The intensifying rhetoric originating out of North Korea has had the world's onlookers concerned that nuclear war could break out at any moment.
While Korea's stock market has exhibited some volatility, the overall mood in the south is one of complacency. as Koreans have gotten used to 50 years of empty threats.
Assuming nothing materializes and the threats turn out to be nothing more than talk, this could be something of a win for South Korea.
Goldman Sachs' Jim O'Neill mentions it briefly in his latest Viewpoints:
I highlighted Korea a few weeks ago when I detected a shift in the Chinese stance on the North, and in the past week or so, the country seems to be doing the most it can to rile everyone. While some aspects of their posturing are clearly a bit scary, I again find myself asking whether this time it is the beginning of the end of two separated Korea's? In the meantime, some Korean exporters will be slightly relieved that the current weakness of the Korean Won gives them some respite against the relentless decline of the Japanese Yen.
The Bank of Japan has embarked on extremely aggressive monetary policy, which has caused its yen to fall against most major currencies.
This aggression by the North is effectively devaluing the won without any action by the Bank of Korea.