Episode 170
After announcing Chunha Group’s withdrawal from the IT market, I began selling our shares. I had intended to sell gradually, minimizing the market impact, but things didn’t go as planned.
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Sir, the sell-off is much larger than we anticipated, Kim Min-sik reported, his voice filled with panic.
“What’s going on? Explain.”
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It’s already down 5%… now over 6%.
“Down?”
My plan had been to demonstrate the market’s resilience, showing that even Chunha Group’s withdrawal couldn’t stop the IT boom. But the price was falling.
“Can’t you stabilize it?”
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I was buying initially, using our remaining funds, but the selling pressure is too strong. We’ve already spent 200 billion won in just one hour trying to defend the price, so I halted the operation. And now the price keeps falling… it’s down 7% now!
200 billion won in an hour?
We had planned to sell our shares gradually over two weeks, but at this rate, we wouldn’t last a day. I bit my lip.
“What’s the reason?”
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Some investors are probably selling because of our announcement, but the volume is too large and too organized. I think there are other players in this market besides us.
Of course, we weren’t the only ones involved in this speculative frenzy.
The IT sector’s market capitalization had increased fivefold, from 10 trillion won to 50 trillion won, after I started pumping it. And the price was still rising, so it was a tempting target.
“Is it… impossible to defend the price?”
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Yes, it might have been possible in the early stages, but the market cap is over 50 trillion won now. 1 trillion won isn’t enough. And we have to consider the individual investors who will panic and sell if the price keeps falling.
Even after the IMF crisis, Korea was still a major economic power. Had I been too arrogant, thinking I could control the entire IT sector single-handedly?
I felt a sense of humility, realizing my limitations. ‘Should I keep defending the price? Maybe the other players will give up if we hold on for a day?’
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Sir, it’s down 8%! The sell-off is intensifying! We have to make a decision!
‘But if Chunha Group joins the selling frenzy and triggers a market crash, we’ll be blamed. No! I can’t let that happen. I’ve worked hard to build our image.’
When Daehoo’s stock price had crashed, I had been able to deflect the blame onto Joongang Investment Corporation, claiming they had acted against my wishes. But this time, it was Chunha Group’s decision. We had announced it publicly. Everyone would blame us for the crash.
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Sir!
“Abort the operation,” I said with a grim expression. “Stop defending the price. And stop selling Chunha Group’s shares.”
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What? We have to sell now to minimize our losses!
“We’ve already made several times our initial investment. Even if the price is halved, we’ll still have doubled our money. I’m not going to risk our reputation for a little extra profit.”
Chunha Group’s image was more valuable than money.
It was my shield and my weapon. I gritted my teeth. “Those bastards, disrupting my plans. I’ll make them regret this.”
“We deeply regret that our decision to withdraw our investments has contributed to the current market decline. We apologize to all the investors who have suffered losses.” I bowed deeply to the reporters and then straightened up. “Chunha Group will not sell any more shares as long as the market decline continues.”
The reporters were surprised.
The IT stocks had hit the lower limit and were still plummeting, a day after Chunha Group’s announcement.
And now, the very company that had triggered the decline was promising to stop selling, accepting the losses.
“Shouldn’t you be selling now to minimize your losses?” a reporter asked.
I nodded. “But if Chunha Group joins the selling frenzy, the consequences will be devastating. Housewives’ savings, retirees’ pensions… I can’t stand by and watch innocent people suffer because of us.”
I said with a serious expression, “We won’t sell any more shares, even if the price falls to zero, as a token of our apology.”
A reporter said to his cameraman, “Wow, he’s a true leader. I would have sold everything before the price fell any further. He’s willing to hold onto his shares even though they’re losing 15% a day.”
But the cameraman, his face sullen, said, “Chunha Group has been buying IT stocks since the beginning. They’re not losing money, even if the price falls.”
“Even so, it’s not easy to pass up a chance to make more money, especially publicly.”
“He’s the one who started this. He should have sold quietly without making a public announcement.”
The reporter frowned. “Why are you so negative? He’s taking responsibility and accepting the losses. Don’t tell me… you invested in IT?”
The cameraman’s face fell. “…A little.”
“How much?”
“About 5 million won. Two days ago.”
He had bought the shares at the peak and was now losing money. The reporter said with a sympathetic expression, “You bought at the worst possible time. Cheer up.”
He grumbled, “What can I do? It’s already done. I don’t blame Chairman Park. It’s not an easy decision to hold onto losing stocks. I just don’t understand why he made a public announcement in the first place. Which CEO would care about individual investors and try to minimize market impact? They would just sell everything.”
He sighed and looked at me. “But it’s good that he’s holding on. If a major investor like him is staying put, the decline might not last long. I’ll hold onto my shares too.”
“I don’t think it’ll last long either. Just hold on. Or who knows? There might be an opportunity.”
“An opportunity?”
“The IT sector isn’t going anywhere. If you buy at the bottom, you’ll make a big profit when the price recovers.”
“That’s true.”
The reporter, turning his attention back to me, said, “He’s a remarkable man, that Chairman Park. I wish all CEOs were like him.”
The market decline, triggered by Chunha Group’s announcement and the other players who seized the opportunity to sell their shares, continued until the IT stocks had lost half their value.
As the market stabilized, I started selling Chunha Group’s shares again, gradually.
“Investors, thinking the price has bottomed out, are starting to buy again,” Park Jong-bum reported.
“Keep selling whenever the price starts rising, creating a sideways trend. And once we’re done selling, use all of Joongang Investment’s funds to push the price up again.” I clicked my tongue regretfully. “I wanted to do this before the decline…”
My plan to sell at the peak had been disrupted by the other players, and I was now selling at half the price.
It was still a substantial profit, but I had missed out on a much larger gain.
“We’ll make over 3.2 trillion won, double our investment. It would have been over 6 trillion won if it weren’t for those bastards. Do we know who they are?”
“We’ve traced it back to several small players, with hundreds of billions or tens of billions of won each. They seem to have coordinated their sell-off after seeing your announcement,” Park Jong-bum reported.
“They must have sold at a higher price than us. I won’t forgive them.”
I had been forced to apologize and watch anxiously as the price plummeted.
Fortunately, it had stopped at around 50%, so we had still doubled our money. But it still felt like a loss.
“I’ve made a profit, but it feels like I lost 3 trillion won.”
Park Jong-bum chuckled. “That’s how the stock market works.”
“How are the investors reacting?” I was curious about the public’s reaction to the IT sector’s first major correction.
“It’s not as bad as we feared.”
“Not bad?”
“Most people see it as a correction, a buying opportunity. Even those who bought at the peak are confident that the price will recover.”
I smiled. “That’s good.”
“Sir, your mother also invested a substantial amount, didn’t she?”
I held my head in my hands. “She’s been hounding me about selling.”
She had bragged to my father about her investment when it had tripled in value, but now that it had lost half its value, she was treating him like a criminal. And she had been calling me constantly, asking when to sell.
“Hahaha, I understand.”
“I’ll tell her when to sell. She’s more stressful than the falling stock price. Anyway,” I said to Park Jong-bum, “what will those other players do now?”
“They’ll probably start buying again once the market stabilizes. The US IT sector is still booming. Everyone thinks the Korean market will recover too.”
I said, my eyes gleaming, “So they’ll sell high, buy low, and repeat. I’m starting to understand how they operate.”
They would target a specific stock, invest in it, drive up the price, and then unload their shares onto the individual investors when they joined the buying frenzy. And then they would wait for the price to fall and buy back the shares at a lower price, repeating the process.
“It’s a valuable lesson. But what if they buy at what they think is the bottom, and the price keeps falling?”
“That’s a risk they have to take.”
I stroked my chin. “Hmm, what if we pump it up again after they buy, and then Joongang Investment dumps half its shares, causing another decline? And then we repeat the process, making them experience the same anxiety we felt?”
“What? Sell only half, not all of it at the peak? But that would reduce our profit.”
I smirked. “But it would screw them over, wouldn’t it?”
“Is it really necessary, sir?”
I clasped my hands together and smiled slyly. “I enjoy crushing my enemies more than making money. And it’s not really a loss. Joongang Investment has twice as many shares as Chunha Group. We’re already struggling to sell Chunha Group’s shares, it won’t be easy to sell Joongang’s. We can’t sell everything at the peak anyway. The price will fall if we do. We’ll take a break, let them buy at what they think is the bottom, and then crush them again. They deserve to experience this.”