I commend how President Lee has handled the situation, when the Chenoan sank, he didn't accuse blame, he didn't make any knee-jerk reactions. He very calmly called in a international team of experts to investigate and waited for their findings. This has greatly strengthened his hand internationally. And now he's made a forceful response by hitting North Korea economically, he looks bellicose and tough without really doing anything.

The conundrum for President Lee is that he can't respond militarily because absolutely no one wants another Korean War - not to mention it would utterly spook investors. It would be devastating for the Korea peninsula if all out war broke out. Pyongyang can credibly decimate Seoul with conventional arms alone. There are about 12 million inhabitants in Seoul. North Korea is bat-shit crazy, but their not suicidal, the regime cares about it's survival, if all out war broke out that would be the end of that regime. South Korea is very vulnerable because of its geographic location. Because of that, the U.S. has been very prudent not to trigger any war-like act. And North Korea knows it; it is the Achilles' heel for both countries.

The biggest danger with these situations is that they can slip out from one's control, sometimes the best policy is to wait until emotions calm down, then decide where to go from there.