Earlier today, in the course of documenting the latest out of North Korea, where Kim is apparently busy trying to figure out if he can jerry-rig one of his homemade H-bombs to one of his homemade ICBMs with masking tape and Elmer’s glue, we noted that the last resort (short of war) may be to simply cut off the North’s oil supply.
Either that, or simply stop trading with anyone who deals with Pyongyang.
Here are some excerpts from a BofAML note we cited:
NK’s trade data are very useful for understanding the geopolitical outlook for the region. As Chart 1 suggests, repeated sanctions since 2006 have not curbed NK trade. Rather, they have simply shifted flows to China, which now accounts for about 90% of NK trade. Of course, there is likely a lot of unreported trade, but given China and NK’s long border, most unreported trade is also probably with China. Note that data on the price of rice and the black market value of the NK Won also suggest sanctions have yet to impose significant pain (Chart 2).
Finally, note that trade is vital to NK since it accounts for 20% of GDP and NK imports virtually all of its oil. In our view, this suggests three things. First, it is not necessarily true that sanctions “don’t work” since tough sanctions have never been attempted. Second, given Korea’s dependence on trade for oil and other vital products, a shutdown of trade would cause a severe recession once inventories are run down. Third, the key to making sanctions work is full cooperation from China.
Well sure enough, it looks like Trump is going to go “nuclear” – only not that kind of nuclear. To wit:
In other words: Washington is going to force Beijing to put a stop to this. Because obviously, what Trump is suggesting there simply isn’t tenable for China. That choice isn’t a choice.
You’re reminded that this is a politically-sensitive time for the Chinese ahead of the Party Congress.
Your move Xi. Maybe Trump can bribe him with some more chocolate cake.
***********************
It will be interesting to see how stopping all U.S. trade with China will work.
More likely, China will laugh this off as the empty and incredible threat it is.
This reads like the kind of thread you’d post on Twitter when your trade advisor is unreachable and your chief of staff has stepped out of the room.
If you had a smartphone and the mental age of a six-year-old, anyway.
What scares me the most is the fact that the Donald has succeeded in normalizing stupidity.
Among Americans, perhaps.
I can assure you, the rest of the world is not so readily lead down the garden path.
Trump has definitely normalized stupidity within his 34% base, I’ll give you that A.I.
As to the rest of the world not so readily being lead down the garden path, Brexit was a headline door opener for the anti-globalists that Trump walked through. Members of the right wing Law and Justice party filled the crowds that cheered for Trump when he visited Poland. But on the whole, it seems clear that excepting Russia and Israel, the world has got his number:
“WASHINGTON – Israel is one of just two countries that prefer US President Donald Trump to his predecessor, Barack Obama, according to new research by the Pew Research Center.
The poll – which looked at 37 countries – found that Trump is not only deeply unpopular in much of the world, but not trusted to manage America’s foreign policy.
According to the survey, a median of 22 percent of respondents expressed confidence that Trump will do the right thing when it comes to international affairs. That rating marks a steep drop from the closing years of Obama’s presidency, when a median of 64 expressed confidence in his ability to direct America’s role in the world.”
https://www.timesofisrael.com/israel-and-russia-the-only-two-countries-who-prefer-trump-over-obama/
“ooh, ooh, ooh, I have an idea.”
I’m sure you’ve all sat in meetings brainstorming difficult problems that called upon complex thinking and creative skill. Invariably, there’s a “guy,” in the room who fits the “smartest man in the room,” profile. He consistently comes up with inane, useless and time wasting ideas. He sucks up all the air in the room, is exhausting and causes eye-rolling weariness for all.
Until he was elected most people with a frontal lobe knew Trump was a moron.
A con-man who managed to fool enough people to enrich himself so as to
achieve stardom with the help of NBC.
With that fame a minority of Americans put him in office.
Now, every morning Trump wakes up with his mind streaming ill-conceived ideas.
The world is his meeting room.
His tweeter is his voice.
We are stuck listening to his inane, useless and time wasting ideas.
He sucks up the air from our lives.
He’s exhausting and causes eye-rolling weariness for us all.
Only Mueller and his team and or the House of Representatives can
end this long national nightmare.
Without Mueller or a Senate or House committee rendering a damning report
implicating Trump in egregious criminal activity the chances of the House of
Representatives impeaching Trump is zero. The chances of a Senate or House
committee rendering a damning report implicating Trump in egregious criminal
activity are the same as Ted Cruz or Trump telling the truth.
Therefore, only Mueller and his team or Force majeure will free us from this
long national nightmare.
Perhaps you might pray, whether you believe in it or not.
Hell, I been praying! Well, except for the last week or so — my prayers have been distracted from asswipe to cover my friend’s lives and homes down the street and around the block and a few on the other side of town. Everyone is kinda settled into comfy temporary digs now so I will jump back on those prayers to support Mueller’s work!
One more thing from the comments above that has me wondering…where is he gonna have those ties made if he cuts off China – not to mention his Princess daughter’s crap?
Separating our mutual disgust over Trump from the issue at hand, I have to say this is an option that may be worth another look. China is the key player in all this. Due to their own skill but mostly through global trade with the west, China has risen itself up from the ash heap. May be time for them to have to make a choice. Garunteed we are a much more beneficial ally to their regional interests than NK. Not saying it is garunteed to work, but the red dragon may be the only thing that will be able to get little kimmys attention now.
I dont mind giving up some cheap electronics and seeing some stock decline temporarily to cement a relationahip with a key global partner and avoid a catastrophic war.
Or you could maintain the trade relationship AND not have a war. Why are these options mutually exclusive?
More to the point, threatening to cut off all trade with China is not a credible threat and simply makes the U.S. look foolish and irrational.
NK’s $2.9B in yearly exports are just about the same amount as Apple’s revenue from “Other Products” segment. Damn good for Apple. Not so go for the Iron Fist. Imports are about $3.57B.
Below is a list of North Korea’s top 15 trading partners that imported the most North Korean shipments by dollar value during 2016. Also shown is each import country’s percentage share of total exports from North Korea.
China: US$2.6 billion (90% of total North Korean exports)
India: $87.4 million (3.1%)
Philippines: $51.8 million (1.8%)
Taiwan: $12.2 million (0.4%)
France: $11.4 million (0.4%)
Mozambique: $10.9 million (0.4%)
Russia: $8.8 million (0.3%)
Brazil: $8.7 million (0.3%)
Burkina Faso: $7.4 million (0.3%)
Mexico: $6.7 million (0.2%)
Germany: $6.5 million (0.2%)
Turkey: $6.3 million (0.2%)
Saudi Arabia: $6.1 million (0.2%)
Egypt: $4.8 million (0.2%)
Chile: $4.4 million (0.2%)
So, as H made clear, when meathead threatens to cease trading with countries who trade with
Iron Fist, he’s talking about his dinner friends in China. The NK population is 25.37 million (2016). Ask yourself this: Will Iron Fist be deterred if all the countries listed above, excepting China, stopped doing business with NK and 1,000,000 North Koreans suffered or died as a result?
Oh, I forgot. Ask yourself this: Will China stop trading with NK? Really.
China needs NK on its border and not a completely disabled one. China cannot cause its collapse by starving NK of its essentials and resulting in a tsunami of refugees streaming across the border in China. Also, a starved and collapsed NK would result in a loose-nuke problem thereby forcing the US to pump up our military presence to reckon with the consequence of NK’s deterioration and to preserve, protect, secure and defend against the potential of an NK loose nukes problem should it become an issue. Lastly, China doesn’t want the US via SK on its border.
Someone please take away his tweeter.