The acquisition negotiations between Sunwoo Group and Duryong Motors had already fallen through once. What’s more, rumors were rampant in the market that a German automaker was set to acquire Duryong’s shares and take the company for Germany. Given this, Tak-hyeon found it hard to believe that Sunwoo Group would actually try to acquire Duryong Motors. But Seong-ho knew this improbable-seeming thing was true — because he remembered, quite clearly, that Sunwoo Group had already gone on to acquire Duryong Motors in that former life.

Not knowing this, Tak-hyeon couldn’t help but question it, and so he pressed Seong-ho for the reason.

“Sunwoo means to revive a deal that already fell apart? What’s the reason?”

“Because Sunwoo Motors needs to grow larger in order to survive.”

“Hm… well, that’s true enough. Sunwoo Motors isn’t in a good position to survive on its own in the current situation. It’s fair that they’d need to grow to survive somehow… but couldn’t they survive by acquiring Doa Motors instead? There’s no reason they’d have to insist on Duryong Motors specifically, is there?”

Tak-hyeon still couldn’t help but question why Sunwoo would try to revive an already-dead deal for Duryong Motors when Doa Motors sat right there on the market.

Seong-ho looked Tak-hyeon in the eye and said, “Because in that case, the tail would be wagging the dog. With Sunwoo Motors’ debt already substantial, taking on Doa Motors’ debt on top would be too much to bear. If they acquired Doa Motors, there’s a real risk Sunwoo Motors itself could collapse along with it. That’s why Sunwoo Group is going after Duryong, which carries relatively smaller debt, rather than Doa Motors. This is the first reason we shouldn’t accept Sunwoo’s proposal.”

Though Seong-ho explained in detail, Tak-hyeon didn’t fully agree. If he were Sunwoo’s chairman, he could see several points that would need addressing. But he couldn’t keep dwelling on this one issue alone — because the word “first” in Seong-ho’s explanation kept echoing in his ears.

“Sounds like there’s a second and third reason too. Go on, then — tell me why we shouldn’t accept Sunwoo’s proposal.”

Tak-hyeon looked at Seong-ho with an interested gaze and told him to continue.

Seong-ho wet his lips and laid out the second and third reasons to Tak-hyeon.

“Chief. Company M has downgraded our country’s sovereign credit rating.”

A secretariat staffer, bearing urgent news, delivered it to Chief Do-beom Hwang, standing before the chairman’s office.

Do-beom took the paper the staffer had brought and checked its contents.

[Company M downgrades Korea’s long- and short-term sovereign credit rating by one notch each. Outlook also shifted to negative]

Do-beom’s expression darkened at yet another piece of bad news arriving without end.

Seeing him standing still, holding the news, the staffer asked, puzzled, “Aren’t you going to go in and report this to the chairman?”

“He told me not to let anyone in, whoever comes, so I have to stay out here.”

The staffer glanced at the chairman’s office door behind Do-beom and asked carefully, “Who’s inside?”

“Head Kim is in there.”

“Head Kim, you mean…”

Few people at Ilhyeon Group held enough standing at the Head level to speak privately with Chairman Tak-hyeon. And Seong-ho was the only one who could do so with the Chief Secretary himself left standing outside.

The staffer looked at the office door and said quietly to Do-beom, “Head Kim must be giving the chairman some important report.”

“Seems that way.”

Do-beom knew the conversation inside concerned Sunwoo Group, and could roughly guess its content. And yet, thinking about his own position — having to wait outside — he made up his mind.

Before long, I should be the one to bring this up with the chairman myself.

If Seong-ho’s standing was bound to rise regardless, Do-beom thought it would be better for him to be the one to lift it up with his own hands. That way it would look better, and he could maintain a good relationship with Seong-ho as his position rose. He resolved to propose making the Restructuring Headquarters report directly to the chairman rather than remain under the secretariat.

Just then, another secretariat staffer came to find him.

“Chief.”

Do-beom and the staffer who’d brought the news about Company M both turned to the new arrival. He held out the paper he’d brought and explained the reason for his urgent visit.

“The KOSPI broke below 500 intraday. And U.S. futures are currently down more than 5%, with expectations spreading that global markets will crash.”

“It broke 500? The KOSPI?”

“Yes. Not only that — a major American investment bank has issued a report telling investors to pull their capital out of Asia and run. It says Asia’s crisis is only just beginning…”

The staffer reporting to Do-beom couldn’t finish the sentence. The weight of what it contained made it impossible to say the rest.

Do-beom looked down quietly at the paper the staffer had brought. Then he lifted his head and glanced toward the chairman’s office.

“Broke below 500, is it.”

The KOSPI’s collapse carried a different meaning for Do-beom than it did for anyone else.

Where did Head Kim take his KOSPI futures short position again?

Do-beom knew that Seong-ho, now speaking with Tak-hyeon behind that door, held a KOSPI futures short position. He’d learned through the secretariat that Seong-ho had put 50 billion won into the short position, and had reported as much to Tak-hyeon. But Do-beom couldn’t recall exactly where on the index Seong-ho had entered the position. Looking at it now, with the index broken below 500, the entry point must have been absurdly high by comparison.

I can’t even imagine how much profit that must be sitting on now.

Do-beom shook his head, unable to estimate what the 50 billion might have become by now. And resolving to bring up the Restructuring Headquarters’ status change sooner rather than later, he filed the paper carrying the KOSPI news and global market trends behind the sovereign-credit-rating report.

Coming out of the chairman’s office, Seong-ho turned his phone back on — he’d switched it off to keep it from ringing while speaking with Tak-hyeon.

The moment it powered on, it rang, as though it had been waiting.

“Hello.”

—Head. You’ve finally answered.

Chung-seop Jo’s breathless voice came through the phone.

Seong-ho paused his steps and looked out over the building’s exterior as he asked, “Your voice sounds urgent. What’s the matter?”

—Head. The KOSPI broke below 500.

Seong-ho smiled faintly at that and asked, “Is that why you called?”

—I was too startled not to… Head, your account’s valuation just crossed 200 billion won.

“That’s a fair amount of profit built up.”

—’Fair amount’ doesn’t begin to cover it. This is… a historic return. No one would believe it if you told them.

“This is only the beginning, you know.”

—Sorry? Only the beginning?

Seong-ho slowly resumed walking, speaking to Chung-seop through the phone. “For a great temple to collapse, one or two pillars falling isn’t enough. Several pillars have to give way before the whole temple comes down. Right now, only three or four pillars have fallen. The pillars will keep falling, and our country will keep sinking.”

No sound came from the other end of the line. Seong-ho’s words had struck Chung-seop harder than the news of the KOSPI breaking 500 ever could.

Seong-ho arrived at the Restructuring Headquarters. Between the people who’d come to borrow money and those still waiting for their assessments to finish, the headquarters still looked like nothing so much as a crowded marketplace. Having come every day now, the crowd no longer reacted at the sight of Seong-ho at all — they simply sat with drained faces, waiting for Ilhyeon Group’s decision.

Pushing through the crowd, Seong-ho spoke into the phone. “We’ll keep holding the position, and the moment it breaks below 400, we start unwinding.”

—400…?

Chung-seop’s voice came through the phone as though he had no strength left to be surprised.

500 to 400 might look like a small difference — no bigger, on the surface, than 1,000 to 900 or 500 to 400, both a gap of 100. But the difference between the two was as vast as heaven and earth. Not in raw numbers but in proportional terms: 1,000 to 900 was only a 10% drop, while 500 to 400 was a 20% drop. Since the figure was calculated against total market capitalization, the ratio was what mattered. In other words, talking about 400 now that 500 had already broken meant another 20% of corporate value evaporating on top of what had already been lost.

With the index already halved from its 1,000 peak, and Seong-ho now speaking of unwinding only once another 20% had vanished on top of that, Chung-seop didn’t know how to respond.

But Seong-ho continued in an unbothered voice. “Honestly, I’d like to start unwinding the moment it breaks 300. But the account’s grown so large by now that unwinding it isn’t a simple matter either, so I mean to take my time and do it gradually.”

—You meant to start unwinding at… 300? What does that… Head, the index broke 500 today. And you’re talking about 400, 300 — I don’t understand what you’re saying at all…

Seong-ho explained as he walked into his office. “Take the numbers exactly as I say them. It broke 500 today, and it won’t be long before it breaks 400. In all likelihood it’ll fall through 300 as well, eventually — but I mean to start winding down roughly once it breaks 400. Just know that much.”

As he spoke, Seong-ho opened the leather diary sitting on his desk.

[…the KOSPI index kept collapsing, again and again, falling as far as 277. Countless companies went under, and…]

Seong-ho found the section recording the KOSPI’s fall, confirmed it matched what he remembered, then turned and perched on the edge of his desk, speaking to Chung-seop through the phone.

“When it breaks 400, don’t be as startled as you were today. We have work to do.”

—Yes, understood.

Chung-seop quickly steadied himself and answered that he understood. Promising to remember Seong-ho’s instructions carefully, he hung up.

Still perched on the edge of the desk, Seong-ho set the phone down and picked up the leather diary again, reviewing its contents.

[As the exchange rate surged, the government decided to raise fuel prices. Once the announcement came, an extraordinary sight unfolded — long lines of cars stretching from gas stations, as people rushed to fill up before the price hike…]

Seong-ho turned the page.

[Consumer spending took a severe blow as well. Not only Sinjung Department Store but distribution companies across the board collapsed like dominoes. No one came to the markets, and…]

[With the stock market collapsing, the government decided, as a stabilization measure, to raise the limit on foreign ownership of shares. But the foreign sell-off didn’t stop. Raising the limit alone couldn’t hold back investors determined to leave.]

[An article reported that Korea’s foreign exchange reserves had fallen to under 2 billion dollars. Alongside rumors that intervention had been suspended, word spread that Korea’s dollars had run completely dry…]

[The IMF managing director said Korea wasn’t in as dire a crisis as the Southeast Asian nations. Newspapers and other media expected credit to recover, but reality proved otherwise. The exchange rate kept soaring, and the stock market continued its historic collapse. No one knew where the bottom truly was…]

Seong-ho turned the pages of the diary, which recorded everything yet to come, with detached eyes.

[Deputy Prime Minister Kang, at a press conference, said he would try to borrow dollars from allied nations including the United States. The press turned this into headlines suggesting Korea could indeed borrow money from allied countries. But no one believed it. Our own Ilhyeon, too, treated Deputy Prime Minister Kang’s words skeptically and threw everything into securing dollars ourselves, but…]

Seong-ho’s eyes fell on an account of Ilhyeon Group very different from the one that existed now.

[Securing dollars proved difficult. My father-in-law came home and, in a fit of rage, smashed things throughout the house. It seemed the same for eldest brother’s household. Everyone in eldest brother’s family except him fled to Pyeongchang-dong, but seeing the broken furniture, they couldn’t bear to stay and turned back. I could do nothing but hide, barely able to breathe, in that atmosphere.]

Seong-ho stopped, his hand resting on the passage recounting his own past.

“Right. Back then I couldn’t even breathe, just hoping this moment would pass quickly.”

In that former life, Ilhyeon Group had failed to secure dollars, just like everyone else. It too had struggled to survive amid the credit crunch. But now was different.

Knock, knock.

A headquarters staffer knocked and entered.

“The Bank of Korea has inquired whether we’d be willing to lend them our dollar reserves.”

Seong-ho closed the leather diary with a smile. “The Bank of Korea asked us to lend them money?”

“Yes. They’re asking if we could lend at least a billion dollars first, if we have it, and if there are more dollars we could bring in from overseas, they’d like that too. How should I respond?”

“How much interest are they offering?”

“Interest… they said they’d add a 100-basis-point spread to the base rate.”

“100 basis points — that’s just 1%, isn’t it?”

“Yes, that’s correct.”

Seong-ho wore a scornful expression and rose from the desk. Turning to the staffer waiting at the door for instructions, he said, “Tell them if they offer 1,000 basis points, we’ll lend 2 billion dollars.”

“1,000 basis points?”

The staffer asked again, wondering if he’d misheard. But Seong-ho repeated the exact same figure with the exact same meaning.

“Tell them we won’t lend at anything less than roughly a 10% spread. And tell them this too — if they take dollars from us, we won’t be able to keep lending money to other companies. Tell them that if they want it, we’ll lend it, but they’ll have to choose, since we can’t keep distributing money into the market at the same time.”

If the Bank of Korea borrowed the money, Ilhyeon would no longer be able to lend to companies. Those companies would then resent the Bank of Korea — and the message carried the implication: knowing this, would they still dare to borrow?

The staffer caught his meaning, answered that he understood, and left the office.

Unlike in that former life, even the Bank of Korea itself was now trying to borrow money from Ilhyeon Group. And all of this situation had been created by Seong-ho.

Watching the door the staffer had left through, Seong-ho smiled lightly, resting a hand on the leather diary, and murmured to himself.

“I’ve sown the seed and spread the fertilizer, and now the grain has ripened — time to go bring in the harvest.”

Ilhyeon Group’s granaries were filled to bursting, its embankments raised high enough to withstand any flood. But what Seong-ho wanted wasn’t merely to avoid the danger. He meant to pluck the fruit from the great tree that had grown, nourished by that very danger. Because doing so would only grow Ilhyeon Group’s influence larger still.

Taking the sound of the storm blowing in from outside as music, Seong-ho moved steadily forward toward the next stage.

(End of Chapter 99)