IT HAPPENED, THE WAY THE MARKET EXPECTED IT TO HAPPEN, THE MARKET IS OVER IT ...FOR NOW

I probably don't need to recap events this weekend in Crimea, but if you missed it: 95+% of residents voted in the referendum to become a region of the Russian Federation. The voter turnout was over 70% which is more than any US election in more than a century.

Ukraine had already made it clear they were prepared to let Crimea go and not fight for it as Russia has mobilized 60,000 troops on the much more important (to Kiev) Eastern Ukrainian border where there's also a high concentration of ethnic Russians that want to join Russia.

So things happened exactly as they were expected to and as such the market was ok with that, it's the surprises it doesn't like and it may be headed for some big ones this week.

My personal take (and this usually wouldn't matter, but may in this case) is that Putin is shrewd, he's the old guard who came to power, will not leave power, lifted Russia which was becoming like a third world nation out of the much and restored the national pride they lost around 1998 as democracy didn't work out as well in Russia as they were led to believe it would as companies like Goldman Sachs, the Oligarchs and others pilfered everything they could get their hands on as the Soviet Union fell apart blindingly quickly and surprisingly.

Putin is restoring Russian pride which is no small thing.

Look at the Crimean situation and you see how Putin operates, he's extremely patient, he waits for an easy opening and then moves without hesitation with incredible speed and no dithering, he knows what he wants and he goes after it. Obama by contrast looks like a dithering president that has no idea how to deal with the situation, what did we do? Send 1 destroyer to the region, impose a few travel visa sanctions? However Mr. Obama has promised Mr. Putin that there will be "Additional Costs", really? Can you imagine how Putin feels after getting off the phone with Obama? An old Soviet KGB top spy vs a Community Organizer? You can simply see in the way the situation has unfolded that Putin has all of the characteristics to get exactly what he wants and he won't be cowed by anyone and everyone else is standing around literally afraid of what he'll do next and they should be, a man like Putin doesn't pull out all the tricks to stay in power as long as he has without an agenda and a real legacy to cement.

Moving forward, Crimea has already applied to become part of the Russian Federation and is expected to be by Wednesday or Thursday, but not before Putin addresses a joint session of Parliament and Parliament has already set up a vote to consider Russia taking over other "Cities, countries and regions " that wish to secede and become part of the Russian Federation, this is where Eastern Ukraine may find it's way in to mother Russia's arms and the EU, NATO and US left losing one of the biggest trophies of the Soviet collapse. 

This sets the stage for Putin, who has chosen the time and the place of the battle and has made swift preparations while his opponents where caught off guard playing golf. 

I use to call Putin, "Man of Action" as a joke because of the photo ops of him topless fishing or in a submarine going to the deepest part of the ocean or his Black belt karate displays, it was kind of silly, but he truly is a man of action that will not dither as the US has one of the biggest dithering presidents in many decades, Putin played this to perfection and he's just getting started.

In the meantime, the VIX protection bought Friday and a little late day selling looked like retail to us Friday, the pros knew what to expect and as such the market was ok with things so long as there weren't surprises. Tuesday's Putin address may be one of those moments of surprise or the Parliament on Thursday taking up annexation of other country's territory "If" the residents want to secede, that's Eastern Ukraine more than anywhere now, that's why Kiev didn't split their forces and valued the east over Crimea, they know what's coming next, they know Putin better than do we.

For now, the market is doing what we've been expecting and that's good enough, lets keep an eye on it and make sure it keeps doing what we expect and we too should come out of this for the better by taking deliberate action on our terms and at the time of our choosing rather than chasing the game after the train has long ago left the station, yes Mr. Obama, that's you.