Russia seized the local assets of Carlsberg beer and yogurt maker Danone. It now threatens Austria’s Raiffeisen bank.
- President Vladimir Putin signed a decree in April allowing for “temporary” state control over the assets of companies or individuals from “unfriendly” states — which include the US and its allies.
- The move is the second time the Kremlin has used the decree to seize assets. Previously, Russia took control of utilities owned by Finland’s Fortum Oyj and Germany’s Uniper SE.
The Backdrop: At the onset of the war, the Fed, under direction of the Biden Administration, illegally seized Russia’s foreign reserves. Illegal is the correct word.
- The Federal Reserve Act mandates that the Federal Reserve conduct monetary policy “so as to promote effectively the goals of maximum employment, stable prices, and moderate long-term interest rates.”
- Nowhere does the act give the Fed the right or power to confiscate the reserves of sovereign nations. But that is exactly what the Fed did when it seized Russia’s US dollar reserves.
- If the Fed can confiscate Russia’s reserves, who’s next?