Powell-ese Listening Test

The stock club.

Lately, the mood at Dongbang had turned unmistakably grim.

"Fuck…"

"Life is absolute shit."

"Don't look at me, you bastard! I'll kill every last one of you!"

They had lost money. That was why.

The market had been obliterated across the board — indices and individual stocks alike. Even the people who'd bought the dip had their hands chopped clean off. Walking away with just one arm left was considered lucky.

"So the reason we lost money…"

"…is because of the FOMC?"

"Yeah."

"What the hell even happened there?!"

He'd known it would turn out this way. And the timing was perfect.

Time for them to start learning about US stocks.

The FOMC. A critical event that moved equity markets across the entire planet. Surprisingly few people paid it any real attention — until the market tanked, at which point they scrambled in a panic.

"So that's what happened."

"If I'd known, I wouldn't have bought stocks."

"I'll make sure to keep an eye on it from now on."

"But why didn't you teach us this beforehand?"

"Yeah, exactly!"

Under normal circumstances, you could talk until you were blue in the face and nobody would listen. People only moved when the fire was already licking at their toes.

They just don't want to deal with anything complicated.

It came up in the news often enough. People simply decided it wasn't a big deal and tuned it out. The truth was, it was a big deal. It usually took an account getting cut in half before anyone grasped just how important the FOMC really was.

"The FOMC is the meeting that sets US interest rates, and Jerome Powell is the bastard who decides them."

"That son of a bitch."

"Fucking asshole."

"Why does that affect the whole world, though?"

"It's not even our interest rate."

Men and women alike, their language had gotten rough. They were growing as investors.

Because interest rates are tightly linked to exchange rates.

When the US raised rates, other countries were forced to raise theirs too. Why? Fail to do so and you risked being labeled a currency ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠manipulator. You got marked by the United States.

"Higher rates are obviously bad for the economy."

"Ah, so that's why…"

"Isn't Korea already a currency manipulator anyway?"

"The Korea-US base rate is inverted right now."

"They're holding out as long as they can, yeah."

That was because of an economy built around real estate and exports. A sudden swing in the exchange rate would hit hard.

They get some leeway because they're an ally.

Korea was riding the irreplaceable advantage of the US-Korea alliance. Without it, they would have been marked long ago. Other countries weren't so lucky. When US rates went up, global demand inevitably contracted.

"So the market bubble deflates."

"The KOSPI isn't a bubble, though."

"Export volumes drop, so we get wrecked right along with everyone else."

"Fuck."

Korea took the hit hard. Unlike the Nasdaq, there wasn't even a bubble to speak of — and yet it was being force-fed a diet. Practically starvation-level.

Most ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠of them were domestic-market investors. The club members had every right to be furious. Korean markets alone were enough of a headache — now they had to worry about America too?

That was why he'd called them in at this hour. Past 10 p.m., the events started rolling in one after another. The ones that happened in the United States.

"The FOMC?!"

"Is something else about to blow up?"

"No. It doesn't happen every day."

Powell wasn't some street peddler who showed up rain or shine. And that was precisely where the problem lay.

The ripple effects are enormous.

The impact on the global economy was massive. Misread even a little and the damage ran into astronomical figures. So the Fed stayed in constant communication with the market. Fed officials took turns stepping up to the mic.

Pull up an economic calendar and the schedule was right there — economic data releases and key speeches, all timestamped.

"Whoa, I had no idea."

"This actually feels like real investing."

"But there's not just one or two of these…"

"There's way too many."

"How are we supposed to know which ones matter?!"

Economists. They analyzed the real economy based on data like this. That kind of dry, academic grind?

That's professor territory.

An investor's perspective was ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠different. Same analysis, but instead of the economy itself, you dug into the psychology.

"Ohh~!"

"That's got a vibe to it."

"So how do you actually do it?"

"Psychology? I'm not really following…"

There was a practical reason, too. You'd think buying or selling the second a number dropped would make you money.

Except it doesn't work that way.

Reaction speed. The major US securities firms sat right next to the exchanges. Internet latency between them: 0.07 seconds. And they ran automated programs on top of that.

"Whoa…"

"That's vicious."

"The rich really do play dirtier."

"So that's why all the US brokerages are in New York."

Bad data drop? The programs sold with surgical precision. In short, they dumped faster than anyone else alive.

Even among the whales, it's a brutal race.

The story of entire firms relocating their headquarters just to shave off 0.01 seconds was legendary. This was called passive investing — something retail traders couldn't do if you beat them to death. Which was why his fund aimed for the other side: active investing.

"Sounds like a skill."

"Yeah, like the terms they use in games."

"Exactly. Passive runs automatically. Active you have to cast yourself."

"Ohh~!"

The data came in bad. But was it actually a negative? You sat with it. You thought it through.

And just like that, it was 10:30. The hour when a human being could gamble with the least amount of guilt.

"Holy shit!"

"Are we fucked?"

"How is the index dropping this fast…"

"I thought I misread it for a second."

An index that had been up +0.7% plunged straight down to −0.3%. A full 1% crash in a single second.

The data had come in ugly. Jobless numbers higher than expected. Under a conventional reading, that was a negative.

But depending on your angle, it could mean something else entirely. The Fed was trying to hike rates right now.

If unemployment is high, they can't raise rates, can they?

Bad for the economy, no question. But factor in how the Fed would respond, and you could read it as a positive.

"Really?"

"Yeah."

"Oh, wait — you're right!"

"It's shooting up like crazy all of a sudden!"

What they called a positive-interpretation rally. Read the market, then buy the dip with a clear head.

The index that had crashed was already past the green and climbing to the technical rebound ceiling of +0.5%. That alone was enough. Call options were the textbook definition of high risk, high return.

"Whoa!"

"Two hundred million just got printed."

"That's insane…"

"You made that just now?"

"Yep."

Impossible in the Korean market. A retail trader dumping a billion won into options would draw an instant reaction from the operators. They'd crush you by force if they had to — shove the index down artificially. But on the Nasdaq, the whales' battlefield, retail money didn't even register. A billion won could slip in without a ripple. ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠That was the beauty of it.

The moment he locked in roughly two hundred million in profit and stepped out—

—the index started falling again. As if the rebound had never happened, the Nasdaq was in freefall.

"It's going down!"

"You said it could be read as a positive!"

"On second thought, that wasn't it."

"What??"

The earlier move had been a positive-interpretation rally. And now—

A negative reinterpretation just hit.

Think about it again and the data really was bad. There was evidence to prove it, too.

Jobless claims data came out once a week. High frequency meant low reliability.

"On a four-week average, there's still no meaningful change in the employment numbers."

"Fuck."

"What the hell, you just buy and sell like that?!"

"I think sunbae's the last person we should be trusting right now."

The market was still gripped by fear. Powell's mind wasn't about to change over something this small.

That's why it's psychology.

Looks like it's fallen too far? If you've got a reason, you buy once. Ride it to the technical rebound and spit it back out. That was the trading style his fund was built around — short-term profits off shifts in market psychology.

"I just bought!"

"I got absolutely wrecked."

"Should I sell even now?"

"Sunbae bastard, Powell bastard, son of a bitch."

They just weren't used to it yet. Wails of grief echoed from every corner of the club room.

Sigh. You can't treat stocks like a casino.

Impulse trading. Buy with zero basis and this was the kind of beating you took.

Fortunately, midnight was approaching — time for the next data release.

The index was about due for a bounce. He accumulated gradually near the previous low.

"This is what we call an anticipation rally."

"Anticipation?"

"Because of something that flimsy?"

"Nasdaq's no different from the damn KOSPI."

Volatility had been running high lately. Even minor headlines sent the index lurching up and down.

Periods like this are perfect for scalping.

But you couldn't get so drunk on it that you forgot the most important thing — the root cause of the current selloff.

Two in the morning drew near. It was late enough that most people had gone home.

"Hey, though."

"Hm?"

"You think Powell's going to say something nice?"

"It's only been a few days. Would anything have changed…?"

A few diehards were still hanging on. Or rather — gamblers desperate to get back to even.

Excellent attitude.

You only got hungry after you'd lost something. Like a one-armed Shanks fixating on Luffy.

"That's exactly why you need interpretation."

"Interpretation?"

"Like… English interpretation?"

"Not that basic."

"?"

You had to dig in with absolute obsession. Dissecting every single syllable of Powell's remarks, word by word.