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# Chapter 5: 78 Billion Won Is Just an Appetizer
The Korea Investment Corporation office, with April just around the corner.
“Is New Country really worth this much panic over a single accounting fraud allegation?”
“Hey, we can’t just brush it off. Half of Gong’s predictions have already come true.”
As if they had made a pact, the employees of the Investment Strategy Team kept sneaking glances at the profit-and-loss window of the “Black Swan” account.
Just seeing the numbers turn from blue to red was enough to make their hearts pound.
“Have you seen our account? We’re up more than 300 million won!”
“Of course. This might be the first profit we’ve ever made through direct investments since the Korea Investment Corporation was established.”
That was when it happened.
A bizarre scream erupted from the corner of the Equity Investment Team.
“AAAH!”
An employee sitting in front of his computer toppled backward in his chair as if he had seen a ghost.
The wheels screeched across the floor before the chair slammed into a partition with a loud crash.
“What the hell is wrong with that guy now? Did he fall asleep?”
Team Leader Park Yong-jin snapped at him.
But the employee sprawled on the floor had apparently forgotten all about the pain. He pointed at his monitor with a trembling finger.
“No! Seriously! I think we’re really going to be doomed!”
“Who? Our company?”
Another employee looked at the screen he was pointing toward and shouted.
“Breaking news!”
Everyone's eyes immediately converged on the monitor.
\(Breaking News\) S&P Begins Review for a Possible Downgrade of New Country Financial’s Corporate Credit Rating
“Holy crap…”
“Does that even make sense? A company that huge is going down?”
“How could this happen so quickly? Wall Street has been making a living off that company for years!”
The atmosphere in the office froze.
Then the silence was shattered by the notification sound from the “Black Swan” account.
Ding—
Ding—
Ding—
The alerts, which rang whenever a target price was reached, began going off like crazy.
\(Unrealized Profit: +1.57 Billion Won\)
\(Unrealized Profit: +2.13 Billion Won\)
The figure that had been sitting at 300 million won ballooned in the blink of an eye.
It was the moment when money bet on fear began feeding on that very fear and growing.
“Whoa, what am I even looking at?”
“The money just keeps piling up!”
The office erupted into commotion.
Team Leader Park Yong-jin was the first to regain his senses.
He shot to his feet and rushed toward the Investment Strategy Team.
“Team Leader Cha, we need to sell right now! Liquidate everything! I don’t know whether that rookie was right about everything, but this is a miracle as it is!”
Senior Associate Kim Tae-woo, who had come from the Ministry of Strategy and Finance, chimed in.
“That’s right, Team Leader! We need to lock in our profits for risk management purposes! The Korea Investment Corporation has been losing tens of billions of won every year since its establishment!”
Every pair of eyes turned toward me.
“Not yet.”
I kept my eyes fixed on the figures fluctuating across the monitor.
“Are you satisfied with this much? This is just an appetizer. We’ve barely whetted our appetites, so why are you already trying to get up from the table?”
Team Leader Park Yong-jin’s face twisted.
“W-What did you say? An appetizer?”
“Selling now would be like closing the windows and congratulating ourselves for being safe while a typhoon is approaching. We can’t run away just because the wind and rain have gotten a little stronger.”
At my words, Team Leader Cha Min-jun clenched his fist as if he had finally made up his mind.
He looked around at his team members and spoke firmly.
“You all heard him, right? The ‘Black Swan’ position is a bet on systemic risk. The Vice President has delegated full authority to Analyst Gong Seok-jun, so we’ll follow his judgment. That’s all.”
New York, Manhattan. The headquarters of New Country Financial (NCF).
CEO Alan’s office was extravagantly furnished.
A mahogany desk held document trays trimmed in gold and a set of crystal fountain pens.
Beyond the floor-to-ceiling windows, the Hudson River shimmered in golden light.
But none of that mattered anymore.
The telephone was ringing like mad, and shouts echoed throughout the office.
“Damn it! I said answer the phone!”
Alan clutched the receiver, his shirt soaked with sweat.
Ever since S&P announced its review for a credit rating downgrade, every bank on Wall Street had seemingly agreed to avoid his calls.
After frantically trying one number after another, Alan finally reached for his last faint hope.
“Michael… He might help.”
Michael from Goldman Sachs. Alan had met him several times at conferences in the past.
With a desperate glimmer of hope, Alan dialed his number.
The call connected shortly afterward.
“Michael! You know how much we’ve paid you in fees over the past five years, right? The media is blowing this completely out of proportion. If you lend us just 500 million dollars in short-term funding, we can get through this!”
His voice was filled with desperation.
New Country Financial wasn’t a bank in the traditional sense. It was a factory that churned out loans as financial products.
And what did a factory need to keep running?
Raw materials.
New Country borrowed short-term funds from investment banks and used that money to issue subprime mortgages.
It then bundled those loans into a finished product called CDOs and sold them across Wall Street.
But now, because of S&P’s announcement, every supply of raw materials had been cut off.
To make matters worse, the banks that had lent it money were all demanding immediate repayment.
A liquidity crunch.
In effect, it was a corporate bank run.
If I can just get 500 million dollars, I can hold out… Just 500 million.
Alan tightened his grip on the phone.
Then he heard a cold, dry sigh from the other end of the line.
“Alan, calm down. This isn’t something to handle emotionally.”
“Emotionally? Does this look like an emotional matter to you? You were more than happy to collect your incentives when things were going well! Don’t you think you owe us some loyalty?”
“I’m sorry, but our Risk Management Committee just made its decision. All credit facilities extended to New Country Financial are to be suspended immediately.”
“…What?”
“What do you expect me to do when that’s how the market has judged the situation? Good luck, Alan.”
Click.
The line went dead.
Alan stared blankly at the telephone before his hand slowly loosened.
The receiver dropped onto the carpet with a dull thud.
“…How did things suddenly come to this?”
Everything was already over.
Michael’s office, Global Head of Prime Brokerage at Goldman Sachs.
Michael was the top executive overseeing a division that managed the funds of major sovereign wealth funds and hedge funds around the world. His team executed some of the most dangerous and complicated investment strategies, including short selling and options trading, on their behalf.
Without going through him, it was practically impossible to execute a major bet against Wall Street.
He set down the receiver with an expressionless face, as though his conversation with Alan had never happened.
Outside his office, the trading floor was already in complete chaos.
A trader rushed into the room and shouted.
“Sir, we need to get into a short position on New Country Financial! Right now!”
But Michael didn’t answer.
He simply stared at the figures flashing incessantly across his monitors.
Those numbers brought back vivid memories of an outrageous order that had arrived from Seoul several weeks earlier.
…The Korea Investment Corporation.
At a time when every market indicator predicted that NCF would continue its triumphant rise, an utterly absurd order had come from Seoul, across the Pacific.
While everyone on Wall Street was shouting about “premium-quality kimbap,” they were the only ones betting on “rotten ingredients.”
Back then, he had laughed it off as a mistake made by a fledgling sovereign wealth fund from the East.
He had assumed his friend David had simply lost his touch for a while.
This wasn’t a lucky guess. This was the result of a perfectly designed and calculated plan.
The Korea Investment Corporation had already established its position weeks before the market began to collapse.
And it had done so with meticulous planning.
Michael’s fingers tightened.
A chill ran down his spine.
Is there some kind of monster hiding inside David Chen’s Korea Investment Corporation… someone who can see what Wall Street failed to notice?
This wasn’t David Chen’s investment style.
Michael abruptly rose from his chair.
He quickly issued an order to the trader.
“Bring me every single order the Korea Investment Corporation has placed through our desk over the past month. Every last one. Don’t leave anything out.”
Then he added in a lower voice.
“Of course we should short NCF. But remember this: we’re already late to the party.”
They were no longer leading the game. They were chasing it.
“Get me connected to the risk management desk immediately. Run every liquidity and margin scenario.”
April 2.
The fateful day predicted by Gong Seok-jun had arrived.
The lights in the Korea Investment Corporation office remained on late into the night.
Nobody wanted to leave work and miss this historic moment.
“All right, anyone want to make one last bet? Is New Country Financial really going bankrupt today or not?”
“No way! This is already more than enough. S&P has downgraded them, and look at the insane returns on our account!”
Everyone had the “Black Swan” account open on their screens.
And the numbers displayed there were unbelievable.
\(Unrealized Profit: +8.57 Billion Won\)
The growing anxiety in the American market had caused the value of the put options to surge once again.
“Is this real? We’ve been called a ‘loss-making corporation’ for years, and now we’ve made 8.5 billion won in less than a month?”
“Exactly! We should stop now. If they somehow manage to recover, all of this could disappear.”
“I’m betting they will go bankrupt. Gong predicted that today would be the day.”
Laughter, tension, and excitement mingled together.
Faced with figures unlike anything in the history of the Korea Investment Corporation, everyone’s ability to think rationally was gradually slipping away.
Then it happened.
“The American market is opening!”
At someone’s shout, the entire office fell silent.
Only the clicks of mice and the data alerts from Bloomberg terminals echoed through the room.
Every eye was fixed on the “Black Swan” account.
Immediately after the market opened, the numbers began to fluctuate wildly.
\(Unrealized Profit: +7.9 Billion Won\)
\(Unrealized Profit: +9.1 Billion Won\)
Just as everyone swallowed nervously, the terminal screen flashed red.
\(Breaking News\) New Country Financial Files for Bankruptcy Protection Under Chapter 11
“…Holy crap. It really happened.”
That single remark set off an explosion throughout the office.
“Is it real?!”
“We did it! We actually did it!”
“Whoa! I can’t believe this is happening!”
At the same time, notifications began pouring in across every monitor.
Ding—
Ding—
Ding—
\(Unrealized Profit: +21.03 Billion Won\)
\(Unrealized Profit: +45.08 Billion Won\)
\(Unrealized Profit: +67.01 Billion Won\)
“This is insane! Absolutely insane!”
“The numbers won’t stop! They just keep going up!”
“Look at that! It’s over 70 billion won!”
“Is money literally multiplying itself?!”
Everyone looked as though they were about to dive straight into their monitors.
The entire office was in an uproar.
Then, as if the storm had finally passed, the noise gradually subsided. Someone whispered.
“Is this… really possible?”
“I don’t know. What on earth is the rate of return?”
Everyone’s eyes turned toward one man.
Gong Seok-jun, who had never wavered for even a moment from the beginning of the operation to the very end.
He turned his head and smiled leisurely.
“This should be enough. Liquidate all positions.”
After every position had been liquidated, the final profit was confirmed at 78.05 billion won.
Gong Seok-jun was quietly tidying up his desk when his phone rang.
“Gong, come to my office.”
When he arrived at David Chen’s office, David gestured toward a seat.
“Sit down.”
He poured himself a glass of premium single-malt whisky and swirled it around.
“I bet 10 billion won on your nerve. And you brought back 78 billion.”
His eyes held a mixture of trust and interest.
“Since the Korea Investment Corporation was established, it’s suffered losses of around 7 billion won and received nothing but criticism. But you turned everything around in one shot. This is the first profit in its history.”
David raised his glass and studied Gong Seok-jun carefully.
“How did you know what to bet on?”
Gong Seok-jun smiled meaningfully.
“It was just obvious to me.”
“…Ha. Is that so?”
David fell silent for a moment.
So he has no intention of revealing his secret. Fine. That must be part of his value, so it would be rude to press him any further.
He chuckled and set his glass down.
“On Wall Street, as long as you get the results right, that’s all that matters. Thanks to you, we’ve already exceeded our performance target for the year.”
He pushed some documents aside and asked.
“What would you like to do next?”
Gong Seok-jun placed the glass of whisky David had offered him on the table.
He hadn’t taken a single sip.
“Before I answer that question, there’s something I’d like to confirm first.”
David raised an eyebrow with interest.
A rookie employee who was already preparing for the next round instead of basking in the glory of victory.
That was a rare type, even on Wall Street.
“Go ahead.”
“If I bring you another proposal like this next time, will you support me and prevent the Ministry of Strategy and Finance or other teams from opposing it, just as you did this time?”
David let out a short laugh.
“If you bring me an opportunity to make 78 billion won, why wouldn’t I be your shield?”
“Thank you.”
Gong Seok-jun nodded.
“Then there’s a second matter.”
David leaned forward in his chair.
“Please confirm exactly how much of the performance fee the Korea Investment Corporation will receive from the government will belong to me.”
The cold gaze in Gong Seok-jun’s eyes was not that of a rookie employee.
Come to think of it, Gong Seok-jun had never once looked nervous while standing in front of him.
David studied him for a moment before the corners of his mouth curled upward.
“Young man, do you like money?”
“Of course. I didn’t join the Korea Investment Corporation just to receive praise.”
Gong Seok-jun gestured toward the glass of whisky on the table with his chin.
“I like whisky like this, too. But I like seeing more zeroes in my bank balance even more.”
David stared at him for a moment before suddenly bursting into hearty laughter.
“Ha! Hahaha! You really are an interesting fellow!”
Raising his glass high, David declared,
“Don’t worry. The reward you receive for earning 78 billion won will be beyond your imagination. People who deliver results get rewarded properly. That’s the rule on Wall Street, and it’s the rule of this organization.”
Only then did Gong Seok-jun lift his own glass of whisky.
“Then I’ll trust those rules and prepare my next report.”