Russia Had a DEVASTATING Week

[00:00:00]So Ukraine has done it yet again. They have found yet another entirely new category of target that they can hit on a repeated basis to damage the Russian war machine like never before. And the Russians just were not ready for this.

[00:00:13]And it actually has strategic significance that goes far beyond what it appears to on the surface. It was just a couple of days ago that we got what were, in my opinion, some of the most impressive images of the entire war as we saw a Russian wild berries facility going up in flames. Now, this wasn't a facility that actually produced berries as some have implied. This is basically the equivalent of the Russian Amazon, and it went up in flames just impressively. We got so many different angles of this attack. We got angles from the air as people were looking down. We got angles from the ground. We even got satellite images showing the scale of the smoke, which covered a huge chunk of the entire Moscow metropolitan area, which is just a massive metropolitan area holding millions and millions of people. The strike was seen by literally everybody. But it was incredibly impactful. It had a lot of impacts, of course, on the Russian economy, on large Russian businesses, and on small Russian businesses. But perhaps more importantly, this strike actually gets at the heart of what could allow Russia to have a massive mobilization. Something that Russia has been talking about for quite a long time and that now seems imminent to happen within another month or two. Ukraine is potentially doing something very strategic right now by striking these specific facilities where they are actually hampering Russia's ability to mobilize men even if they want to. There are so many details to this story and so many angles to look at from the economy to these mobilization efforts and I'm going to get into all of them in today's video right after a brief break for today's sponsor. How do you feel about the fact that various companies are essentially watching every website you visit and can easily see your internet browsing history? It's a bit creepy, but that's the reality of the internet these days. Every website seems to be filled with trackers and ads that follow you around everywhere. And even worse, your data all too often gets leaked or governments pass laws that mandate they be given access to your data so that they can spy on you. To solve these problems, over a billion people across the globe use VPNs. But not all VPNs are created equal. And with a traditional VPN, the provider of the VPN itself can still see who you are and what sites you visit. That's fine if you think you can trust them, but that data can still be leaked or handed over to a government.

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[00:03:32]Obscura is giving my viewers 25% off a subscription for only $6 per month. So click or scan now and thanks again to Obscura for sponsoring today's video. So getting back into the story, I want you to leave today's video with a full picture for the significance of what is really going on with Ukraine's new strikes on Russian wild berries facilities. And yes, I did say strikes plural, and that is actually part of the significance here. Ukraine doesn't hit things just once or twice. Not historically in this war. Typically, when they find a new category of target, they hit it again and again and again and again. Which means that what we're seeing today is probably not the end, but just the beginning. A beginning of a new strategy that already just in the first two strikes has been absolutely devastating for the Russians. But we'll get more into that later in this video.

[00:04:19]Right now, I want to talk about the significance of these facilities in general and what has already been done so you can really see the potential here when you think about how Ukraine could do this at a broader scale. And there's really three aspects to the significance here. There's the economic aspect in doing damage to the Russian economy.

[00:04:35]There's the psychological aspect of bringing the war to the minds of the Russian people. But there's also a third aspect that I haven't seen explored nearly as much. And that's actually the direct military significance of these wild berries facilities, which it turns out is actually quite massive. a lot bigger than I think most people have actually noticed already, but more people are going to start to notice.

[00:04:59]Now, as far as the Russians go, they will of course deny the military significance left and right. That's part of what they do. They say that these targets are only civilian targets. They have no military significance at all.

[00:05:11]And therefore, Ukraine has committed a war crime by attacking these categories of facilities, which is ironic on its surface because, of course, Russia has been striking civilian targets this entire war. In fact, recently Russia struck a Ukrainian postal service, the Ukrainian Postal Service. And that's largely seen as the impetus for why Ukraine struck this category of facility. Now, Ukraine wasn't doing anything unique. They were responding to the Russians in kind against what the Russians had already done. And that would be valid even if these were merely civilian targets with economic significance because Ukraine cannot fight a war on different terms than the Russians are fighting against them. And unfortunately, the Russians have decided that certain categories of targets are on the board, which means that if Ukraine wants a chance of survival, they have to have the ability at their discretion to hit those same categories of targets. That's just simple warfare.

[00:06:05]But that being said, Ukraine throughout this entire war has held the higher moral ground even though they don't have to. And Ukraine has not struck any merely civilian targets. And that yes is still the case even with these Wildberries facilities because these facilities don't just have economic or psychological importance to the Russians. They're becoming increasingly critical to how the Russian military actually functions. And I think that's very important as we consider that Russia is now talking openly about potentially mobilizing hundreds of thousands of new Russian men to join the Russian military and attack Ukraine. You see, Russian logistics has two nodes.

[00:06:45]There's the official Russian logistics and there's the unofficial Russian logistics. And Wildberries touches on both of them. At the official level, Ukraine has claimed, and not without evidence, that these facilities were used for the logistics of drone parts.

[00:07:00]These facilities are used to transport drone components, which end up in the hands of the Russian military, and they help Russia assemble the drones that attack the Ukrainian front lines and the Ukrainian rear. Ukrainian cities on a daily basis. That's completely true. But I don't think it's the biggest piece here. I think the biggest piece here is the unofficial note of Russian logistics. All across Russian social media, we've been talking about this throughout the entire war. The main way that Russian soldiers get certain military equipment isn't by getting it from the Russian military directly, but it's by fundraising for it and then either purchasing it for themselves or having their family purchase it for them and getting it to them on the front line. And this is basically everything that doesn't actually go boom. The Russian military will supply their soldiers with drones most of the time and their weapons most of the time, but they don't really care about a lot of the other essentials like warm uniforms, socks, uh, body armor, boots, things of that sort, even for example, infrared scopes so they can see better at night or all sorts of other categories of equipment. When it comes to the Russian soldier, if they want anything like the normal kit that the Ukrainian military has, for example, they need to get that purchased for them on the Russian civilian market and then delivered to them. And this is where Wildberries really comes into the picture.

[00:08:24]Wildberries was basically is basically Russia's Amazon. And the way that that works is they have things they sell directly, but for the most part, the biggest aspect of the business model is that sellers all across the country store their items at Russian Wild Berries facilities. And they run small businesses through the large business infrastructure that's provided by Wildberries. And on Wildberries, it's become very common to see listings of Russian military equipment with keywords targeted, for example, towards the SMO because they call it the special military operation inside of Russia. So, there's all sorts of equipment from walkie-talkies to actual direct military equipment that is tagged as having been tested and proven on the battlefield in the SMO. And so in a very real sense, wildberries had become an unofficial marketplace by which the Russian military was actually sustaining itself.

[00:09:20]That's a big deal. That makes it a valid military target, of course, on the surface. But you also realize the strategic significance here where it's not just a valid military target, so he took it out, but it's actually a very strategic target if Russia is truly about to conscript hundreds of thousands of soldiers. already with the size of the Russian military they have today, they have all of these problems when it comes to supplying their soldiers with enough equipment. And if they were to conscript soldiers, we have long kind of mocked the Russians and saying it doesn't really matter how many soldiers you put on the battlefield if those soldiers don't have equipment, they're effectively useless because the human body in terms of a weapon in and of itself isn't all that effective. We need equipment and the Russians just don't have that equipment. So what Ukraine is doing right now is they are disrupting the system that actually provides Russian soldiers, especially new Russian soldiers, with what they need to actually get to the battlefield in the first place. And once you realize that, you realize this is potentially the single most strategic target that Ukraine could strike right now to create massive disruptions. And it actually seems it's becoming one of their most strategic targets, at least for the past couple of days. Ukraine has actually paused their strikes on Russian refineries where they've already been so effective and caused so much damage to attack these wild berries facilities instead. So very much so. This is a big big deal for the Russian military. Now those arguments are incredibly important and I want to hear them argued more because on the surface you can see from a military perspective how terrible this actually is for Russia and how bad it will be if this happens more and more and more. If every Wildberries facility across Russia gets struck, people are going to have to completely rethink the way that they acquire things. And it's not that the problem becomes impossible to solve. People can go to a different sort of system, but it will be much slower and people won't have access to everything they want the way they've come to be used to. Very important on its own. But what really makes this such a juicy target is that of course this isn't the only aspect to it. There's also the economic aspects and there's also the psychological aspects which are equally important. So important that it's hard to really know and argue and determine what was Ukraine's primary goal here. Maybe they didn't have a primary goal. Maybe it was all three. So from an economic aspect, I really want to lean into why this is so significant.

[00:11:47]Because obviously when you strike a country's Amazon, that's going to have big repercussions. But it's especially significant because in a lot of ways it's a firstofits-kind kind of strike on a certain segment of the Russian economy. Most of Russia's economy is of course oil and natural gas or depends on oil and natural gas. And Ukraine has been striking that throughout this entire war very effectively. But what they haven't done as much is actually strike Russia's internally facing economy. So for the most part they've been trying to keep revenues flowing in.

[00:12:18]And there have been second order effects on the internal economy because of that.

[00:12:22]This is different. This is a strike on the Russian internal economy directly which will only magnify the existing chaos to levels we haven't seen before.

[00:12:33]And for a lot of Russians this is when they start noticing and you can think of this in your own country really as a correlary because in your own country if your oil and gas facilities were getting hit it would be frustrating but maybe directly you wouldn't notice. Maybe you would think, well, this is going to affect somebody somewhere. It's going to affect my gas prices. It's going to affect my government's budget. But I can largely ignore it. And that's exactly what the Russian citizens have largely done. And the government has tried to make it as ignorable as possible using brilliant financial levers like inflation and different things, different topics for a different video.

[00:13:09]But what they're doing right now, what Ukraine is doing right now to the Russian economy is unignorable. because you might not notice if an oil facility got hit in your country, but you'd probably notice if a facility got hit that actually triggered a notification on your phone, hey, um, your package is not going to get delivered because it burned up. Oh, why did it burn up? Oh, well, because Ukraine destroyed our entire logistics facility. This is huge.

[00:13:37]And the economic impacts are broad sweeping. First, there is the big picture corporate impacts on the company of Wildberries itself and on the insurers who, you know, potentially I don't know who's ultimately going to eat the cost, but it's going to be one or both of those entities. That's a big deal because these corporate entities when people are looking for ways to make money, they have to find alternatives to oil and to gas because there's no money to be made there in Russia right now.

[00:14:04]So, a lot of the big wig oligarchs have fought over who gets the money from Wildberries. And you know, there's actually some interesting rumors here about Katarov and how he actually sent some armed men to try to take over the company in the past. I'm not going to get into all that in this video other than to point out that this is a huge blow to this company corporately. And that's a big deal because it impacts the oligarchs directly financially, either the owners of wildberries or those who profit from insurance who already lately have been pretty openly talking against Vladimir Putin and against the war.

[00:14:41]We've already seen a lot of economic forums in Russia where these people are deeply bothered by the fact that their profits are getting hit so heavily. And there's rumors that they're kind of working against Vladimir Putin. In fact, there's a reason a lot of these guys fall out of windows or drown in their own bathtubs. Vladimir Putin is taking a lot of these elites out because the elites are nervous and because that nervousness is causing them to put pressure on him. Pressure that he doesn't exactly like. This strike on this Wilder's facility is only going to increase that. It's going to be big. Um I've heard damages estimated directly in the billions of US dollars, at least a billion US dollars. That's not monumental in and of itself, but again, that's just the first strike. And it also doesn't talk about the second order effects on the business model. For example, we see in the Straight of Hormuz, one or two tankers gets hit.

[00:15:34]Nobody wants to guide their tankers through there anymore because the risk is too great. It's similar with the Wildberries facilities right now where right now there is a mass exodus from these facilities of small business owners trying to get their goods out, store them anywhere but there. They will have a less efficient business because they don't want to be at risk of losing everything to a Ukrainian drone strike.

[00:15:59]So that's big. It actually disrupts an entire business model, an entire economies of scale type of business model that really the modern world has come to depend on. Things are going to get more expensive for the average Russian when you don't have those economies of scale. And already the average Russian is really struggling with inflation and things of that sort.

[00:16:18]So that will affect the Wilder's bottom line overall. That'll put pressure on Vladimir Putin. That's good news. But it might not be the biggest impact. the biggest impact might actually be these small business owners who have found one of the few areas of leverage they have in Russia to actually start a business and run it. You know, the same way people in the United States and all over the world have businesses on Amazon.

[00:16:42]these people, if they had their um their product in the facilities that were already destroyed by Ukrainian drones, they're probably out of luck because their contract with Wildberries actually says that Wild Berries is not responsible if a Ukrainian drone strike destroys their product. That's bad in and of itself. And that's what's fueling the exodus of these people to try to derisk themselves from this area. But these businesses are still being impacted massively because there's a reason you go through wild berries in the first place. And that disruption is going to spread through the Russian economy in ways that really we haven't seen anything like it before. So as all these small businesses are getting broken down directly, it doesn't just impact them, of course it does, it impacts a whole host of other people who are in a chain of cause and effect who ultimately get their payment from these small businesses. It works like this.

[00:17:36]You have the small businesses. They get broken down directly either because a Ukrainian drone physically destroyed their product in a wild berries facility or because they backed out of the facility and they basically undermined their entire business model. These people now no longer have money coming in. And without money coming into them, they can no longer pay the businesses they typically pay. And that's everybody. Whether it's the people they pay rent to, whether it's their car payment, whether it's uh you know food and groceries and restaurants, any business, any service that they typically pay for, they've now lost a lot of customers too. This has been a big problem across Russia in general, and it's something that really the Russian government has tried to fix by paying high military salaries. The idea is even though we're losing a lot of revenue, we're keeping money flowing through our economy internally by giving people big salaries that they then spend and that keeps everybody in our country having a job. That's already started to break down lately. And now Ukraine has just struck probably the single most impactful target that they could actually physically strike to cause chaos within that system where a lot of people in Russia are going to start losing their incomes overnight. It's not just a breakdown in a loss of income, though. It's a breakdown of an entire income producing system that modern society has increasingly toolled itself around. And so, if Ukraine ramps up these strikes, which they probably will, it's only going to get more and more devastating from here. Now, what's potentially even the most devastating aspect of this is also the new thing that Russia now has to think about.

[00:19:15]Russia has already had a massive air defense shortage. They don't have enough air defenses to protect their military targets, let alone their refineries.

[00:19:24]They've had to abandon large areas of their country as far as air defense goes to try to triage and protect certain areas. And now Ukraine has just basically told the Russians there's a whole host of other targets that you have to think about. This means that Russia is going to have to make even more hard choices about where to allocate air defense systems and what to protect. And it means that the damage that Ukraine is about to unleash on the Russian economy could potentially be completely unprecedented throughout this entire war. And that actually brings the ultimate significance of this down to the psychological impacts on the average Russian person. I've already talked about the psychological impacts and how people are seeing this. They're seeing this in the smoke plume that literally covers almost the entire region of Moscow. Not just the city, but the region. Everybody would have seen that smoke. Everybody directly would realize something massive has just happened to our country. We were told that this would never happen. We were told it was just a special military operation. So, people can physically see it there.

[00:20:29]They're also going to feel it directly from the interruption to the way that they enjoy daily life. They're going to see notifications literally on their phones saying that this product that they ordered is no longer available and never will be available again. that will get your attention unfortunately a lot more if you're a Russian or or really anybody living in a society like this that is so closed with so little information coming in in a way that people dying overseas in a different country would never get your attention.

[00:21:01]The Russians are going to realize more and more that this war has a very real cost. And that is a cost not just to the oligarchs, not just to the elites, not just to the guys who volunteer and choose to sign a contract and their fate is in their own hands, but they're going to realize that this war has a cost on everybody, on the entire society, on the entire system that chose to support it.

[00:21:27]So, we'll keep our eyes open and I'll continue trying to update you as things come in. If you want to get those updates, please don't forget to like this video and subscribe to the channel.

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