Daehung Venture Capital HQ, Gangnam, Seoul.
[USD/KRW: 1,730.10 (177.42)]
Sitting at his desk in the CEO's office, Seok-won watched the exchange rate crash—plummeting as if the morning's surge past 2,000 KRW per dollar had been a lie—and let a deep smile form on his lips.
"I thought they'd hold out longer, but the resistance was weaker than expected."
The way it all crumbled like a sandcastle under pressure made him suspicious. It was almost too easy, as if there might be a trap hidden somewhere.
Just then, his phone on the desk buzzed.
[It's Landon, boss.]
"I was just about to call you. Judging by the heavy buying pressure on the won coming from
sources other than us, did a short squeeze just happen?"
[Hahaha. That's right. Just like you predicted—once we dumped $4 billion at once, they couldn't hold their ground and collapsed.]
The strategy had been to dump a massive amount of dollars at once to crush the rising exchange rate, and it worked perfectly.
"It's good news, but I'm a bit uneasy about how quickly they gave up their positions and rushed into buying back the won for short-covering."
[Like I said, they freaked out when we dropped dollars like a financial nuke. And once they
realized we were taking the opposite position, the hedge funds scrambled to get out.]
Landon chuckled.
"You're saying the hedge funds got scared of us."
Seok-won sounded skeptical, but Landon's voice turned serious.
[You already know that big players like the Quantum Fund didn't join the won attack this time.]
"So?"
[Sure, there are still sizeable players like P&P Partners, but most of the others shorting the won were minor funds. When a big whale shows up, it's only natural for the smaller fish to flee.]
"Hm."
Leaning back into his chair, Seok-won listened as Landon continued.
[It's only been a few years since we established the fund, but after hitting multiple jackpots, our assets under management have grown into the tens of billions. That puts us among the top three even on Wall Street.]
"That's true."
Thinking about it again, the amount they'd grown was indeed staggering.
[So when they see us pushing in billions of dollars in a single stroke, it's only natural they panic and retreat.]
Landon's satisfied smile was practically audible through the phone.
"You might be right about that."
[Sometimes, boss, I don't think you realize just how powerful your influence really is.]
Landon spoke with growing fervor, determined to drive the point home.
[They used to call you the Midas of the markets, admiring all your successes. But now, after this Asian currency crisis—where you've outperformed even George Soros's legendary Quantum Fund—people are starting to say a new king has arrived.]
"Is that so?"
Hearing something new for the first time, Seok-won looked intrigued for a moment, then let out a dry chuckle.
"They're probably just gossiping for fun, but I can't say it feels bad to hear."
Brushing it off lightly as nothing serious, Seok-won shifted the conversation back.
"In any case, it's not a bad thing if the hedge funds are retreating like this."
[Now that the hedge funds are entering short-covering mode and buying back the won they previously dumped, the exchange rate is facing strong downward pressure. Should we ease up a bit on our dollar sales?]
Seok-won stroked his clean-shaven chin in thought for a moment before replying.
"No. If we ease up on buying, some hedge funds might start getting funny ideas. Let's stick to the original plan—keep pushing dollars to firmly suppress the rate."
[Understood.]
Landon responded without hesitation, then naturally changed the topic.
[Also, we've confirmed that the reason George Soros and other Wall Street big players didn't join the won short-selling was due to pressure from the White House.]
Seok-won's eyes lit up at the news.
"I knew something felt off. So the White House was involved."
[They were planning to use the IMF to force open Asian financial markets. But when the crisis started spiraling beyond control, hitting not just Korea but Japan as well, they panicked and started reining things in.]
At the time, China hadn't yet fully risen, and Japan still held the world's second-largest economy status.
With Japan reeling from the spillover of the Asian financial crisis—and their long-suppressed bad debt bubble finally bursting—the U.S. realized the crisis might spiral into something uncontrollable and scrambled to contain it.
Seok-won spoke coldly.
"Looks like they finally realized they were playing with fire next to a powder keg."
['Powder keg'—an accurate description. If the Korean crisis spilled across the Korea Strait into Japan, it wouldn't just be an Asian problem. It'd become a global one.]
"And if that happened, Japanese financial institutions, just like Korea's, would start pulling back their yen from all over the world to stay afloat. That would hit the U.S. and Wall Street hard."
[Exactly. Japan holds a huge amount of U.S. Treasuries. If even part of that were sold off, it
would trigger sheer panic in the global financial markets.]
Seok-won adjusted his grip on the phone and asked to confirm.
"Japan holds over $300 billion in U.S. Treasuries, right?"
[Yes. Japan holds about $1.2149 trillion in U.S. Treasuries overseas, and around one-fourth of that belongs to Japan alone.]
Of the $300 billion in Treasuries held by Japan, about one-third was in the hands of private
institutions—banks, brokerages, and insurance companies.
"Even if the Japanese government doesn't act, just the private sector dumping those bonds would be a catastrophe."
[It's horrifying just to think about.]
It would essentially be the unwinding of the yen carry trade—Japanese funds invested abroad
returning home en masse.
"That's why George Soros and the other big Wall Street players didn't resist the White House's involvement."
[True. Normally, they wouldn't back down just because the White House tells them to—not when money's involved.]
"In any case, this confirms one thing for sure."
[And what's that, sir?]
"That we won't be seeing the exchange rate spike again."
Landon immediately understood what Seok-won meant and replied:
[That makes sense. The U.S. and Japan will take active measures to prevent the crisis from
spreading.]
It was a bit bitter to accept that the two notoriously slow-moving nations had to intervene just to get things under control—but it was also the truth.
"The biggest obstacle, the issue of the next administration, has also been resolved. The
presidential candidates have publicly reaffirmed their commitment to honor the agreement with the IMF. I'd say that's settled."
[Understood. Then we'll continue purchasing the won as instructed.]
"You never know what might happen. Stay sharp until the end, and let me know immediately if there's any change."
[Will do.]
After ending the call and putting his phone down, Seok-won calmly stared at the exchange rate graph displayed on the monitor.
"The rate's crashing even faster than expected. The hedge funds that shorted the won must be
taking massive losses."
Imagining the hedge fund managers who'd gone all in, hoping to hit the jackpot, now sitting in a daze watching their expected profits vanish in an instant, Seok-won allowed a smirk to form on his lips.
***
Seoul, Euljiro – Head Office of Korea Exchange Bank
The moment the market opened, the exchange rate skyrocketed—finally breaking past the
unthinkable 2,000 won per dollar mark. The trading floor of Korea Exchange Bank was filled
with groans and despair.
At the beginning of the year, the exchange rate had hovered around 890 won per dollar. A spike of over 124% was almost surreal.
Yes, a weak won might help exports, but only to a point.
South Korea, lacking natural resources and heavily dependent on imports—starting with crude oil
—was now staring into the face of disaster with such a steep currency plunge.
And to make matters worse, the nation's foreign reserves, the very buffer needed to withstand a high exchange rate, had nearly dried up due to the financial crisis. It was like standing at the edge of a cliff.
The mere mention of a moratorium —a national default—had been unthinkable. Now, it loomed right in front of them, and everyone was drowning in hopelessness.
But then, something miraculous happened.
The rate, which had surged past 2,000 won per dollar, suddenly reversed course—and began to plummet rapidly.
"Wh-what…?"
"Everyone, look at that!"
"2,030… 2,000… 1,995… The—the exchange rate…"
"It's dropping! The exchange rate is falling!"
Assistant Manager Na Un-hak, unshaven and disheveled, stared at the giant display board
showing the USD-KRW rate. His eyes widened, and his jaw dropped.
But soon, the despair on his face gave way to joy and elation.
Next to him, Seol Kyung-seok stood up, his face blank with disbelief as he stammered while
staring at the board.
"D-did I just imagine that?"
"That's what I want to know."
"What the hell is going on?"
"I said—that's exactly what I want to know."
Assistant Manager Na Un-hak also couldn't make sense of the situation.
The outflow of foreign investment, the indiscriminate recall of short-term foreign debt, and on top of that, the attacks by currency speculators—everything combined to create a truly hopeless scenario.
Yet suddenly, as if struck by a hammer, an overwhelming wave of won buying slammed down, causing the exchange rate to sharply reverse. It was nothing short of a miracle.
If he hadn't seen it with his own eyes, he would never have believed it.
"Could the government have intervened?"
Na Un-hak thought for a moment and shook his head.
"No, I don't think so."
If they had the capability, they would have acted to defend the rate before it broke 2,000 won.
Seol Kyung-seok, still in a daze, stared at the giant ticker board with a face full of curiosity.
"The volume of buy orders coming in is enormous. Who on earth is doing this?"
"I'm curious too."
Just then, one of the traders suddenly jumped up and shouted loudly.
"I found out!"
"What?"
"Where? Who's behind this?"
As murmurs spread among the traders, the first to shout raised his voice again.
"It's the Eldorado Fund! The place dumping an insane amount of dollars right now is the
Eldorado Fund!"
"What? The Eldorado Fund?!"
"That's the Wall Street big shot who recently acquired Ilhan Bank and Hanseong Bank."
"What on earth is their game?"
As the identity of the party pulling the wildly rising won-dollar exchange rate back down was
revealed, the traders at the Korea Exchange Bank grew even more confused, unable to grasp their true intention.
"The Eldorado Fund, huh…"
Na Un-hak let out a breath, clearly surprised.
"Could it be that those Wall Street guys are actually fighting each other over the won?"
"Who knows."
Running one hand through his messy hair, Na Un-hak made a long sigh and fixed his gaze on the rapidly plunging exchange rate.
"One thing is certain — the Eldorado Fund saved South Korea, which had been hanging on the edge of a cliff."