Last Friday, the market became concerned enough over a possible conflict with North Korea that the NASDAQ fell more than 2% in a single day, it’s second worst tumble of the year. Some will insist that the market was reacting to President Trump’s colorful language, but if that’s so, it is the first time the market has done so in months. More likely there was some real fear bubbling up about the stability of the administration, and some of it spilled over onto the stock market.
As of today, it would seem that either the fear has dissipated or the threat has receded, but that may not be the case. In fact, by removing North Korea from the headlines, the white supremacist attack may have made the situation even more dangerous. Kim Jong-Un clearly wants the undivided attention of the US, and now he has to do something even crazier than threatening Guam if he expects to win it back.
To quickly recap, one reason Korean companies are in such a precarious position is that the South Korean capital of Seoul is a mere 35 miles from the border of North Korea and well within the rogue state’s artillery range. Further, it is taken as axiomatic among military analysts that North Korea could essentially flatten Seoul, even with conventional weapons. It’s an unthinkable scenario, or would be, if Kim Jung-Un were not so determined to make us think about it.