Chapter 30
Translator: Dreamscribe
A terror attack struck directly at the capital of Saudi Arabia.
Riyadh was the most developed city among the Middle Eastern countries and was also considered the safest place, so this kind of terror attack delivered a great shock.
“Thanks to Iran quickly releasing a statement saying it absolutely wasn’t their doing, the market didn’t shake too badly.”
Iran is currently engaged in a power struggle with the United States over the nuclear issue.
Well, to be honest, that’s just from Iran’s perspective.
In reality, they’re just getting beaten up unilaterally.
The U.S. is already cooperating with various countries to completely cut off all trade with Iran, thereby applying pressure.
On top of that, they have to get involved in the civil war in Yemen, so Iran was in quite a troublesome situation in many ways.
And then, all of a sudden, a terror attack on the capital of Saudi Arabia occurs?
Seeing that news, Iran must’ve felt chills down their spine.
Even if it wasn’t their doing, if the other side concluded it was Iran’s and declared war, then the nation would be in jeopardy.
“Back during the 9/11 terror attacks, North Korea was the fastest to strongly insist that it wasn’t their doing. It’s the same thing.”
Thanks to that, the market looked like it would take a huge dive but quickly returned to normal.
However, because of this incident, some prices increased even more.
“Safe asset prices just keep climbing endlessly.”
“Yeah. Even treasury bonds, which usually don’t move much, kept going up.”
There are the top two most highly rated government bonds in the world.
They are U.S. treasury bonds and German treasury bonds.
They are classified as the most creditworthy and safest assets among all government bonds.
Because of that, when the market becomes all about safety, these two see the highest trading volume among government bonds.
“But what’s going on with the franc.......”
However, the franc’s price is practically frozen.
Due to a Swiss government financial regulation called the price ceiling system, the franc’s price remained still.
“It looked like it would go up a bit, then went down. Then it seemed like it was dropping too much, and it went back up. The price is basically just stuck.”
“Well, it’s the franc after all. There’s a reason it’s considered the top safe asset, right? If the price rises too much, the Swiss government releases supply to bring it down again. And if it seems like it's dropping too much, they buy it up to push it back.”
There was a reason the Swiss franc maintained its position as the top safe asset.
“But why did the Department Head buy this?”
“Hmm. My lacking guess is, even before the terror incident, the market was totally frozen. So, maybe he didn’t want to just hold on to capital, and decided to convert everything into francs to observe the situation.”
Everyone nodded.
It was the most plausible theory.
“What do you think, Manager?”
Manager Seo is someone who would jump into a fire pit if Department Head Jung Jin-ho told him to.
His trust in Department Head Jung Jin-ho was unmatched.
“I don’t know the Department Head’s intentions either. No one in this company can fathom that man’s insight. But there’s one thing I know for sure.”
The employees perked up their ears.
“W-What is it?”
“That the Department Head has no brakes.”
No brakes?
“Even the new people here must’ve experienced it. Has anyone seen our Department Head doing risk management when he does short-term trading?”
“.......”
Come to think of it, no one had.
They just followed what the Department Head ordered, without thinking about risk management, just as Manager Seo had said.
On top of that, the short-term trades were so fast-paced that there wasn’t even time to think.
“But isn’t it dangerous to not do any risk management?”
Even when investing with 5 billion won, thorough risk management is a must.
If not, the Risk Management Team immediately halts the trade.
But here, he’s doing short-term trading with 500 billion won, and doesn’t even care about risk management?
It was truly a dangerous investment without brakes.
“Yeah. From our perspective, it looks insanely risky. But in the Department Head’s eyes, that is risk management.”
"What? How is that risk management?"
“Because he wins.”
“......?”
“You don’t get it? If you only fight battles you win, that in itself is risk management.”
The people who had originally worked on the team with Department Head Jung Jin-ho were nodding.
In contrast, the newly joined employees tilted their heads with expressions that showed they couldn’t make sense of it.
It was as if these people had all fallen under some kind of group hypnosis.
How could that be considered risk management...
Beep-!
At that moment, notification sounds went off here and there.
It was a signal that the stocks they had selected were rising.
“Huh? Wait a minute. W-What’s going on?”
“Wasn’t the franc supposed to be capped due to the price ceiling? But it’s going up like crazy right now?”
“Something must’ve happened. Check the news, fast!”
The Swiss franc, which should never have gone up in price due to the ceiling set by the Swiss government, suddenly began to surge.
As the graph shot skyward with no sign of stopping, the employees' jaws practically dropped.
“Th-They just announced that Switzerland is abolishing the ceiling!”
“What? This suddenly, with no prior notice?”
“It’s going up. Already 5%... 7%... No, 10%!! The speed is insane!”
Only then did the department employees all look over toward Manager Seo.
“I told you, didn’t I?”
He grinned as if to say he had known it all along.
***
[Due to the craze for safe assets, Switzerland has ultimately announced the abolition of the price ceiling. The sudden announcement, made without any prior notice, has delivered a major shock to the foreign exchange market, and franc prices are soaring. In addition, the price of the euro is also……]
They had been on edge all the way through Friday.
And finally, it exploded.
The franc, considered the safest currency in the world, had stabbed everyone in the back like this.
The ceiling policy was literally intended to prevent the price from rising or falling beyond 1 euro = 1.20 francs.
But there was one thing they had overlooked.
It was demand that exceeded all expectations.
The China Shock and Greece’s default.
From that point, money had already started flowing into the euro and franc.
Switzerland was barely suppressing the surging value by injecting money to stabilize its currency.
Then came the terror attack in Saudi Arabia.
That was the beginning of the domino effect.
Upon seeing the attack on the Saudi capital, people feared an escalation and rushed to safe assets, which resulted in such overwhelming demand that price defense became nearly impossible.
“So in the end, Switzerland raised the white flag.”
“Wow. But even so, how can they suddenly make such an announcement like this? Hedge funds and securities firms that trusted the ceiling policy must be in chaos.”
“You think it’s just them? Swiss companies and places that import their products are getting hit too.”
Normally, removing a ceiling like this would require advance discussion.
That’s the only way to soften the impact.
But perhaps Switzerland was so desperate that they detonated it without any warning.
“Isn’t this level of shock second only to the subprime crisis in FX history?”
Just as Deputy Manager Lee Hye-rin said, a shock of this magnitude is the first since the subprime crisis.
The franc’s price had risen by a whopping 20% at that point.
The key was how much further it would go from here.
Because of that, despite it being Friday, neither I nor my employees were able to leave work.
“But Department Head, how on earth did you predict this?”
“You foresaw that Switzerland wouldn’t be able to hold out, right?”
“Phew. As expected, such insight...!”
"This is why we need to develop the ability to see the forest."
“.......”
Even without me responding, the employees were busy beating the drums and cymbals on their own.
“Department Head, when should we sell this?”
It had gone up by 20%.
In the foreign exchange market, where a 5% daily increase is considered significant, 20% was a crazy level.
Selling here would net a massive 100 billion won in profit.
Anyone else would’ve lost their mind and sold immediately.
“.......”
But even when hovering the mouse over the sell button, there was no signal.
That meant it would go even higher from here.
“Don’t sell yet. Keep holding it.”
***
The terror attack in Saudi Arabia that had made CEO Hwang Dae-woon’s heart sink.
When he saw that news, it was so shocking that it felt like his life flashed before his eyes.
But now, that memory didn’t even register in his head.
“Right. S-So what happened?”
It was a nerve-wracking moment, enough to make someone bite their nails.
That feeling was not limited to Hwang Dae-woon, every executive gathered in his office felt the same.
“He’s still holding.”
At the staff member’s report, sighs burst out from all directions.
“What? Still?!”
“Didn’t it go over 30%? And he’s still holding on?”
Since Friday, the price of the franc had been skyrocketing.
And Jung Jin-ho had been holding onto it from even before the surge, with over 500 billion won invested.
Naturally, the executives who knew that fact had no choice but to gather in the CEO’s office.
Truthfully, they wanted to go down to Jung Jin-ho’s department and enjoy the moment live, but no one dared to interrupt him, so they assembled here instead.
“But isn’t the maximum 30%?”
“Tsk. Seriously. Even with the heart of a beast, to be this greedy at this point...”
CEO Hwang Dae-woon looked at the executives who had gathered one by one after hearing the news about the franc and were now using his office as their hideout, discussing and analyzing the situation. He was speechless.
It was absurd, yet strangely entertaining, that was the catch.
“Hey. Didn’t you guys say earlier that 25% was the peak?”
“That was a misjudgment. But this time it’s for real. 30% is definitely the ceiling-”
“Whoa, it’s going up again! It’s broken past 33%!”
“What the hell! How high is this crazy thing going?!”
The franc, which had stalled in the 30% range, finally broke through the resistance line.
With the percentage continuing to climb, CEO Hwang Dae-woon involuntarily swallowed dryly.
“What about Jin-ho? Did Jin-ho sell?”
“Not yet.”
“Ugh.”
“He’s still not selling at this point? What does Department Head Jung think the peak is?”
At this point, it was the executives whose palms began to sweat and mouths dried up.
Even the most cold-hearted investor would have pressed the sell button at 30%. But Jung Jin-ho was holding out to the end.
It was Saturday, yet no one even thought about going home. They were all huddled together, staring at the chart.
The franc, which had gone up to 33%, looked like it was dipping again, only to shoot up once more.
“Ugh. This is driving me insane. The swings are too big.”
From 30%, then 33%, then at times crashing down to 20%.
It was such extreme volatility that it made them doubt whether this was even the FX market.
“No need to ride a rollercoaster. Just watching this is on the same level.”
Then, in one moment.
"Huh? Huhhh?"
The franc, creeping upward again, hit a new high.
“40%!?”
They turned their heads toward the staff member monitoring the real-time trading volume of Jung Jin-ho’s department.
“...He sold!”
Finally, Jung Jin-ho had dumped all the holdings.
And, as expected of the world’s largest market, the 500 billion won position was instantly sold off.
The recorded profit rate was an astounding 40%.
“Wow-”
“This is seriously unreal. It’s not even a game…”
“Even in a game, you couldn’t pull this off, unless you used cheats.”
The executives exhaled the breath they had been holding and shook their heads.
They, too, had spent their lives in the world of investment, but they had never seen a beast like this before.
No, how could anyone hold on through these wild price swings, up and down like tap dance steps, without selling?
It was not something a sane person could do.
“If I worked with Department Head Jung, I don’t think my heart could handle it for long.”
“Seriously. When it climbed to 30% and then dropped to 15%, I thought I was going to faint.”
“And even after that, he didn’t sell and held on till the end... Phew. I could never do that.”
Being able to make decisions that others can’t, and having the mental fortitude and nerves to endure until the right moment arrives, that’s why Jung Jin-ho alone was managing an enormous sum of 500 billion won.
“But... doesn’t that mean the capital Department Head Jung Jin-ho is handling has now surpassed 700 billion?”
“Right. It hasn’t even been that long since the department was established, and it’s already 700 billion?”
“At this rate, won’t it soon exceed our company’s net assets?”
Currently, Kwangwoon Securities manages 1 trillion won in total assets.
That’s the amount excluding the 700 billion being handled by Jung Jin-ho.
But now, his investment funds were on the verge of surpassing the company’s net assets.
“At this rate, he’s really heading for the trillion-won mark...”
To do that, another 300 billion would be needed.
In a world where earning even 3 billion is tough, a whole 300 billion?
And yet, for some reason.
Once the name Jung Jin-ho was attached to it, even that 300 billion felt small.
***
“This SUV model has a spacious trunk and is perfect for camping or travel. It also has four-wheel drive. Once you try driving it, you’ll really feel the difference. And this particular model is a hybrid, so if you’re looking to reduce costs...”
Hmm. Maybe I shouldn’t have come alone.
I should’ve brought someone who knows about cars.
My father’s birthday was coming up soon, and I wanted to buy him a car, so I was looking around alone. The problem was, I didn’t know much about cars, so even after listening to the explanations, I wasn’t confident about what was good.
I had been searching online, visiting various dealerships...
Maybe I should’ve just called my sister.
But she didn’t come home this weekend, she went to the office, probably because something urgent came up at work.
-Department Head, I’m sorry to bother you on the weekend. Do you have a moment?
While walking around, I got a message from Deputy Manager Lee.
-What’s the matter?
-Ah, you replied right away...! I think I sent you the wrong version of the data summary file. So I made urgent revisions and sent it again. Please double-check that one.
-Okay. I’m out right now, so I’ll check it when I get back in.
-Oh, you’re out? I thought you’d be resting at home. Especially since you worked late yesterday on Saturday…
On Saturday, the moment the price peaked at 40%.
My intuition gave me a screaming signal, and I sold all the holdings.
At that time, it was already night, so my team and I all got off work quite late.
-Yeah. I was planning to get some rest too, but actually-
I gave a rough explanation of why I was out and about now.
-Choosing a car is tough, right? When I was picking one, I spent ages researching. Would you like some help?
-Huh? Really?
-Hehe. I don’t know much, but because of my job I’ve done so much research. Where are you? I’ll get ready and come over.
It was a development I hadn’t expected.
If I’d known this would happen, I would’ve dressed up a bit more.
-It might take me a little while, so please be patient. I’ll get ready as fast as I can, Department Head!
Since we were meeting unexpectedly, I figured she’d need some time to prepare.
Meeting Deputy Manager Lee alone like this for the first time, I felt a bit nervous, maybe a little excited, and it was a curious feeling.
“While I wait, then…”
This was the dealership I was going to enter before messaging her.
That famous German company, Stummwagen.
One of the key criteria for the car I was choosing was the body frame.
How well could the car hold up in the event of an accident?
Maybe I really had become a proper securities man, safety was my first concern.
Although, to be honest, I don’t pay that much attention to safety when investing.
“Our Stummwagen models are known for their top-tier safety. Especially this new line, the optional features are excellent as well.”
As soon as I walked in, a dealer approached and began explaining in detail.
“Can I try sitting inside?”
“Of course. Please, go ahead. The ride quality is exceptional.”
Sure enough, the ride felt great.
No wonder people go for foreign cars.
“Do you like it? Our Stummwagen brand is actively producing eco-friendly models, passed the recent emissions tests with top marks, and above all, fuel efficiency is excellent.”
Should I go with this one?
Dad tends to like these thick-bodied SUVs.
For now, I should put this one on the candidate list and bring him over next time to ask his opinion…
“Ugh!”
While holding the steering wheel, I was startled and let go as a sharp spark suddenly popped.
“Are you okay, sir?”
“Ah, yes.”
What was that just now?
Was it just static electricity?
No. It felt different from static electricity.
In that case, could it be-
“Could you explain the car you just introduced one more time?”
“Ah, of course. Our Stummwagen was recently selected as Europe’s top eco-friendly vehicle, and especially this time, the emission output is reduced by 20% compared to all previous models-”
Zap-!
Right at that moment, there was another spark-like signal.
“C-Customer?”
“Thank you for the explanation. I’ll come back another time.”
I quickly left the dealership.
I didn’t know the reason, but I clearly got a signal the moment I heard the word “eco-friendly”.
And it was a very strong one.
Was there a problem with the car?
But Stummwagen’s vehicles had excellent reviews in many areas.
“…Is Stummwagen listed on the stock exchange in Korea?”
*****
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