North Korea news is dominating the headlines, scaring stock market traders and trying the patience of world leaders. Crass and belligerent as a rule, North Korea has turned its international misconduct up a notch lately. The nuclear-armed dictatorship can’t feed its own people attacked and sank a South Korean ship in March. After all available evidence implicated North Korea, South Korea responded with a naval exercise on Thursday. In return, the North severed a hotline between the two nations set up to prevent confrontations. Analysts trying to figure out the mysterious nation said North Korea’s behavior is related to the upcoming succession of power from dictator Kim Jong-il to his son Kim Jong-un.
The North Korea nuclear test
The first North Korea nuclear test in 2006 started painting a picture of a more desperate, impoverished dictatorship that would rather blackmail than borrow money. The Washington Post reports that since President Obama took office, dictator Kim Jong-il has launched missiles, conducted a second North Korea nuclear test and seized a pair of U.S. journalists. In March a North Korean submarine torpedoed and sunk the South Korean warship Cheonan in South Korean waters, killing 46 sailors. This week, after South Korea halted aid and trade to Pyongyang after evidence from the Cheonan sinking implicated the North, the North said it would sever relations with its neighbor. It also threatened more North Korea misbehavior if South Korea sees a U.N. Security Council resolution imposing additional sanctions.
Cheonan ship sinking
After the Cheonan ship sinking, North Korea news analysts are laying out another theory about the most recent boorish behavior from the Pyongyang regime. It could be part of an effort by 69-year-old dictator Kim Jong-il, who recently had a stroke, to establish his 27-year-old son as his successor in the family dynasty. The New York Times reports that no other explanation makes sense. To rational minds, the North’s accelerating confrontation is self-defeating. But it makes sense to Kim Jong-il. He needs to create a warlike atmosphere against a foreign enemy to rally public support. As for the Cheonan ship sinking, giving his son credit for planning and ordering a successful naval attack in a disputed sea border with the South boosts Kim Jong-un’s credentials as a “ruthless leader” who can command the military.
North Korea news: one thing for certain
North Korea news about such an isolated country is conjecture most of the time. At present the succession theory for North Korea’s recent provocations can only be a guess. CNN contributor Fareed Zakaria said until now North Korea nuclear tests could be understood as blackmail — make trouble, get paid off, then back off. Zarkira added that in the past, there has been considerable tension between South Korea and the United States on how to handle North Korea. With the Cheonan ship sinking, things are definitely not business as usual anymore. Now the United States and South Korea are united in wanting to send North Korea’s leaders a very strong signal that they really have crossed the line, even if they can’t figure out what they’re thinking.
North Korea stock market fear
North Korea’s stock market influence continued to be felt this week. When the North Korean government ordered its citizens and troops last week to be ready for combat, investors ran for cover. In comments about the North Korea stock market connection to MarketWatch, Andrew Wilkinson, senior market analyst at Interactive Brokers, said “The words of the North Korean leader commanding his troops to be battle-ready are yet another excuse for markets to recoil once again.”