US government another sanction on Russia to further cripple the Russian economy and to condemn the Russian violation of human rights. The US along with the Group of Seven and European Union Allies announced that gold transactions with Russia have been banned. Russia has the fifth largest gold reserves in the world. The US also announced sanctions against 48 Russian state-owned defense companies, 328 members of Russia’s parliament, and Herman Gref, the head of Russia’s largest lender, Sberbank. The purpose of the gold sanction is to further pressurize the Russian economy and also to cover all the loopholes through which other countries still do business with Russia. It will also affect Russian people who trade in gold in Russia and in other countries as well. The previous sanctions on Russia did not affect the gold reserves of Russia so the US is now directly aiming to attract the Russian gold reserves. Russia has used gold to back its currency and also to purchase goods and services so the gold sanction is primarily to restrict Russia from any economic activity.
Considering everything going on with Ukraine, I believe the US and allies made the smartest decision to restrict the gold sanction as it is a primary reason their economy does well. Covering the loopholes is an important part this article touched on as well, wonder how they are addressing the petroleum situation.
ReplyDeleteI also think that putting sanctions on gold is a very smart decision by USA as it will make Russia vulnerable as the only source of trading for Russia after being removed from SWIFT banking system is trading though gold. It will definitely put Russia in a tight spot and will make Russia rethink its oppressive decisions
DeleteThis is yet another example of the world responding to Russian aggression through the use of economic weapons. Do you believe these actions and the sanctions in general are enough to stop Russian aggression in Eastern Europe?
ReplyDeleteI think these sanctions are not enough to stop Russian aggression but it will definitely trouble Russia and weaken its economy. Moreover, it will set an example for the world to stand against oppression. In my opinion, the way to stop Russia's aggression is to completely isolate Russia from the rest of the world and to isolate its allies which in reality is quiet impossible because Russia and its allies like China are very powerful economies.
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