It appears the Korean 'rhetoric' is being taken a little more seriously than the (always knows best) market - as we noted here with the last inter-Korea cooperation breaking down. Chuck Hagel just announced that the US will be moving missile defense batteries to US bases in Guam (an American territory southeast of Korea). Bloomberg adds:
- *HAGEL SAYS WORKING WITH CHINA TO DEFUSE N.KOREA SITUATION
- *HAGEL SAYS CHINA SEEKS TO AVOID A NORTH KOREA 'WAR SITUATION'
The market dipped on the news of the mobilization and Hagel's comments that North Korea "poses a 'real, clear danger' to US Allies."
The U.S. is preparing to deploy an advanced missile-defense system to Asia to defend American military bases in the Pacific, a signal that the Pentagon doesn't believe the threat of a possible North Korean attack is likely to fade quickly.
A senior administration official said the U.S. will deploy the system, known as a Terminal High-Altitude Area Defense battery, or THAAD, to Guam to protect against short- and medium-range missiles from North Korea.
A senior administration official said that when the THAAD system is deployed in Guam, its protection won't reach South Korea. The deployment is aimed at protecting American interests in the region.
With a major U.S. airfield and an incoming contingent of U.S. Marines, Guam has become the most important U.S. military base in Asia.
The decision also signals that the Pentagon views North Korea as the larger immediate—and potentially more long-lasting—threat to the U.S. and its allies.
"It can defend salvos, multiple launches coming at them, more than any other system," Mr. Ellison said. "It is the best system we've got."