Tag: north korea
Bi-Weekly Geopolitical Report – Implications of North Korean Soldiers in the Ukraine War (November 18, 2024)
by Daniel Ortwerth, CFA | PDF
In late October, the world learned that North Korean soldiers had deployed to Russia to assist their allies in the Ukraine war. This dramatically changed the geopolitical profile of the conflict. Allies and partners of both Ukraine and Russia have been providing material and financial support to both countries since virtually the beginning of the war. North Korea itself (formal name Democratic People’s Republic of Korea, or DPRK) has been contributing large quantities of arms and ammunition to Russia; however, this is the first known instance of another country sending combat troops to join the fight on either side. This precedent-setting action marks a clear escalation and raises the question of how this development might further accelerate the conflict.
This report addresses that question. We begin with a review of the known facts concerning troop numbers, types, locations, etc. We continue with an assessment of the likely impact of DPRK forces on the course and outcome of the Ukraine war and culminate with considerations of how this development might affect the broader geopolitical landscape beyond the conflict. As always, we conclude with investment implications. Since this report addresses a newly emerging and rapidly evolving development, its status may materially change post-publication. We encourage readers to monitor our Daily Comment for emerging updates.
Don’t miss our accompanying podcasts, available on our website and most podcast platforms: Apple | Spotify
Bi-Weekly Geopolitical Podcast – #43 “Rebirth of US Nuclear Deterrence” (Posted 3/11/24)
Bi-Weekly Geopolitical Podcast – #10 “Going Nuclear with North Korea” (Posted 5/23/22)
Bi-Weekly Geopolitical Report – Going Nuclear with North Korea (May 23, 2022)
by Thomas Wash | PDF
At nearly 5,000 nuclear warheads, Ukraine had one of the largest nuclear arsenals in the world on its territory. If Ukraine hadn’t transferred those weapons to Russia in 1996, it is unlikely that Moscow would have invaded. North Korea believes it is facing a similar threat which is why it has fought to maintain its nuclear program.
In North Korea’s first nuclear test in 2006, the bomb generated the equivalent of a 4.7 magnitude earthquake. In its next attempt in 2009, the bomb was four times stronger. The bombs tested in 2016 and 2017 each yielded more power than the atomic bomb dropped on Hiroshima in 1945. In short, North Korea clearly has the ability to develop and produce its own nuclear weapons. The country’s ability to deliver a nuclear weapon against the U.S. or any other adversary is less clear, but a flurry of recent tests suggests it is making incremental progress in its missile technology.
This report will focus on North Korea’s nuclear program and the implications for the rest of the world if North Korea is capable of striking the U.S. with a nuke. We start with a brief history of the country’s nuclear weapons program and discuss how the rest of the world has tried to denuclearize the country. Next, we examine North Korea’s current military capabilities and potential threats to the global order. As usual, we conclude with the potential impact on financial markets from these events.
Don’t miss the accompanying Geopolitical Podcast, available on our website and most podcast platforms: Apple | Spotify | Google
Confluence of Ideas – #19 “The 2021 Geopolitical Outlook” (Posted 2/9/21)
Weekly Geopolitical Report – The 2020 Geopolitical Outlook (December 16, 2019)
by Bill O’Grady and Patrick Fearon-Hernandez, CFA
(This is the last report for 2019; the next report will be published January 13, 2020.)
As is our custom, in mid-December, we publish our geopolitical outlook for the upcoming year. This report is less a series of predictions as it is a list of potential geopolitical issues that we believe will dominate the international landscape for 2020. It is not designed to be exhaustive; instead, it focuses on the “big picture” conditions that we believe will affect policy and markets going forward. They are listed in order of importance.
Issue #1: U.S. 2020 Presidential Election
Issue #2: Iran
Issue #3: China’s Debt
Issue #4: Demographics
Issue #5: North Korea
Honorable Mentions…
Weekly Geopolitical Report – The Mid-Year Geopolitical Outlook (July 10, 2017)
by Bill O’Grady
As is our custom, we update our geopolitical outlook for the remainder of the year as the first half comes to a close. This report is less a series of predictions as it is a list of potential geopolitical issues that we believe will dominate the international landscape for the rest of the year. It is not designed to be exhaustive; instead, it focuses on the “big picture” conditions that we believe will affect policy and markets going forward. They are listed in order of importance.
Issue #1: The Political Fragmentation of the West
Issue #2: North Korea
Issue #3: An Unsettled Middle East
Issue #4: A Resurgent Russia
Issue #5: China’s Financial Situation
Weekly Geopolitical Report – The Second Korean War: Part II (June 26, 2017)
by Bill O’Grady
(N.B. Due to the Independence Day holiday, our next report will be published on July 10th. That edition will be our Mid-Year Geopolitical Update.)
Last week, we offered background on the situation with North Korea. We presented a short history of the Korean War with a concentration on the lessons learned by the primary combatants. We also examined North Korea’s political development from the postwar period through the fall of communism and how these conditions framed North Korea’s geopolitical situation. We also analyzed U.S. policy with North Korea and why these policies have failed to change the regime’s behavior.
The primary concern is that North Korea appears on track to developing a nuclear warhead and a method of delivery that would directly threaten the U.S. This outcome is intolerable and will trigger an American response.
In Part II, we will discuss what a war on the peninsula would look like, including the military goals of the U.S. and North Korea. This analysis will include the signals being sent by the U.S. that military action is under consideration and a look at the military assets that are in place. War isn’t the only outcome; stronger sanctions or a blockade are possible, as are negotiations. An analysis of the chances of success and likelihood of implementation will be considered. As always, we will conclude with market ramifications.