The Magician’s Memorial - Chapter 327



Only Krnovel

327. Filling the barn (1)

There are only a few days left in 2009.

Director Fukuda of the Economic Research Institute came to see me.

When I became president, I promoted the advisor to the Economic Research Institute to director, and he submitted reports every month or quarter.

But we always reported only in writing.

Since there has never been a face-to-face request like this one, it was predictable that the contents of this report would be unusual.

“Director Fukuda, it’s been a really long time. I should have visited and talked to you often, but I’ve been neglecting it.”

“I can’t waste the chairman’s busy time on someone like me. So, let’s get straight to the point. First, please look at the report.”

The contents of the report are only 3 pages.

There were two reports on Tesla’s stock price war with short sellers.

The remaining page stated that Taewo Group also has a structure vulnerable to short selling.

“Do you think Taewoo Group could be attacked by short sellers like Tesla?”

“That’s right. Before, the debt ratio was 0% and we had a huge amount of internal reserves, so there was no need to worry, but now the situation has changed.”

When AIZ and GM were acquired, their debts were also transferred to Taewoo Group.

Although the U.S. government reportedly reduced a huge amount of debt, the two companies were still losing money, so in Director Fukuda’s view, they seemed like a time bomb.

“The deficit of the acquired company is decreasing significantly. If we can endure a little with the profits of other affiliates, we can quickly turn into a surplus.”

“I see it that way too. I expect that we can turn into a surplus within 3 years at the shortest or 5 years at the longest. However, if another major economic crisis breaks out within that time, we may become a target of short sellers.”

Clearly, the next three years were the weakest financial period for Taewo Group.

AIZ, GM, electric vehicles, and even underground resource development.

We invested in so many different places, and Taewoo Group’s treasury was almost dry.

Of course, there was no major worry because the Taewo Group had several affiliates that acted as cash cows, but as Director Fukuda said, a major economic crisis could lead to a funding crunch.

“Hmm, that certainly makes sense. We need to call an emergency executive meeting.”

“Are you saying you’re only going to listen to what I say and call an executive meeting? It’s not too late to analyze a little more.”

“No. Director Fukuda was the first to notice the IMF crisis. We need to deal with this as quickly as possible to prevent an emergency from happening.”

I immediately called an emergency meeting of Taewoo Group’s CEOs.

The only attendees at the meeting were Vice Chairman Park Man-deuk, President Han Jeong-hoon, and the Planning Director, and Director Fukuda was the presenter.

“Thank you all for attending the meeting despite your busy schedule. This meeting is to exchange opinions to ensure the financial soundness of Taewoo Group.”

“I requested the chairman to convene an emergency meeting. According to the economic research institute’s analysis, the Taewoo Group is now like a jar with a hole. Due to excessive quantitative expansion, no matter how much money comes in, all the money is flowing out through the hole.”

Director Fukuda’s report was not wrong.

However, his report omitted the part about Taewo Group’s hidden assets.

By using hidden assets, including fintech banks, Taewo Group was able to withstand even an economic crisis.

But it wasn’t a bad idea to prepare in advance.

Because it was better not to use Taewo Group’s hidden assets.

But not everyone agreed with what he said.

One CEO, who was particularly strong in numbers, expressed the opposite opinion.

“It is true that a lot of funds were used due to the acquisition of companies such as AIZ and GM, and I agree that there is a lot of money to spend in the future, but I do not agree that it is a crisis. It can be sufficiently handled with the money coming from Taewo Semiconductor, Electronics, and IT. It’s level.”

“It is true now, but the moment another global economic crisis occurs, we will face a financial crunch.”

Taewoo Group looked rosy on the outside.

It acquired global companies such as AIZ and GM, and successfully pioneered the electric vehicle market.

However, it certainly did not mean that I was rotten and broken inside.

Advisor Fukuda was merely saying that, assuming the worst, the Taewo Group could be in danger.

“Even if another economic crisis occurs, Taewo Group has the strength to withstand it.”

“It is only possible to hold on. There is a lack of momentum to move forward. AIZ, GM, electric vehicles, and underground resource development. At least 100 trillion won in funds are regularly withdrawn per year.”

“After a few years, the acquired companies can stabilize and the amount spent will be significantly reduced.”

“I am saying this because the global economic crisis may come again within a few years.”

A fierce debate between President Han and Director Fukuda.

Director Fukuda continued speaking in a slightly exasperated voice to convey the seriousness of the situation.

“The Taewo Group may become a target just as the short-selling forces attacked. Although it is not being attacked now because its financial soundness is high. If the Taewo Group is shaken by the economic crisis, it may become good prey.”

“What reason would there be for short sellers to attack Taewo Group? Taewo Group has more than one or two cash cows. It has sufficient strength to defend itself even if attacked.”

“Because the situation is quantitatively inflated, it is bound to be vulnerable to attacks from short sellers.”

It wasn’t wrong.

In order to defend against short sellers, a huge amount of funds must be used.

The funds needed to be used for the growth of Taewo Group may have been insufficient.

Therefore, I sided with Director Fukuda.

“The Taewoo Group has certainly expanded too excessively. If a funding crunch occurs, the group’s growth momentum may disappear.”

“Even if there is a capital crunch, it won’t be a big problem. Wouldn’t it be enough to lend money to Wall Street capital for a while?”

“Have you forgotten the IMF era? Taewoo Group almost collapsed due to excessive debt. It is best not to take out loans. There is a better way than that.”

Everyone focused on my mouth.

What is the best way to deal with an unexpected economic crisis?

“Let’s fill in the shortage. As Director Fukuda said, it looks like an economic crisis will erupt sooner or later. But if we can deal with the economic crisis in advance, wouldn’t it be the best investment?”

“Currently, it is difficult to predict where the economic crisis will begin. Europe, the United States, or East Asia. It is not surprising no matter where the economic crisis breaks out.”

I knew where economic crises begin.

The European financial crisis is coming soon.

The whole world was shaken by the Lehman crisis, and the first place to be hit hard was Japan.

In the case of Japan, the economy was shaken not by the Lehman incident but by the effects of a major earthquake.

In the aftermath, the European financial crisis erupted, and the world economy was set to enter another dark era.

But there was one problem.

If it were another economic problem, it could be said that it was figured out through prediction.

It was difficult to talk about it because it was impossible to predict a natural disaster like a major earthquake in northeastern Japan.

“Based on information from Wall Street and personal sources, it seems likely that an economic crisis will hit Japan and Europe.”

“Economic research institutes also predict that the economic situation in Europe, especially Southern Europe, will worsen. The economic situation is worsening due to the impact of the euro and the fallout from the Lehman incident. However, in the case of Japan, there is not such a bad news.”

I wasn’t saying this because Director Fukuda was Japanese.

From anyone’s perspective, there was absolutely nothing in Japan that could be called a major crisis right now.

“Then, let’s move on two tracks. We will invest half in Japan and the other half in Southern Europe, assuming that there is an economic crisis.”

“In order to create an investment portfolio, you must predict what Japan’s economic situation will be like in the future.”

“Please make a plan based on the Japanese economic situation at the time of the Kobe earthquake.”

Everyone looked at me puzzled.

It was because the words ‘Kobe Earthquake’ suddenly came out of my mouth.

I knew that it was an inappropriate word for the current situation, but I didn’t have the confidence to explain it, so I pretended not to know.

“Of course, I’m not saying that an earthquake will occur again in Japan. I’m just asking you to predict if an economic crisis similar to that one will occur.”

“KIKO products can be made and sold back in Japan, and short selling of Japanese companies can be done through paper companies and fintech banks.”

“Try to plan specifically for manufacturing-focused companies.”

No one complained about my instructions.

There were probably a lot of things I didn’t understand, but thanks to the achievements I had made so far, the executives didn’t give a damn.

“And for Southern European countries, let’s assume the worst and make a plan. For example, if Greece goes bankrupt, predict what the European economy will do and create an investment portfolio.”

“If Greece goes bankrupt, are you talking about the IMF?”

“Currently, Greece is the country with the worst financial situation in Europe. There is a high possibility that the country will go bankrupt like Korea did.”

Everyone nodded at this instruction.

In the case of Japan, there was an absurd reason: a major earthquake.

In the case of Greece, it was understandable because there was evidence of worsening financial conditions.

“If the whole of Southern Europe, starting with Greece, falls into financial deterioration, the euro is expected to be the first to take a big hit.”

“Isn’t Quantum Fund an expert in currency? It wouldn’t be a bad idea to draw up the big picture with CEO George.”

The idea was to put Quantum Fund as the face.

Making money during an economic crisis was something that was bound to be criticized in the end.

For Quantum Fund, which is familiar with villains, it was perfect to hide our presence and move.

“Quantum Fund has already made quite a lot of money through this short selling. And we contacted us several times. They suggested that we work together next time.”

“If possible, it would be good to move the Saudi sovereign wealth fund as well.”

“We will meet with the Quantum Fund and Saudi Arabian Sovereign Wealth Fund to discuss matters.”

Vice Chairman Park Man-deuk was quietly listening to President Han’s conversation.

He very cautiously made one negative comment.

“I am by no means doubting the Chairman’s investment plan. However, if the projects being carried out in Japan and Europe are not aligned at the same time, Taewo Group’s financial condition may become even more difficult.”

“I will take full responsibility. However, if this project is successful, Taewo Group will no longer have to worry about financial deterioration in the future.”

The hidden asset was a secret weapon.

We started this project because we needed a defensive wall that could protect Taewo Group without using secret weapons.