AGF Management: The Biggest Surprise of the War — The Inept Russian Army
AT THE BEGINNING OF THE WAR, we had no doubt that the brave Ukrainian patriots would fight hard, and we believed that NATO would show surprising unity on the sanctions aimed at crippling the Russian economy.
BUT THE SHOCK has been the heavy Russian army, poorly led, short of essential supplies and facing a morale crisis among soldiers with little enthusiasm
for a war against civilians.
WITH WEEKS OF FIGHTING AHEAD, Moscow seems content to wage war on civilians – not just doing collateral damage, but actually trying to kill and terrorize them. War crimes seem to be Moscow’s preferred option because its military has failed.
THE ARMY IS A KEY PART of Putin’s troika; the other two-thirds are oligarchs and ordinary Russians. The super-rich see the ruble collapse and their assets confiscated in the West, while the general public faces a dramatic collapse in their standard of living.
BUT IT IS THE ARMY that has suffered the most dramatic disgrace. Most experts estimate that Russian casualties topped 5,000 in less than two weeks of war – at least half of them dead. Reports of surrenders and low morale persist, with Russian soldiers shocked to find they are not being greeted as heroes, as their leaders had promised.
THE NEW YORK TIMES REPORTS this morning that some Russian troops crossed the border with MREs (ready-to-eat meals) that expired in 2002, and Western officials report that soldiers surrendered and sabotaged their own vehicles to avoid the fights.
WE ARE NOT NAIVE, WE CONSIDED that the Russian army can bludgeon Ukraine and take most major cities. But as Vietnam and Afghanistan have proven, an insurgency can eventually prevail against the superpowers.
AS THE NEW YORK TIMES REPORTS, European military personnel who once feared Russia say they are no longer as intimidated by Russian ground forces as they once were. Part of this narrative is the United States’ eagerness to supply arms and apply aggressive sanctions (an oil ban is approaching and higher defense spending is certain).
BUT PART OF THIS STORY is that the Russian military has been strategically inept, exposing a 40-mile convoy to relentless Ukrainian attacks. And part of that story is the Russian military’s failure to modernize.
TODAY’S HIGHLY RECOMMENDED ARTICLE quotes a Russian military expert: Much of the money to modernize the military “was stolen and spent on mega-yachts in Cyprus. But as a military advisor, you can’t report that to the president. to him instead. Military Potemkin.
The views expressed in this blog are those of the author and do not necessarily represent the views of AGF, its subsidiaries or any of its affiliates, funds or investment strategies.
The opinions expressed in this blog are provided as a general source of information based on information available at the time of publication and should not be considered personal investment advice or an offer or solicitation to buy and/or sale of securities. Speculations or opinions expressed about future events, such as market or economic conditions, corporate or securities performance, or other projections represent the opinions of the author and do not necessarily represent the point of view of AGF, its subsidiaries or any of its affiliates, funds or investment strategies. Every effort has been made to ensure the accuracy of these comments at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change and AGF accepts no responsibility for individual investment decisions arising from the use of or reliance on the information contained herein. All financial projections are based on the opinions of the author and should not be considered forecasts. Forward-looking statements and opinions may be affected by changing economic circumstances and are subject to a number of uncertainties that may cause actual results to differ materially from those contemplated in the forward-looking statements. The information in this commentary is designed to provide you with general information related to the political and economic environment in the United States. It is not intended to be comprehensive investment advice applicable to an individual’s situation.
AGF Investments is a group of wholly-owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments America Inc. (AGFA), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFA and AGFUS are registered advisers in the United States. AGFI is a registered portfolio manager with Canadian securities commissions. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The subsidiaries that make up AGF Investments manage a variety of mandates consisting of equities, fixed income securities and balanced assets.
Founded in 1957, AGF Management Limited (AGF) is an independent, globally diversified asset management company. AGF takes a disciplined approach to delivering excellence in investment management through its fundamental, quantitative, alternative and wealth businesses focused on delivering an exceptional client experience. AGF’s portfolio of investment solutions spans a wide range of clients globally, from financial advisors and individual investors to institutional investors, including pension plans, corporate plans, sovereigns, endowments and foundations.
For more information, please visit AGF.com.
©2022 AGF Management Limited. All rights reserved.