Thursday, February 9, 2017

A Certain Crisis Scenario

What if an important ally of the US, such as South Korea, suddenly finds its currency to be worthless?

I for one happen to find the sudden crisis that engulfed the South Korean president to be rather suspicious. In light of China and Russia's fierce opposition to the deployment of the THAAD system and Russia's expert use of its espionage capabilities, it's not beyond their capabilities, will and SOP to discover the South Korean president's improprieties and expose them in the hope of preventing THAAD deployment.  If this crisis fails to prevent its deployment, they might engineer other forms of attack on South Korea, such as an economic crisis meant to bring the country to its knees by attacking its currency.

In such a crisis, the Trump Administration should move to support its ally by coming to an agreement with South Korea in which Seoul will agree not to print any currency or issue any government bonds. In exchange, the US should agree to allow conversions of the South Korean won to the US dollar at a rate that prevailed before the crisis erupts. The full force of the US Treasury should save South Korea from financial ruin, strengthen an important ally in the Far East, demonstrate US commitment to its allies and earn the undying gratitude of Seoul.