For the second time in less than a month, North Korea on Friday fired a ballistic missile that flew over Japan in what was widely seen as payback for the U.N. Security Council's latest sanctions. As tensions continue to rise, this conflict could benefit some American companies. One example is Honeywell. Honeywell is a multinational company with a defense sector. These alarming moves by North Korea has lead to an arms race in Japan and South Korea who are franticly increasing defense budget to defend themselves. This presents Honeywell with an opportunity for more business.
https://www.cnbc.com/2017/09/17/north-korea-crisis-may-boost-honeywell-sales-singapore-summit.html
While this may benefit some American businesses, the money being spent on defense sector could be taking away from other businesses. When the government spends more and increases budget spending on the defense sector, then this could be taking away from small businesses, education sector, healthcare, and etc. affecting companies relying on those industries. When the 2016 budget expires on September 30th they will need to vote on a new budget that could increase national defense due to the current political climate.
ReplyDeleteI completely agree with Rachell, the effects this situation is having on businesses is marginal compared to the effects it is having on our government's spending. We currently have upwards of 30,000 troops stationed in South Korea, and I imagine the costs that the bases in South Korea are imposing on us are astronomical. If we should increase defense spending in response to the latest actions of North Korea, taxes could rise to increase the budget or our pre-existing budget could be re-allocated in order to take the burden of these costs. As Rachell said, this could take away from certain benefits of our government spending that we rely on.
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