{"id":26834,"date":"2023-06-24T03:45:29","date_gmt":"2023-06-24T07:45:29","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/wagner-chiefs-accusations-about-russia-military-spark-coup-fear-uncertainty\/"},"modified":"2023-06-24T03:45:30","modified_gmt":"2023-06-24T07:45:30","slug":"wagner-chiefs-accusations-about-russia-military-spark-coup-fear-uncertainty","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=26834","title":{"rendered":"Wagner Chief’s Accusations About Russia Military Spark Coup Fear, Uncertainty"},"content":{"rendered":"
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Russia is providing a real-time case study in how geopolitical uncertainty affects markets: very quickly or not at all.<\/p>\n

Friday, Yevgeny Prigohizn, the head of the Russian mercenary Wagner Group, released a\u00a0series of audio messages\u00a0blaming the Russian military for an apparent attack on Wagner\u2019s forces. He then proceeded to try to play down his earlier statements, saying, \u201cThis is not a military coup.\u201d<\/p>\n

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Coup or not, the Russian state appears to be taking the situation seriously. By the time midnight rolled around in Moscow, Russian President Vladimir Putin had been briefed, and \u201cnecessary measures [were] being taken,\u201d Putin\u2019s spokesman said,\u00a0according to state media. <\/p>\n

The Wagner Group has played a critical role on behalf of Russia in its war with Ukraine. It isn\u2019t clear what the Kremlin might do or how that might affect its thinking.<\/p>\n

The possibility that the Russian war would end in Putin\u2019s overthrow has been percolating since the first days of the military misadventure.\u00a0Although no news that makes that appear likely has emerged so far, of all the ways the war in Ukraine could proceed, a coup would produce the\u00a0most immediate uncertainty\u00a0for markets. <\/p>\n

It would be a profoundly challenging event because there is little anyone can do to cushion the immediate economic blow of instability at the top of a nuclear-armed, oil-exporting, global power. Pity the Federal Reserve.<\/p>\n

In any case,\u00a0it isn\u2019t at all clear that Putin is actually being challenged by what is unfolding.<\/p>\n

Putin has stayed in power so long because he is adept at playing potential adversaries off each other. \u201cThis is a playbook that Putin has had for a long time,\u201d said Angela Stent, a Georgetown professor and former U.S. intelligence officer, discussing the possible threat from the Wagner Group earlier in the year. \u201cHe sits and kind of watches it happen. And he\u2019s the ultimate arbiter,\u201d she said.<\/p>\n

And in the event that Putin were to exit the scene, violently or otherwise, the power system that sustained him isn\u2019t exactly friendly toward Ukraine or the West. Putin has killed or exiled many pro-Western voices over the years. <\/p>\n

A Putin successor could in theory end the war in Ukraine and beg for relief from sanctions, but it isn\u2019t particularly likely. The intense diplomatic process that went into coordinated energy embargoes and price caps won\u2019t be quickly reversed even if a hypothetical new Russian leader asks nicely.<\/p>\n

That means the economic factors that have driven up inflation in the West are likely to persist regardless of what happens within the walls of the Kremlin in the near term.<\/p>\n

Crucially, very few people know what\u2019s happening within the Kremlin at the moment. Putin has made it exceptionally difficult for objective foreign journalists to operate in Russia, including through the arrest of Wall Street Journal reporter Evan Gershkovich, who has been jailed on trumped-up charges for nearly 100 days. That makes the fog of war especially thick.<\/p>\n

What is unfolding will become clearer with time. For now, the best advice comes from Sam Greene, a professor at King\u2019s College London. Don\u2019t assume you know what\u2019s happening,\u00a0he tweeted<\/a>. \u201cBetter to embrace the uncertainty and prepare for a range of plausible outcomes.\u201d<\/p>\n

Write to Matt Peterson at matt.peterson@dowjones.com<\/p>\n<\/p><\/div>\n<\/div>\n