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Korean War Part II?

By Confluence Investment Management. Originally published at ValueWalk.

north korean troops achieve success in first Korean war – a look at the similarities to today?

Tensions with North Korea have been escalating in recent months. The regime has tested numerous missiles and claims to be capable of building nuclear warheads, which, combined with an intercontinental ballistic missile (ICBM), would make the Hermit Kingdom a direct threat to the U.S. Such a situation is intolerable to the U.S., and thus there is rising concern about an American military response.

In Part I of this report, we will recap the Korean War, focusing on the lessons learned by all sides of the conflict. We will discuss North Korea’s political development through the postwar period and the fall of communism. This examination will frame North Korea’s geopolitical situation. The next step will be to analyze U.S. policy with North Korea and why these policies have failed to change the regime’s behavior.

In Part II, we will use this backdrop to 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 military assets that are in place and the signals being sent by the U.S. that military action is under consideration. War isn’t the only outcome; stronger sanctions and a blockade are possible, and the chances of success and likelihood of implementation will be considered. As always, we will conclude with market ramifications.

north korean troops
code404 / Pixabay

Echoes of the Korean War


After extensive consultations with the leadership of the Soviet Union and the People’s Republic of China (PRC), Stalin and Mao, respectively, Kim Il-sung, the leader of North Korea, prepared to attack South Korea. Stalin believed that the U.S. would not risk a wider war by intervening in South Korea. After all, if the U.S. was willing to allow Mao to win China, it seemed likely that the U.S. would not consider Korea important enough to defend. Mao was less confident of American behavior but didn’t act to stop Kim. On June 25, 1950, North Korean troops moved south of the 38th parallel and the war began.


Although Truman’s Secretary of State Dean Acheson didn’t include South Korea on his Asian Defense Perimeter, the president was worried that if the U.S. didn’t respond to communist aggression after China fell, it might embolden Stalin and Mao to become even more aggressive. Stalin was threatening Europe and thus taking a stand seemed necessary. It doesn’t appear that Stalin expected a U.S. military response; on the other hand, if one came, it would not be a major problem for the Soviets. The U.S.S.R. was not deeply invested in Kim Il-sung and so, from Stalin’s perspective, Kim’s adventure wasn’t a major risk.


Initially, North Korean troops enjoyed great success, rolling South Korean troops and a few American forces into a corner in southeastern Korea. Soon after, the infusion of U.N. troops, spearheaded by the U.S. military, halted the North Korean advance. Gen. Douglas MacArthur later that year launched the amphibious assault at Inchon. The attack was successful with allied troops

North korean troops and Korean war article continues below

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