The games the Kremlin is playing in the Ukrainian theatre of almost-war are an extrapolation of the techniques it uses in Russia. Postmodern authoritarianism – or whatever you want to call the 21st-century system the Kremlin has developed with its puppet politicians and simulated ideologies and pretend conflicts and real killing and corporate KGBism – is going on tour.

The Kremlin’s Ukrainian adventure seemed to slide off the end of the Olympics, whose opening and closing ceremonies celebrated Russian history as a sequence of performances and hallucinations. The Night Wolves, the Kremlin-sponsored religious-imperialist Hells Angels out to save the soul of Holy Russia from the satanic West, rode their Harleys down to Crimea: ‘Russia is wherever we are,’ their leader has often said. ‘Ukraine and Russia should reunite,’ he has now announced. On TV the leader of the Eurasia party, Aleksandr Dugin, called for Ukraine to be split along racial lines; the Eurasianist presidential advisor Sergey Glazyev said Russia would leave the global financial system and create its own behind a high white wall. Does anyone who has real power in Russia believe any of this? The ‘shareholders of the system’, as they’re known in Russia, with their children at Western business schools and their investments in Geneva? Really? Do they? Or are the Night Wolves and the Glazyevs just pushed forward to intimidate? Don’t mess with us, we have madmen in our midst! And it works.

Then, just as you were trying to get your bearings over the weekend, the news was suddenly dominated by senators approving Putin’s request to authorise the invasion of Ukraine, in speeches that quoted directly from the USSR’s invasion of Afghanistan, spoken in the same graveyard tones last heard in 1980, by men in awful suits in a room whose very colour-coding screams ‘USSR’. And watching it all you can’t help but think: ‘My God, they really do believe it’s the Cold War.' And then you calm down: does the Kremlin really still think it’s 1980? Or is this just the calculated use, utterly contemporary, of Cold War quotes to unnerve the enemy? Yes. Yes, you tell yourself, that makes much more sense. But: they just declared war! Real war!

And while you’re still pinching yourself, there’s one of the sane, modern spokesmen (maybe Medvedev, maybe just Naryshkin), contacting the government in Kiev and promising, in the most rational, sensible terms, that ‘of course there will be no invasion of mainland Ukraine. We all live in the modern world, don’t we?’ And it comes as such a relief you’re willing to accept its terms, however skewed they are, just for the world to make sense again. But the moment you’ve calmed down there are crowds of thousands springing up in Odessa, Donetsk, Kharkiv, calling on Russia to save them from Ukraine. And everyone’s talking about civil war. And there are women wailing to the cameras they're afraid being attacked by roving gangs of Nazis from Kiev. But all the reliable news sources say there are no roving gangs of Nazis from Kiev. And why do the same women appear in every meeting in different cities: are they rented? Is the civil war rented? Are all these crowds, which appear so suddenly and just as suddenly disperse, all extras? But what of all those millions who really did vote for Yanukovich? Who really do love Putin? They’re real. Aren’t they? And you sink deeper into the scripted reality show designed to to disorientate, provoke, intimidate, with its scare puppets that might just come alive and the invocation of nightmares to give you nightmares in which you can’t quite really tell what’s simulated and what isn't.

And then comes Putin. And now you think the games will stop. Everything will become clear. War or peace. Madness or sanity. And he begins to speak, and he says, in essence: 'War? What war? We would never dream of starting war! We respect all territorial integrities.' And you relax. It was all just a little sabre-rattling to get back in the global game. And then he says: ‘But of course we might invade if Russians in Ukraine ask us. And maybe the borders should be changed, in which case it wouldn’t even be invasion.' And then he says: ‘Soldiers? What soldiers? We have no Russian soldiers in Crimea.’ And now you feel reality is slipping faster than ever, because if there was one real thing in all this it was real Russian troops arriving in Crimea (they even said they were Russian troops, though they have no Russian army insignia). And off Putin goes, invoking his defence of human rights and snatches of Nazi history and Americans treating Europeans like lab rats. And is he doing all this to send us mad with his use, in the US state department phrase, of ‘startling fiction’? Or because, in the alleged words of Angela Merkel, he’s lost all contact with reality?

For some sort of madness is implicit in the system. If at one end of the spectrum there's Vladislav Surkov in his 2010 pomp, switching through the gears of contradicting narratives with triumphant cynicism (he sped through East Ukraine just before all these new performances were set in motion), then at the other end is the figure of Boris Berezovsky, the progenitor of the system who became its absurd reflection, bankrupt, making no sense in an English courtroom where he was told by a judge that he ‘deluded himself into believing his own version of events’ (after that, all that was left for him was suicide). And somewhere in the middle is a minigarch I met in Moscow who was convinced he was the messiah, and rich and powerful enough to organise his world to foster the illusion.

But for all this loose talk of ‘madness’, look underneath the Kremlin’s whirligig and don’t you see the most precise, hard calculations? The Crimea was always easy to take over. Secretly, some in Kiev might well want rid of it (it sucks out money; it's too Russian; though you’d be politically dead if you were to ever say that publicly). If one part of the Kremlin system is all about performance, another part is about slow, patient co-option. The Kremlin has been co-opting Europe for years: the fate of British shareholders is tied to Rosneft because it controls BP; the fate of German exports is tied to Russian passion for BMWs and Mercedes. And that’s not to mention Gazprom. The Kremlin knows there may be a red line somewhere on the horizon, but there's a long way to go before it even comes into focus. London, Berlin, Paris have all so far said no to sanctions. And for every announcement about war and peace made by Moscow, equity prices rise madly up or down, and someone, somewhere very near to Putin, is making a killing on the markets.

When you talk to members of the elite in Moscow, no one serious thinks in terms of the Cold War. The metaphor I heard most often – from liberals and oilmen and corporate spooks – is ‘we are minority shareholders in globalisation.' Which, given the specifics of Russian capitalism, may mean the best way to imagine the Kremlin's idea of its position in today’s world is as a ‘corporate reider’: the ultra-violent cousin of western corporate raiders. ‘Reiding’ is how most of the Russian elite made their first money, buying into a company and then using any means possible (arrests, guns, seizures, explosions, bribery, blackmail) to take it over. The Kremlin is the great corporate reider inside globalisation. But though it may want to take the system hostage, that means – doesn't it? – that it can’t go all the way and actually destroy it. Because then what would it feed from?