Ukraine: An Update

I had a few thoughts after I finished my Ukraine post.  Everything I said on Saturday still holds as long as the events in Ukraine remained confined to the Crimean region and the regions of Ukraine that hold a large Russian speaking population.  Should events spiral out of control,  and by that I mean something that looks like a serious diplomatic or military escalation, then I'll have to rethink my stance.  The Crimea is probably already lost to Ukraine and the markets will factor that in shortly enough.  A Russian throw of the dice-say an expanded invasion in the rest of the country-would change the equation.  

I don't think it's going to come to this and I'd note that the financial world is already punishing the Russians in a way that the diplomats really can't as the Ruble is getting smoked today.  But should the politicians lose control over the events, then we'd rapidly change our thoughts about how this could turn out.

P.S.  {11:10 AM Chicago Time} There are reports now that the Russians have delivered an ultimatum to Ukrainian troops in the Crimea to lay down their arms and surrender and they have until about 10:00 our time tonight to do so. I don't think this changes anything above or over the weekend as I've said regarding the longer term picture as long as any possible hostilities remain confined to the regions where Russia has a strategic interest.  One thing to note is that the market was over bought prior to this event so the participants are all leaning the wrong way right now.  That could give us some more chop in the next few days and we'll have to see how this plays out.  Stocks are down over 1% today so you can see what the short term reaction to this has been.