The news on North Korea's plans to attack Guam hit the world's financial markets causing serious repercussions. The North Korean officials have developed a plan to attack the island using intermediate-range ballistic missiles and passed it to Kim Jong Un for approval. In response to these actions, US President Donald Trump said that he would meet any threat to US security and peace with "fire and fury".
As the situation is getting more tense, it caused disturbance in the financial markets. Earlier, the North Korean threats did not spark such a strong reaction, but now everything is different, since Pyongyang has made considerable progress in its ballistic missiles program. Experts perceive the confrontation as a grave threat. "Tensions will continue to mount and could eventually develop into a 'black swan' event that the markets are not prudently considering," Steve Hanke, professor of Applied Economics at the Johns Hopkins University, said. But even under such circumstances there are optimists who believe that all these troubles are just a matter of time. "The sell-off caused by geopolitical tensions on North Korea will likely be short-lived as long as both Trump and Kim Jong Un keep making feints against each other and neither takes military action," Tomoaki Fujii, head of the investment research division at Akatsuki Securities Inc in Tokyo, stated.
Now all we can do is to closely monitor the dispute between the two leaders and hope that the situation will not aggravate beyond empty threats.
