. Gold, miners and ETFs. I will be the first to tell you that I am not smart enough to figure out what Gold will do from the fundamental perspective. There are two many variables at play. Is it money or commodity, supply/demand, macroeconomics, geopolitical issues, etc… 

With that said, recent gold technical action is encouraging. Particularly, when you take the bear market of 2014-2017 in equities and a severe recession in the US into consideration. The FED will start printing again over the next 12 months to avoid another collapse, which typically bodes well for GOLD as a hedge. Once the short term correction is over I would definitely recommend taking a long position in the likes of ABX, NEM, GG, GLD with very tight stop losses. 

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Why gold is setting up for a vicious rally

Gold is at its highest price in more than six months thanks to economic and political uncertainty in places like Argentina, Venezuela, Turkey, and, of course, Ukraine.

Meanwhile, the Federal Reserve Bank’s Open Market Committee (FOMC) meets Wednesday to discuss further tapering of its monetary stimulus program.

Though gold was down Monday for the first time in over a week, will the overall rally in gold continue?

“In fact, it is sustainable,” says Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson. “We’ve been very bullish here on the US, but we’re seeing things are getting a little dicey out there from a global standpoint. Emerging markets are on the ropes right now. You’re seeing what’s going on in Russia. Even in Europe, the momentum is slowing. All of that continues to favor gold.”

Ross notes that gold has broken above its 200-day moving average and is headed towards resistance not far above its Monday settlement price of $1,392.60 per ounce.

“I think the next stop if $1,420,” says Ross, who sees the yellow metal potentially making its way to $1,560 per ounce. “Clearly, you want to be a buyer down here and a seller higher later.”

CNBC contributor Andrew Busch, editor and publisher of The Busch Update, believes gold can indeed get close to Ross’ initial target of $1,420 but Busch doesn’t see it going much higher. It will depend on what happens at the FOMC meeting, he thinks.

“We’ll get some information on that Wednesday,” says Busch. “We’ll get Janet Yellen to talk. It’s really going to be what she says moving forward and what kind of forward guidance they give us for interest rates because the Fed is going to stay tapering and that will hurt gold overall.”

“I think we can get up to about $1,425 but I’d love to start shorting it there.”

Warning: Wall Street Is Sharply Divided On 2015.

Wait a second…… What the hell happened to 2014, are we done already? Yes, sorry, I forgot. As per CNBC, Goldman Sachs and most money managers out there we should have a 20-40% rally this year. It’s a done deal. My bad. 

Listen, this is rather simple. Our mathematical and timing work shows that we will have a severe bear market and a recession between 2014-2017. When economic data starts to confirm a recession, the FED will open the flood gates, once again, to try and re-inflate the markets and the economy. Until that happens they will continue cutting QE as per their originally publicized schedule. Down and up we go. Again. 

If you would like to know exactly when the bear market of 2014-2017 will start and it’s internal structure, please CLICK HERE. 

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Warning: Wall Street Is Sharply Divided On 2015.  Google

Janet Yellen will chair her first meeting of the Federal Open Market Committee with broad agreement on Wall Street over the outlook for policy this year and a forecast for stronger U.S. growth this year and next. But the March CNBC Fed Survey finds sharp divisions over what happens to Federal Reserve policy in 2015 and a cloud of geopolitical concern hanging over the outlook.

All but one of the 41 respondents, who include economists, fund managers, and strategists, see the Fed tapering at the meeting this week, and 81 percent expect tapering at each of the remaining meetings this year.

That’s up from 72 percent in January. On average, respondents see the Fed tapering by around $10 billion at each meeting. A strong 59 percent agree with the $10 billion pace of tapering, with 27 percent saying the Fed should go faster and 10 percent saying slower.

The Fed currently is purchasing $65 billion in assets every month to try and drive down interest rates and stimulate the economy. It has signaled it would reduce or taper its purchases by $10 billion at each meeting this year, which would effectively ends it purchase program by December.

(Read more: US manufacturing output posts largest gain in six months)

Tom Williams | CQ Roll Call | Getty Images
Janet Yellen

“The strong February jobs report gives ammo for the Fed to continue tapering its stimulus program by $10 billion a month through 2014,” Robert Morgan of Fulcrum Securities wrote in response to the survey.

There are greater divisions emerging over what happens next year, however. About 60 percent see the Fed hiking interest rates in 2015 and 40 percent look for it to wait until 2016 or later. While 60 percent see the Fed maintaining its large balance sheet, now at $4.1 trillion and growing, 40 percent see the Fed reducing it, which can happen either through asset sales or by not replacing bonds that mature. Those who think the Fed reduces the size of its balance sheet in 2015, look for an average decline of $108 billion in 2015.

An overwhelming 95 percent of respondents think Yellen and the FOMC will scrap the guidance that says the Fed will consider raising interest rates once theunemployment rate drops to 6.5 percent, but they are unclear how the Fed fixes the problem. The rate has already declined to 6.7 percent and Yellen and other Fed officials have said that it does not tell the full story of excess slack in the labor market and the need for continued low rates.

“They will use Yellen’s first press conference to move away from the 6.5 percent unemployment threshold,” said Diane Swonk of Mesirow Financial.

About half of respondents think the Fed will drop a numerical target all together. A fifth of respondents think the threshold will be replaced by another number, with the average being 5.6 percent.

“Fed policy is not going to be bound by single hard numeric unemployment targets, but by the Fed’s judgment of the strength of the labor markets,” wrote Rod Smyth of Riverfront Investment Group.

Tony Crescenzi of Pimco called removing the threshold, together with an end to the bond-buying program, “a recipe for a steep yield curve, because longer maturities tend to bear the burden of uncertainty.”

Play Video
 
Expectations for the Fed
CNBC’s Steve Liesman thinks Fed Chair Janet Yellen will continue reducing monthly bond purchases by $10 billion.

Respondents to the survey also see economics new risks on the horizon, with most of them being the foreign horizons of China and Ukraine. “The financial markets are too complacent over a tail risk that could turn into a new ‘cold economic and financial war,'” wrote Allen Sinai of Decision Economics.

(Read more: Fed meets amid market skittishness)

Guy LeBas of Janney Montgomery Scott wrote that growing evidence that China and other emerging markets are slowing or even contracting is “a major impediment to global and thereby U.S. economic growth right at the time that the domestic situation is supposedly looking better.”

Still, average growth is seen picking up from 2.3 percent in 2013 to 2.8 percent in 2014 and 3 percent in 2015. The weather is seen subtracting about six-tenths of a point off growth in the fourth quarter of 2013 and the first quarter of 2014, but it will recapture four-tenths of that loss in the second quarter of this year.

Wall Street is reasonably comfortable with its outlook for Fed policy. Just a quarter say the risk is that the Fed is more hawkish than they forecast, a third say the risk is for a more dovish Fed. Forty percent say the risks are balanced. That’s up from 35 percent in the January meeting, the last one chaired by Yellen’s predecessor Ben Bernanke.

What You Ought To Know About Warren Buffett

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FUN FACTS ABOUT WARREN BUFFETT: 

  • Warren Buffett, the 3rd richest man in the world, still lives in the $31,500 house he bought in 1957.
  • Warren Buffett gave 85% of his money to charity (mostly to the Bill and Melinda Gates Foundation) to a total of 40.7 billion dollars.
  • Warren Buffett filed his first tax return in 1944, at the age of 14, and took a $35 deduction for the use of his bike and watch on his paper route.
  • In 2010, a lunch with Warren Buffett was auctioned off to a man for $2.63 million dollars
  • If you invested $1000 with Warren Buffett in 1957, you would have amassed upwards of $30 Million today.

WARREN BUFFETT QUOTES:

  • “If past history was all there was to the game, the richest people would be librarians.”
  • “Only when the tide goes out do you discover who’s been swimming naked.”
  • “Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.”

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What You Ought To Know About Warren Buffett Google

Daily Stock Market Update. March 17th, 2014. InvestWithAlex.com

Daily Chart March 17, 2014 investwithalex

A strong up day with the Dow Jones up 181 points (1.13%) and the Nasdaq up 34 points (0.81%). 

This stock market action is consistent with what I have warned about at the end of February. The fact that the market is shifting from it’s bull market to it’s bear market and to expect a lot more volatility. That is exactly what we have seen thus far in March.  While most people believe that the market is acting wildly due to geopolitical events associated with Ukraine/Russia/USA, it is anything but true. As I have said so many times before, the market is tracing out it’s exact mathematical structure. When the market is done, it will reverse itself and start the bear market of 2014-2017.

Now, the market left a huge gap on the downside that it will have to eventually close.  Whether it’s going to happen over the next few days or over the next few weeks is indicative of whether or not the bear market has already started. If you would you like to know exactly when the market will top out as well as the internal structure of the upcoming 2014-2017 bear market, please CLICK HERE.  

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Daily Stock Market Update. March 17th, 2014. InvestWithAlex.com Google

Bill Gates Confirms: Robots Will Take Your Jobs

I have been a proponent that outsourcing, macroeconomic forces and robotics will be the major driving forces behind increased unemployment over the next few decades. In fact, in one of my earlier articles “4 Reasons US Unemployment Rate Will Be at 20% by 2017” I have outlined the rationale and analysis behind such developments. Bill Gates tends to agree (see article below). According to him, upcoming software and robotics advances will decimate our labor pool over the next few decades. It will impact “low-skilled” category particularly hard. I tend to agree.  

I guess laying on the couch, eating bonbons, watching Jerry Springer while robots wipe your ass will be the future for many Americans. I can’t wait. 

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Bill Gates Confirms: Robots Will Take Your Jobs  Google

Bill Gates: Yes, robots really are about to take your jobs

Microsoft cofounder Bill Gates isn’t going to sugarcoat things: The increasing power of automation technology is going to put a lot of people out of work. Business Insiderreports that Gates gave a talk at the American Enterprise Institute think tank in Washington, DC this week and said that both governments and businesses need to start preparing for a future where lots of people will be put out of work by software and robots.

“Software substitution, whether it’s for drivers or waiters or nurses… it’s progressing,” Gates said. “Technology over time will reduce demand for jobs, particularly at the lower end of skill set… 20 years from now, labor demand for lots of skill sets will be substantially lower. I don’t think people have that in their mental model.”

As for what governments should do to prevent social unrest in the wake of mass unemployment, the Microsoft cofounder said that they should basically get on their knees and beg businesses to keep employing humans over algorithms. This means perhaps eliminating payroll and corporate income taxes while also not raising the minimum wage so that businesses will feel comfortable employing people at dirt-cheap wages instead of outsourcing their jobs to an iPad.

And it’s not just “low-skilled” workers who will have to worry about automation. AsBusiness Insider points out, The Economist earlier this year predicted that high-paying jobs such as accountants, real estate sales agents and commercial pilots would all lose their jobs to software within the next 20 years.

Why Most Stock Market Bears Will Be Disappointed.

Fedreservestockchart-investwithalex

If you pay attention to today’s bearish community and to the likes of Elliotwave.com or Zerohedge.com you would walk away with a perception that the Dow Jones is going to 1,000 or lower. In fact, according to them you would be better off stock pilling guns, ammo and canned food. If you have the same point of view, I am sorry, but you will lose a lot of money over the next few years.  

Yes, our incredibly accurate timing and mathematical work confirms that there will be a bear market over the next few years. Between 2014-2017 to be exact. Yet, it will not be as severe as the bears would like you to believe. In fact, it won’t be half as severe as the bear market leg between 2007-09. Now, most of the Perma Bear will dismiss this notion as nonsense. They want the market to collapse and they won’t be happy until we see a 1929 type of a crash. Yet, it a dangerous delusion that will cost them a lot of money. Just as it did over the last 5-Years when the stock market completely annihilated all of their short positions.   

Instead, if you would like to know exactly when the bear market of 2014-2017 will start and it’s exact internal composition (forecastered to the day), please check out our work on this site….. Click Here. 

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Why Most Stock Market Bears Will Be Disappointed  Google

Attention: The Crisis In Ukraine Is Now Over…..Bull Market To Continue?

After analyzing Russian media for quite some time I believe the conflict in Russia is now over. Putin got what he wanted……a highly strategic and valuable piece of real estate known as Crimea. Plus, both Putin and Russian people see this as a major victory over the West.  Given the West’s incredibly weak sanction response, Russia is ready to be done here. While Putin will maintain a high level of Russian troop presence around Ukraine, just in case, he is somewhat reluctant to go into East Ukraine. If things remain as they are, you can consider this conflict over.

The only thing that can escalate the situation further is sanctions that have a bite. Looking at today’s situation, I see very little evidence that either the EU nor the US are willing to go far enough to hit Russia with actual sanctions.  However, if they do, you will see an immediate re-escalation of hostilities in Ukraine. At that stage, Putin will be willing to go into Eastern Ukraine to show his dominance. 

In terms of the stock market, this geopolitical issue will not impact the markets over the long terms. While we might see some short-term volatility associated with Russia’s action, over the long-term Ukraine becomes irrelevant. The Bear Market of 2014-2017 will start shortly, ushering in much lover prices over the next few years. If you would like to find out exactly when it starts and it’s exact internal structure, please Click Here. 

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Attention: The Crisis In Ukraine Is Now Over…..Bull Market To Continue Google

 WAR IS OVER INVESTWITHALEX

Obama Sanctions 7 Russian Officials. Putin Seen On The Floor Laughing

In an retaliatory show of force, President Obama slammed sanctions against 7 of “Putin’s Irrelevant Officials”. Not Putin himself……..of course. Not being sure how to react, Russian officials witnessed Mr. Putin fall to the floor in laughter. Yet, this is just the beginning. The US Government is expected to debate further sanctions against Russia starting next week……after their well deserved week long vacation.

On a more serious note, this is incredibly painful to watch. I have argued for some time that neither the US nor the EU should have any business in Ukraine. It is hard to win a conflict when the other side (Russia) is ready to go to war over Ukraine. As a matter of fact, it is impossible to win in a situation like that until and unless the US is willing to lay out a military option on the table. If the US wants to stop Putin running in circles around it’s credibility, there is only one thing left to do. Forget about Ukraine. 

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Obama Sanctions 7 Russian Officials. Putin Seen On The Floor Laughing Google

 

US announces sanctions against Russian officials

WASHINGTON (AP) — President Barack Obama on Monday imposed sanctions against Russian officials, including advisers to President Vladimir Putin, for their support of Crimea’s vote to secede from Ukraine.

The White House also announced that it is working to identify and target the assets of other individuals who aren’t government officials but are supporting them. The Treasury Department also is imposing sanctions on four Ukrainians, including former President Viktor Yanukovych, a former top Ukrainian presidential adviser and two Crimea-based separatist leaders.

“Today’s actions send a strong message to the Russian government that there are consequences for their actions that violate the sovereignty and territorial integrity of Ukraine, including their actions supporting the illegal referendum for Crimean separation,” the White House said in a statement.

“Today’s actions also serve as notice to Russia that unless it abides by its international obligations and returns its military forces to their original bases and respects Ukraine’s sovereignty and territorial integrity, the United States is prepared to take additional steps to impose further political and economic costs,” the statement said.

The U.S. announcement came shortly after the European Union announced travel bans and asset freezes on 21 people they have linked to the unrest in Crimea.

The sanctions were expected after residents in Crimea voted overwhelmingly Sunday in favor of the split. Crimea’s parliament on Monday declared the region an independent state.

Raw: Pro-Russia Demonstrators Clash With PolicePlay video

The United States, European Union and others say the action violates the Ukrainian constitution and international law and took place in the strategic peninsula under duress of Russian military intervention. Putin maintained that the vote was legal and consistent with the right of self-determination, according to the Kremlin.

Warning: Is Federal Reserve Out Of Ammo?

As the article below indicates, absolutely. There is very little they can do going forward. With real interest rates being in the negative territory and QE losing it’s credit velocity, there very little the FED can do to aid our financial markets and the US Economy. Particularly, with the onset of the bear market of 2014-2017 the FED will be powerless to “re-inflate” our markets and the economy as fast as they did at 2009 bottom. If at all.

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Warning: Is Federal Reserve Out Of Ammo?  Google

The Federal Reserve gets a lot of credit for what passes as an economic recovery. Whether it deserves that credit, going forward the Fed has very little power to influence events because it is essentially out of ammo to further ease. The economy, meanwhile, is still lackluster, despite the central bank’s unjustified optimism.

The Fed cast a warm and fuzzy glow in January, when it predicted a pickup in economic growth, which it cited as its rationale for tapering its bond buying campaign, called quantitative easing (QE). And if that acceleration doesn’t happen in the near future?

Don’t worry: Wall Street will just shift its predictions for a growth resurgence to the second half of the year, as it’s done every year since about 2005 — if memory serves correctly. At this time of year, the Street always says that things will get better in the second half.

The revision of fourth-quarter 2013 gross domestic product growth of 2.8% is not enough of a reason to reverse the Fed’s QE policy, which seems to have less and less effect on the real economy, according to the central bank’s own research. The Fed says it will gradually taper its monthly bond buying, most likely ending it altogether late in the year. But the Fed’s new chief,Janet Yellen, adds that it reserves the right to change course and increase the purchases if the economy dips.

If the current first quarter does end up with say, 1.5% GDP growth, the bad weather in much of the nation will be a factor. But the weather effect is still amorphous enough not to reverse course. Once winter fades, there will inevitably be a rebound effect, so the bank may have to wait until the third quarter before it feels comfortable saying anything about the true core rate of growth (although it probably will cut its 2014 forecast by the June meeting).

Keep in mind that the only easing tools the Fed has left are forward guidance – its practice, through issuing forecasts of its policy intentions, of influencing market behavior – and more QE. It can’t run about ramping up money printing for every bump in the road. Its bond purchases succeeded in raising asset prices by progressively upping the ante each time; that option isn’t available anymore, not when the price tag is the Fed’s bloated balance sheet already on its way to $5 trillion. Also, 2014 is a mid-term election year, and I suspect that the Fed governors would really like to be out of the program entirely come November.

Finally, as dovish as Yellen and the others may want to be, there are a couple of realities confronting the bank. One is the lack of ammunition for any crisis that might pop up before the current QE program is back to zero again. QE is partly a psychological effect, and backing out of tapering it in mid-stream is likely to induce considerable anxiety after the initial euphoria wears off.

The other is the nature of the Fed’s charter. Quantitative easing was predicated from the beginning on improving employment, a goal handed to the bank in the 1970s by the Humphrey-Hawkins Act. The unemployment rate, now 6.6%, is unlikely to rise anytime soon, given that unemployment is a lagging indicator. So far as the business cycle goes, it is one of the last parts to decline. A resumption of QE after a weak GDP report and a Fed prediction that unemployment might worsen would be politically lethal – the central bank is only as independent as Congress says it is.

The economy hasn’t shown any signs whatsoever of accelerating to a sustained 3% growth rate. The recovery from the Great Recession has been choppy, with one quarter’s surge followed by a weaker performance. Fourth-quarter 2012 growth slipped to a mere 0.1%, for example. Temporary growth surges sometimes occur, due to sporadic influences like the inventory-restocking episode from last year, when this sudden and unexpected increase helped propel the third-quarter gain to 4.1%.

I couldn’t believe my ears on Thursday when I saw a fellow on CNBC say with a straight face “well, the economy really is getting better this year.” The economy is only getting better on the same basis it’s gotten better the last five years – somewhere over the rainbow.

The current stock market rebound is getting stretched: The Standard & Poor’s 500 has nearly reclaimed its January peak, while the Nasdaq is making new post-2000 highs. All of that in spite of some pretty weak data recently, such as the housing sector’s downbeat results. The National Association of Realtors says January existing home sales slumped 5.1%, which it ascribed to poor weather, and rising home prices and mortgage rates.

That said, equities could still squeak out mild gains ahead, after a breather here and there. I’ve talked about a first-quarter top for stocks since the beginning of the year, and my prediction is still intact. But it still appears to me to be a top to sell, not to buy.

Why Russians Love Putin

As predicted on this website, Putin scored a major victory over the weekend in Crimea. While the US and the EU will continue it’s huffing and puffing, pounding the table and threatening sanctions, Putin was able to regain Crimea as Russian territory. The remaining legal stuff is nothing but a  formality now. Yet, most Americans are dumbfounded by the fact that Putin’s approval rating surged to 72% while Obama’s hit a new low at 41%.  Here is why….

  • In Russia, Crimea is seen as a Russian territory and most people (in both Russia and Crimea) believe that it should be part of Russia again. 
  • Most Russians are fed up with the West. Putin is seen as a powerful leader who is able to stand up to powerful Western interests and people eat that stuff up. 
  • Russians are starting to feel as if they are getting their old “Soviet Union” power back. 

 Despite all of the above, Western powers continue with their support of radical elements within Ukraine. Playing right into Putin’s hands.  

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Why Russians Love Putin  Google

 

Putin Is No Mad Man to Russians as Power Play Trumps Economy

Western leaders may think Vladimir Putinis crazy for threatening to annex Crimea and invade other areas of Ukraine. Most Russians, still bitter about the Soviet Union’s demise more than two decades ago, couldn’t be prouder.

Putin’s approval rating, bolstered afterRussia hosted its first Winter Olympics last month, reached a three-year high as he poured troops into Crimea amid the overthrow of the Kremlin-backed government in Kiev. The tensest showdown with the West since the fall of the Berlin Wall has proved to be good for the business of governing in Moscow.

“Putin is just defending his country’s interests,” said Yaroslav Batashev, 32, a manager at a Moscow-based trader of consumer products who says he isn’t necessarily a fan of his president. “Crimea is historically important for Russia and it’s Russian.”

Since overcoming the biggest protests of his 14-year-rule to win a third term in 2012, Putin has reasserted his power at home and abroad. Even at the risk of sanctions that could tip the economy into recession for the second time in five years, Russians see his defiance of the West over Ukraine as a sign of strength, reinforcing his image as a leader who restored his country’s greatness from the post-Communism chaos of the 1990s.

Putin’s Backing

Seventy-two percent of Russians approve of the work Putin is doing as president, the independentLevada Center said March 13, citing a survey of 1,603 people that had a margin of error of 3.4 percentage points. A March 8-9 poll by the state-run All-Russia Center for the Study of Public Opinion, known as VTsIOM, also gave Putin 72 percent.

“The involvement of the U.S. in a situation with which it has nothing to do with is very irritating,” said Ilya Knyazev, a 31-year-old sales director at a food distributor in Moscow. “I support Crimea joining us because otherwise NATO would be in Ukraine, hurting Russia’s security.”

Part of that support has been drummed up by the attacks by Putin’s vast media apparatus on the “fascists” who took power in Ukraine and the portrayal on state-run television of the protests that led to the ouster of President Viktor Yanukovych.

“Russians were deeply astonished by the pictures they saw on TV from Independence Square in Kiev — the shootings, killings, burning tires,” Alexander Oslon, head of the Public Opinion Fund, said by phone yesterday.

‘Overwhelming Support’

“Those pictures created the fear that it may happen in Crimea, where the majority of the population is Russian,” Oslon said. “Now Putin has the overwhelming support of the majority of the population.”

Putin, who came to power in 1999, the year after Boris Yeltsin defaulted on $40 billion of domestic debt, averaged economic growth of 7 percent a year in his first two presidential terms as oil prices and output surged. The former KGB colonel reasserted state control of the economy and media and gained popularity as he reined in the oligarchs — men who became billionaires overnight by acquiring some of the country’s most valuable assets at rigged auctions. He jailed the richest of them, Mikhail Khodorkovsky.

Crimea has been home to Russia’s Black Sea Fleet since its founding by Catherine the Great in 1783, after the Ottoman Empire ceded the peninsula. It was part of Russia until Soviet leaderNikita Khrushchev gave it to the Ukrainian Socialist Republic in 1954, when Putin was 14 months old.

Leaving Ukraine

A total of 96.8 percent of voters in the Black Sea peninsula yesterday backed leaving Ukraine to join Russia, the head of the election commission, Mikhail Malyshev, told reporters. The results exclude one city, Sevastopol. The U.S. and the EU have both called the vote illegal.

Crimea may be incorporated into Russia by the end of this week, Alexander Ageyev, first deputy head of the Russian State Duma lower house of parliament’s committee for constitutional affairs, said in a phone interview today.

Putin’s focus is already shifting to eastern Ukraine, which is also largely Russian-speaking. The Foreign Ministry in Moscow, which called the overthrow ofYanukovych a “coup” by “fascists,” said March 15 people in eastern Ukraine asked for Russian protection after a series of deadly clashes in Donetsk and Kharkiv.

To be sure, many educated Russians are aghast at Putin’s policy over Ukraine. Organizers of a peace march against Russian actions in Ukraine drew tens of thousands of people to central Moscow on March 15, according to organizers and media reports. Police put the number at 3,000.

‘Aggressive Quest’

“Moscow’s aggressive quest for its ‘near abroad’ has become an ideological mission to fight the West, one that has left all rational grounds and that ignores all costs and consequences, including those to Russia itself,” Joerg Forbrig, a senior program officer at the Berlin bureau of the German Marshall Fund of the U.S., said by e-mail.

Ukraine in general and Crimea specifically represent the latest and, for Putin, the most crucial step in his crusade to halt what he sees as the West’s relentless encroachment on Russian interests since the end of the Cold War.

Most of the buffer states between Russia and Germany, where millions of people died during World War II, has been absorbed by the North Atlantic Treaty Organization and the European Union since the Soviet Union disbanded in 1991. Sevastopol, home to the Black Sea Fleet, is a symbol of Russian heroism not unlike the Alamo for Americans. The city was under siege by the British and the French during the Crimean War in the 1850s and then by Nazi forces in 1941-1942.

Syria, Iran

In just the past year, Putin has cemented Russia’s role in the Middle East by brokering a deal that averted U.S. strikes on Syria and kept in power President Bashar al-Assad, a Soviet-era ally and buyer of Russian weapons. He’s also encouraged the West to make concessions to Iran over its nuclear program and struck a multi-billion arms deal with Egypt’s new military rulers after the U.S. suspended aid.

Putin, who once described the breakup of the Soviet Union as the biggest geopolitical catastrophe of the 20th century, was named “Person of the Year” in December by the Times of London for the accord over Syria. That effort “propelled the president back into the front ranks of effective world statesmen,” the Times said.

For now, most Russians are shrugging off Putin’s crackdown on what’s left of independent media, which includes forcing out the longtime head of the country’s biggest talk radio station, Ekho Moskvy, and the editor-in-chief of one of its most popular news sites, Lenta.ru.

‘In Ruins’

“The country was in ruins under Boris Yeltsin,” said Batashev, the Moscow trader. “Despite all of Putin’s disadvantages, he’s a tough and uncompromising leader who managed to transform Russia into a better place than it was a decade ago.”

With the presidential term extended to six years from four, Putin, first elected in 2000, may stay in power until 2024 if he runs and wins again in 2018.

Even within the government, some officials are hoping Putin will moderate his response to the crisis, though they are afraid to speak out against what they see as a course already chosen, according to two people familiar with the situation.

Russia retaliating with sanctions against the West could wipe out 10 years of achievements in financial and monetary policy, one of the people said. Such escalation could erase as much as a third of the ruble’s value, another said.

Ruble, Peso

The ruble has slumped about 10 percent against the dollar this year, the worst-performer after Argentina’s peso among 24 emerging-market currencies tracked by Bloomberg.

“I don’t want Russia to be in isolation again and be in the opposition to the rest of the world,” said Anatoly Kapralov, 29, the founder of an advertising agency in Moscow.

That kind of sentiment isn’t likely to sway Putin, said Nicholas Spiro, the managing director of Spiro Sovereign Strategy in London.