Kim Jong Un faces ‘dire straits’ without Chinese financial backing

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Closely followed trader Art Cashin told CNBC on Friday that North Korean leader Kim Jong Un will be in “big trouble” without China’s financial backing.

On Thursday, Reuters reported that China’s central bank has told banks to stop doing business with North Korea amid U.S. concerns that Beijing has not been tough enough about Pyongyang’s repeated nuclear tests.

“If (China) follows through on what they did that could be a game changer,” said Cashin, UBS director of floor operations at the New York Stock Exchange.

“There have been about four or five Chinese banks that have been carrying North Korea. And, if they stop, then (Kim) is going to be in really big trouble,” Cashin added in an interview on “Squawk on the Street.” “If Chinese banks stop helping them out, they’re going to be in dire straits.”

Commerce Secretary Wilbur Ross echoed Cashin’s read on China’s banking directive regarding North Korea.

Beijing “sent a message to North Korea that China is not being as supportive of them as it had been,” Ross told CNBC on Friday, adding it’s “a very welcome move” in conjunction with new U.S. efforts to halt funding for Pyongyang’s missile program.

“A lot of the goods going into North Korea have been in support of the missile program and the nuclear program. If we can cut off their ability to import those things that would be very good,” he said.

Before joining the Trump administration, Ross amassed a net worth of about $2.5 billion by investing in distressed assets.



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