Golden Spoon Investment Portfolio - Chapter 372

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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372. This market crash will have a very deep bottom.

September 1, 1997.
Park Tae-hong awoke to the loud chirping of sparrows perched on the branches of cherry blossom trees planted in the Garden.
As Park Tae-hong, dressed in pajamas, raised his upper body and glanced at the clock on the nightstand beside the bed, it had just passed six in the morning.
Park Tae-hong pulled back the sheets, rose from the bed, and shuffled toward the bathroom in his slippers.
After a quick wash, he emerged into the Living Room where Jo Deok-rye, dressed in a home dress and watering the potted plants, greeted her husband.

“You’re awake?”
“Yes.”

Park Tae-hong replied and settled onto the leather sofa.

“What’s for breakfast this morning?”

He picked up the newspaper from the table and asked. Jo Deok-rye smiled and answered.

“You said yesterday you wanted something spicy, so I made loach soup.”
“That sounds wonderful. Well done.”
“The Gunsan Housekeeper is preparing it now, so just wait a moment.”
“Understood.”

As Park Tae-hong unfolded the newspaper in his hands, he caught sight of a prominent article on the front page and furrowed his brow.

[
Government Announces Financial Market Stabilization Measures
As the exchange rate continues its sharp upward trend, the government announced that starting from the 1st, it will completely ban individuals and companies from depositing or holding foreign currency for speculative purposes, and will implement foreign exchange liberalization measures such as expanded cash loan allowances ahead of schedule.
Furthermore, the government decided to actively intervene in the foreign exchange market and exert all efforts toward exchange rate stabilization by utilizing foreign exchange reserves and dollars deposited by the Bank of Korea in commercial banks.
According to the Ministry of Finance and Economy and the government, the recent sharp rise in exchange rates is attributed more to market anxiety psychology than domestic economic instability. According to the Ministry’s announcement, the foreign exchange reserves held by the Bank of Korea combined with foreign currency deposits in commercial banks are known to total approximately 59 billion dollars.
Furthermore, the government announced plans to request active cooperation from companies and financial institutions, including the top ten conglomerates, in stabilizing the foreign exchange market.]

“Exchange rate instability as a psychological issue… The exchange rate is on the verge of exceeding one thousand won per dollar, yet the government still hasn’t grasped the situation properly.”

Perhaps they understood but were concealing it to reassure the people.

“If word spread that a foreign exchange crisis could strike, there would be an immediate run on dollars, causing the exchange rate to skyrocket even further.”

The Blue House and the government would surely know this, so there was no way to speak the truth openly.

“So that’s why they announced they’d ban individuals and corporations from holding dollars for currency speculation purposes.”

From this alone, I could see that the government was extremely vigilant about dollars flowing out of the country.

“I understand the intention is to prevent hoarding of dollars, but this really does seem like a major blunder on the government’s part.”

It was as good as the government openly announcing that the exchange rate could rise even further—so without a doubt, starting from today, everyone would be desperate to exchange even a single more dollar bill.

“I had my doubts, but if things unfold like this, the won might actually break through 1,000 per dollar.”

As the situation developed this way, Chairman Park Tae-hong thought he had done well to heed his second son’s advice to convert all available funds into dollars once more.
Had he not done so, he wouldn’t be able to sit at home reading the newspaper so leisurely right now.
Like other company presidents, he would surely have been bleeding dry every single day from the banks’ relentless demands for loan repayment and interest rates that climbed higher by the hour.

“That boy. He takes after me—sharp mind and a keen eye for the world.”

Chairman Park Tae-hong murmured to himself with a slight smile.
Just then, Jo Deok-rye came out from the kitchen into the living room and saw her husband laughing to himself, giving him a puzzled look.

“What are you muttering about to yourself?”
“Ahem. It’s nothing.”

Chairman Park Tae-hong cleared his throat unnecessarily, set down the newspaper in his hand, and casually broached the subject.

“It’s about the second one.”
“What about Seok-won?”
“People say he resembles me quite a lot.”
“My goodness. Who says that?”

Jo Deok-rye scoffed dismissively.

“Manager Gil and the other executives were saying the same thing.”
“How can their eyes be so poor? Just because they see a handsome face that rivals some actors, they think it’s a resemblance.”

At that, Chairman Park Tae-hong bristled and countered.

“What’s this now. When I was young, women used to follow me around constantly. Even successful actresses were eager to have a drink with me.”

The moment Jo Deok-rye heard those words, her eyes narrowed to sharp slits.
She planted her hands on her hips and fixed her husband with an interrogating stare.

“Oh, how wonderful for you. So what’s the name of this actress you were following around?”
“Well….”

Park Tae-hong realized his mistake in an instant and shifted his gaze away from Jo Deok-rye’s piercing stare, rising from the sofa.

“Ahem. Look at the time already. I should eat breakfast and head to the office.”
“So which actress did you say you liked so much?”
“Good grief. That was ages ago—why are you pestering me about ancient history? What good does it do to dredge that up!”

Park Tae-hong hurried toward the kitchen, fleeing the conversation.

* * *

[USD/KRW : 997.38 (
7.13)]

Just as Park Tae-hong had predicted, the moment the foreign exchange market opened, the exchange rate surged, sending shockwaves through the currency authorities, banks, and corporations alike.
The Daeheung Venture Capital Fund Management Department was no exception—everyone stared at the rate that had jumped over seven won in a single bound, their expressions clouded with concern.

“This atmosphere feels ominous. At this rate, the exchange rate really will break through a thousand won.”

Jung Hwan-yeop, reclined in his chair with both hands behind his head, spoke those words, and Manager Choi Ho-geun, wearing a purple necktie and standing with his arms crossed, replied with a grim expression.

“Given how forcefully it’s rising, that might actually happen.”
“If it does, wouldn’t that be catastrophic?”

Hong Jae-hee asked anxiously, and Yu Seok-hyun shook his head slowly.

“Who would have imagined the exchange rate would surge from around 820 won last year to threaten a thousand won?”

Though she said nothing, Noh Hee-won’s expression betrayed her worry.

“That won’t happen.”

At the sound of a voice from behind, Manager Choi Ho-geun and his team members all turned their heads in unison.
Seok-won, dressed in a perfectly tailored suit as if he were modeling today, walked into the office alongside Han Ji-sung Deputy Manager.
Jung Hwan-yeop, who had been sprawled out like he was in his own bedroom, startled and quickly rose to his feet to offer a greeting.

“P-President, you’ve arrived.”

Seok-won addressed his team members with a smile on his face.

“You’re all working hard.”

Manager Choi Ho-geun bowed his head slightly in acknowledgment and asked him.

“Did you say the exchange rate wouldn’t exceed 1,000 won?”
“That’s right.”
“But the moment the foreign exchange market opened, trading was halted once due to such strong dollar-buying pressure. Can we really hold the 1,000 won line?”

Manager Choi Ho-geun spoke with a skeptical tone.
The stock market was plummeting while the exchange rate soared—a pattern typical of Asian countries experiencing a currency crisis—and moreover, he couldn’t shake his anxiety, especially given what Seok-won had told him previously.
However, Seok-won answered with a composed expression.

“Yesterday, Deputy Prime Minister Lee Eun-hyung came forward personally to announce financial market stabilization measures. The government and the Ministry of Finance and Economy wouldn’t simply stand by and watch the symbolically significant 1,000 won per dollar exchange rate collapse the very next day, would they?”
“Ah, now that you mention it, that makes sense.”

Jung Hwan-yeop nodded as if he hadn’t considered that point until now.

“Moreover, since they’ve publicly declared they’ll actively intervene to stabilize the exchange rate, they’ll definitely release their dollar reserves to bring the rate down.”

As Seok-won spoke, he shrugged his shoulders.

“Though ultimately, it’ll be nothing more than trying to hold back the tide.”

Seok-won turned his gaze to Manager Choi Ho-geun and asked.

“The KOSPI is also collapsing, correct?”

Manager Choi Ho-geun nodded heavily.

“Yes. The 550 level we barely managed to hold has collapsed, and even the 500 level is now in jeopardy.”

Seok-won showed no particular change in expression, maintaining an unperturbed demeanor as if he had anticipated this outcome.

“Foreign investors have been withdrawing for some time now, and it appears that individual and institutional investors who were waiting for yesterday’s government announcement, only to find nothing substantial, have begun cutting their losses.”
“I believe that’s the case as well.”
“This market collapse will have a very deep bottom. Don’t even think about jumping into bargain buying just yet—for now, simply observe the market.”

Jung Hwan-yeop, sensing something ominous in the weighted tone of his words, carefully watched Seok-won’s expression and asked cautiously.

“If the bottom is deep, how far do you think it will fall?”

Seok-won lifted his gaze and fixed his eyes on the large market ticker board mounted on the opposite wall.

“You’ll see numbers we’ve never experienced before.”
“…!”

Jung Hwan-yeop unconsciously swallowed hard.
The moment he caught sight of Seok-won’s profile, rigid and fixed upon the market ticker board, red warning lights began flashing in his mind.

‘Is… is it that dangerous?’

The other team members were also staring at him with visibly tense expressions.
As the atmosphere grew heavy and oppressive, Seok-won turned to Manager Choi Ho-geun with a question.

“What’s the current level of the Malaysia stock futures index?”

Manager Choi Ho-geun checked the monitor on his desk and answered.

“It’s fallen to 431 points.”

Unlike Hong Kong, which had achieved a dramatic victory, other nations had succumbed to currency speculators’ attacks and extended their hands to the International Monetary Fund for bailout assistance. Malaysia, however, had implemented extreme capital controls—banning dollar transactions entirely and blocking foreign investment withdrawals for a set period.
As a result, the ringgit exchange rate and stock market were being completely devastated, plummeting into the abyss.

‘In doing so, Malaysia lost complete credibility in the international financial markets and had to endure tremendous economic suffering, but it managed to avoid the harsh structural adjustments and market liberalization demands imposed by the International Monetary Fund.’

Of course, since Malaysia would later require considerable time and effort to restore its credibility in the international financial markets, it was impossible to definitively say which choice was better.

“So we’re looking at over 37% in profits.”
“Yes, sir.”
“It doesn’t look like it’ll drop much further from here, so let’s close out all positions now.”
“Understood.”

Manager Choi Ho-geun accepted Seok-won’s instructions without question.

“I’m heading out now. Keep working.”

As Seok-won left the office with Han Ji-sung, his Attendant Secretary, Manager Choi Ho-geun and the team members bowed in farewell.
Jung Hwan-yeop, unlike his usual self, stared after Seok-won with an expressionless face before turning his gaze to Manager Choi Ho-geun.

“You don’t think the president believes we’ll face a currency crisis like the Southeast Asian countries, do you?”
“Ah….”
“That can’t possibly be the case.”

The team members exchanged anxious glances with one another.
Manager Choi Ho-geun looked around at his team members, whose expressions had grown tense, and answered in a subdued voice.

“Hong Kong was attacked by currency speculators too. There’s no reason Korea would be an exception.”

Jung Hwan-yeop’s pupils trembled noticeably for a moment.
Manager Choi Ho-geun, cutting off what Jung Hwan-yeop was about to say, clapped his hands lightly as if to clear the heavy atmosphere.

“Alright, everyone heard what the president said. Starting now, let’s begin liquidating the short positions we’ve placed on Malaysia’s stock index futures.”
“…Yes.”
“Understood.”

Amid the slightly unsettled mood, the team members responded and headed to their respective desks.
Jung Hwan-yeop looked at Manager Choi Ho-geun with eyes full of questions, but soon closed his mouth and went to sit at his desk.
Meanwhile, Manager Choi Ho-geun remained standing, his gaze fixed on the won-dollar exchange rate displayed on the large market board with a complicated expression.

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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