He absolutely is a madmen. I not only doubt his sanity, im sure his mind is somehow damaged. Would not be the first one in this age. The question is just, to what level. And even if not, he's a killer that can't be trusted.
And yes, i take his speach very seriously. As seriously as europe should have taken Hitler's speaches before the start of WW2. No, Putin is not Hitler, but he is of the same psychopath personality. If he says so and given how russian Propaganda works, we should prepare for the worst.
He planned this or at least something like this from the beginning. He fund extreme right and leftwing partys for centurys, to weaken democracys all over the world. Trump is the top result of this. A capitalist USA, that fucked over it's own educational and social system, was an easy loot. Putin wage a hybrid war with destabilize democracys, putting out tons of fakenews per RT, even paying a cyber centrum with trolls that flood social media and news sections with fascist shit, massive cyber attacks, the literalbkilling of oppostion qnd the modernization of the russian army.
It is very obvious that he will take what he can get for his legacy, even with blood and fire.