The Conglomerate Family Became A Villain [EN]: Chapter 258

258. Tokyo vs. America (2)

As the weather grew hotter, Jung Hyun-woo’s face darkened. Sera placed a glass of cold orange juice in front of him and asked,

“What time did you get in yesterday?”

Jung Hyun-woo took a sip of the juice before answering.

“Around 2 a.m., I think.”

“You came in and worked some more before sleeping, didn’t you?”

“I just slept yesterday. I was too tired.”

Sera was always worried about Jung Hyun-woo’s health.

“We decided you’d hand over some of your work to others starting in the second half of the year, right?”

Victoria Corporation was preparing for executive promotions in June.

Sera planned to significantly increase the number of executives at Victoria Corporation during these June promotions to reduce Jung Hyun-woo’s burden.

“I need to hand over my responsibilities to other people, after all.”

He was in charge of several development teams, and even handing over that work wasn’t leaving him with enough time.

“You’ve also been on the phone a lot lately.”

Jung Hyun-woo placed the glass on the table.

“International affairs are a bit unstable, I suppose.”

“Aren’t international affairs fine?”

Soviet General Secretary Gorbachev and President Reagan were sending signals indicating the Cold War was ending.

“When times change, the flow of money changes. For people like us, that’s a source of anxiety.”

Sera smiled and sat next to him.

“Oh, you’re starting to sound like a real CEO.”

“Like a CEO?”

“You used to sound like a fund manager or an IT developer.”

Jung Hyun-woo sighed softly.

“I guess I’m getting old.”

“Charlie?”

“Well, being in your twenties is older than being a teenager, isn’t it?”

“Tch, don’t start talking about age in front of your older sister.”

It was Saturday, so neither of them had gone to work and were staying at the mansion.

Jung Hyun-woo was about to answer her question when—

*Ring, ring.* *Ring, ring.*

The phone rang loudly.

“Did something happen in the garden?”

Sera reached for the receiver.

“Hello?”

“Hello, this is Korea.”

Sera realized the caller’s English wasn’t fluent and handed the phone to Jung Hyun-woo.

“It’s Korea.”

Jung Hyun-woo frowned at the call on his day off.

“See? International affairs…”

Sera held the receiver to his ear and said,

“I’ll go prepare breakfast.”

She left him alone to concentrate on the call.

“Hello?”

Jung Hyun-woo asked in Korean, and the other person replied in Korean as well.

“Hyun-woo, it’s me.”

The person who called him was Jung Min-young, the sole heir to the Daewoon Group.

“Uncle, what’s happening in Korea again?”

South Korea was in a state of extreme tension due to political conflicts.

“The protests are growing. What should Daewoon Group do?”

Reduce investments and pay off debts.

In the worst-case scenario, they might have to go into austerity [strict economic measures].

“Wouldn’t it be fine to do as you’re doing?”

“Hyun-woo, the way America sees South Korea and the current situation in South Korea are very different.”

“Is the situation that serious?”

“Tanks might roll into Gwanghwamun [a major thoroughfare in Seoul].”

Jung Min-young was worried about the government’s violent suppression.

‘We can’t repeat the Mexico City massacre [the 1968 killing of student protesters].’

He hoped Jung Hyun-woo would take action for the country.

“I don’t think that will happen.”

“Hyun-woo, I’m telling you, the situation is serious.”

Jung Hyun-woo lowered his voice and responded,

“I received a call from Chief Han.”

Jung Min-young was slightly surprised by his words.

“You’re saying the President’s Chief of Staff called you?”

“Yes. We talked a bit about what’s to come.”

“The government assured you there won’t be a crackdown?”

Jung Hyun-woo shook his head and replied,

“I told them the United States doesn’t want a crackdown.”

“Hyun-woo, that’s…”

…merely conveying the United States’ position.

Jung Min-young wanted to say this.

“The current government has the Olympics coming up. They can’t risk a crackdown against the wishes of the United States.”

“The Olympics aren’t a panacea [a solution for all difficulties]. Remember the Mexico City massacre?”

“I’m aware. But things are different now than they were then.”

During the Mexico City massacre, the Cold War was at its peak.

The United States supported anti-communist dictators, fearing the communization of its allies.

“Hyun-woo.”

Jung Min-young thought Jung Hyun-woo was being too optimistic about the situation.

‘If you were to pick the most influential person in South Korea right now, it would be Hyun-woo.’

Now was the time for Jung Hyun-woo to act.

“Can’t you contact the White House?”

Jung Hyun-woo raised his voice slightly.

“The White House?”

“If the U.S. President calls Korea…”

“Then it would be interfering in domestic affairs.”

“So, you’re saying something will eventually happen.”

Jung Hyun-woo shook his head.

“Uncle, don’t overthink it. The government won’t be able to resist the demands of the times.”

Jung Min-young’s voice hardened.

“Hyun-woo, you don’t know the President now.”

He believed the current government wasn’t afraid of bloodshed.

Of course, Jung Hyun-woo knew how things would unfold.

‘The Blue House [the presidential residence] wanted a crackdown, but even the generals who participated in the coup seven years ago refused.’

Summer of 1987.

South Korea was moving toward the future.

“President Reagan is more powerful than the President of Korea. If you anger him, who knows what might happen.”

At his words, Jung Min-young frowned.

“President Reagan’s will is that strong?”

“Think about the People Power Revolution in the Philippines last year.”

In 1986, the Philippines had completed its democratic revolution. Of course, happiness and democratization weren’t the same thing.

The Philippines fell into a deep recession after the democratic revolution due to the chaos.

“Hmm… So, the democratic revolution in the Philippines was at the behest of the United States.”

Jung Hyun-woo didn’t know the situation in Seoul exactly. However, he knew the outcome, so he could speak comfortably.

“The United States will never stand idly by in this matter.”

Jung Min-young cleared his throat slightly.

“I hope you’re right.”

“Uncle, this will end well. So, don’t downsize or halt your business.”

“Alright.”

*Click.*

It was when Jung Hyun-woo hung up the phone.

Sera’s voice came from the kitchen.

“Charlie! Breakfast is ready!”

Jung Hyun-woo sighed briefly and walked toward the kitchen.

“Hoo… Dealt with one thing on a Saturday morning.”

The life of the world’s number one conglomerate didn’t allow for complete rest even on holidays.

* * *

If you sell all the real estate in Tokyo, you can buy not just California or New York, but the entire United States.

This saying began to circulate openly from the latter half of 1987.

Japanese real estate was showing an annual growth rate of nearly 200%, and bank loans were steadily increasing.

“More than half of the top companies in Japan are banks.”

At John Pierre’s report, Jung Hyun-woo sighed briefly.

“If money is pouring into bank stocks, that means loan and interest income is increasing rapidly.”

The two were talking at Jung Hyun-woo’s mansion on the outskirts of Boston.

“That’s right. When the Bank of Japan lowered the base interest rate, commercial banks rushed to lower their interest rates.”

When interest rates fall, real estate prices rise.

This was like a truth in East Asian regions such as Japan, Korea, and China.

“What does Mr. Tanaka say?”

John Pierre replied in a stiff voice.

“That friend of yours is drunk on success.”

Yu Tanaka was in Tokyo, reveling in the bubble [an economic cycle characterized by rapid asset price inflation]. Even if he tried to maintain his composure, he would soon be drawn into the revelry.

“So, he’s saying there are no problems.”

John Pierre nodded silently.

Jung Hyun-woo sat on the sofa and crossed his legs.

“I don’t think the situation is entirely good.”

John Pierre picked up on his words.

“I think so too.”

As a financier working on Wall Street, he could clearly feel the flow of funds heading to Japan was excessively large.

“John, are you alright?”

John Pierre paused and asked back.

“Are you talking about the company’s situation?”

Jung Hyun-woo shook his head slightly.

“No. Aren’t you working on a Sunday?”

The reason the meeting place was Jung Hyun-woo’s home was because today was Sunday.

“Considering the money at stake, I should be working not just on Sunday, but on Sunday morning.”

The assets of Victoria Fund had increased rapidly from $22 billion last year to $95 billion this year.

‘Soon, the asset size will reach $100 billion.’

There weren’t many funds with assets exceeding $100 billion in the United States, or even in the world.

John Pierre raised his voice slightly.

“Shouldn’t I be asking if Charlie is alright?”

Jung Hyun-woo was a CEO who was being chased by time, having to divide every moment.

“It will get better next year.”

“I heard from Ms. Hilton that you’ve started restructuring.”

“The company has grown more than expected.”

The two’s conversation shifted from Japan to Victoria Corporation.

They talked about Victoria Corporation for about 20 minutes.

And then the conversation returned to Victoria Fund.

“How is the U.S. side doing?”

John Pierre replied with a smile.

“It’s exceeding expectations here as well.”

“You mean it’s doing well?”

“Large-scale capital has flowed into LA and Hawaii.”

If there was money flowing into Japan, there was also money flowing out of Japan.

One of the reasons Jung Hyun-woo established a Japanese branch was precisely for this money flowing out of Japan.

“How much has come in?”

John Pierre lowered his voice slightly.

“The total contract size alone is $20 billion.”

The value and managed funds of Victoria Corporation and Victoria Fund were astronomical, but $20 billion would still make them a top contender in the real estate brokerage industry.

“Really?”

“It’s overshadowed by the Japanese stock market, but the returns here are also considerable.”

Here, the contract amount was $20 billion, but the profit wasn’t $20 billion.

“We should give bonuses to the people at the U.S. branch as well.”

“We’re already doing that.”

Managing the U.S. branch was Jeremy Spin’s responsibility more than John Pierre’s.

Jeremy Spin’s management skills were superior to those of John Pierre or Robert Bernard.

“That’s fast.”

John Pierre looked around and then asked.

“Charlie, is that news really true?”

Jung Hyun-woo tilted his head and asked back.

“What rumors have you heard?”

“Mr. Tanaka said that Mr. Jung has drawn a Maginot Line [an impenetrable defensive barrier; here, a point of no return].”

Jung Hyun-woo calmly picked up on his words.

“Didn’t I say before? I want to withdraw before 1990.”

John Pierre and he had discussed retirement and investment direction several times.

“Come to think of it, 1987 is already halfway over.”

“There are only two and a half years left until 1990.”

John Pierre leaned back on the sofa and said.

“Then we should start withdrawing from 1989.”

The funds invested in Japan were so large that it was impossible to withdraw in about half a year.

“Actually, I think we should start next year.”

John Pierre raised his eyebrows.

“You mean pull out when the market is good?”

“Buy at the knee and sell at the shoulder [a strategy of buying low and selling high].”

John Pierre chuckled at his answer.

“Charlie, if anyone could do that, they would all be tycoons.”

Having spent many years on Wall Street, he knew it was impossible to buy at the knee and sell at the shoulder.

‘No one can predict how far a company will grow. All we can do is distinguish whether the company is going to fail or continue to grow.’

The end of growth.

In other words, predicting the peak was something even the most brilliant financiers couldn’t do.

That’s why there’s the saying that you should buy stocks and then sleep for 10 years and wake up.

Jung Hyun-woo raised his right hand at John Pierre’s cold reaction.

“John, then let’s change the words. Let’s get out before it collapses.”

John Pierre asked him.

“Charlie, what happens if the Japanese stock market continues to rise after 1990?”

Jung Hyun-woo calmly answered his question.

“Then we just have to applaud the victors.”

It was a story about congratulating those who overcame the fear of the bubble and made profits.

“Can we really applaud?”

“Haven’t we already eaten a lot?”

Jung Hyun-woo’s thought was that they shouldn’t be greedy anymore than this.

‘The bubble might burst not in 1990, but in 1992.’

However, he had no intention of waiting until 1990.

“Looking at Charlie, he seems indifferent to money.”

“That’s a misunderstanding. It’s because I’m not indifferent to money that I’m trying to get out now.”

“You mean you don’t like losing money?”

Jung Hyun-woo said firmly.

“There’s no one anywhere who likes losing money.”

That was true.

No customer enters a casino to lose money. Everyone steps into the casino thinking about winning.

“Charlie, but do you think that story is true?”

“What story are you talking about?”

“That you can buy America if you sell Tokyo.”

Jung Hyun-woo put his hands together and said.

“If the world’s capital is infinite and someone can buy all of Japan’s real estate at the current price, it’s a possible story.”

“You mean it’s realistically impossible.”

John Pierre was talking about gossip, but Jung Hyun-woo was taking his gossip as a documentary.

“If you compare the absolute values, they might be the same.”

In the summer of 1987, Japanese real estate was inflated beyond belief.

The price per square meter in Ginza [a district of Tokyo] was heading towards 100 million yen, and the exchange rate was also continuing to rise.

As of 1987, converting 100 million yen to US dollars was well over 1 million dollars.

And with 1 million dollars, you could buy a two-story detached house in Manhattan, New York.

You can buy a detached house in Manhattan with one pyeong [a unit of area in Korean and Japanese] in Ginza.

Just looking at this, you could see how severe the real estate bubble in Japan was.

“Exactly when should we withdraw?”

John Pierre thought he needed to know the exact timing.

‘Because there’s a lot to prepare.’

Instead of answering his question, Jung Hyun-woo asked a question.

“When do you think would be a good time, John?”

John Pierre thought for a moment and then answered.

“It would be best to start disposing of real estate right before the Olympics.”

“Why?”

“Dispose of the real estate while people’s attention is focused on the Olympics.”

“The Olympics are being held in Seoul, not Tokyo.”

John Pierre said in a bright voice as if he knew.

“But thanks to color TVs, you can watch the Olympics in Tokyo too. Besides, there’s no time difference between Tokyo and Seoul, is there?”

You can comfortably watch the Olympic games without a time difference.

Jung Hyun-woo couldn’t deny his words.

‘That’s right.’

He remembered the 2002 FIFA World Cup held in Korea and Japan. At that time, the games held in Japan and South Korea could be watched without a time difference.

“Sell the real estate right before the Olympics. Then there’s only about a year left.”

John Pierre bowed his head slightly.

“I will prepare thoroughly.”

He had a heavy responsibility as the CEO of Victoria Fund.

‘Charlie is the one who sets the direction, but I’m the one who moves the ship.’

If the ship called Victoria Fund ran aground, it wouldn’t be Jung Hyun-woo’s fault, but his fault.

It was when John Pierre was about to get up from his seat. Jung Hyun-woo asked as if he had belatedly remembered.

“Come to think of it, we didn’t talk about stocks.”

John Pierre raised his voice slightly.

“Are you talking about the Tokyo stock market?”

“That’s right.”

“What do you want to know, Charlie?”

Jung Hyun-woo unfolded his hands and replied.

“We have to get out of here too, so we need to time it.”

The timing to pull out of stocks.

John Pierre said in a soft voice.

“Stocks are lighter than real estate, so we can pull out from 1989.”

His words were orthodox.

But Jung Hyun-woo had a feeling there was something more.

‘Should we pull out sooner? Or is it not too late to pull out after the real estate collapses?’

The exact timing is what you can’t know about stocks.