Momentum Acceleration (3)

Lee Jaseung had split the position across brokerage contracts with ten banks, but someone still had ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠to consolidate and manage the whole thing.

That overseer was Seoseong Securities.

The dedicated Makers desk.

The team members murmured, faces blank with disbelief.

"Does this even make sense?"

"What the hell was I doing this whole time……?"

Lee Jaseung had fragmented the position with ruthless precision.

So even they never saw the full strategy.

Each broker had received orders under different pretexts, at different times, and in different sizes.

They simply executed on command, hitting the timing they were given, and when it was over……

"I feel like I was under some kind of spell."

Someone started digging back through the old order logs.

Looking at it now, every piece locked into place like a perfect puzzle.

"The real position was a hundred trillion won, wasn't it? That's an absurdly small amount for what it did……."

And it hadn't been dumped in all at once, either — it had been fed in across multiple waves.

The FX trader shook his head in slow amazement.

"He hit the exact points with exactly the right force. I could never do that. How do you drop precisely the volume you need at every critical market indicator?"

Every time the market hesitated, he slammed in sell orders.

So the acceleration steepened.

And as it steepened, more players piled on.

And as more players piled on, the acceleration steepened further……

Until, finally—

"It turned into a pure casino."

Six months later, the yen had fallen past twenty-five percent.

For a major developed-market currency, the drop was unprecedented.

"This isn't even an equity market. Pulling this kind of move in the supposedly safe yen-dollar market is completely insane."

The foreign exchange market is normally more stable and less volatile than equities.

Right now, though, it was the hottest gambling table on earth.

Hedge funds were a given — there were even rumors that pension funds had hauled their heavy backsides out of their chairs to rebalance their portfolios.

"I never thought he could turn a trend into a full-blown mania."

Then someone asked carefully:

"So…… how are we supposed to unwind this?"

The desk went silent for a beat.

Everyone had been thinking the same thing.

Building a position this size was hard enough.

Unwinding one of this magnitude at the right moment was far harder.

Even the desk head found himself wondering about the exit timing.

"Well. He nailed the timing on the gas futures, too. Odds are he's already thought this one through."

"That's true, but……"

The FX market was not the futures market.

Far more variables were in play.

The biggest of them was the nation itself.

If the central bank moved, the market's direction would reverse.

"You think the Japanese government will sit still?"

By now, Tokyo had to be rattled.

They couldn't have anticipated a plunge this sharp, which meant some form of policy response was inevitable.

"Tsk. Getting out clean won't be easy if they step in……"

Prime Minister Sato muttered in a stunned voice.

"This…… wasn't in the calculations."

He had fully expected the short position to become a trend.

Using every last speculative player to drive the yen lower had been the entire point.

But—

"This isn't a short trend. It's a short storm."

A storm was raging!!!

The Minister of Finance spoke.

"The yen is falling far too fast. If this continues, the side effects will cascade."

"If import prices climb, the domestic market takes a hit. Consumer sentiment could freeze."

"The real problem is that even the export companies are getting nervous. Rising raw-material costs could wipe out every yen of profit they earn from overseas sales."

Sato exhaled and stared at the ceiling.

There was such a thing as an appropriate line.

An appropriate speed.

Japan's original target had been a twenty-percent decline over one year, and forty percent over five.

Instead, the yen had already dropped twenty-five percent in a mere six months — and the pace was still accelerating.

The target had blown past the critical threshold, yet the velocity only grew steeper.

They had completely lost control of the currency.

And on top of that—

"The backlash from neighboring countries is severe. China has warned through its embassy that it won't shy away from a currency war, and South Korea is reportedly reviewing countermeasures as well."

Sato's face twisted with disbelief.

"Korea?"

"Yes, sir."

"They're the ones who loaded up on FX hedges just as aggressively as anyone. Who exactly is supposed to be pointing fingers right now……"

He could grumble all he liked, but he couldn't really press the issue.

Because worse offenders than Korea were scattered all over the United States and Europe!

At this point, shorting the yen was a global trend, and Korea was barely a handful of it.

Singling out Korean companies alone would have been awkward.

Sato forced down the anger boiling in his gut and asked:

"Hah. Korea is the least of our problems. What about the United States?"

"At this rate, Japan's ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠monetary policy is going to be placed on the formal agenda at the next G7 meeting."

"Damn it! They know this isn't what we wanted!"

Everyone knew.

Ninety-nine percent of this crisis had been manufactured by speculative capital.

But the first trigger had been pulled by Japan itself.

None of it would have happened if they hadn't pursued quantitative easing so aggressively.

At the time, though, a decisive break from deflation had been necessary.

Sato wrestled with the problem.

What do I do?

Satonomics was his signature policy.

Revising it only six months into his term would be politically catastrophic.

The moment he revised it—

Policy credibility collapses.

It would deal a fatal blow to every initiative he tried to push going forward.

And yet he couldn't leave it untouched either.

I've lost control.

He had no choice but to admit it.

The yen was already thrashing inside an unmanageable storm.

Which is worse?

Losing control of the system.

Or losing the momentum of the policy.

He was a politician, and he refused to surrender either one.

"We keep both the control and the momentum."

"How, exactly? Don't we have to give up one or the other?"

"First, put out the message that we've achieved a successful target. Emphasize that the pace was fast, but the goal has been reached all the same."

This was the domain of politics.

Messaging and framing.

"Then give just enough of a signal that we intend to slow the yen's decline. The speculative crowd will already expect us to step in. A signal alone will flush a large share of them out."

The plan was clear.

Do not withdraw the quantitative easing policy itself — merely throttle its speed, and ride out the crisis that way.

Acknowledge the policy's success while cooling the market's overheating.

Find the equilibrium point.

"Understood!"

"Hahahahaha!"

Chairman Han's booming laugh rolled through the offices of Hanyeong Auto Group.

Three hundred billion won was about to come back as three trillion. How could anyone not be happy?

Of course, the fees will take a heavy cut.

Even so, the returns would be extraordinary.

In his thirty years as an industrialist, spectacles like this were rare.

He turned to his chief of staff.

"He'll start unwinding soon, won't he?"

"Yes, sir. The short mania is already cooling. The Bank of Japan is showing signs of wanting to moderate the pace."

Japan was currently congratulating itself on the "successful completion of Phase One."

Of course, no one failed to read the subtext.

— We've hit the target, so we're going to slow down!

Until now, the yen-dollar market had been a pure "money in, money out" machine.

From the day Sato took office to the present: a twenty-five-percent decline.

Even without leverage, simply parking capital there yielded a twenty-five-percent return.

No one was going to refuse that, and on Wall Street people were already drinking the kimchi soup in advance, dreaming of enormous ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠bonus parties.

Korea was no different.

Lee Jaseung had deliberately advertised the yen short while raising two trillion won.

The FX hedge trend that began among the chaebol had now spread all the way to mid-sized exporters.

Nearly the entire world had linked arms and gone short!

But the moment the Japanese government signaled a change of course, investors started pulling out with a chorus of "yikes, too hot."

Satisfaction with the enormous gains played a part as well.

"That's enough!"

"We ate well!"

The party was over.

Most positions were being ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠closed, enough that the yen was temporarily swinging into strength.

And yet.

Exactly one person was not leaving.

The Makers FX hedge fund.

Lee Jaseung held his position with stubborn calm.

When Chairman Han heard the news, his mouth went dry.

"Why isn't he getting out?"

"I have no idea, sir. I can't begin to guess what he's thinking……. Perhaps you should ask him directly?"

"Ahem."

The chairman hesitated.

Pressing the man himself felt undignified. A group chairman had his pride.

"No. Hasn't Master Lee already delivered more than enough profit as it is?"

"True enough."

They weren't sitting on losses — their position was already deep in the black.

Unwinding a little late wouldn't create any real problem.

It was only the difference between eating a hundred and eating ninety.

Chairman Han spoke with grave solemnity.

"He delivered results. We should trust him."

"As expected……!"

The chief of staff withdrew with an admiring look. Chairman Han then summoned his son, Han Juhyeong.

"Son."

"Yes, Father."

"Go over to Makers and casually ask when he plans to unwind."

Han Juhyeong edged backward.

He had already been chewed out once for pressuring Lee Jaseung before.

"Uh, that might be a little……"

"Tsk!"

Han Juhyeong grumbled under his breath the whole way.

"Damn it. The second I show up, he's definitely going to give me hell."

But when he arrived at Makers, a guest was already there.

Huh? Chairman Seon Kangsik?

He recalled the rumor that had circulated through the business world earlier.

He tried to buy a Platinum membership and got shut down cold. So he invested at the base tier instead?

Hidden behind a pillar, Han Juhyeong watched the two men talking in the lounge.

His heart was pounding for some reason.

"Ahem!"

Chairman Seon Kangsik stiffened his neck and declared:

"I know a thing or two about investing, and you need to get out now. The Japanese government just signaled intervention. If you wait any longer, you could wipe out every yen of profit you've made so far."

Oh……

Giving Lee Jaseung of all people that kind of lecture.

Han Juhyeong glanced at Jaseung. He was listening patiently, rolling a ball between his fingertips at a leisurely pace — but the moment Juhyeong saw the dangerous smile at the corner of his mouth, he understood.

That bastard is pissed!

True to form, Lee Jaseung did not hold back just because the man across from him was a group chairman.

"Chairman."

"Hm?"

"So you remember your gas futures investment, then?"

"……"

"You lost a hundred billion won. And right now, I'm the one covering that loss for you."

"That was one failed trade. I still have considerable expertise in inves—"

"If your expertise is that considerable, you're welcome to manage it alone. Shall I remove you from our fund's investor list going forward?"

"Kuhehm!"

Facing the sudden prospect of being dropped even from base membership, Seon Kangsik cleared his throat and shut his mouth.

Watching the exchange, Han Juhyeong felt a deep and sincere impression settle over him.

That bastard is truly, democratically, equal-opportunity rude!

Seon Kangsik softened his tone a little.

"I wasn't criticizing you. I was simply curious about the exit timing."

"Today."

"Today?"

"Yes. It should have hit around now."

Lee Jaseung lifted his wrist and checked his watch. Then he called out to the figure who had been openly eavesdropping on the conversation.

"Han Juhyeong."

"……"

Silence.

Jaseung sighed and called again.

"I can see you behind the pillar. Stop wasting time and check the news."

At that, Juhyeong shuffled out, looking sheepish.

"You saw me? What news, though?"

"Japanese government bonds."

"Japanese government bonds?"

Confusion crossed Han Juhyeong's face, but he lifted his smartphone and pulled up the news.

At the same moment, Chairman Seon Kangsik's phone erupted in a frantic cascade of alerts.

The two of them shouted almost in unison.

"Government bond trading suspended?!"

The Japanese government bond shock.

In a single day, yields had risen one hundred percent and trading had been halted.

Stunned by the news, Chairman Seon Kangsik muttered:

"Th-this is completely absurd……"

In the financial markets, it was a scenario almost impossible to imagine.

The government bond market.

Especially the bond market of a developed nation like Japan — it was supposed to be the safest market of all.

And trading had been suspended!

Seon Kangsik, still reeling, asked:

"Is this what you were waiting for?"

"Japan needs to push its government bond yields down. And interest rates and currency values move in the same direction. So to lower rates……?"

"They have to push the currency down."

The corner of Lee Jaseung's mouth lifted. This was the exact moment he had been waiting for.

"Japan is going to personally drive the yen lower for us. It's the optimal exit window."

"……Huh."

Jaseung's tone carried none of the gloating of a man who had simply "gotten it right." It was the absolute certainty of someone who had known it could never have gone any other way.

Seon Kangsik let out a hollow laugh. When he rubbed his arm, the skin had broken out in goosebumps.

Only now did he understand the strategy.

Relentlessly force the Japanese government into a dilemma.

Lose control of the market, or lose the momentum of the policy.

Lower interest rates, or lift the currency's value.

At every fork in the road, a government inevitably hesitates.

Wavering.

Floundering.

And if that pattern repeats in the early phase of a policy — what happens?

In the end, they won't be able to do either.

The capital raised had been a mere two trillion won.

Two trillion, levered through the financial system into a hundred trillion.

That hundred trillion, hurled into the FX market at precisely the right moments, had moved the market itself.

And at last, it had even reached into Satonomics.

With only two trillion won, he had weakened Satonomics.

A genius of leverage?

Leverage.

Using a small force to summon a great one.

He felt as though he were watching the pure essence of the concept. A strange, hollow chill settled over him.

No — still. How does someone pick a fight like this with the Japanese government?

Chairman Seon Kangsik had always taken a certain pride in being the business world's most notorious gambling addict.

Meeting an opponent a full level above him, he finally understood that he himself was nothing more than an ordinary man.

This guy is a genuine madman.