BREAKING: Putin Requests Vote to Annex Crimea

Zero Hedge:

And there it is:

PUTIN ASKS FOR CRIMEA, CITY OF SEVASTOPOL TO BE ADDED TO RUSSIA
PUTIN CALLS FOR RATIFICATION OF TREATY ON CRIMEA, SEVASTOPOL

And futures, stocks, and risk in general is soaring, sending the Kremlin precisely the message it needs to know that there is absolutely nothing wrong with this. Perhaps if Russia had annexed all of Ukraine, or the Baltics, or maybe even Poland, the S&P would have soared over 2000 already?

But there’s also this from the LA Times:

More than two decades of building foreign investor confidence in Russia as a reliable business partner — over.

Reliable customers in Western Europe for the oil and gas exports on which Russia’s economy is heavily dependent — now in doubt.

Rising prices for imported food, clothing, cars and financing of private and government building projects — a given.

The costs to Russia of its internationally condemned seizure of Ukraine’s Crimean peninsula extend far beyond the symbolic sanctions adopted in Washington and Brussels a day after Crimeans, under armed Russian occupation, voted to secede from Ukraine and appealed for induction into the Russian Federation.

From an economic standpoint, Russia’s recovery of Crimea 60 years after its inter-Soviet transfer to Ukraine makes no sense at all for the Kremlin or the Russian people.

Perhaps the hope in the Kremlin is to give the markets time to adjust to the new reality, before making a move against Eastern Ukraine. Or perhaps by then Ukraine will be in enough trouble that the Russified bits will fall into Moscow’s lap, without the need for all the military/parliamentary/referendum kabuki. Or maybe Putin is full and won’t be going back for seconds.

But I’m wouldn’t put any money on any particular outcome or method.