"Moody's just announced that it is downgrading Argentina's foreign-currency-denominated sovereign bonds and peso-denominated sovereign bonds from Caa3 to Ca!"
"They're saying that following the president, even the finance minister has resigned due to pressure from the opposition and the protesters."
Director Choi Ho-geun, who had been standing with his shirt sleeves rolled up, asked with his nerves on edge at the stream of incoming news.
"How are the bonds moving?"
At that, Jung Hwan-yeop, who was sitting with his tie loosened, answered immediately.
"After the credit rating downgrade announcement a short while ago, they're down more than 15% compared to before the president announced his resignation."
At that moment, Hong Jae-hee cut in while keeping her eyes on the Bloomberg terminal and relayed the breaking news that had just come in.
"JP Morgan says the Argentine government failed to pay 121 million dollars in bond interest that was due on the 17th and the 19th!"
Choi Ho-geun narrowed his brow slightly and looked at Hong Jae-hee.
"Didn't the Argentine government say they had wired the interest?"
Hong Jae-hee, who had been the focus of everyone's gaze, lifted her head.
Because she had been called in since dawn due to the Argentina situation, she looked almost like a different person, with a bare face without makeup, her hair tightly tied back, and even a pair of large glasses without lenses.
"That's right. It looks like the Argentine government lied."
At that, Jung Hwan-yeop leaned back in his chair and added,
"If they're even pulling a lie like this, it really does look like it's heading all the way to a default, doesn't it?"
Choi Ho-geun was thinking the same thing, so he folded his arms and gave a small nod.
"Moody's has also announced that it will downgrade the credit ratings of Argentine domestic banks, including HSBC Argentina, by two notches across the board."
Yoo Seok-hyun shouted again as he lifted his head toward the monitors lined up across the desk.
Jung Hwan-yeop, still seated, shrugged his shoulders as if to say, See?
"Given that they're downgrading the ratings even though a large number of Argentine banks are foreign-owned, it looks like Moody's is treating a default as a foregone conclusion too."
Choi Ho-geun turned his head and asked Noh Hee-won.
"How are the MERVAL index futures reacting?"
Noh Hee-won, who had been listening tensely to the seniors' conversation, quickly opened her mouth and answered.
"They're up 17.49% at 320.46, staying strong for the third straight day."
The MERVAL Index was the benchmark index that reflected the volatility of the Buenos Aires Stock Exchange in Argentina.
"Normally, when an economy gets wrecked like this, the stock market should collapse right along with it, but no one could have imagined it would surge by more than 58% instead."
Jung Hwan-yeop shook his head as if he couldn't believe it.
Then Hong Jae-hee adjusted her glasses, which had slipped down, and replied with a prim expression.
"There's exactly one person who predicted this would happen, isn't there?"
"Right, that's true."
Jung Hwan-yeop let out a small chuckle.
Listening to the two of them, Choi Ho-geun recalled the phone call he had had with Seok-won a month earlier.
"You're saying we should buy MERVAL index futures, not sell them?"
[Yes.]
Choi Ho-geun held the phone to his ear, wearing an expression that said he couldn't understand.
"If Argentina's economy is in such bad shape that you're even expecting a default, then the stock market should crash too. If we buy index futures here, wouldn't we just be taking a loss?"
[In a normal case, yes.]
"...?"
No matter how much he thought about it, he couldn't figure out the reason, and Choi Ho-geun tilted his head with a puzzled look.
[If the Argentine government declares a default, abandons the fixed exchange rate system, and devalues the peso, wouldn't prices surge and cause massive inflation?]
"If the value of the peso falls, import prices will inevitably go up, so that's what will happen."
[That means if you just keep holding peso cash, you'll be sitting there watching your money melt away like ice, right?]
Choi Ho-geun nodded in agreement.
From the public's point of view, it would feel unbearably unfair and like a sudden bolt from the blue, but with the national economy collapsing and things ending up this way, there was nothing that could be done.
[In a situation like this, if there were a way to preserve your assets without losing them, what do you think people would do?]
"...Are you saying that if you buy stocks, you can avoid the effects of inflation?"
When he asked with his brow furrowed, Seok-won smiled and replied.
[You got it exactly right.]
Even so, it still didn't make any sense to him.
"If the economy is shaking, companies will struggle too, so how can you protect your assets with stocks?"
[That's because there's a magic card called ADR.]
"ADR?"
Choi Ho-geun asked again, the wrinkles between his brows deepening.
When an overseas company lists its shares on a U.S. exchange in the form of depositary receipts, it's called an ADR (American Depositary Receipt).
Korean companies like Samsung Electronics and POSCO were also listed on the New York Stock Exchange through ADRs.
[If they face an emergency situation where they declare a default and devalue the peso, the Argentine government will try to restrict not only cash withdrawals from banks but also currency exchanges.]
Because something similar had happened in Korea during the IMF foreign exchange crisis, Choi Ho-geun's expression hardened slightly as he replied.
"That's very likely."
[Cash would be frozen in place and impossible to move, but if you convert stocks into ADRs listed on the U.S. market, you can switch them into dollars or move the money into overseas funds easily.]
Choi Ho-geun let out a low exclamation at the unexpected idea, then tightened his grip on the phone in his hand.
"That makes sense, but isn't that something ordinary individuals can't do?"
[Of course. But it's an option for foreign capital and the wealthy who are in Argentina. And since they have far more money than ordinary individuals, if all of that flows into the stock market at once, Argentina's stock market will surge in the opposite direction of the economy.]
Only then did Choi Ho-geun grasp what he meant, and his eyes began to shine.
"So you're saying the stock market won't move based on fundamentals, but that foreign capital and the wealthy will use the stock market as an escape route."
[Exactly.]
With that, Choi Ho-geun cleared his thoughts and clicked his tongue inwardly in admiration.
'To think it would turn out exactly the way the Chairman predicted. That's really something.'
It was hard to believe, yet the fact that it was reality made it all the more astonishing.
Choi Ho-geun looked at his team members and gave his orders in a firm voice.
"Keep the positions we've set in Argentine government bonds and index futures as they are, and keep watching closely without missing a single thing about how the situation develops."
"Yes."
"Understood."
As he heard their replies, Choi Ho-geun pulled his shirt sleeves back down and straightened them. When he took his jacket from the coat rack behind the desk, Jung Hwan-yeop asked from his chair,
"Where are you going?"
Choi Ho-geun shot him a look and replied curtly.
"Do I look like I have time to report to you about every little thing?"
"If the higher-ups come looking for you while you're gone, I need to have something to tell them."
Choi Ho-geun snorted and slipped his arms into his jacket.
"I'm heading up to the Chairman's office, so even if I'm not here, make sure you all do your jobs properly."
"Yes, sir. You can just trust me and take your time."
"Hey. That just makes me more nervous."
"No, really. Why do you complain no matter what I say? That's unfair. Seriously."
"That's why you should've done better in the first place."
Choi Ho-geun left the office, ignoring the guy muttering something behind him.
He took the elevator up to the very top floor, walked down the corridor lined with thick carpet, and entered the Chairman's office.
In the spacious anteroom, among the staff members working at their desks, Deputy Manager Na Seong-mi, who was wearing a two-piece suit, stood up and greeted him.
"Welcome."
"Is the Chairman inside?"
"Yes."
"I have something to report, so please ask if I can go in."
Deputy Manager Na Seong-mi nodded and picked up the intercom receiver.
"This is Choi Ho-geun from the Asset Management Department. Yes… yes, understood."
She listened for a moment to the voice coming through the receiver, then smiled slightly and said,
"He says you can go right in."
Once permission was granted, Choi Ho-geun went straight to the inner door made of solid wood, briefly straightened his clothes, and gave a light knock.
Then he took the handle and pushed the door open. As he stepped inside, Seok-won, who was sitting at an L-shaped desk lined with multiple monitors, lifted his head.
"Welcome."
Choi Ho-geun walked up to the desk and gave a polite bow.
"What brings you here in the middle of the trading day?"
Seok-won took his eyes off the monitors and leaned back against the backrest of his plush chair as he asked.
"I came to report on the Argentina situation."
"Perfect timing. I just saw the breaking news that Moody's downgraded Argentina's sovereign bonds to Ca."
Choi Ho-geun glanced at the Bloomberg terminal installed on one side of the desk, then looked straight ahead again.
"Up to now, we're up 30% on the government bonds and 65% from the MERVAL index and individual stock call options."
"I noticed that the stock of the oil company Perez Companc has gone up quite a lot."
"Yes. It isn't listed on the New York Stock Exchange as an ADR, but since it holds a large amount of dollar-denominated assets, it's benefiting relatively from the collapse of the peso."
Seok-won spoke with his fingers interlaced.
"As I said before, once the Argentine government declares default and takes emergency measures, the spare funds of the wealthy will flow into the stock market. Let's keep holding our positions as they are for the time being."
"Yes. Understood."
Choi Ho-geun answered without any objection, then added,
"And the stock of Odaeyang, which you told us to accumulate last time, broke past 100,000 won per share today."
After the IMF foreign exchange crisis, when the share prices of domestic companies had plunged to rock bottom, Seok-won did not miss the opportunity and steadily bought up blue-chip stocks that were set to rise sharply in the future.
Among them were Odaeyang, Lotte Chilsung, and Utopia, the three so-called blue-chip value stocks of the early 2000s that would set the domestic stock market ablaze.
In just one year, their share prices had skyrocketed by more than 900%, but Seok-won showed no particular sign of surprise and responded calmly, as if he had known all along that it would turn out this way.
"As its core cosmetics business keeps growing steadily, even though the stock price has gone up and the PER dropped from 1.9 last year to 0.49 this year, it's still going to rise a lot more."
"I think so too."
"The stake we've secured is about 15%, right?"
"That's correct."
"Then let's increase it to 20%. Oh, and don't forget to inform Odaeyang in advance about the purchases so there's no unnecessary misunderstanding."
"Yes. Don't worry."
Choi Ho-geun replied with confidence.
"Then I'll be on my way."
Just as he was about to turn and leave, Seok-won spoke as if something had just occurred to him.
"Oh, right. On your way out, pick up a vehicle catalog from Manager Na, decide what you like, and let me know."
"A vehicle catalog? Why would I need that…?"
When he blinked and asked back, Seok-won unclasped his hands and settled into a more relaxed posture.
"You know that once you're at the executive level, the company provides a corporate car, right?"
"...Of course."
"You'll find out in a few days anyway, but since you're here, it's better if I tell you myself."
Seok-won looked at Choi Ho-geun, who was wearing a puzzled expression, and smiled faintly.
"Congratulations on being promoted to Division Head in this year's New Year personnel reshuffle."
Caught completely off guard, Choi Ho-geun asked in a daze,
"Did you say… Division Head?"
"Yes. Just like you've done until now, I'm counting on you to keep up the good work."
Only then did Choi Ho-geun grasp the situation, and with a face flushed with emotion, he bowed deeply.
"Thank you very much!"
"Director Choi. No, Division Head Choi. This is the result of all the good work you've done so far."
"I may not be enough, but I'll work even harder and serve you until my bones turn to dust!"
"Haha. Don't push yourself too hard, though. Just keep doing what you're doing now."
Seok-won stood up from his seat and personally patted his shoulder in encouragement.
For Director Choi Ho-geun, who had trusted and followed him from the very beginning, this much was a reward he could give without hesitation.
TL/n -
Moody's: A major credit rating agency that evaluates the financial health of countries and companies.
Sovereign Bonds: Debt issued by a national government. Investors buy these bonds expecting repayment with interest.
Foreign-currency-denominated bonds: Bonds issued in a currency other than the country's own (e.g., Argentina issuing bonds in US dollars). These are riskier because repayment depends on foreign reserves.
Peso-denominated bonds: Bonds issued in Argentina's local currency (peso). Their value can collapse if the peso is devalued.
Caa3 → Ca downgrade: Moody's rating scale.
Caa3: Very poor credit quality, high risk of default.
Ca: Even worse — default is highly likely, with little chance of recovery.
Default: When a borrower (here, Argentina) fails to meet debt obligations (e.g., missing interest payments).
+++
MERVAL Index: The benchmark stock market index of Argentina (Buenos Aires Stock Exchange).
During 2001 crisis → MERVAL fell hard.
After default & devaluation (2002 onward) → MERVAL rebounded strongly.
The fictional narrative exaggerates the timing: in reality, the surge came after the collapse, not during the immediate chaos.
ADR: Certificates representing shares of foreign companies, traded on US exchanges. Investors in Argentina can convert local stocks into ADRs, which can then be converted into US dollars, thereby bypassing government restrictions. This made stocks a safe haven compared to holding pesos.
Perez Companc: Argentine oil company.
PER (Price-to-Earnings Ratio): Stock price divided by earnings per share.
A low PER means the stock is cheap relative to its earnings.
Example: Odaeyang's PER dropped from 1.9 → 0.49, signaling undervaluation despite rising prices.