Francis Scotland: We’re in a multi-polar world. We’re not in a unipolar world. We’re not in a bipolar world. If there ever was a benign global hegemon, that era is over. And so, I think, in really broad terms, what that implies is that sovereign states will take foreign policy initiatives that are in their own self-interest, independent of what maybe the United States or China might like them to do. And so, we end up with more and more regional blocks. And if you, sort of, think about the economic and an investment environment of a multipolar world versus a more unipolar or even a bipolar world, there’s more flare-ups. There’s more potential for conflict, smaller, more regional, but probably more frequent and more intense. And so, we get exactly what we’re seeing right now. So, you know, there’s an awful lot of what I would call potential alpha in Russian assets if things subside in an orderly constructive way, but we just don’t know.
You could frame all of the outcomes, I suppose, between two extremes. One being the Ukraine and Belarus and Georgia agree not to join NATO [North Atlantic Treaty Organization] for the foreseeable future, which seems to be [Russian President Vladimir] Putin’s red line, unless Putin really does want to reassemble a Soviet Union. And the opposite extreme would be a full-scale invasion of the Ukraine. Against that backdrop, you have some pretty substantial value the way we measure value building up in Russian assets. A lot of this is factored into price. But when you overlay the information risk of uncertainty that these scenarios could lead you to, the only conclusion, at least we come to, is whatever you would have owned, you’d own less. So, from a strategic point of view, managing this, kind of, multi-polar world probably means, when you have these situations flaring up, risk and uncertainty overlays dampen down whatever you might have chosen otherwise relative to the valuation opportunities. So strategically, that’s how we’re looking at the world, as multi-polar. And to the extent you get these flare-ups, that’s how we’re approaching them.
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