Golden Spoon Investor

The next morning, Seok-won was seated at his desk in his private office, engrossed in some paperwork. A knock on the door made him look up.

"Come in," he called.

Cautiously, Chief Ho-geun Choi entered, his demeanor noticeably timid as he approached Seok-won's desk.

"Is something the matter?" Seok-won asked, leaning back in his chair.

"The meeting is ready," Chief Choi replied, his hands clasped together nervously in front of him.

Ever since the incident in the elevator, when he discovered that Seok-won had overheard his conversation with a colleague, Chief Choi had been on edge, constantly walking on eggshells around him. Even now, he kept stealing glances at Seok-won's expression, visibly anxious.

Suppressing a smile, Seok-won maintained a serious expression. "Alright, let's go," he said.

"Um…" Chief Choi hesitated, clearly wanting to say something more.

"Is there something else you need to tell me?" Seok-won asked, raising an eyebrow at the chief's hesitant demeanor.

Unable to avoid it any longer, Chief Choi squeezed his eyes shut and bowed his head deeply in apology. "I'm sorry," he said.

Seok-won watched him quietly before asking in a calm voice, "Is this about what happened in the elevator yesterday?"

"Yes… I had no idea you were there, sir. It was just some idle chatter between colleagues, but I truly didn't mean anything by it," Chief Choi stammered, bowing his head even lower.

Although Seok-won hadn't been particularly bothered by the incident, he saw this as an opportunity to assert his authority. With a stern tone, he said, "So it's okay to badmouth someone as long as they don't hear it?"

"N-no, that's not what I meant…" Chief Choi stuttered, his face turning bright red.

Seeing how flustered the chief was, Seok-won decided to let it slide but made sure to give a firm warning. "I'll overlook it this time, but be more careful in the future."

"Thank you! I promise it won't happen again," Chief Choi replied, bowing repeatedly. His palms were sweaty from the tension.

"Let's go to the meeting room. I'm sure everyone is waiting," Seok-won said, standing up.

"Yes, sir," Chief Choi quickly straightened up and led the way out of the office.

When Seok-won and Chief Choi entered the meeting room, the rest of the team, already seated around the long table, stood up in unison.

"Please, have a seat," Seok-won said, nodding at them as he moved to the head of the table.

Once everyone was seated, Seok-won looked to his right where Chief Choi was sitting. "Let's begin," he said.

"Yes, sir," Chief Choi replied, opening the folder in front of him.

"As of this morning, the KOSPI (Korea Composite Stock Price Index) stands at 749.27. After hitting an annual high on the 9th, the market has entered a mild correction phase, but it's still maintaining an upward trend with a 7.44% increase compared to the beginning of the year," Chief Choi reported.

"Is this due to the inflow of foreign capital?" Seok-won asked.

"Yes, it is. In the first half of this year alone, foreign investors have purchased 3.1395 trillion won worth of stocks while selling off 1.1187 trillion won, resulting in a net purchase of 2.0208 trillion won. To put that into perspective, last year, the net purchases by foreign investors totaled 1.5083 trillion won. So, this year's figures have already far surpassed that," Chief Choi explained.

"That's a positive sign for the market going forward," Seok-won remarked.

"Indeed. In addition to the influx of foreign capital, domestic funds have also been pouring into the market, driven by rising stock prices and economic recovery expectations. Last month, customer deposits reached 3.2455 trillion won, an increase of 962.9 billion won compared to last year," Chief Choi added.

Customer deposits referred to the funds that clients had set aside at brokerage firms to purchase stocks. An increase in these deposits indicated that more money was flowing into the stock market.

"With all that money coming in, it's only natural for prices to go up," Seok-won commented.

"While most sectors have outperformed the KOSPI, the financial and construction sectors have lagged behind. They haven't declined, but their performance has been relatively weak," Chief Choi noted.

"That's likely due to issues with substandard construction," Seok-won said.

"Yes, the recent major disasters have had a significant impact," Chief Choi confirmed.

"And the government announced a crackdown on subcontracting violations not too long ago, which probably added to the pressure on construction stocks," Seok-won added.

"That's correct. As a result, the construction sector has been struggling," Chief Choi agreed.

"It would be wise to steer clear of construction stocks for the time being," Seok-won concluded.

"I think so too," Chief Choi nodded.

"The number one stock by market capitalization right now is Korea Electric Power Corporation (KEPCO), correct?" Seok-won asked.

This time, Deputy Manager Hwan-yeop Jung, seated on the left, responded. "Yes, with a market capitalization of 10.2 trillion won, KEPCO has held the top spot for several years. It's followed by POSCO, Samsung Electronics, and Hyundai Motor."

Deputy Manager Jung handed Seok-won a prepared list of the top stocks by market capitalization. As Seok-won scanned the list, he noted the significant gap between the first and second positions.

"There's a big difference between the first and second places," Seok-won observed.

While KEPCO's market value exceeded 10 trillion won, the second-ranked POSCO was only valued at 1.95 trillion won. Although they were just one spot apart, POSCO's market cap was less than a fifth of KEPCO's.

Seeing that Seok-won was looking at him, Deputy Manager Jung explained, "KEPCO has a monopoly on the domestic electricity market, and with the demand for electricity expected to continue rising due to economic growth, its revenues and profits are anticipated to increase sharply."

With his arms crossed, Seok-won listened to the explanation, but his expression remained unimpressed. "But POSCO also enjoys a monopoly in its industry, doesn't it?" he pointed out.

"…."

"And as the demand for electricity rises, KEPCO will need to borrow significant amounts of money to build new power plants. However, because electricity prices are regulated as public utilities, they can't fully pass on those costs to consumers," he continued.

Chief Choi and the team members nodded in agreement, acknowledging the validity of Seok-won's argument.

"On the other hand, POSCO benefits directly from the government's heavy industry promotion policies. Demand for steel products is outpacing supply, and POSCO enjoys high margins, so it should actually be valued higher than KEPCO," Seok-won argued.

Indeed, the demand for steel products was so high that buyers would line up outside POSCO's plants, eager to purchase steel the moment it came out of the furnaces.

'There was even a joke that POSCO's sales department's main job was to field calls about when steel would be available and to hand out queue numbers,' Seok-won thought to himself.

The shortage of steel products eventually led Hanse Group to embark on a massive steel mill construction project that went bankrupt and triggered the IMF crisis.

As this thought briefly crossed his mind, Chief Choi cautiously asked, "Are you suggesting that KEPCO's stock is overvalued?"

"Yes. In an export-driven economy like Korea's, export companies that bring in dollars should be valued higher than a utility company with limited growth potential," Seok-won said without hesitation.

His logical and well-reasoned response left Chief Choi and the rest of the team speechless. They had expected Seok-won to be smart—after all, he graduated from Harvard—but they hadn't anticipated such a deep understanding of the domestic market, much less such sharp insight.

'Impressive!'

'He's not just a privileged parachute hire after all.'

'Wow… this guy is no joke.'

The team members' opinions of Seok-won shifted in an instant. Even the lone female team member, Hong Jae-hee, seemed to be smitten, her eyes sparkling as she looked at him.

But no one was more shocked than Chief Choi himself.

'I thought I'd just be babysitting the chairman's son, but it turns out he's no pushover,' he mused.

Although Chief Choi had already sensed that Seok-won wasn't ordinary after the elevator incident, he hadn't expected him to have such a keen grasp of the domestic market.

As everyone stared at Seok-won in newfound admiration, he continued speaking as if it were no big deal. "I can understand why ordinary investors might not be able to access or analyze this kind of detailed information about a company's fundamentals."

He placed the document he was holding on the table and looked around at the team. "Given KEPCO's monopoly, high growth rate, and stable profits, coupled with the government's support for expanding the power infrastructure, it's no wonder that investors find it to be a safe and attractive investment," he acknowledged.

Later on, it would be Samsung Electronics that people would most commonly recommend as the safest bet in the stock market. Seok-won then leaned back in his chair and turned to Chief Choi.

"We have 5 billion won allocated for operations, correct?"

"Yes, the funds have been deposited into a separate account and are available for use at any time," Chief Choi confirmed.

"And I have full discretion over how to use those funds, without any specific guidelines?"

"That's… correct. Those were the instructions I received," Chief Choi replied, feeling a growing sense of unease as he watched Seok-won, who seemed to be leading up to something.

"The companies at the top of the market cap list—does Daehung Securities hold significant amounts of their shares?" Seok-won asked.

"Yes, because they're popular among investors and have high trading volumes," Chief Choi said, still feeling uneasy as he answered.

Smiling broadly, Seok-won bared his teeth in what could only be described as a mischievous grin. "Perfect," he said.

Seeing that grin, Chief Choi suddenly felt a pang of fear. 'What is he planning? Why do I have such a bad feeling about this?'

"Since we're dealing with the same company, there should be some incentives, like lower margin requirements for leveraged trades, correct?" Seok-won asked casually.

As the team exchanged confused glances, unsure of where this was going, Seok-won took out an expensive-looking fountain pen from his jacket pocket.

He drew large circles around the top five companies on the market cap list and then dropped a bombshell.

"We're going to short all five of these stocks with the full 50 billion won," he declared.

"...!"

Publicly traded stocks couldn't yet be shorted directly, as the short-selling system hadn't been implemented in Korea at that time. So they would have to borrow the stocks from a securities firm and sell them, with the understanding that they would be bought back later—essentially betting that the stock prices would drop.

It took a moment for Chief Choi and the rest of the team to fully grasp what Seok-won was saying, but when they did, their eyes widened in shock.

"Did… did you just say short selling?" Chief Choi asked, unable to believe what he'd just heard.

Seok-won's response was clear and unambiguous. "Yes."

He watched as Chief Choi's pupils dilated and the rest of the team struggled to mask their panic. Then, in a confident voice, he reiterated his plan.

"We are going to short the market."

Given that they were about to short the top five stocks in the Korean stock market—companies that collectively represented a significant portion of the market's total value—there was no exaggeration in saying they were shorting the entire market.

Chief Choi's earlier sense of dread had been right on the mark, and now his face twisted in dismay as he realized the gravity of what they were about to do.

'This guy is completely nuts!'

All the respect and admiration Chief Choi had felt for Seok-won just moments ago evaporated, replaced by sheer horror at what he now saw as a reckless and insane move.

The rest of the team was similarly aghast, their faces frozen in expressions of disbelief.

Given the recent surge in the market, fueled by an influx of foreign capital and daily record highs, the idea of shorting at this moment seemed like absolute madness.

Even though they were all looking at him like he'd lost his mind, Seok-won remained perfectly calm, as if unaware of—or indifferent to—their reactions.

'He's not just a parachute hire; he's a parachute with a bomb strapped to him!'

Chief Choi silently screamed as he imagined banging his head against the table in despair.