North Korea Attacks South Korea Yellow Sea Island, South Korea On Highest Non-Wartime Alert In Response, USDJPY Goes Parabolic

Tyler Durden's picture

Update: South Korea has scrambled F-16 jets to its west coast.

It is time to see just how much WWIII is priced into this market. WSJ reports that the Koreas may have just crossed the line:"North Korea fired artillery at South Korea's Yeonpyeong island in the
Yellow Sea off the countries' west coast Tuesday afternoon, setting
houses on fire
. South Korea returned fire, according to residents on the
island speaking on South Korea's YTN television network.  A spokesman for South Korea's joint chief of staff confirmed the
exchange but didn't have details except to say "scores of rounds" were
fired by the North." The response: S. Korean military says it is on highest non-wartime alert after the North's shelling of island.

More from the WSJ:

The artillery—more than 50 rounds, according to island residents speaking on YTN—was fired from positions south of the North Korean city of Haeju.

The attack started at 2:34 p.m. local time, according to residents who were speaking on the TV network. There were no immediate reports of injuries.

About 1,200 people live on the island, which is 10 kilometers south of the tip of North Korea's south coast.

The attack is the second by North Korea this year against South Korea in the maritime border area of the Yellow Sea. In March, a North Korean submarine torpedoed and sank a South Korean warship near an island about 40 miles west of the island that was hit Tuesday.

And these tidbits coming in from Reuters:

  • Witness says power failure on South Korean island hit by shells; Residents evacuated to bunkers
  • Television pictures show at least four plumes of smoke from S.korea island
  • Witness says shelling continues on S.Korea island, a few houses have collapsed

...This pearl:

  • S. Korean military says it is on highest non-wartime alert after the North's shelling of island

And let's not forget this:

  • S.Korea top presidential aides meeting in underground bunker at presidential compound

Yen goes parabolic on the news:

In other news Netflix prepares to trade at one trillion forward PE as recently uncovered North Korean centrifuges are about to be put to the ultimate test.

Real time video feed from Al Jazeera:

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mophead's picture

They will drag China into this. Just you watch.

Edited: FYI - War is a racket. None of this is by chance. All planned. Kim Jong II is a paid tyrant. Just like Hitler, Mussolini, Napoleon, etc. The idea is to kick off WWIII in Asia, ultimately, (debt) enslaving most of the population. Russia will be dragged in as well. Everyone has been side tracked by the middle east tensions.

Instant Karma's picture

Strangely more effective in lifting the USD than a YEN intervention.

66Sexy's picture

The important question is "why"?

i dont think north korea takes a dump without china's permission.

so: china gave the green light to north korea.

here comes a conventional arms race...

got oil?

But the primary issue is trust. The world policeman has gone insane. there are entities that are outside the jurisdiction of the US gov't; like the CIA, financial elites, military industrial complex, and others that would like a cold war. i bet russia wouldnt mind either.

without trust, where does that leave the financial system? what right does any government have to decree value when that authority has come into question?

got gold?

66Sexy's picture

only 2 dead means its a message not a full blown hot war. theres no resources that we want in korea so we will probably not do anything rash. hard to politicize an ideological war.

cossack55's picture

You, sir, have obviously never had winter Kimchi.

seton's picture

If WWIII starts, it'll be in the Middle East. Guarantee my two cents.

Tense INDIAN's picture

some say its already going on ME....u cant call its wrong because 50 nations are involved in that WAR theatre.........whatever i think ME is the stage for WW3...but u will find some battles here n KOREAS....India-PAK...u dont want to miss that ...dont u......plenty of people and NUKES

Xedus129's picture

WW3 will be fought.. on Earth.  Hence WORLD-WAR lol.

barkingbill's picture

it may start in the middle east, but by definition a world war happens all over the globe. it also may have more then one start or flare up which later leads to one giant multi fronted war.

dhengineer's picture

No, a world war can be contained to one continent.  WWI was only fought in Europe, essentially.  The "world" part comes from the participants.  Afghanistan and Iraq, with troops representing 50 countries, pretty much fits the description.  We just so happen to have flash points in India/Pak, Korea, and a few other places.

Dollar Bill Hiccup's picture

Drag China? North Korea does nothing without China's permission.

China is pushing back against the "currency war" with its own asymetric capacities.



Big Corked Boots's picture

NK is China's proxy.

Step 1 - Go to Califonia and fire an ICBM that everyone will see.

Step 2 - Start an "incident" in Korea.

Step 3 - Widen the incident with increased fissile production, more nuke tests, maybe a live above-ground test south of the DMZ. Wait for big US response.

Step 4 - Attack Taiwan. "Reunification."

Step 5 - Attack the US in the Pacific Ocean during the Taiwan response; drag Japan into it.

Step 6 - Attack the US in its home soil.

Step 7 - Kiss your asses goodbye... whichever side you're on, and wherever you may be.

Somewhere in there is a dump of Treasuries and a dollar collapse. No, I'm not looking forward to this, and no, I don't have my tinfoil hat on this morning.

Max Hunter's picture

Way too many eggs in the air for me to be relaxed.... Not sure if I subscribe completely to your view but, the geopolitical and economic situation of this world is a powder keg inside a building fire.. It's just a matter of time..

LowProfile's picture

Step 6 - Attack the US in its home soil.

That would be suicide.  US has 18 Ohio class submarines.

BigJim's picture

I'm sorry? "Attack the US in its home soil."

The US would eat China alive in an armed conflict. Yes, China has some cute submarines; but the US is so far ahead militarily in every other respect it wouldn't make any difference.

I don't say this with any glee; I think the US' overwhelming military power is, overall, a bad thing for everyone, including Americans.

There won't be any direct military conflict between China and the US; ceratinly not on their home soil. Both are nuclear powers; it would be suicide.

hugomarch's picture

Don't the Chinese have a million man standing army?

Fish Gone Bad's picture

The United States has spent more money on its military and weapons than pretty much all the rest of the world... COMBINED.  Since the US is the "good guys" it is OK for them to have so very many weapons.

matthylland's picture

I have never understood the arguement that China (or North Korea) have such huge 'standing men armies'. I just don't see how that matters...what are they going to do...march 1 million people across the atlantic without us knowing? man - size of armies seems insignificant when comparing with today's technology.

RockyRacoon's picture

Ever seen a column of ants cross a stream?  They just crawl over each other making a bridge, sacrificing the ones on the bottom.  No prob!

The Chinese should make it a few miles off their own coast.  It'll make a great Youtube item.

Poundsand's picture

Well, kind of.  But even if it were a true army, good luck moving it anywhere.  This talk of an invasion of the US is not well thought out. 

Step 1.  Load troops on all those chinese container ships.

Step 2.  Set sail for the US.

Step 3.  Get up close and personal with Davy Jones Locker courtesy of a Los Angelos class US attack sub.

An invasion is never going to happen.  Nukes are another issue, but never an invasion.

MachoMan's picture

I thought Iraq did too?  Giving old women shovels doesn't make them part of the military...  and certainly not combat ready/worthy.

Further, in modern warfare, sheer numbers of soldiers is meaningless.  With modern weaponry, additional people are simply additional cannon fodder.  A single soldier who is incredibly well trained and who has dynamic communication tools as well as access to the highest technological wonders can act as a force multiplier of incredibly grand scale.  Look at how we took control of Afghanistan...  ~100 guys?

About the only way for us to be defeated militarily is to cut the balls off the money changers and war profiteers...  other than that, we have all the tools at our disposal for victory in about any conceivable campaign.

BigJim's picture

As long as the campaign doesn't involve occupation, of course...

MachoMan's picture

Yet.  Give us another 50 years of robot technology and we'll revisit the issue.  But yes, if you want to occupy a country, you have to essentially breed them out to succeed...  and even then, there is no guaranty.  We can decimate any standing army in seconds, but we have not the time, energy, nor resources to occupy virtually any nation.  Although, they've been incredibly successful at occupying america for decades.

Oh regional Indian's picture

Spot on Mophead. 

All Kabuki for the masses. Only, this is not ketchup but blood and real bombs.

The timing too is interesting,as it is pretty clear that QE2 is a fail, Irish bailout is already a fail, the FED is failing.....

As we have all discussed here many a time, the PTB have a well designed play-book, with many tricks in their bag and flexible bifurcations.

The parabolic yen, was that expected? Anyone understand the direct correlation?

And what will we wake up to tomorrow? Is this the start of the long leg down?

Head fake? Iran in the cross hairs?

Crazy, fascinating, tragic and comic times.

We are all Truman and life is one big SHOW!


Bartanist's picture

On a bigger (longer term) chart the parabolic Yen is a tiny blip. Look at the scale and how far it has moved over the past 2 years.

moregoldplease's picture

Who was paying all these folks? Oh I get you watch a lot of Alien primogeniture programs on  "History" Channel

Rahm's picture

Game on. Game on.     Game on. Game on.


*Wayne's World Voice*

greenewave's picture

There is a very serious possibility we have a BANK RUN December 7th. Please watch and share this video with the people you care about (


This is really scary guys, people are already talking about it and it has spread from France to the UK and now coming to the United States.

Ratscam's picture

So lets assume that I would be in favor of getting my money out of the bank. What should I do with it? Put it under my matrace? Ok I would do that but only with a couple of thous,not with tens or hundreds of thous. HUGE security problem.

So get real, what will happen is that a couple of tenthousand people will withdraw a couple of hundreds or thousand Euros each.

Who cares, it's a non event.

I prefer the idea of buying silver bullion!

BayAreaAlan's picture

Yeah, put it in your matrace!!

mtomato2's picture

Spelingg fayul.  I'm on the verge of turning troll on this.

MsCreant's picture

Aren;t U a Maff teecher? :-)

RockyRacoon's picture

Holy shit.  There's an app for that.  Wonder if anyone notices that "ABC" with check mark on the tool bar of the reply window?   Sheesh.

SPONGE's picture

"I prefer the idea of buying silver bullion!" 

 sounds like you already answered your question.

max2205's picture

GL trying it in the US. They won't give u that much cash. It'll scare them though. But if everyone writes the cash out on a Check and maw it to your credit union it would work.

Too bad nobody had the balls to do it in 08 09

MachoMan's picture

The people attempting to initiate bank runs are attempting to show the too big to fail banks their discontent.  However, we already had a massive bank run in the united states in 2008.  What happened then is the same thing that will happen now.  Essentially, money is pulled en masse from all the local and regional banks and DEPOSITED INTO THE TOO BIG TO FAILS because everyone knows that they will be backed by the federal government until the bitter end.  This time will be no different. 

In short, you're only helping the banks you despise.

YHWH's picture

It certainly is an exciting time to be alive!  :-)

Hook Line and Sphincter's picture

China uses North Korea as a wedge against the United States. It will be interesting to see how future inaction on their part is brought about to reach their objectives.

Clancy's picture

China doesn't control North Korea, dummy.  If it did it would stop them from running drugs into its territory and counterfieting its currency.

Hook Line and Sphincter's picture

Never said they control NK - Put your monocle on! Counterfeiting and drug running occurs between most countries. North Korea, although a serious pain to China (because they have to feed them to keep them from swarming their border with refugees), is used as a tool to expend US resources, and act as a buffer from US troops in S Korea (but obviously not as a buffer to trading!).

China would stomp that little dung heap in a second, if it's benefit didn't outweigh its cost.

Beijing is so complacent about their Mr ILL's nuclear program because it serves their interests. They regularly cut off the flow of oil to them when Kim JongILLMonkey doesn't do as he's told. 

Clancy's picture

Everyone would like to stomp that little dungheap.  No one has done it yet.

China is a world power now.  You seriously think they want to be allies with pissants like the North Koreans?  C'mon use your head.


FYI China's favorite country is South Korea.

Hook Line and Sphincter's picture

Not allies, of course not. I can tell though, that you'd quite enjoy a good session giving that pig of a human Kim Jong Ill a good beating!

My point was a simple illumination of how it has been, and will continue to be interesting to see how China uses NK to achieve certain geopolitical advantages.

If you want to do some quick and entertaining research, search the events that are associated around China's cutting off oil to North Korea. The correlations are quite clear. Correct, they don't control the intracacies of NK's internal government, but they do force the hand of pig-boy to quite a few things that are solely in their best interest.

Poundsand's picture

And to continually test US resolve.  Think of it as a way to test just how far they can push us.

China gives NK the ok to build a nuke plant designed to build weapons and sees what the US does.

Answer: Help them build it and give them oil for their energy needs.

China has NK provoke the SK with the attempted sinking of their naval ship.

Answer:  Point fingers at them, say "Bad man... Bad man!" But at least this time don't give them technology to build better torpedoes.

China has NK shell SK with over 200 artillary rounds, but does it immediately after a SK training exercise.

Answer:  Point fingers at them, say "Bad man... Bad man!" but admit that it was likely really our fault to begin with as the SK and US had the audacity to run military training exercises.

NK is just a proxy for China.  NK takes all the risk if things really were to get out of hand, but it's leaders starve their people anyway, big deal.  China gets answers to much debated questions regarding their economy and Taiwan. 


How hard can it be to see the escalation over the last two years?

Ted K's picture

The North had the confederacy's testicles in a vise at the end of the Civil War, that doesn't mean you can stop all smuggling or border movements "dummy".  North Korea has been China's anus licker for a long time, and will continue to be---unless they would like to increase the rate of starvation to food crumbs from Russia.