EU wary of confiscating Russian assets, retaliation for sure.

 SANCTIONS AND ECONOMIC WARFARE HAS UNEXPECTED COSTS

POLITICIANS WON'T PAY COSTS

The U.S. and UK are urging the EU to confiscate Russian assets and transfer the money to Ukraine. While some of the money may go to Ukraine much of it will pay for weapons and supplies. Over $300 billion in Russian assets have been frozen, most of it in EU banks. Confiscation would most likely lead to retaliation by Russia against EU companies with assets in Russia. Just yesterday Russia decided to not confiscate French yogurt maker Danone's assets. The company is still operating in Russia. Those companies that have decided to leave Russia are negotiating to recover some value for those assets.

Russia has indicated that they may actually sever diplomatic relations with any EU country that confiscated assets and hinted at severe retaliation. The long list of sanctions against Russia have proven to damage EU business and economies more than Russia. 

The other concern is a rapid flight of foreign assets out of EU banks by other non European countries that could possibly create a banking crisis in the EU.

Recently Russia has suspended a fishing treaty with the UK that has been in effect since 1956 that allowed the UK to fish in Russian waters in Barents sea. Some have estimated that 40% of UK fish came from these waters, but the UK dismissed the action as immaterial. Will the UK now see a rise in fish prices?

The recent action in the U.S. to demand that TIK TOK be sold to U.S. parties is really another form of sanctions and economic warfare. Has anyone considered if China may retaliate and demand that Boeing, General Motors or other U.S. companies be forced to divest from their assets in China. One must wonder how short sighted many of these decisions have become.

These types of sanctions and economic warfare have historically preceded major world warfare. At one time most of these issues could have been negotiated by serious diplomacy, something that is now nonexistent. As this escalation continues chances of diplomatic solutions may soon be impossible.