Free Web NovelThe new year dawned.
The presidential transition committee was launched, and at the same time the prosecution began its investigation into Vice Chairman Seo Jaehun.
Business organizations, including the Federation of Korean Industries, issued one statement after another.
All of them expressed support for the government’s investigation into Ilseong Group.
Major media outlets followed suit, pouring out negative articles about Ilseong Group — or, more precisely, about Seo Yonggeon and Seo Jaehun’s management competence.
Only Jungseong Ilbo, which was tied to Ilseong by marriage, ran favorable pieces, but it was like throwing eggs at a rock.
A week remained before the Ilseong Electronics shareholders’ meeting.
I was meeting Han Kyungyeong in Pyeongchang-dong.
“The private equity funds have finally thrown in the towel.”
The hedge funds’ attack had been fiercer than expected. On top of that, the internecine conflict among criminal organizations in Japan and a coup plot plunged Japanese society into turmoil.
But they underestimated the Japanese people.
The coup was suppressed, and the gap left by fleeing foreign capital was filled by the Japanese themselves.
Japanese citizens ~Nоvеl𝕚ght~ bought dollars en masse with the yen they had in their bank accounts.
They helped their government repel the hedge funds’ assault.
Of course the hedge funds did not give up easily. They poured in trillions of dollars and kept buying yen.
Most used leverage to buy more yen than their capital would normally allow.
Backing down now would be tantamount to a bankruptcy sentence for them, so they fought with everything they had.
The Bank of Japan, having had to block three foreign-induced surges in yen, ended up buying dollars in turn.
On top of that, the Iraq War and the Afghanistan War stabilized sooner than expected.
Even though the yen’s price looked similar to before, the dollar strengthened day by day.
In the end, the hedge funds had no choice but to retreat with their hands up.
“Soon the Japanese government will pump out massive yen and buy U.S. Treasuries. Quietly start buying yen now.” I said.
Japanese banks purchased U.S. Treasuries using the huge amount of yen printed in recent years.
Japan’s deflation was severe, and flooding the market with massive yen would lead to inflation.
But because deflation was so deep and the yen still enjoyed quasi-reserve-currency status, such a policy was possible.
Even so, by the time the central bank’s intervention wound down, the yen’s value gradually rose, eventually hitting ¥102.
In the end it was a failure.
This policy would later cause Japan’s lost twenty, thirty years — a failed war. For now it looked like a victory, but what it would bring remained to be seen.
Still, the hedge funds’ defeat was undeniable. As a result, at least thousands of hedge funds worldwide went bankrupt.
“So you want me to accumulate yen?” Han asked.
I nodded.
“For now it may seem like yen weakness because of the yen dumped into the market, but eventually it will return to yen strength. I’m even looking at ¥100.”
“Right now it’s around ¥130, so you mean it could rise even further than when hedge funds attacked at ¥105?” he said.
“The probability is high. The U.S. doesn’t like keeping the yen weak. Didn’t we talk and prepare in advance?” I replied.
“But... after spending trillions to attack and still holding the rate, could it jump that fast?” he wondered.
This was an inevitable flow. Whenever a government intervenes and then withdraws, bubbles adjust.
“Brother, it’s an artificially defended exchange rate. Once the Bank of Japan pulls back, the market’s judgment takes over. Even though the Iraq conflict easing strengthens the dollar again, for a while investment into yen will increase. The hedge funds collapsed because the central bank intervened, noticing the unnatural moves. A natural yen appreciation is something even the government would find hard to stop.”
“Alright. I’ll watch the Bank of Japan’s moves. When they stop buying dollars and begin buying Treasuries, start buying yen immediately.”
With Japan covered, I moved to the most important matter.
“Wall Street still refuses our proposal?” I asked.
“Yes. Those bastards don’t even think about negotiating. Seems like revenge. In the Japan affair we just watched.” Han replied.
Ilseong Electronics had a fairly high foreign ownership ratio.
Most of the current shareholders were on Wall Street.
“If it’s like that, it might become tricky,” I said. freewёbn૦νeɭ.com
We had friendly shares adding up precisely to 48 percent. Ilseong Life and Ilseong Fire held Ilseong Electronics shares with restricted voting rights, and most small shareholders leaned toward us.
But to be safe we needed two-thirds of attending shareholders to vote in favor at the shareholder meeting.
If we secured the shares held by Wall Street investment banks and brokerages, that would not be difficult.
Han Kyungyeong had been trying to contact them for months, but they refused to negotiate.
“Someone behind them must be pulling the strings,” he said.
The beasts of Wall Street don’t give up money-making opportunities over petty pride.
But their masters might think differently.
“This could get complicated. We could take management control, but if we want to run things freely we’ll be hamstrung. They’ll nitpick everything.”
“Likely.” I nodded. “We were the same. Seo Jaehun can hold management rights, but as a major shareholder they can hobble whatever he tries. I don’t want to end up like that.”
After a moment’s thought I said, “Change the operation for now: focus on securing management rights only. Keep contacting them. If they won’t transfer shares, demand delegation of voting rights.”
Han agreed but his face betrayed concern — he’d been treated coldly by Wall Street.
Then he remembered something.
“By the way, that guy's coming to Korea today. Patrick, the vice president of Goldman Sachs, is visiting in person.”
“Patrick himself?” I asked.
Patrick was a significant young executive at Goldman — reaching a vice-presidential post at a young age showed his prowess.
If such an important official landed in Korea timed to the Ilseong Electronics shareholders’ meeting, it meant only one thing.
“He’s going to meet Seo Jaehun,” I said.
“I expect so too. We’ll try contacting him, but I don’t know if he’ll agree to meet.”
“I’ll meet him myself. Tell him I want to meet. He won’t be able to refuse me.”
Han looked surprised. “You’re going to meet him personally?”
“I need to know what game he’s playing. Even if he shakes hands with Seo Jaehun, he can’t reliably protect management rights. What do they hope to gain by bothering us?”
“Understood. If you ask, he won’t refuse. If you go that far, it’ll mean he’s really picking a fight with us.”
“We need to find out everything about him.”
I pressed the bell and called for Manager Ma. He opened the office door and came in. I gave him orders.
“Manager, gather all information on Patrick from Goldman Sachs and bring it to me. Contact Black Bear in the U.S. so we can have it by tomorrow morning at the latest.”
“Understood. I’ll deliver it,” Ma said.
Black Bear’s head office intel team would have it in a day. With Ma gone, Han said with worry,
“But is this okay? I’ve never met Patrick either.” ƒrēewebnoѵёl.cσm
“Then meet him this time. Let’s have a drink — invite Eva too,” I said lightly to ease his worry.
Han jumped up, brightening. “Drinks sound great! Our boss, Kim Muhyuk, is the best!”
For once his flattery was over the top; I shook my head, amused. A smile had already crept onto my face.
The next morning.
Because of yesterday’s heavy drinking I woke later than usual.
I took a cold shower, came downstairs, and said, “Housekeeper, give me an iced coffee.”
“Yes, sir.” she replied.
With the coffee in hand I went into my study, drew back the curtains, and looked out over the sunlit garden.
Staring at the well-tended garden cleared my head.
I straightened myself and sat at my desk.
There was an envelope on the desk. I turned on the computer and opened the envelope.
Inside was a thick bundle of documents and some photos.
I skimmed the photos then picked up the documents.
Everything about Patrick at Goldman Sachs was laid out.
As I read I came upon an interesting note.
Someone had sponsored Patrick from his poor immigrant home.
I could not tell who, but someone had supported him from childhood.
Patrick graduated from Harvard and joined Goldman, rising at unprecedented speed.
He eventually reached vice president at a young age.
“Someone’s backing him. His abnormal promotions and performance are too much. If he weren’t a second-life guy like me, I’d suspect nepotism,” I mused.
I took a sip of coffee and continued reading.
I soon reached the section summarizing his activities at Goldman.
My eyes stopped at his most recent actions.
“Look at this. He led operations to shake Argentina and Brazil.”
Argentina, after repeated uprisings and capital flight, had declared a moratorium, the peso devalued, and the country teetered toward bankruptcy.
The U.S. government neither prevented nor aided Argentina’s default.
Suddenly Brazil became turbulent too.
The chance of a socialist government rising increased.
Patrick served as Wall Street’s agent and launched attacks on Brazil.
People were told George Soros led the charge, but behind the scenes Patrick organized the Wall Street players.
—For Brazil’s economy, José Serra must win. If Lula wins, Brazil will go bankrupt.
Soros publicly endorsed a candidate, and soon after the real fell, bond yields soared, and foreign capital fled.
Brazil, too, neared bankruptcy.
The U.S. seized the opportunity and used the IMF to promise rescue financing.
But only if the newly elected president accepted IMF conditions.
It felt painfully familiar — a mirror of Korea’s foreign-exchange crisis.
“This is interesting,” I said.
In the end Lula visited the U.S. when all eyes were on our presidential election.
Although Lula rose from the labor movement, he promised President Bush to maintain free trade and a market economy.
The Bush administration was satisfied and used the IMF to bail out Brazil.
Brazil capitulated, and Wall Street’s banks and hedge funds made money.
“Dirty bastards,” I spat.
They bailed out Brazil but not Argentina — a warning: don’t confront the U.S. If you defy us, we’ll abandon you.
Wall Street made money off the scheme, and the U.S. government engineered Brazil’s submission.
I put the documents down and thought.
‘Even if Patrick joins hands with Seo Jaehun, he can’t change the outcome of this management war. Is he simply trying to annoy us? Or is there another agenda?’
I needed to meet him to find out.
I organized my thoughts and started searching the news on my computer.
Politics tabs were mostly about the transition committee; economics tabs were filled with Ilseong Group articles.
I read through the articles. Soon there was a knock on the office door.
“Come in.”
Han Kyungyeong and Manager Ma entered.
“Are you sober yet?” Han groaned; he still looked pale from last night.
“Ugh... I’m dying. Eva must have blood of alcohol instead of veins. How does she drink so much? Yet you drank with her and look fine?”
“I’m okay. Age catches up to you,” I teased as I sat on the sofa.
Han collapsed next to me without his usual energy.
Ma placed a soothing drink in front of Han and said, “Patrick entered Ilseong Group’s head office.”
I shrugged; it was what I expected.
“Of course. I figured he’d meet.”
The important thing was what Patrick would negotiate with Seo Jaehun.
“Find out whether it’s a private meeting or a discussion with others,” I ordered.
“Yes, boss,” Ma replied and left.
Then I told Han, “When he leaves headquarters, you contact him and arrange a meeting. Tonight if possible.”
“I’ll call him,” Han said.
I wanted to meet Patrick, that man, myself.
