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CH272 | GSI
🕑 Added 2025-04-02 03:10:00 +0000 UTCCopper, often referred to as "Dr. Copper" for its ability to reflect real-world economic conditions, was one of the most actively traded commodities in the futures market.
Following its aggressive investments in Southeast Asian junk bonds, Peregrine Securities had also poured substantial capital into copper futures in pursuit of higher returns.
‘But their timing couldn’t have been worse.’
Unfortunately, the firm's entry into copper futures coincided with the downturn of a decade-long economic boom in Asia, which had been fueled by the yen appreciation following the Plaza Accord.
As the economy began to slow, copper demand naturally declined, causing copper futures to peak and then enter a downward trend.
As a result, Peregrine Securities, which had taken a long position in copper, was now facing losses.
This was a highly sensitive investment position, kept strictly confidential to prevent external exposure from exacerbating their financial losses. Yet, Seok-won had managed to uncover this information—thanks to Manager Oh, the so-called "Too Much Talker of Yeouido."
~~~
[Breaking News]
The U.S. government is increasingly likely to nationalize the country’s two largest mortgage lenders, Fannie Mae and Freddie Mac.
Due to the subprime mortgage crisis, Freddie Mac has already suffered significant capital erosion, while Fannie Mae has reported a staggering $9.5 billion loss over the past four quarters.
Government sources indicate that despite continuous demands from the Treasury Department and the Federal Housing Finance Agency to raise additional capital, both institutions have admitted they cannot do so on their own.
This contradicts the Treasury Secretary’s previous statement that "there are no plans for a public bailout," strongly suggesting that large-scale government intervention is inevitable.
Meanwhile, domestic financial institutions hold considerable investments in these two mortgage companies...
The global financial crisis, triggered in April by the collapse of the second-largest U.S. subprime mortgage lender, showed no signs of abating. Instead, it was worsening by the day.
What had begun as a wave of panic on Wall Street had rapidly spread across the world, plunging domestic financial markets into chaos.
Under these circumstances, luxuries like shoe-shining were among the first to be abandoned. Over the past few weeks, Seok-won had often opened his shop only to sit idly all day, unable to polish a single pair of shoes before heading home.
Today was no different. He had spent the entire day staring blankly at the radio or television, killing time.
A glance at the digital clock on the wall told him it was already past 8 PM.
"Time to call it a day."
Switching off the TV, Seok-won pushed himself up from his chair.
He began bringing in the items displayed outside his shop when a heavily inebriated voice called out from behind him.
"Still here, huh?"
"Manager Oh!"
Seeing the familiar face after a long time, Seok-won’s face lit up.
Manager Oh stood there, swaying slightly, a convenience store plastic bag dangling from one hand.
"Had a drink, I see."
"Yeah… Had a few. Heading home?"
"Yes."
At that, Manager Oh lifted the plastic bag in his hand.
"Then let’s just have one can of beer together."
Something about his face looked unusually downcast, making Seok-won pause his cleaning and open the shoe shop door.
"Come in."
Inside the dimly lit shop, Manager Oh, moving with the familiarity of someone at home, pulled a small table closer and started taking out the canned beers and snacks he had bought from the convenience store.
Seeing him line up six cans, Seok-won sat down across from him and raised an eyebrow.
"I thought we were only having one?"
"Come on, just one would be too cold-hearted."
"Seriously?"
Seok-won let out a small chuckle as he began unwrapping the snacks Manager Oh had brought.
"Almonds, peanuts, dried squid legs, sausages… Wow, you really went all out. We’re going to get full just from the snacks."
"I wanted to get some fish-shaped buns too, but they weren’t selling them."
"Fish-shaped buns? And with beer? Wouldn’t chicken be a better match?"
"I just eat what I crave, man."
Manager Oh popped open a can of beer and held it out.
"Well, things have been pretty gloomy lately, but we still gotta toast, right?"
"Of course."
With a playful clink sound from his mouth, Seok-won lightly tapped his can against Oh’s and took a sip.
Summer was nearing its end, but the night was still muggy. The cold beer rushed down his throat, bringing an instant, refreshing chill.
"Ahh, that hits the spot."
"Right?"
Manager Oh smiled faintly and took a sip himself.
Even as he smiled, though, there was a shadow behind his expression. Sensing something was off, Seok-won hesitated before carefully asking,
"Did something bad happen today?"
"Who in Yeouido isn’t having a bad time these days?"
"Fair point."
Manager Oh tossed a piece of jerky into his mouth, chewing slowly as he glanced at Seok-won.
"That damn subprime mortgage crisis wrecked my director too. What about you? Holding up okay?"
"Do I look like I’d be fine? Took a brutal hit—down by half. But I scraped together every penny I had left and doubled down today."
"Wait, what?"
In an atmosphere of despair, where everyone was scrambling to cut their losses and pull out their money, Manager Oh’s eyes gleamed with interest upon hearing that Seok-won had instead bought more stocks.
"You’ve never heard the saying ‘Don’t catch a falling knife’? What makes you so confident about averaging down?"
Seok-won simply shrugged and answered nonchalantly.
"The stock market isn’t going to collapse and disappear entirely because of this. That means good stocks are dirt cheap right now, so I figured I should scoop them up while I can."
"Hah."
Manager Oh let out a dry chuckle before his expression turned serious.
"You do realize that Lehman Brothers—one of the top five firms on Wall Street—just went under, right? AIG, Citibank, and all those massive financial institutions people thought were untouchable are on the brink of collapse."
"I sit in this tiny shop all day listening to nothing but stock market news. You think I wouldn’t know that?"
"And you still doubled down? Did it not occur to you that there might be more rock bottom levels beneath this one?"
Despite Manager Oh’s warning tone, Seok-won remained unfazed.
"Maybe. But didn’t you always teach me that when the moment comes, you shouldn’t hesitate and just bet big?"
"You crazy bastard. How much did you put in?"
Seok-won held up a single finger.
"One billion?"
"No. Ten billion."
Manager Oh had just brought his beer to his lips but froze mid-motion. His head jerked up with a creak.
"What? Ten billion?!"
"Yep."
"Are you out of your damn mind?! Wait, you actually had that much cash lying around?"
Seok-won scratched his head, looking a little sheepish.
"I’ve been working hard, rolling my investments wisely—just like you taught me."
Manager Oh shook his head in disbelief, half-admiringly.
"I knew you had a good chunk in your trading account, but I didn’t expect you to have that much extra cash. Impressive."
"Well, it’s all thanks to my brilliant mentor, isn’t it?"
"Damn right. Then keep it up and do even better."
"That’s why I always treat you with the utmost respect. I even buy you free coffee every time."
Seeing Seok-won’s playful grin, Manager Oh finally burst into laughter.
Having known each other for over a decade, he felt no jealousy—only a sense of pride. Still, he offered a word of caution.
"But remember, investing isn’t always smooth sailing. Don’t get too greedy. You didn’t take out a mortgage on your apartment for this, did you?"
"Come on. If my wife found out, she’d kill me."
"Good. No matter how much you love the market, never make a bet that could put your family out on the street."
"Of course."
At last, Manager Oh seemed reassured and took another swig of beer. Then, as if a sudden thought struck him, he gave Seok-won a curious look.
"But seriously—if you’re making that much money in stocks, why the hell are you still here polishing shoes instead of sitting at a trading desk?"
"It’s not like that. Besides, I never even went to college—what kind of trader would I be?"
"What’s that supposed to mean?!"
Manager Oh’s voice suddenly rose as he snapped back.
"You know better than anyone that in this industry, skill matters way more than your education. Seriously, why don’t you come work with me as a prop trader?"
A proprietary trader (prop trader) was a professional who managed a firm’s capital to generate profits, usually under a one-year contract.
Success meant high rewards—some firms even offered traders up to half of their profits as bonuses. But if they failed to deliver results, they’d be cut loose without hesitation. It was a high-risk, high-reward career.
On the upside, traders who performed well enjoyed unmatched freedom over their trades and schedules.
A few years back, Manager Oh had quit his job voluntarily and transitioned into prop trading. Despite nearly twenty years in Yeouido’s financial sector, he was still called ‘Manager Oh’—a remnant of his old title.
For a brief moment, Seok-won was tempted. But he quickly shook his head.
"I really appreciate the offer, but I’m happy with where I am now."
"Tch. You’ve got real talent, though…"
Manager Oh clicked his tongue in disappointment.
"Well, I get it. Chasing profits every single day is stressful as hell. Maybe it’s better to invest and manage your own money at your own pace."
Seok-won seized the chance to change the subject.
"Judging by your face, I’d say you already had a few drinks before coming here."
Manager Oh’s expression darkened.
"You know Director Seo from ST Securities, right?"
"Of course. Isn’t he your college friend?"
"Yeah. That bastard resigned today."
"Wait, seriously?"
Seok-won’s eyes widened in shock.
Seo had been on a meteoric rise at ST Securities, and there were strong rumors he’d be promoted to vice president next year. He was one of the firm’s most respected executives.
Manager Oh crushed his empty beer can in his hand and tossed it into the plastic bag before cracking open another.
"Yeah. To be precise, he didn’t quit—he was fired."
"What? Why?"
"He took a big hit trading copper futures. That’s why he had to resign."
"Ah…"
Seok-won’s expression darkened with sympathy.
Manager Oh absentmindedly toyed with his beer can, speaking as if to himself.
"People think these guys are living the dream with their seven-figure salaries, but in reality, they’re just one bad trade away from getting the axe. Everyone in this industry knows that."
He sighed and took another sip before continuing.
"At least he had the sense to cut his losses before things got even worse. Remember the Sumitomo scandal? That trader kept holding his copper positions for over a decade and ended up racking up a $2 billion loss. At least Seo knew when to walk away. That’s the only reason he got out with just a resignation instead of total ruin."
"You mean the infamous Sumitomo case?"
"Yeah. Back then, Peregrine Securities in Hong Kong also had a long position in copper and got dragged down with them, losing hundreds of millions."
Seok-won recalled studying futures markets after hearing about the incident. That’s why he still remembered Peregrine’s misstep in copper trading.
~~~
Shaking off his thoughts, he focused on the present.
Across the conference table stood Richard Lee, the president of Peregrine Securities, his expression unreadable. Seok-won’s voice dropped to a calm, deliberate tone.
"If you refuse my offer, I will immediately short copper futures."
Richard Lee’s face hardened.
"I don’t know how you found out about our position, but do you really think you can manipulate prices in a market as massive as copper futures? That’s an arrogant assumption!"
Seok-won leaned back in his chair, completely unfazed.
"If you have doubts, feel free to test me. Just be aware—the consequences will be painful."
It was true that copper futures were too large a market for easy price manipulation. But Eldorado Fund’s influence couldn’t be ignored either.
More importantly, copper futures were already peaking and showing signs of decline. That’s what troubled Richard Lee the most.
If Eldorado Fund executed a massive sell-off, it would be like throwing a lit match onto a pile of dry kindling.
Vice President Hurd, seated beside him, clearly understood the situation. His anxious eyes darted toward Richard, waiting for his decision.
Richard swallowed dryly, his mind racing for a way out.
As Seok-won watched them wrestle with their predicament, he took a slow sip of tea, waiting patiently.
Silence stretched between them.
Finally, Richard realized he had been completely cornered. His jaw tightened as he let out a quiet sigh and sank back into his chair.
Then, begrudgingly, he looked across the table at Seok-won and asked, "Name your price and terms for the bonds."
A bright smile spread across Seok-won’s face.
