Why are Currency Traders So Sanguine About North Korea?
Claire Berlinski, Ed. ·
Dec 23, 2010 at 8:41am
The markets, apparently, are shrugging off North Korean threats to launch a nuclear "holy war."
The Japanese yen was unmoved by North Korea's minister of armed forces saying its military was prepared to wage a "holy war" against the South, using its nuclear deterrent, after what he called Seoul's attempt to initiate conflict.
Does this seem like excessive sangfroid to you?
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Comments :
Nov '10
Re: Why are Currency Traders So Sanguine About North Korea?
The old saw is “buy on the sound of cannons, sell on the sound of trumpets.” Plus, the Japanese are net exporters to the rest of the world giving them a large foreign currency reserve. This allows the Japanese central bank to counter any market moves to weaken the currency substantially. In general, Japan would even welcome a weakening of the Yen as it would make their exports cheaper and would decrease the real burden of the enormous Japanese debt.
Re: Why are Currency Traders So Sanguine About North Korea?
And they are to attack the South with what, exactly?
Their nuclear test was a failure and they are literally ringed in all directions with tactical nukes-- missiles, nuclear cannons, probably by the hundreds-- and they have not so much as an atomic squib to fend those things off with...
I would excessively sangfroid myself...
http://www.strategypage.com/qnd/korea/articles/20101221.aspx
May '10
Re: Why are Currency Traders So Sanguine About North Korea?
After a while The Boy Who Yelled "Tiger!" starts to lose a bit of ability to garner attention.
Frankly, like all would-be bullies, the goal is to extract tribute, but not engage in battle. Since the RoK has finally gotten tired of the endlessly repeated nonsense, it is now prepared to engage. Very often that causes bullies to beat a strategic retreat.
All along, the RoK population has been fearful of first strike artillery barrages into Seoul. They now appear to be ready to absorb them and flatten the DPRK in response because they have leadership that is not willing to surrender.
When you are a shallow bully who has lost the element of inferred terror, you are in trouble.
Re: Why are Currency Traders So Sanguine About North Korea?
I think that's exactly right--the world has just decided, "Oh, they don't mean it, and they can't be that irrational"--but is discounting the very real possibility of miscalculation and the evidence that they could be just that irrational. This seems like other cataclysmic risks that people get a little too used to living with and therefore don't evaluate properly (c.f. previous discussions about earthquakes in Istanbul). I understand a response of, "Let's not panic completely," but "shrugging?"
Jul '10
Re: Why are Currency Traders So Sanguine About North Korea?
Dog Bites Man
Sun Rises in East
North Korea Makes Threats
Dec '10
Re: Why are Currency Traders So Sanguine About North Korea?
Claire Berlinski, Ed.
I think that's exactly right--the world has just decided, "Oh, they don't mean it, and they can't be that irrational"--but is discounting the very real possibility of miscalculation and the evidence that they could be just that irrational. This seems like other cataclysmic risks that people get a little too used to living with and therefore don't evaluate properly (c.f. previous discussions about earthquakes in Istanbul). I understand a response of, "Let's not panic completely," but "shrugging?" · Dec 23 at 10:34am
The NorKs missed their chance to prove that they are Martin-Riggs-style just that crazy when they failed to follow through on their threat to fire back on the latest South Korean live-fire exercise. They got away with their previous outrage because it was a complete surprise, but once the South Koreans announced that they were anticipating a NorK provocation, the real risk of South Korea's retaliation made the idea of provoking them a lot less palatable.
May '10
Re: Why are Currency Traders So Sanguine About North Korea?
North Korea is a hyper-rational regime with one objective. The survival of the Kims. Vague threats tend to work against us. Nuclear war will not. They know that very well. They are not ideologues or religious fanatics seeking paradise.