July 11, 2011: Signs of shortages and unrest are everywhere in the north. Anti-government graffiti has even been showing up in the capital, and is remaining visible longer in other parts of the country (where local officials are under orders to eliminate such public displays of disloyalty as soon as possible.) There is also an increase in illegal traders, even as there is less food to be found in the officially sanctioned markets. The Spring potato harvest was much less than usual. Even the army is short of food, and officers are increasingly coming to markets and demanding "voluntary contributions." Thus it's more profitable to be an illegal trader, even with the risk of arrest. That's not such a big risk anymore, as the police are easier to bribe. The crackdowns on the security forces are only temporary. Once the special secret police anti-corruption agents leave an area, it's back to business-as-usual. Even if the secret police have arrested some local cops, the others see bribes as an essential part of their income. With food growing increasingly scarce, black market alternatives get more expensive. For the local police, bribery is a matter of life and death.

For unarmed North Koreans, the only alternative is starvation. It's a more common sight to see very thin and desperate looking people on the streets, including homeless kids (whose parents have either died, been arrested or simply abandoned children in order to survive.) Foreign donors continue to refuse food aid for North Korea, unless the northerners allow the foreign aid organizations to supervise the distribution of the food. This the north refuses to do, as the northern government seeks to convert much of the food aid to cash (by selling it in North Korean markets, or to Chinese traders.) About a quarter of the North Korean population is starving, or at least malnourished. Some aid groups are urging that food be sent anyway, as some of it will get through and the rest can be written off as a bribe. In many parts of the world, a percentage (often large) of food shipped in is lost as bribes to local warlords and government officials. But there is real fear that the North Korea government would divert all, or nearly all, of food aid. Nevertheless, the EU (European Union) is going to ship some food to North Korea, enough for about ten percent of the six million or so in desperate need of it. The EU will try to monitor the situation and see if the North Korean government can be trusted to feed its starving population. Aid groups take advantage of an informal news and intelligence network that has developed in the north over the last few years. Increased bribery, more foreigners and North Koreans moving in and out of the country (legally or otherwise) and smaller video cameras make it possible to monitor things the northern government tries to hide.

A drought (that reduced hydroelectric power) and fuel shortages (no cash for oil imports) have sharply reduced electricity supplies. That has reduced economic activity still further, with factories unable to operate, and farms producing less because irrigation pumps or farm machinery cannot operate. There's also been a growing fertilizer shortage. Nuclear and missile programs have priority on energy and cash for imports, but this is in short supply as well. The American led arms embargo has been increasingly effective, and fewer missiles and other weapons are being delivered. Orders are down, as customers fear non-delivery, or retribution by the United States for flaunting the embargo.

The cash shortage has caused extreme measures to be taken. The most noticeable effect seen by foreigners is the commercial exploitation of North Korean embassies. In Russia, the embassy was caught running an illegal casino. In other countries, embassy facilities are available for rent, or businesses are set up in them. North Korean diplomats are more frequently caught using diplomatic mail privileges to smuggle illegal items (like drugs). In some countries, local freight companies won't handle North Korean embassy business.

North Korea has become so unstable that China is openly admonishing North Korea leaders to behave. Privately, Chinese officials warn the United States and South Korea that the northern leadership is increasingly unpredictable and resistant to Chinese threats. Russian officials report similar experiences. The U.S. and China have both openly warned the north to avoid armed incidents with South Korea, and China has privately told the north that, if the south is attacked again, the response could be massive, and that China would not back up the north in such a situation. None of this has produced any official change in the traditional North Korean paranoia and antagonism towards all foreigners.

China is angry at the growing quantity of illegal drugs coming out of North Korea. While most of this traffic used to be from criminals, it's now believed that most of the recent increase in shipments is coming from pharmaceutical plants, and being produced and smuggled into China with government approval. It would not be the first time North Korea has exported drugs to raise cash. China doesn't really care, except (as is now the case), when a lot of the drugs are sold in China. Growing affluence in China has created a growing demand for all sorts of recreational drugs. Entrepreneurs in North Korea have long shipped methamphetamines into China. Since the late 1990s, pharmacists and other medical personnel have been manufacturing methamphetamines, and selling the stuff to Chinese dealers across the border. Often, the Chinese gangs sent Chinese into North Korea to smuggle the drugs back. This trade was, and is, a vital source of income at a time when starvation was an ever present danger. But in the last few years, more and more of the methamphetamines have been sold inside North Korea, to the children of the ruling class, and the growing number of affluent trader families. Now, the North Korean government has apparently ordered state-owned drug plants to produce recreational drugs for export.

More Internet security researchers (academic, commercial and government supported) are looking at North Korea, and finding that North Korea is the source of an increasing amount of Cyber War activity. Most of it appears to be espionage or shutting down sites of organizations considered hostile, or harmful, to North Korea. Given the historical government use of criminal activity to raise money, the north is expected to use its growing Cyber War skills to raise cash.

July 8, 2011: Pakistani nuclear weapons scientist Abdul Qadeer Khan, who has largely escaped punishment for selling nuclear secrets, was long accused of selling detailed plans for a nuclear weapon to North Korea. Now Khan has revealed a 1998 letter from a North Korean official that discusses the deal. Khan says that North Korea paid $3.5 million for nuclear weapons technology in the late 1990s.  Previously, the only proof has been the similarities in the first nuclear weapons tested by Pakistan (in 1999) and North Korea (in 2006). Both of these bombs were only partially successful (they “fizzled” instead of exploding). North Korea later denied any dealings with Khan.

July 4, 2011:  A South Korean marine went on a shooting rampage, killing four other marines before he was subdued. The shooter complained of harassment and bullying by fellow marines. This is a growing problem in the South Korean armed forces. Often it's parents who complain to the media, and there are an increasing number of soldiers and marines getting injured or killed because of the breakdown of discipline.