Chapter 110

Chapter 110

I did not like the current American President, who was currently embroiled in sex scandals. However, Americans liked him. His current low approval ratings were due to sleeping with a 22 year old White House intern, even though ostensibly, they impeached him for lying to Congress. His work would be evaluated higher after his term was over. During the 8 years he served as President, America’s economy boomed. Also, his pioneering American market ideology that opened global markets, the North American Free Trade Agreement (NAFTA) would be praised by many.
If he had used the IMF in America’s best interests, it would have been more forgivable. However, I knew from my past life that he was a tool of the “Powers” that controlled Wall Street rather than someone who served his country.
“Don’t do anything until I give you the signal.”
I warned Jonathan, and Jonathan’s bodyguard/driver was the one who looked back in surprise. I had let him drive because Jonathan trusted him.
“I’m just as angry as you are, but all right. What’s the signal?”
“You’ll know.”
**
We entered the White House and went through various checkpoints to a meeting room deep inside the South Wing guided by a White House page. This was not the first time I had been here.
I saw the Secretary of the Treasury, Edward was his name, waiting for us and no one else. It didn’t matter, as the Secretary was a spokesman for the President, and both spoke for those who controlled Wall Street. I did not think courtesy was needed in this case, as what I wanted was to speak first, to shake his confidence and his belief that he held the dominant position.
(EN: Robert Edward Rubin served as the 70th United States Secretary of the Treasury during the Clinton administration. Before his government service, he spent 26 years at Goldman Sachs, eventually serving as a member of the board and co-chairman from 1990 to 1992. His post-government role includes serving as director and senior counselor of Citigroup, where he performed advisory and representational roles for the firm. From November to December 2007, he served temporarily as chairman of Citigroup and resigned from the company on January 9, 2009. He received more than $126 million in cash and stock during his tenure at Citigroup, up through and including Citigroup’s bailout by the U.S. Treasury.)
“Please listen. I am thinking of ruining LTCM right now.” (EN: Long-Term Capital Management L.P. (LTCM) was a hedge fund based in Greenwich, Connecticut. )
Jonathan looked at me with surprise, as he did not expect me to be so aggressive against the head of American finance, which was the strongest in the world right now. Edward also cleared his throat and looked at Jonathan with admonishing eyes. Jonathan sat in front of him, still in shock, and I sat next to Jonathan to face Edward. The Minister was staring at me with a mixed expression as he spoke.
“This is not your office, young man. I know why you’re angry, so you need to be mature. There’s still time. About LTCM, while I cannot stop such foolishness, isn’t that one of your precious acquisitions?”
LTCM was the hedge fund that had lost heavily against us during the Russian finance war. I had bought it before its insolvency affected America. (EN: In the original timeline, in 1998 it lost $4.6 billion in less than four months due to a combination of high leverage and exposure to the 1997 Asian financial crisis and 1998 Russian financial crisis. The master hedge fund, Long-Term Capital Portfolio L.P., collapsed soon thereafter, leading to an agreement on September 23, 1998, among 14 financial institutions for a $3.6 billion recapitalization under the supervision of the Federal Reserve.)
(EN: If Sun hadn’t bought LTCM, the Federal Reserve would have had to bail it out.)
“You said you knew why I was angry.”
I stayed angry, and Edward looked at Jonathan with an awkward expression. While I currently owned New York, I seemed to be too young for him to take me seriously. However, Jonathan did not intervene, and Edward looked at me differently on seeing the situation.
“I wanted to meet you for a long time, Sunhoo. But, this was unexpected.”
“You don’t have to change the subject. Why are you doing this when you owe us so much?”
“What do you mean?”
“You know what the consequences would have been if we had not bought LTCM and the other hedge funds to prevent a second Great Depression.”
“That was to fill your own pockets.”
“Of course not. If I had wanted to fill my pockets, I would have let them go into insolvency. I would have sold them short, not only making money off them, but reducing future competition.” (EN: Sell Short: sell stock or other securities or commodities which one does not own at the time, in the hope of buying at a lower price before the delivery time.)
“Jonathan, why are you so silent?”
“I understand why Sunhoo is angry.”
“For this? I cannot understand what your position on this is.”
Edward shrugged his shoulders like he really did not know as Jonathan spoke.
“Sunhoo is not only the majority stockholder, he’s the senior partner, and it seems that I shouldn’t get in between you two.”
Jonathan folded his arms, and the Minister looked at me again.
“Did you do this because your patrons couldn’t get any of the Korean firms or banks they coveted? Were you just putting me in my place because I’m Korean?”
Edward’s eyes grew cold, and I knew I had been right. I stood up to continue.
“If you want to look down on me, do so. But things will happen from tomorrow and don’t forget you were the one who started it. Please convey my message to the President. Let’s go, Jonathan.”
Heads of State smiled while threatening a country with ruin, and their subordinates emulated their bosses. Edward’s world was one where people hid malicious intent under smiles. They cursed with esoteric financial terms and hid their daggers under numbers. People like him did not often meet naked, visible hostility, so I had switched to polite, mild mannerisms after my first threat concerning LTCM. Thus, he knew I was serious.
It worked as Edward blocked me from going out and showed his true colors.
“What’s all this nonsense just for getting your name in a magazine?!”
He shouted and opened his eyes wide at hearing his own voice.
“Why are you letting things go this far? I know that if I were you, I wouldn’t be shouting. You don’t have the time to do so.”
Edward frowned as he heard the thorns and threats in my words.
“What do you mean?”
“If I were you, I would be heading to Japan now to stop a young guy from playing with your country’s Treasury Bonds there.”
His gaze wavered for a moment as I continued on.
“That ‘hypothetical’ young guy would probably go after the American Treasury Bonds held by Japan, if he were in the same ‘hypothetical’ circumstances I was in. Even if you went there to stop it, I don’t know whether Japan will welcome you, or your interference, or any orders you might give. Even with the weight of the White House. Japan is still in a recession from what you did in the nineties. Also, are you aware that there are many Russians who still believe that this is the Cold War Era? And still nurse antagonistic feelings toward the US? I’m sure both countries would love to sell this ‘hypothetical’ young man as much American Treasury Bonds as he’s able to buy. ”
(EN: The Lost Decades refers to a period of economic stagnation in Japan caused by the asset price bubble’s collapse in late 1991. From 1991 to 2003, the Japanese economy, as measured by GDP, grew only 1.14% annually, while average real growth rate between 2000 to 2010 was about 1%, both well below other industrialized nations.)
(EN: An economic bubble or asset bubble (sometimes also referred to as a speculative bubble, a market bubble, a price bubble, a financial bubble, a speculative mania, or a balloon) is a situation in which asset prices appear to be based on implausible or inconsistent views about the future. It could also be described as trade in an asset at a price or price range that strongly exceeds the asset’s intrinsic value.)
(EN: The Plaza Accord was a joint–agreement signed on September 22, 1985, at the Plaza Hotel in New York City, between France, West Germany, Japan, the United Kingdom, and the United States, to depreciate the U.S. dollar in relation to the French franc, the German Deutsche Mark, the Japanese yen and the British Pound sterling by intervening in currency markets. The U.S. dollar depreciated significantly from the time of the agreement until it was replaced by the Louvre Accord in 1987. Some commentators believe the Plaza Accord contributed to the Japanese asset price bubble of the late 1980s.)
(EN: What Sun is implying is that Japan’s economic recession was caused by a conspiracy, engineered by the United States, to deliberately cripple the Japanese economy, in order to bolster the American economy, at the expense of Japan.)
Ed placed a hand over his forehead after listening to me and slowly lowered it. He would have seen a financial war, a war where currencies were used like weapons and one that would escalate to a global scale, as the inevitable jackals would move in, scenting prey in distress. And a disastrous outcome, where even if the US won, the White House would lose.
“How dare you say such things here, inside the White House! You know you can lose all of your money!”
“You’re familiar with the investments Jonathan and I have made. I really don’t care, as I can earn money again if necessary. Besides, if this ‘hypothetical’ young man started a financial war with the United States, who’s to say I couldn’t profit from it? I could end up richer than ever before.”
“What is the real reason for this? Don’t tell me that the Forbes magazine article is the reason.”
“This conversation is getting nowhere. If you’re coming after me, prepare a ticket to Japan and don’t forget to tell your Wall Street ‘Patrons’ that you have started a new war, where they can gain back the money they had lost in Russia.” (EN: Loyal readers, you’ll find out who the “Patrons” are later. This is Sun’s real threat. He’s implying that if he attacks America, America will be forced into such dire straits, that they’ll have to publicly admit they can’t pay back foreign debts, like Russia was forced to do in chapter 64. )
The Secretary glared at me, and he really looked like an S class boss monster. I was aware that he had the power to make Jonathan’s and my life hell with a few words if necessary.
“America likes bloodless wars, right? If your country becomes the battlefield of a new financial war, your people will follow your policies and pay taxes for you to fight against me. Shouldn’t you thank me for playing the villain?”
Edward looked like he wanted to curse me but looked at Jonathan who was wearing an indifferent face. I wanted to clap, as I knew he must have used incredible patience to hold himself in.
“This kid is fourteen?”
I nodded to Jonathan, who then spoke.
“Yes, I also regretted having thought so before.”
Jonathan smiled, but Edward did not as he murmured.
“You guys joke around too much. I will speak to Forbes but remember it was a mistake made by my subordinates.” Politician to the last, he instinctively covered his a$$.
He glared at me before going to the door and went out with these last words.
“Resolve the misunderstanding between the pension committees and us.”
The door slammed, and Jonathan and I glanced at each other. We could barely grasp what we had done. We had won the battle in the White House.