Jim Rickards: The North Korean Endgame is Playing Out Now

Via Daily Reckoning,

As mounting tensions rise from the latest round of nuclear testing out of North Korea, Jim Rickards believes a considerable window is closing by the United States. The threat of a nuclear armed and capable North Korea is a line that the currency wars expert and macro analyst believes the United States will now allow to be crossed. Speaking on CNBC’s Capital Connection Rickards offered his latest critique of the restrictions and response by the international community on North Korea.

The interview began with a question what an oil embargo would mean for North Korea and how it would impact that country. Rickards blasts,

“North Korea has already beaten the world to the punch. They’ve been building up their strategic oil reserves. What that means is they have an estimated year’s worth of held in reserve and China has played a role in these things in the past.”

Jim Rickards is the editor of Strategic Intelligence and a best-selling author featured in the New York Times for his latest work, The Road to Ruin. Rickards’ worked on Wall Street for over three decades and has advised the U.S intelligence community on international finance, trade and financial warfare tactics.

“The area that would be effective for a reactionary measure would be for the United States to exclude the People’s Bank of China, the Industrial and Commercial Bank of China and some of the other major Chinese banks from within the U.S dollar payment systems. The U.S could completely shut down the U.S operations.”

On the keys to a successful response, Rickards notes that China plays a pivotal role. The macro analyst relays, “Ultimately, the Chinese are facilitating the North Korean finance. The move would be a kind of sanction with bite behind it. My expectation would be that China wouldn’t necessarily put pressure on North Korea. In reaction we could see escalation of further sanctions from the Chinese against the United States leaving for a trade and financial war without solving the North Korean situation.”

Speaking on the impact of nuclear development in the country the intelligence community advisor warns, “Currently, North Korea is in what is classified as a ‘break out.’ Under typical nuclear development phases, we’ve normally seen countries that are cheating on nuclear development programs complete their operations in baby steps.  In the process they proceed gradually and when they do draw attention will stall programs until beginning again at a later date. North Korea has put that pattern aside and is in complete breakout.”

“To give a U.S football comparison, they’re in the red zone and the quarterback is simply about to throw a pass into the end zone. The leader of North Korea is going for it and not hiding anything.

 

 The leadership in North Korea is hoping that the United States is bluffing and that they will be able to get a serviceable intercontinental ballistic missile (ICBM) with a hydrogen bomb that could threaten or destroy Los Angeles before the U.S could do anything. The United States is facing a six month window to act and I believe they will.

When asked about the preemptive strike threat by the United States and what it means for China the currency wars expert narrowed in, “China will be looking out for its own interest. They will have great concern over a U.S ground invasion in North Korea and as was the case in 1951 they would be highly concerned over any proximity of forces to the border. There would also be concerns that the U.S is attempting to reunify the Korean Peninsula under U.S strategic interests.”

“The way I expect that the U.S government will approach the situation is to approach China in outlining that it will be functioning toward strategical means. What that would signal is that they are not going to get anywhere near the Yalu River and that special operations and cyber warfare will be a key role.”

 

“My expectation is that the first steps will see the country going dark by shutting down the power grid and cutting off the command and control operations. From there they will use psychological warfare tactics. The objective will be to disrupt all North Korean operations before the heavy bombers move in. North Korea will be limited and reduced in its artillery response.”

 

“All of that will be relatively close to the demilitarized zone (DMZ) region. By indicating to China that when the U.S military operation is over, they will be looking to open up communications and negotiations to reunify stability on mutually acceptable terms.

As Rickards noted previously, North Korea detonated a nuclear weapon early on Sunday, Sept. 3. This was the sixth time they had done so, but the first time since their ICBM missile tests and the first time under President Trump’s administration.

This test was different in another important way. It is estimated to be a hydrogen bomb instead of an atomic bomb. The difference is significant.

Both types of nuclear weapons work by releasing neutrons in critical-state radioactive material, either highly enriched uranium or plutonium. The difference is that the atomic bomb works by fission, literally “splitting” an atom, so that a neutron is emitted, collides with other atoms and causes a chain reaction with an enormous release of energy.

The hydrogen bomb works by fusion. Atomic particles are “fused,” or pushed together, in a way that destabilizes the atom and also releases a neutron.

Both methods start a chain reaction. But the fusion method in a hydrogen bomb is orders of magnitude more powerful. The destructive force can be 100 or even 1,000 times greater than that of an atomic bomb.

This gives North Korea many more options in their attack scenarios.

They can put more destructive force in a smaller space, thereby achieving the warhead miniaturization needed to fit on an ICBM.

They do not have to worry as much about accuracy. An atomic weapon has to hit the target to destroy it. A hydrogen bomb just has to come close. This means that North Korea can pose an existential threat to U.S. cities even if its missile guidance systems are not quite perfected. Close is good enough.

Finally, a hydrogen bomb gives North Korea the ability to unleash an electromagnetic pulse (EMP). In this scenario, the hydrogen bomb does not even strike the Earth; it is detonated near the edge of space. The resulting electromagnetic wave from the release of energy could knock out the entire U.S. power grid. Good luck with your bitcoins in that scenario.

Got gold?

These threats are existential from a U.S. perspective. Deterrence does not work when the opponent has so little to lose.

Comments

philipat JacksNight Fri, 09/08/2017 - 02:34 Permalink

All good so long as it is remebered that Seoul will cease to exist. That might not matter to Washington but it matters a whole lot to the 25 Million+ inhabitants of the greater Seoul metropolis. Rickards apparently believes that this matters less than an "If, maybe, possibly" threat at some undetermined point in the future to the US when, in reality, DPRK is NO threat to the US at all. It just wants to ensure it doesn't become the next Iraq or Libya.

In reply to by JacksNight

giovanni_f philipat Fri, 09/08/2017 - 04:04 Permalink

The US is pushing for a "solution" for a problem it creataed in the first place by bombing North Korea untill it resembled a desert. Pathetic.But regardless of how it will end, the US will be more and more recognized officially globally as what it is, a bully-with-nukes, weak, i.e. lacking inner life, morally degraded beyond all recognition and a population stupid like hell. As Putin said, it is difficult to talk to people who confuse Austria with Australia. 

In reply to by philipat

Slack Jack Manthong Fri, 09/08/2017 - 04:57 Permalink

"The leadership in North Korea is hoping that the United States is bluffing and that they will be able to get a serviceable ICBM with a hydrogen bomb that could threaten or destroy LA before the U.S could do anything....."

"The leadership in the United States is hoping that North Korea is bluffing and does not use the hydrogen bomb it has in a shipping container in some deserted warehouse in LA.

Engdahl says Kim Jong Un is false opposition.

Engdahl also thinks North Korea is an Pentagon Vassal State, but it seems more likely that Kim Jong Un is their man (i.e., Kim Jong Un is false opposition) and that North Korea is truly an enemy state.

https://journal-neo.org/2016/11/01/north-korea-is-an-pentagon-vassal-st…

If Kim Jong Un is false opposition, then maybe the Trump clan know there are no prepositioned nukes?

They couldn't be so stupid that they haven't considered prepositioned nukes, could they? I mean even a few folk at zerohedge have mentioned this possibility.

In reply to by Manthong

bluez Slack Jack Fri, 09/08/2017 - 08:06 Permalink

I don't know for sure if we have "global warming" right now, but we will start to see it big time within about a decade. This is because the natural nuclear reactor in the earth's core has been ramping up. Maybe we could compensate by setting millions of indium tin oxide rafts on the oceans or something.

In reply to by Slack Jack

moneybots Slack Jack Fri, 09/08/2017 - 10:30 Permalink

"Have you every considered that global warming might be real?" Climate is always changing over time. Climate alarmism is a leftist propaganda program. It is about socialism, not climate.Obama flew all over the place in Air Force One, dumping tons of carbon, as he pleased. Obviously, he is not concerned about cabon dioxide emmissions.

In reply to by Slack Jack

fx moneybots Fri, 09/08/2017 - 10:59 Permalink

Rickards is clueless. North korea is technologically very backward, except in a few areas. The upside for them to this is that they are not as much integrated in the www and are way less vulnerable to cyber warfare. If the US really attempted to shut down NK power grid completely (still, the military has its own, as is the case virtually everywhere) they better be prepared for a sino-russian counter attack on critical US infrastructure. There is a reason why Putin sounded the alarm of a poissible planetary catastrophy that could stem from the Korean crisis.. What the dumbasses and russophobes in D.C so easily forget is that by permanently attacking Russia (and increasingly China) in public statements with tons of hyperbole and wrong accusations, there is little cost for both countries to really doing at some point what they were publicly charged with already anyway.

In reply to by moneybots

lucitanian giovanni_f Fri, 09/08/2017 - 06:30 Permalink

Your absolutely right. In your second paragraph.But in fact the problem was created earlier in 1945 at the Moscow Conference when the Foreign Ministers of Stalin, Roosevelt and Churchill decided to carve up the Korean peninsula on a line drawn in the middle with no understanding or consideration for the Korean people.The ensuing war was again because the big outside powers, Russia and US set up and manipulated puppets in their cold war games and again the Korean people didn't matter as they saw the country as a soccer ball to be kicked back and forth.The reason the Kim dynasty was able to found and maintain its cult and isolation was as a direct result of the atrocities inflicted on the Koreans during that war and the continued threat ever since.There is no military solution and Kim is not about to use his nuclear weapons against anyone who doesn't threaten his regime. He's perfectly aware that using it against another nuclear power would be his and his country's end.The Korean problem today is the same as 1951, but this time it is a soccer ball between China and Russia on one side and the US on the other, except this time the ball has developed a nuclear weapon for self defence, having seen the game in Iraq, Afghanistan, and Libya, to name a few.An illegal nuclear weapon in the hands of Kim is no more or less dangerous than a nuclear weapon in the hands of Netanyahu, Modi, or Abbassi (MP of Pakistan). So why not just leave N. Korea alone?  

In reply to by giovanni_f

Itinerant lucitanian Fri, 09/08/2017 - 09:30 Permalink

The problem was not created by carving the Korean peninsula up -- that was simply a rough division of work. The US was keen on enlisting the help of the Soviets in freeing Manchuria and Korea from Japan (Teheran Conference, 1943). The Soviets attacked Japan at 12:01 am on Aug 9, exactly 3 months after the defeat of Germany, as promised. The Soviets (1.5 million men; 11,000 deaths) rolled through Manchuria in no time, and Japan capitulated on Aug 15. The Soviets were in Pyongyang Aug 24, and judging by their momentum (Manchuria is bigger than Western Europe), they could easily have occupied the rest of the peninsula, but stupidly and gullibly honoured the agreement with the Allies and waited until the Americans landed a small party at Incheon on Sept 8. The Americans were welcomed by a delegation from the provisional government, consisting mostly of members of the Korean resistance, but the Americans refused to talk to them, preferring to do business with the capitulated Japanese occupation authority in Seoul. And the rest is history as they say. It was about regime change from day 1 (with the necessary revolts and authoritarian repression). The problem was created by the naive and gullible Stalin and the Soviets: They could easily have prevented the whole problem by iliberating the rest of the peninsula.

In reply to by lucitanian

bluez Perimetr Fri, 09/08/2017 - 08:13 Permalink

Especially Americans. The word is Li'l Kim's biowar weapons are as advanced as his nukes.The smallpox/ebola "hybrid" spreads much faster than the flu, and kills in days by causing bleed-out from everywhere. It's called a "bloodpox" and Li'l Kim almost certainly has it.Maybe people like Jim Richards have deep bunkers.

In reply to by Perimetr

Itinerant Perimetr Fri, 09/08/2017 - 09:50 Permalink

Agree. If the N Koreans are prepared for one thing, it is the scenario Rickards unfolds. Do you not think they have standard orders and procedures on what to do if America strikes or uses special ops? Do you think they don't realize that computers are proned to hacking? N Koreans are used to dealing with no power grid on a daily basis. No country has prepared as thoroughly as N Korea for attempts to take out their leadership and their command & control. Special ops would be dependant on S Koreans: how easily can American commando's operate in a country as geared to war as N Korea -- it's probably the last place you want to go as a commando. Americans are also continuing their 200 year delusion (started during invasions of Canada in the 18th century) that the population will welcome them as liberators, and are not on the side of the regime.The N Koreans are not thinking about nuking LA, because they wouldn't suvive long enough to even know if it was succesful.

In reply to by Perimetr

libertyanyday philipat Sat, 09/09/2017 - 08:39 Permalink

seoul goes away........what about guam or la or sf or seattle.  Whats the game plan if kim goes nuclear?  shrugging off Kim is to kick the can, the man is certifiable, he thinks the NK people are his personal war fodder..............your assertion must be right every time he threatens, Kim only needs to be right once.

In reply to by philipat

not dead yet wildbad Fri, 09/08/2017 - 04:07 Permalink

The Norks have tunneled into SK and many of them have been found. Nice engineered tunnels that are even paved to move troops and small equipment fast. Although quite a few have been found there is speculation that there are more. So just wheel a nuke into the south close to Soeul an let er rip. Probably there already.

In reply to by wildbad

Soundgardener JacksNight Fri, 09/08/2017 - 06:46 Permalink

Shite the bed—Keiser he looks like he shuffled into the office on day 6 of a bath salts binge. I reckon Keiser's got a MEAN Full Charlie in the wings, waiting for the worst possible moment to depth charge his career to smithereens:"Vatican Assassin! Tiger's Blood! I'm on a drug called Max Keiser! I'm bangin' 7 gram rocks (up my Keiser)""Fuck, aah....Rickards...how 'bout those markets, buddy? TELL ME about...wuh? Okay all you fer'a'bit (make it good, giz 5 mins plus...I gotta splash some face on my water...all you bud. Owe ya one, love your work man...ugh I'm gonna vom HEURGH!!!""...the fuck you lookin' at Stacey Facey...you horse-faced b**ch!! Welcome to trading...OLD SKOOL! Clean this fuckin' mess up and keep Goldie Horn gabbing....I'm outta hea..."

In reply to by JacksNight

Twee Surgeon Fri, 09/08/2017 - 02:10 Permalink

This bald headed wack job has been flapping his lips for a decade or more of horseshit advice. Once he was prince charming . Let me guess. He is in the Gold and Silver metals business ? OOOOh!Finally a Nuke goes off and you don't have a hat made of silver, don't say we never warned you, sucker. A Solid Silver hat is survival, or your wife and kids die you loser punk ! Get your Silver hat now bitchez, it's for the childrenz.

wisehiney Fri, 09/08/2017 - 02:08 Permalink

There were three guys walking down a hill a black guy, a Mexican guy, and a Korean guy. Then they got kidnapped by a crazy gay guy. He said, "If all three of your dicks add up to 12 inches your lives will be spared." The black guy pulls down his pants and he measured 6 inches.The mexican measured 4 inches.The the Korean measured 2 inches. Their lives got spared. Walking down that same hill the black guy said, "You are lucky im black" The mexican said, "You are lucky im Mexican" Then the Korean said, "You are soooo lucky I had a boner". 

SoDamnMad Fri, 09/08/2017 - 02:08 Permalink

Russia and China scream, Negotiate, Negotiate.  We did in 2008 and every big player signed an agreement. The NOKS blew up a "token" cooling tower and went back to stealing technology and working with the likes of ex-Pakistan and Soviet scientists.  So here we are again.  We have fed them since the Korean war and it is suppose to stop in November. Why not right now. The food can sure be used in Yemen where all the children are starving (Madeleine Albright is probably cackling away about another 500,000 children dying and WORTH IT). Negotiating is getting us nowhere.