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Let me start off by making something very clear–the Russian de facto invasion of Ukraine is a very big deal for the people of Ukraine, the separatists regions, and the countries of Eastern Europe. I think we’re looking at the potential for thousands of deaths and casualties and the potential destabilizing of the Baltic republics and more in Eastern Europe.

But the reaction of the financial markets is a different matter. Today, stocks fell but not a huge amount on uncertainty about exactly what sanctions the United States and the countries of Europe will impose on Russia.

So far, the reaction seems to be one of “disappointment” that the announced sanctions aren’t bigger.

The major indexes moved lower today–the Standard & Poor’s 500 closed off 1.01% and the Dow Jones Industrial Average ended the day down 1.42%. The NASDAQ Composite finished of 1.23% and the small cap Russell 2000 fell 1.45%. (In the case of the S&P 500 that decline was enough to push the index into its first correction in to years. The NASDAQ Composite is already in a correction.)

But, and I think this is important in figuring out where stocks will go from here, the obvious hedges against the effect of sanctions fell even harder. U.S. oil shale producers ConocoPhillips (COP) and Pioneer Natural Resources (PXD) dropped 2.01% and 4.36% on the day, respectively. Alcoa (AA), which I added tony Jubak Picks Portfolio on Friday, February 18, as a hedge against sanctions on Russian aluminum, fell 5.26%.

Other hedges or assets that you might expect to show big moves on the news didn’t shift much. U.S. crude benchmark West Texas Intermediate was up just 1.41% and international Benchmark Brent crude rose 1.05%. Natural gas, which you might have pegged for a big move after Germany put a hold on approval for the Nord Stream II pipeline from Russia to the European Union (thus bypassing Ukraine) gained just 1.31% on the day.

Gold, a classic hedge against turmoil, ws up only 0.11%.

The price of the 10-year U.S. Treasury hardly budged with the yield climbing just 1 basis point to 1.93%.

The VIX “fear index,” the CBOE S&P 500 Volatility Index, which measures how much investors and traders are willing to pay to hedge risk, did indeed climb today but by a very minor 3.82% to 28.81.

A few reasons for this.

First, with stocks in decline for 2022 already, some of the selling that might have accompanies this news had already taken place.

Second, a lot of investors and traders (myself included) had already hedged against this event. Today I think we saw some profit taking in the selling of those hedges. That doesn’t mean that the trend won’t reverse with investors and traders putting on new hedges to sending the VIX higher but not today.

Third, the U.S. and European response to Russian moves so far was been relatively muted because these governments want to keep some sanctions in the quiver I case Russia makes further moves such as a full scale and overt invasion of Ukraine. So today investors and traders were genuinely uncertain about how like more extensive sanctions might be and how much they should hedge on those potential events.

And, fourth, while financial markets can entertain two thoughts at once, it’s not easy when one of them is as big and market moving as the question of how fast the Federal Reserve will raise interest rates at its March 16 meeting. That’s top of mind when a Wall Street money manager thinks about how to position a portfolio. So far, the events in Ukraine, aren’t enough to nudge that focus aside. Right now, I’d say, financial markets are in a wait and see mode.

I think that in all probability Russia isn’t done. And this crisis is likely to assume greater significance in the coming days and weeks. So I’m not selling any of my hedges at this point.