Deep-Rooted Evils
Gaemi Investment Securities, Trading Team 3.
"Sell Osung Bio? Why?"
"How should I know? They said dump it, so we dump it."
There were five trading teams in total, each with its own specialty. Team 1 handled foreign exchange, Team 2 did day trading, and Team 3—
Then everything we've been grinding for was a complete waste.
—handled long-term investments. They took the long view of market trends and gradually accumulated positions.
"And they want us to buy Osung Electronics on top of that."
"No, seriously, why?"
"We busted our asses dumping that stuff…"
Recently, Team 3 had been selling Osung Electronics and buying Osung Biologics. They had been steadily advancing toward their target.
And now, out of nowhere?
Upper management had issued a bizarre order. Reverse everything you've been doing.
Do the people upstairs even understand what they're asking?
This wasn't as simple as pressing a buy button. If it were that easy, they wouldn't need traders at all. Market forces would catch on. Once the purpose was exposed, losses of several percent could pile up—and those few percent meant tens or hundreds of billions of won. Hitting the rewind button meant swallowing those losses whole.
"Quit yapping and just do the work."
"Even you have to admit this doesn't make sense, Team Leader."
"If you want to rack up performance numbers, transfer to Team 2. I'll write you a recommendation."
"No, sir!"
Before any of that, it was just fucking infuriating. They'd worked their asses off following orders, only to be told to flip the whole board over.
Just do as you're told, you lot.
This wasn't something you could explain to regular employees. Even he had only learned the truth after becoming team leader.
The collusion between securities firms. When they joined forces, one or two stocks were easy to manipulate.
"Full buy on Osung Electronics!"
"Dump Osung Biologics!"
They distorted the market. Other brokerages cooperated with Gaemi Investment Securities.
We need to kill the buying sentiment.
The retail investors can't catch on.
Because they were all thinking along the same lines. From a long-term perspective, it paid off.
Of course, retail investors weren't complete idiots. A slightly slower climb wouldn't shake them—
But a bear market was a different story entirely.
The short-term rebound ended and the market headed back down. This time, though, the atmosphere was different. Osung Electronics shareholders were downright cheerful.
The KOSPI just dropped 7%, but Osung Electronics hasn't even fallen half that. Institutions and foreigners are still buying, too.
A falling stock price in a bear market was inevitable. Money was draining out of the market. But the damage here was milder. Aggressive institutional buying was holding Fifty-Thousand Electronics steady.
Phones?
No—semiconductors.
And semiconductor prices are going up.
If you panic-sell just because the market looks bad right now, you're doing exactly what the institutions want.
Positive interpretations lined up one after another, explaining away every dip. The stock had room to breathe—and so did its shareholders.
The opposite was also true. Osung Biologics shareholders had every reason to lose their minds.
The index only dropped 7%, but this thing fell almost twice that. Is something wrong with the company??
It had been sluggish during the rebound. In the bear market, the losses ran even deeper. When the stock price looked ugly, so did every thought that followed. Existing bad news loomed larger than ever.
So many red flags and you ignored them all, smh. The only idiots buying a company with a PER of 150 are you people.
No matter how much you believed in a company, a falling stock price made you waver. That was human nature. A climate of fear was taking shape.
A few cold-blooded investors still held the line, though.
The average PER is 100. And with the Osung Group backing it, the growth potential gets valued even higher. People who don't know anything keep harping on about PER.
It was beyond control. A bear market could turn even hardcore shareholders into haters. Watching your account print red in real time—if you could keep your head after that, something would be wrong with you.
Now that's retail for you.
Division Chief Lee Tae-ho watched it all with a satisfied smile. Institutions monitored the stock discussion boards constantly. They reflected individual psychology in real time. Mental fortitude was already half shattered. Bear market plus additional freefall. The plan they had been aiming for was landing exactly as designed.
Shake them like this for about two weeks and you've got a perfect retail fleecing.
No need to push it lower. Just bouncing the price up and down was enough to annihilate buying sentiment. Throw in a few negative news articles on top? Even a steel-nerved holder would start wanting to sell.
That was retail. Even the people they had so faithfully followed and trusted would start looking different.
If you've got a brain, use it! If a stock was really going to go up 100%, why would he teach you instead of just making a killing by himself?
Grievances. Nothing felt more satisfying or convenient than dumping them on someone else. When Osung Electronics fell, they blamed Manager Yeom. Osung Biologics could go the same way.
You're no exception either.
Every so often, one of them popped up—some kid who thought he was spouting the truth. Each time, they crushed him thoroughly underfoot. That was how the market worked. The weak got eaten by the strong. If you didn't understand that, no amount of stock analysis would save you.
You're a frog in a well, kid.
He had escalated things a bit more than necessary. But the matter was critical enough to warrant it. The volume they needed to unload onto retail wasn't measured in mere tens of trillions. This grand plan had to be executed. Crushing a few future sprouts along the way was no great loss.
Korea had no place for a stock player who worked for the retail investor.
Institutional games. It was one of the scenarios he had fully anticipated.
The stock market was always put-your-money-down, take-your-money-home.
Value investing? He had never been the type to find hobbies in such monotonous trading methods.
U.S. ISM Manufacturing Index
2018/02/02 — 60.8
[Roughly two years of a vertical moonshot chart]
The market was a war of pre-reflection. Global trends were already pointing to the next direction.
DRAM prices? Operating profits? Nobody looks at that stuff anymore.
The ISM Manufacturing Index had broken 60. The end of the semiconductor cycle might not be far off. The mere possibility was enough. For foreign investors, Osung Electronics was losing its appeal.
DOUBLE KILL!
Institution has shut down Foreigner's retail massacre!
For now, the institutions were holding the line with everything they had. But how long could that last?
And when Osung Electronics collapses, where does that money go?
Only those who predicted the predictions made money. For him, this fight was nothing more than a matter of time.
Gaemi Investment Securities.
The once-peaceful Trading Team 3 now had a fire under its feet.
We're propping it up below the retail average cost, but…
Team Leader Jeong Jae-woo was sweating bullets. They kept Osung Electronics range-bound—institutions pooling their strength to do it. That had been the original trading strategy.
An unexpected variable had appeared. Foreign selling pressure grew stronger by the day—more than double, more than quadruple the forecast. At this rate, even with hedges, the losses would be astronomical.
"Division Chief, this is beyond what I can handle on my end."
"Hmm…"
Korean securities firms had connections. Birds of a feather. They colluded under the table to move the market.
Why the hell won't these foreign bastards play along?!
But foreign institutions had no such code. Fellow traders who refused to respect the unwritten rules of the trade.
Tap, tap!
Lee Tae-ho made calls in rapid succession. He tried to work it out amicably with the contact on the other end.
"We'd appreciate it if you could ease up on the selling pressure for Osung Electronics. Take it slow, give it time—we can unload the volume onto retail together, yeah?"
"Your mom."
There was no reason not to scoop up free money lying in the street.