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5:21
Markets fall sharply after Putin's declaration of war
Russia gave the green light to the invasion of Ukraine to "defend" Donbass, which has led investors to a currency shock in recent hours
The rubber band breaks up after carrying strong tensions during the last days. Russia has launched a "special military operation" on Ukrainian territory, which the Ministry of Defense classifies as harmless.
Although the words of the Russian president and his military cabinet do not seem like the beginning of a war, investors know that it is and seek in any way to anger any volatile situation.
The stock market and the level of cryptographic currencies are submerged, imprisoned by the fear of their investors and imagining other situations that could also come from the war in the West.
Russia already has financial problems because of the military operation in Ukraine
Quickly, after the statements offered by Vladimir Putin, Russian shares fell to half their value. A perfect 50% less for the country that has unleashed the resentment of the world population.
Many media on the web have already begun to classify today as a "Black Thursday" for the Russian territory.
While its currency, the ruble, also fell significantly, positioning itself below the US dollar, and setting a new record low.
The Moscow stock exchange, after the last index delivered, has completely stopped its operations and indicated that the same organization will notify when activities resume.
All markets collide with Russia and its military operation initiative
The lack of supply is not yet a problem, but the fear that this situation becomes a reality, caused the gas to shoot up to 40%. Likewise, oil increases in price notoriously.
This is also directly linked to Europe, and the increase of USD$103 per barrel of oil. It is stated that the beginning of the market this Thursday throughout the continent has been depressing.
Wall Street had already closed in a negative red color this Wednesday, February 23, and the news from Russia did not come in handy, so far they report a fall of 5%.
Similarly, Asian stock markets show 3% in their final index this morning. The neighbors of Russia, Poland and Turkey, yield in their portfolios and fall by 7%.
Meanwhile cryptocurrencies fall with more notorious numbers. Bitcoin plunges 9%, pulling all other tokens with it in its market capitalization.
A psychological war will also affect the market
Since the territorial conflict between Ukraine and Russia resumed, the market drop has continued, in addition to adding to US inflation, but this morning the worst scenario for the world economy has occurred.
When declaring a war from a power like Russia, with disproportionate military weapons, the terrible idea that an armed conflict becomes massive is consistent.
In this way the feelings and the mind of the people who invest, generate moves in the stock market, while they are even worse in the volatile market.
Related to this, many people will start the wave of false information that worries the general population. What will turn this Thursday into a difficult psychological war to wage.
The fall of the market represents a concern coupled with the war
Investors are trying to put up a protective wall, moving their money into debt, gold and the dollar, but there are not many solid or sustainable options at the moment.
The market at this time acts as a meter, and alerts us to what could happen in the monetary field, not only in countries that are at war.
A push of this magnitude in the first indices on February 24 puts us on the alert for what it could bring to the national economies. When one nation falters, the others will be like dominoes.
The decisions made with distant allies will be reflected in all international monetary systems, even if it is only a small replica of the earthquake that Russia or its close neighbors are experiencing.
Russia's reasons for invading Ukraine
Vladimir Putin in his latest statements argues that his military intervention is totally understandable, since according to him, Kiev has oppressed its people. Implementing the terrible genocide throughout its territory.
His special military operation will only have the philanthropic excuse of "protecting people who have suffered abuse and genocide by the Kiev regime."
He clarifies that his intention is not to invade and seize Ukrainian lands, he only wants to imprison those responsible for the disaster in Ukraine, and adds that Dobass is the one who has asked him for military help.
For its part, the Ministry of Defense affirms that Russian heavy artillery and weapons are only brought in to bring down the oppressive force in Kiev.
Their words dictate that they exclusively seek to imprison all those guilty of the previous violent events. "The Ukrainian population is totally safe."
The US and many others do not believe these arguments from Vladimir Putin and his cabinet at all, which is why they have further strengthened economic sanctions. This is the reason that Russia has problems with its stock market.
And now the other countries see the effects that this generates, some with slow actions and others coming as a quick blow that leaves one breathless.
