There is a larger game at work here that probably centers on the difficult-to-read domestic politics of North Korea. It is by no means assured that Kim Jong Un has fully consolidated his authority. By ramping up rhetoric, but exercising restraint with respect to actual military actions, the regime can count on the fact that the United States and South Korea are not going to take the first step either.
The result is that North Korea’s exercises and threats of retaliation have been successful in deterring attack, even though none was coming. The regime can claim some sort of victory in staring down American threats in its two big political meetings this week, the timing of which suggest that some of the rhetoric has been driven by domestic politics.