Bluehole Venture Capital – Chairman's Office.
Yoon Kihoon, Executive Director; Eom Taejun, Chief Financial Officer; and Yoo Hyunseok, Division Head, sat on the leather sofa, one on each side.
At the head of the table, Seok-won set down the approval folder and spoke.
"So, the negotiations are finalized to sell 10% and 20% of Seum Technology's shares to So Beorin Asset Management and Tiger Fund through a block deal, correct?"
Yoon Kihoon, seated on the right, quickly responded.
"Yes, that's correct. Thanks to Eldorado Fund's mediation, we reached an agreement to sell everything at a 25% premium for a total of 750 billion won."
"That's roughly a 24,900% return, then. Not bad."
Unlike Seok-won, who remained calm, the other three couldn't hide their excitement.
Especially Eom Taejun, the CFO, who smiled broadly as he spoke.
"With this deal following the previous ModuNet block sale, we'll have earned over 1.4 trillion won in net profit just from equity disposals. We're likely to record a historic first-quarter profit."
Yoon Kihoon added with a grin.
"A return of nearly twenty-five thousand percent… Even after seeing it myself, I can hardly believe it."
Then he turned to Seok-won with a look of admiration.
"When we first invested in Seum Technology, I thought even a 100% profit would be a jackpot. This is truly remarkable."
Sitting beside Eom Taejun, Yoo Hyunseok joined in with a comment.
"Every company you touch turns into a gold mine, Chairman. Word is, the industry's started calling you the 'Midas of Investments.'"
"Haha. I've heard they call you that on Wall Street too. Whoever came up with it couldn't have picked a more fitting nickname."
When CFO Eom Taejun said that with a cheerful smile, Executive Director Yoon Kihoon nodded in full agreement.
"Considering you've already hit three home runs in a row since Gold Bank, the nickname is more than deserved."
Even as the praise piled up, Seok-won only gave a faint smile without showing much reaction. Instead, he turned to Yoon Kihoon.
"The sale of Hancom Innovation shares is proceeding smoothly, I hope?"
Catching Seok-won's gaze, Yoon Kihoon quickly answered.
"Yes. As you instructed, we're not using a block deal. The Treasury Division is gradually selling the shares in the open market."
Perhaps buoyed by the extraordinary investment returns, Yoon's smile didn't fade for a second.
"Thankfully, market sentiment is strong, so even with large-scale sales, the stock price isn't falling much."
"That's probably because government policy is expected to expand PC distribution again this year. Hancom Innovation is being seen as one of the major beneficiaries."
At Seok-won's comment, CFO Eom Taejun chimed in.
"Exactly. Even our own company spent quite a bit buying legitimate Hancom Innovation software like Hanword when we upgraded our office PCs."
Then Yoon Kihoon leaned forward slightly, a hopeful look in his eyes.
"Once the Hancom Innovation shares are fully sold, our investment portfolio will shrink significantly. Is there any new venture you've been eyeing, Chairman?"
At that, both Eom Taejun and Yoo Hyunseok perked up, their eyes gleaming with interest.
They had once been uneasy when Seok-won first singled out a few venture companies for investment, worried it might all end up as a waste of money.
But after every one of those ventures turned into a massive success, their attitudes had completely flipped. Now, they openly waited for him to name the next promising company.
Seeing how drastically their behavior had changed, Seok-won couldn't help but let out an inward, faint laugh.
"There are a few companies I've been keeping an eye on," Seok-won said, "but for now, I plan to hold off on any additional investments and watch how things develop."
"Is that because of the Federal Reserve's interest rate cut you mentioned last time?" asked Executive Director Yoon Kihoon.
Seok-won nodded.
"That's right. Just like how a butterfly flapping its wings in Beijing can cause a hurricane in New York, any change in the United States—the center of the global economy—will inevitably have some effect on our domestic stock market."
Everyone nodded in understanding. They were all familiar with the so-called butterfly effect, where a small change on one side of the world could eventually lead to huge, unpredictable consequences elsewhere.
But what no one foresaw was that the Fed's rate cut would later trigger the catastrophic collapse of the dot-com bubble.
At best, they only expected a slight correction caused by tightened liquidity.
Unaware that a massive storm was about to hit, they remained perfectly at ease. Watching their complacent expressions, Seok-won gave a faint, bitter smile.
Then he turned to CFO Eom Taejun.
"There's a good chance the market will see major volatility soon. Transfer all the cash we've just brought in to the Treasury Division for management."
"Yes, understood," Eom replied immediately, without question.
All three men knew by now that while Seok-won's ability to spot promising startups was impressive, his true brilliance lay in his overall investment sense. None of them dared to disagree.
"Leaving the cash in the bank for interest can't compare to what the Treasury team earns by managing it. I'm curious to see how much profit we'll make this time," Eom said with a light laugh, half-joking.
Seok-won gave him a knowing smile.
"You'll probably be shocked when you see the results later."
"...?"
For a moment, Eom blinked in confusion, but as the topic shifted elsewhere, he dismissed it and soon forgot.
***
February 3, 2000
Early morning.
Seok-won hadn't gone to bed. He sat on the sofa in his living room, sipping whiskey over ice while watching CNBC on satellite TV.
As he tilted his glass and took a small sip, the anchor announced a breaking news update from the latest FOMC meeting.
[... The Federal Reserve Board (FRB) has announced a 0.25 percentage point increase in the federal funds rate—from 5.5% to 5.75%—to curb overheating in the economy and ease upward inflationary pressure.
This marks the fourth rate hike since June of last year. Accordingly, the discount rate applied to loans made by commercial banks from the FRB has also been raised from 5.0% to 5.25%.
Federal Reserve Chairman David Stanway issued a statement warning strongly of the inflation risks caused by an overheated asset market and indicated that the tightening policy would continue until the economy stabilizes.
With Australia, the United Kingdom, and New Zealand having raised their benchmark rates by 0.5% and 0.25% respectively just a day earlier, analysts expect this FOMC announcement to trigger a global domino effect of rate hikes.
Experts have responded by saying...]
"As expected, the Fed has resumed its rate hikes after that short pause."
With the S&P 500 surpassing 14,063 points and all three major indexes setting new record highs day after day, asset bubbles had swollen far beyond sustainable levels. From the Fed's perspective, the move was inevitable.
"The problem is, the Y2K scare threw off their timing."
If they had kept tightening without interruption, the bursting of the bubble might have been a little less painful—but unfortunately, they hadn't.
"Instead, they pumped liquidity back into the market, and that only drove stock prices even higher."
As a result, the eventual collapse would bring an even heavier blow to the market.
Chairman David Stanway and the Federal Reserve were likely hoping for a soft landing, but Seok-won knew all too well that the outcome would be a rapid, hard crash. His expression turned grim.
"No, calling it a hard landing isn't quite right," Seok-won muttered. "Crash landing would be more accurate."
Just then, his phone rang loudly. He turned down the TV volume with the remote and picked up the phone from the table.
[Did you see the results of the FOMC meeting?]
At Landon's question, Seok-won lifted his eyes toward the television. On the screen, the panelists were discussing how the Fed's rate hike would affect the market.
"They went with a baby step, raising it by 0.25%—just as expected."
[Yes, exactly as you predicted, sir.]
Leaning back against the sofa, Seok-won kept the phone pressed to his ear.
"With the asset market overheating and inflation fears surging, anyone could have predicted this move."
There was a brief pause before Landon spoke again, his tone turning serious.
[If that's the case, this could really lead to a bubble collapse.]
"When liquidity was overflowing, no one cared that dot-com companies weren't actually making money. But once the money dries up, they'll finally realize something's wrong."
[And that moment will mark the start of the crash.]
Seok-won's voice dropped, heavy and calm.
"It will."
Landon swallowed audibly on the other end before asking, now with clear concern.
[When do you think the market will start to fall?]
"The rate hike won't cause an immediate shock, but the timing's already off because of the Y2K disruption. They should've started deflating the bubble earlier. If the Fed, feeling the pressure, rushes to pull liquidity back to make up for lost time, the crash will begin—maybe in a month, or at the latest, within the first half of the year."
[Then we should accelerate both the share sell-offs and our short positions.]
Sinking deeper into the soft sofa, Seok-won swirled his glass of whiskey slowly.
"That would be wise. The sharper players will soon start noticing that something in the air feels off."
[I'll discuss it with Andrew and make sure we finish the work as quickly as possible.]
Landon's voice was stiff, almost frozen.
"From this point on, focus on unloading every stock we're holding before the bubble bursts, even if it means taking some losses."
[Understood.]
A faint breath came through the phone, heavy with tension.
[If the bubble really bursts like you say, you'll write a new Wall Street legend—one that surpasses George Soros, bringing the Bank of England to its knees.]
"To make that happen, we need to load up on as many short positions as possible."
Seok-won replied calmly.
[Some people are already puzzled that we're dumping dot-com stocks in bulk, but optimism still dominates the market. We'll scrape together every short position we can find.]
"Keep me updated as things progress."
[Yes, sir.]
After exchanging a few more words, Seok-won hung up and set his phone down.
When he looked up at the TV, the panelists were still sitting in the studio, sharing their opinions.
They all agreed that the Fed's rate hike would negatively affect the market, but not one of them predicted it would trigger a bubble collapse.
Watching their unwavering optimism, Seok-won's expression hardened.
"When people finally realize the tsunami is right in front of them," he muttered, "it's already too late to run."