The Conglomerate Family Became A Villain [EN]: Chapter 234

234. Currency War (1)

Jeong Hyun-woo’s business trip proved successful. His negotiations saved the game division a significant commission to Nintendo, and Victoria Fund successfully shifted its focus from real estate to the Japanese stock market.

Furthermore, he’d planted a seed for South Korea’s future.

‘Either way, it’s a win-win situation.’

Even if events deviated from historical precedent, he was positioned to profit.

‘Of course, there’s still a 98% chance things will unfold as they did historically.’

As he congratulated himself on the successful trip, Sarah’s sharp voice cut through his thoughts.

“That was a spectacularly failed business trip.”

Jeong Hyun-woo frowned, puzzled. “Wasn’t the trip itself a success?”

“How can it be a success when you’re lying here sick? Don’t you realize that if Charlie collapses, the company collapses too?”

Was the problem his detour from Japan to New York?

Or was it that he’d plunged into work after a long trip instead of resting at home?

Regardless, Jeong Hyun-woo’s body couldn’t withstand the demanding schedule, and he found himself bedridden with aches and a fever.

‘Is this the first time I’ve crashed like this since meeting Sarah?’

Jeong Hyun-woo inhaled deeply, admiring Sarah’s radiant blonde hair and the elegant lines of her suit.

‘Hoo… She’s all dressed up; Sarah is as striking as her sister.’

She resembled Charlize Theron.

“You’ll recover if you take medicine and rest at home.”

Sarah frowned, her voice rising at the end of her sentence.

“Seriously… your fever is 39 degrees Celsius [102.2 degrees Fahrenheit].”

She implied that this wasn’t a simple ailment that could be cured with rest and over-the-counter medication.

“I’m fine.”

“What do you mean you’re fine? A doctor will be here soon.”

Jeong Hyun-woo raised his eyebrows at her announcement.

“A doctor is coming?”

“A doctor and a nurse will be at the house all day to look after Charlie.”

“What does that mean…”

Having a doctor make a house call was already a burden, but the idea of them staying all day was difficult to accept.

Sarah stated clearly, “I won’t be home, so someone needs to watch over Charlie.”

The reason for her elegant attire wasn’t a typical workday at Victoria Corporation.

Today, she was flying to New York to present Victoria Corporation’s earnings.

“Then can’t we call Luna?”

Sarah raised her right hand, her tone firm. “Charlie, Luna is simply a secretary who assists you with your work at the company. She’s not your personal servant.”

“I understand that. But having a doctor and a nurse stay at the house feels excessive.”

Sarah picked up her bag, saying, “Robert was about to have an ambulance on standby, but I barely stopped him. Just put up with this much.”

“Even an ambulance?”

“Charlie’s health is that important.”

Jeong Hyun-woo closed his eyes and asked, “But who will open the door when Sarah leaves for work?”

His room was on the second floor.

It would be difficult for a patient with a fever of 39 degrees to go downstairs and open the door.

“What are you talking about? The security team is already on the first floor.”

“Huh?”

“How could I leave Charlie alone?”

Sarah sighed again and turned around.

“Don’t think strange things; just take care of yourself.”

At times like this, she acted like a strict older sister.

“Yes.”

Clack.

As soon as the door closed, Jeong Hyun-woo took a deep breath under the blanket.

“Ha… This isn’t it.”

Instead of projecting the image of a confident CEO, he’d once again shown the image of a younger brother.

‘I think I lost points with Sarah.’

‘Everything can’t be perfect.’

He could only cling to that thought.

* * *

The Plaza Accord.

The core concept was simple.

Increase the value of currencies of economically advanced countries, excluding the United States, to make their goods more expensive.

American consumers would then buy American products instead of pricier imports, reducing the U.S. trade deficit.

“It’s been a year, and what is this?”

Even after the Plaza Accord, the trade deficit persisted. In some countries, it even worsened.

Within the government, some even considered the agreement a failure.

“After the Plaza Accord, the economy will trace a J-curve.”

“So you’re saying we’re currently at the lowest point of the J?”

“That’s right. The U.S. economy will rebound soon.”

Supporters of the Plaza Accord argued that the current deficit was a temporary phase of normalization.

“No matter how optimistically we view the situation, the real economy hasn’t improved; only stock prices have risen, right?”

Both the NASDAQ and the Dow Jones indices were climbing.

“Stock prices always foreshadow the real economy. The fact that stock prices have risen indicates a bright outlook.”

“Isn’t that just armchair theorizing?”

“Haha, that’s a bit harsh. Armchair theorizing? Isn’t the Plaza Accord strategy based on the J-curve theory?”

Disagreement over the Plaza Accord wasn’t confined to the U.S. government.

On Wall Street, opinions were also divided on its effects and future prospects.

JP Morgan was also unable to reach a consensus.

“Henri, what do you think?”

The person addressing Henri Arnault was JP Morgan Chairman Edmund Norman.

“It’s up 35% in a year. I think it’s time for a correction.”

“A correction?”

“In fact, it has only been moving sideways for the past two weeks.”

The conversation between Henri Arnault and Chairman Edmund Norman concerned the yen, which had been strong recently.

“So you’re suggesting we bet on the yen falling?”

“That’s not it.”

“Is your position neutral?”

Henri Arnault crossed his arms and replied, “I don’t think now is the time to be passive.”

Chairman Edmund Norman smiled at the word “passive.”

“That’s not like you.”

Henri Arnault was a conservative investor, but he held strong opinions.

“It doesn’t seem like market sentiment has solidified yet.”

Chairman Edmund Norman inquired, “Sentiment hasn’t solidified? You’ve even been paying attention to the sentiment of individual investors?”

“I’m not just referring to individual investors. The sentiment I’m talking about is the overall market sentiment.”

“Hmm, if what you say is true, then even institutions are wavering.”

Henri Arnault unfolded his arms and spread his hands.

“Aren’t we doing that right now?”

Chairman Edmund Norman shifted his chair and turned to the side.

“The fact that even we can’t decide on a direction suggests that others are in an even worse position. But we must consider that neither you nor I can think entirely neutrally.”

Henri Arnault frowned.

“Why can’t we think neutrally?”

“We can’t help but consider our biggest client.”

The biggest client.

Henri Arnault’s frown vanished upon hearing Chairman Edmund Norman’s words.

“You mean Victoria Fund.”

He specified Victoria Fund, not Victoria Corporation.

The reason was that Victoria Fund channeled money through JP Morgan’s accounts.

Henri Arnault shook his head and said, “But most of their funds are in Japan.”

He meant that only a portion of their cash was currently in JP Morgan’s account.

“It’s in Japan, but won’t it eventually return to our account?”

Henri Arnault took a deep breath at his question.

“Hoo… That’s true.”

“So we can’t assume that Victoria Fund will fail.”

The failure of Victoria Fund.

This implied the collapse of the Japanese economy and the depreciation of the yen.

“Does Edmund believe Japan will fail?”

“Japan without the United States is destined to fail.”

Japanese companies were currently profiting in the United States, but if the U.S. economy weakened, Japan wouldn’t be able to withstand the pressure.

“Then we should short it.”

“Honestly, I’d like to, but based on your attitude, I don’t think you’ll agree.”

Henri Arnault raised his right hand and asked, “What does the higher-up say?”

The higher-up he was referring to was Arthur Morgan, the retired chairman of JP Morgan.

“Arthur says we should make the decision ourselves.”

“Does that mean he’s completely stepped back?”

“I don’t think so.”

However, it wasn’t a significant enough issue for him to intervene. That seemed to be Arthur Morgan’s perspective.

“Let’s observe.”

“Are you suggesting we forgo the potential profits and step back?”

“It would be ideal to profit, but if we lose, we bear the responsibility.”

Henri Arnault remained conservative.

Chairman Edmund Norman chuckled softly at his response.

“Hahaha, I understand. Even for the sake of our biggest client, we will refrain from shorting.”

Henri Arnault’s eyes widened at the words “refrain from shorting.”

“You mean others have contacted you to short together.”

Chairman Edmund Norman elaborated, “Our competitors and brothers.”

Competitors likely meant Citibank or Bank of America, while brothers referred to Morgan Stanley.

“I didn’t think they were so pessimistic about the market.”

Chairman Edmund Norman clarified, “They’re not pessimistic about the market; they’re negative about Japan.”

Many were already predicting Japan’s bubble would burst. However, the world rarely aligns with expert predictions.

* * *

Sarah met John Pier before Victoria Corporation’s earnings announcement.

“Sarah, the situation is a bit strange.”

Sarah raised her voice, “Is it because Charlie is absent?”

“No, it has nothing to do with Charlie.”

“If it has nothing to do with Charlie, how is it strange?”

John Pier lowered his voice and replied, “There are strange rumors circulating on Wall Street.”

Sarah noticed his lowered voice and knew he was being cautious of their surroundings.

“Speak freely. It’s just us here.”

“What about the secretary and aides…?”

“Tom is here, but the attendants have gone to the interview room.”

Victoria Corporation’s earnings announcement was scheduled to be held in the interview room of Victoria Corporation’s New York branch.

John Pier sighed briefly after hearing her explanation.

“Ha… The rumor is that Wall Street banks have united.”

“Are they going to short Victoria Corporation again?”

Victoria Corporation had already won a short selling war in the past.

“That’s not it.”

“Then what’s the problem?”

“They seem to want to short the yen, the mark [German currency before the Euro], and the pound.”

Sarah calmly absorbed his answer.

“So they’re implying the dollar will rebound again.”

For an American bank to sell foreign currency was essentially a bet that the dollar would rise, encouraging others to buy it in advance.

“It means it’s gone up too much.”

“What does John think?”

“Technically, I think it’s reaching a limit.”

John Pier also believed that a technical correction was inevitable.

“Then should we participate in the short selling?”

“That’s…”

Sarah’s voice hardened as John Pier trailed off.

“Charlie is against it.”

“Couldn’t Miss Hilton persuade Charlie?”

John Pier felt that the investment in Japan was somewhat excessive and wanted to hedge their bets.

‘It’s wise to have some insurance in case of a technical decline.’

He generally followed Jeong Hyun-woo’s investment strategies, but he couldn’t simply ignore this rumor.

“Are you suggesting I persuade a sick Charlie?”

Sarah’s voice was slightly sharp.

“I heard that Charlie wasn’t feeling well, but I didn’t realize it was that bad…”

“His fever has risen to 39 degrees Celsius. He didn’t even want to go to the hospital, so I called a doctor to the house.”

“It’s more than just not feeling well.”

“Charlie is too confident in his youth.”

Sarah said, rising from her seat.

“If it’s a technical correction, let’s just ride it out.”

“Sarah?”

“We’ve already made a substantial profit. It’s okay to lose a little.”

Sarah turned and headed to the interview room.

John Pier was left alone.

He looked at her empty seat and mused.

‘Miss Hilton is extraordinary as well.’

It wasn’t just Jeong Hyun-woo who was exceptional. He often overshadowed her, but Sarah frequently made remarkable decisions.

Fifteen minutes later.

Click. Click.

Accompanied by a barrage of flashes, Sarah’s Victoria Corporation’s third-quarter earnings announcement commenced.

“Distinguished investors, I am pleased to announce good news again today.”

The words “good news” implied an earnings surprise.

The reporters briefly exclaimed upon hearing her opening statement.

“It seems like the results are positive again this time?”

“It appears to have exceeded market expectations so far.”

Sarah’s initial announcement covered the live broadcast service, including JP Service.

“The number of subscribers to each service is continuously increasing, and we’ve seen particularly positive developments in the western region.”

Rumors of Western financial companies collaborating with Victoria Corporation had been steadily circulating.

However, with today’s announcement, the rumors were confirmed.

“It’s a scoop.”

“The rumor was true.”

The reporters’ hands moved faster.

Some had already left the conference hall to find a phone.

“Compared to Victoria Corporation’s earnings announcement, IBM is too boring.”

IBM was the world’s leading company in terms of market capitalization. However, IBM’s performance began to decline from the beginning of 1986.

“Thanks to Compaq and Dell.”

As of 1986, Compaq possessed all the advantages of IBM and Dell.

In 1986, they led the market by unveiling the world’s first computer equipped with the Intel 80386 chipset, commonly known as the 386 computer.

This 386 computer was an IBM-compatible model and included Microsoft’s latest operating system, Windows, as a bundle.

The market’s response to the combination of the latest hardware and innovative operating system was explosive.

“At this rate, I think we’ll be overtaken by Compaq.”

“Then will Compaq become the world’s number one company in terms of market capitalization?”

“It’ll be Victoria Corporation rather than Compaq.”

“No way.”

“This guy, you never know.”

While the reporters were conversing, Sarah’s announcement transitioned from the live service to the game division.

While Nintendo’s NES was a hit in North America, the game division’s performance continued to improve.

“Sales increased by 12%, and profits increased by approximately 2% compared to the second quarter. This increase was achieved through the improvement of G-Shop’s distribution network and the increase in sales of NES packs.”

Everyone knew that Victoria Corporation’s game division was thriving.

The reporters covering IT sighed briefly as they listened to Sarah’s announcement.

“There’s no company as unique as Victoria Corporation in the game industry.”

“Because they’re handling distribution and development simultaneously?”

“No, they don’t have a mega-hit.”

Victoria Corporation didn’t have a major hit like Nintendo’s Donkey Kong or Atari’s Pong. Nevertheless, the company continued to grow.

“It means they’re doing a good job of managing it.”

“You mean Charlie Jeong?”

“Miss Hilton and Robert are in charge of operations, so it must be thanks to them.”

Many reporters still believed that Sarah and Robert were running the company.

Sarah’s announcement moved past the game division and onto the network security business.

“There was also an increase in sales in the network system. Although the sales volume isn’t large, it showed remarkable results with a 22% increase.”

The network security business was a sector that Victoria Corporation envisioned as a future source of revenue.

“The network side is also performing well.”

“There are rumors that government contracts have also increased.”

“So it’s an IT company that also benefits from the government’s budget.”

Victoria Corporation had now become a massive company with tens of thousands of employees.

They had retail stores like G-Shop, as well as major banks and even the U.S. government as clients.

“What’s next?”

“It’ll be the highlight of this announcement.”

The highlight of this earnings announcement, in the reporters’ minds, was Victoria Fund.

Victoria Fund wasn’t a subsidiary of Victoria Corporation, but it was an affiliate in which Victoria Corporation held more than 30% of the shares.

And Jeong Hyun-woo and Sarah, who managed Victoria Corporation, each held 60% of Victoria Fund’s shares, so the market considered it the same entity as Victoria Corporation.

“Next is Victoria Fund.”

The reporters’ eyes were fixed on Sarah.

“It’s coming.”

“Will it be an earnings surprise?”

Sarah paused for a moment and then continued, “Let me reiterate, Victoria Fund is a company that manages Victoria Corporation’s profits. The performance of Victoria Fund is partially reflected in Victoria Corporation’s performance.”

After finishing the explanation, she finally announced the results.

“Victoria Fund’s performance this quarter reached 210%.”

Not 21%, but 210%.

The reporters gathered in the interview room couldn’t believe their ears.