Photo: CBS via YouTube
Things are heating up on the Korean border today.North Korean leader Kim Jong Un has officially cancelled the nonaggression pact between North and South Korea that unofficially ended the Korean War in 1953, closed down the North’s shared border with the South, and told his troops to “prepare for war.”
This all comes against a backdrop of annual shared military drills between South Korea and the United States, as well as U.N. sanctions against North Korea signed yesterday aimed at limiting food aid to the poverty-stricken country.
Of course, this is far from the first time North Korea has engaged in blustery, provocative rhetoric like this.
UBS’s floor trader Art Cashin, though, says the guys who traders follow for their North Korea news are starting to sound the alarm bells, concluding in his latest note that it “could be an interesting weekend.
Below is what Cashin has to say in his morning note today (emphasis added):
Geo-Politics Might Spoil The Party – A variety of reliable people are hoisting more warning flags about what’s going on in North Korea. For one, Bob Hardy, whose GeoStrat blog is followed by lots of traders, sent me this note this morning:
I find the recent actions and words coming from North Korea particularly ominous and would not be surprised to see an incident, Kim and his regime seem to have misread the situation and are indoctrinating the population to prepare for something grim. They have created a crisis atmosphere by announcing the end of the Armistice Agreement. This will of course mean that a state of war exists, and the fact the DPRK is cutting off all communication with the U.S. and South Korea would seem to indicate it feels it is not being taken seriously. Cutting off communications is a basic indicator of preparations for War, which I doubt will occur, but view it possible that a live fire incident could be about to occur on or about March 11th. If they recall diplomatic missions and close airports that will be a sign of war readiness. A significant change to the security situation in the region is evident. The DPRK is gambling that it could take an action that would not lead a general war but would put it in a position to force negotiations from a different base point. The North Koreans have cast themselves as victims under threat of attack from the U.S. and South Korea to justify an incident.
Away from Bob, there are contentions that North Korea has begun to rapidly camouflage trucks and facilities both military and civilian. Then there’s the opening paragraph of North Korea’s official statement yesterday as reported in the Korean Central News Agency:
“First, now that the U.S. is set to light a fuse for a nuclear war, the revolutionary armed forces of the DPRK will exercise the right to a preemptive nuclear attack to destroy the strongholds of the aggressors and to defend the supreme interests of the country.”
Could be an interesting weekend.
Something to be aware of, at the very least.
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