This is CBSI on the world.

I'm John Batchel.

I welcome my good colleague, Michael Bernstein,

the Hoover Institution, guides me through the sanctions regime

upon the Russian Federation through the long conflict between Ukraine and Russia,

or the way Russia has it, between Russia and NATO. We begin, however,

with a story, a barter story. This is Reuters. In Moscow, you take rubles that you can't spend

outside of Russia, and you buy wheat, lots of wheat. In Beijing or Shanghai, you are a trader, just like your opposite number in Moscow,

but you take yuan, the Chinese currency, and you buy electric vehicles.

And then you send the electric vehicles to Russia, and Russia sends the wheat to you.

That is actually happening now.

And Michael tells me, we've gone back to the future.

It's called barter, Michael.

Does it make sense?

It makes sense when countries cannot conduct and cannot clear their trade with the currency that both

countries would accept. And so the Chinese don't need Russian rubles. The Russians would

be happy to take renminbi. They would take dollars and they would take euros, but the Chinese don't want to give it to them.

And so there is a situation in which, luckily for the Russians and for the Chinese, it's a unique

case that their export and import roughly balanced. The total trade between Russian and China is to $145 billion a year.

And of that, $129 billion is Russian export, mostly oil and natural gas and some wheat

and metals and natural resources.

$122 billion is import of Chinese technology and Chinese electronics and Chinese manufacturing goods, including

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