The main development in the Ukraine is the sharp increase in the number of visible signs of the economic collapse taking place.  Prices are sky-rocketing, more and more salaries are simply unpaid, shortages are becoming more frequent and as a direct result, so are social protests.  The interesting thing is that these protests are not limited to the eastern Ukraine, but are also taking place in western regions of the country.  These protests includes strikes and street protests.  The IMF has agreed to $17.5bn in loans to Ukraine but that will clearly not be sufficient, if only because whatever money is not stolen will be used for war.  The situation is now so dire that the Ukraine purchases gas from Russia only for a couple of days in advance.

The situation is also sharply deteriorating along the line of contact where the junta forces have resumed sporadic shelling all along the frontline.  It is becoming evident that the junta forces have not withdrawn their heavy weapons.  DNR Foreign Minister Alexander Kofman has declared yesterday that he expected a full scale junta attack within the next two weeks.  Needless to say, such an attack has exactly zero chance of success, but if it is executed in response to a false flag atrocity somewhere near the line of contact it will at least serve to distract the public from the economic disaster taking place in all of the Ukraine.

Since the Hrivna is in free fall and since Kiev has stopped paying pensions and bank operations in the Donbass, the two Novorussian republics have now switched to a multi-currency system in which the Hrivna, the Ruble, the Dollar and the Euro are all legal tender.

As was easily predicted, the Minsk 2 Agreement has now basically stalled because the junta is apparently unable (or unwilling) to withdraw its heavy weapons or engage in constitutional reforms.  As a direct result of this, Russia and Novorussia are now the legal “owners” of the border between the two countries.

US military aid is slowly coming in, and officially it is limited to non-lethal aid.  As I said many times, no amount of military aid will make any real difference in the military balance between the junta and Novorussia.

Finally, I am happy to announce that a representative of the Saker Community has been chosen to travel to the Donbass as part of the trip organized by the agency Europa Objectiv.  God willing, this will allow us to get a daily travel report with photos and interviews.  My thanks to all those who applied and sorry that you were not chosen.

The Saker

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