Investors Wonder Whether Tensions Between North Korea and the World Will Boil Over Into Violence

Some investors are content to sit on their positions for years at a time, and that can sometimes be advisable. Investors who buy shares in suitably conservative, index based funds, for example, can ride the slower swells and swings of the markets with a fair amount of confidence.

On the other hand, times of political or economic turmoil can make the voyage a lot less pleasant and secure. When major news breaks or seems to be ready to do so, the markets can react in viciously aggressive ways. That can see some investors losing progress that took years to build up and watching it happen in what seems like an instant.

All Eyes Turn Toward Twitter as a President Lays Down an Ultimatum

As posts made at point out, something along these lines has recently been developing with regard to the situation in North Korea. That cloistered, alienated dictatorship has for many years wielded threats as a way of securing concessions from the rest of the world.

With a United Nations panel having recently voted unanimously to impose harsh sanctions, North Korea has ratcheted up its bellicose language to an almost unprecedented degree. Seemingly ready to say anything it might take to provoke a response, the country has started to concern even the most hardened and experienced of observers.

That led the President of the United States to pen some harsh responses of his own. With investors worldwide now increasingly wondering whether these threats and ultimatums might soon translate into action, the markets have been more volatile than in quite some time.

READ  Finding Parallels Between Options and Life

One Major Sell-Off Does Not Need to Mean the End of the World

Quite a few investors have lost a lot of money through the recent selling, at least in notional terms. Many have previously experienced the pain, however, that can come with liquidating positions just when prices are ready to recover.

As the posts on Twitter make clear, many now regard the recent turmoil as something of a short-term thing. Despite being able to account for political and economic developments well in the large and over the longer term, the markets are also famously prone to temporary overreaction.