September 17, 2001, 11:00 a.m.
As the stock market plunged, shattering expectations, the Eldorado Fund trading floor was operating at a breathless pace.
Beep! Beep!
"American Express is falling on expectations of poor performance due to the fallout from the terrorist attack!"
"Airline stocks, including Delta and American Airlines, are in free fall!"
"Continental Air, which has been flagged as being at risk of bankruptcy due to its deteriorating financial condition, has seen its share price cut in half!"
With traders shouting from every direction, the vast trading floor was in utter chaos, enough to leave anyone dizzy.
Dan Baradan, the senior investment chief who had rolled up his dress shirt sleeves and was directing the traders, approached with his headset hanging around his neck.
He spoke in a hoarse voice to Seok-won, who was standing behind him watching the situation unfold together with Landon and Andrew.
"The Dow plunged more than 600 points right at the open, but as you can see, it's stopped falling and is showing a slight recovery."
[DJIA : 9,035.40 (570.11)]
With both hands tucked into his trouser pockets, Seok-won turned his gaze to the Dow index displayed on the massive market board.
Out of the 3,027 stocks listed on the New York Stock Exchange, well over half, 2,518 of them, were declining, leaving the board looking pale blue across the screen.
Just then, Mason, a senior trader, spun around in his chair to face them and shouted loudly.
"Through Kuwait's state-run KUNA news agency, OPEC announced that it may allow international oil prices to fall by increasing production if necessary!"
With fears of war driving international oil prices higher after the terrorist attack, news of increased production from OPEC was clearly positive for the stock market.
As expected, the Dow and other major indices, though only slightly, began to narrow their losses after the announcement.
"The European Central Bank has cut its benchmark interest rate by 0.5 percent!"
"The Swiss National Bank has also announced a 0.5 percent rate cut!"
It looked as though not only the U.S. government and the Fed, but also major central banks around the world, including the Organization of the Petroleum Exporting Countries (OPEC), had coordinated in advance, all exerting themselves to the utmost to prevent a collapse of the New York stock market.
Watching this, Seok-won let out a bitter smile inwardly and thought to himself.
'If the New York stock market, reopening today after four days, were to collapse, the shockwaves would strike other countries that have already endured sharp declines and are only now finding their footing, triggering a domino-style breakdown of stock markets worldwide. In that sense, this might be the natural course of action.'
Whether due to the combined rate cuts, the declines in the three major indices narrowed significantly compared to earlier.
[DJIA : 9580.32 (▼25.19)]
[S&P500 : 1084.33 (▼8.21)]
[NASDAQ : 1629.10 (66.28)]
As the indices clawed back losses and showed signs of rebounding, buy orders from investors who had recoiled in shock at the initial plunge began to trickle back in.
"Doesn't it feel like the market trend is starting to turn?"
At Andrew's remark as he pushed up his gold-rimmed glasses, Landon looked at him with a tense expression.
If the market managed to overcome the shock of the terrorist attack and successfully rebound, the Eldorado Fund, which was holding short positions, could suffer heavy losses.
Unlike their concern, Seok-won remained calm.
"We expected large swings today. It's only been three hours since the market opened, so don't rush it. Let's keep watching."
"Hmm… all right."
Andrew looked as though he had more to say, but quietly closed his mouth.
Landon also felt a flicker of anxiety at the thought of the market rebounding outright, but chose to trust Seok-won and continue observing.
Just then, Mason shouted loudly.
"Oh! United Technologies has reported an earnings shock and cut its guidance for the next quarter."
"United Technologies is plunging more than 10 percent on the earnings miss!"
The sudden emergence of an unexpected negative development poured cold water on a stock market that had been steadily narrowing its losses.
"Trading in United Technologies has been halted after a plunge of more than 15 percent!"
The market atmosphere, which had seemed to be reviving just moments earlier, shifted abruptly.
"Oh. Damn."
As the three major indices that had been showing signs of recovery all turned downward again and widened their losses, Landon let out a low exclamation.
"It looks like the market direction has shifted again."
When he turned to Seok-won beside him, Seok-won wore an expression of relaxed certainty, as if he had expected this all along.
"See? I told you volatility would be high today."
"But this is practically a roller coaster."
With hundreds of billions of dollars at stake depending on where the market ended up today, it was remarkable that he showed not the slightest sign of tension.
It was the kind of composure only someone absolutely confident in their judgment could display.
Andrew couldn't help but marvel at that confidence, clicking his tongue inwardly.
Just then, Mason raised his voice to announce breaking news coming in through the Bloomberg terminal.
"The Swedish central bank has just announced a 0.5 percent cut to its benchmark interest rate!"
Hearing the consecutive rate cut announcements from central banks around the world, Andrew nodded slightly.
"As expected, there must have been coordination with European countries before the Fed convened its emergency meeting and announced its rate cut."
Seok-won replied while watching the large market board, where the red that had been gradually shrinking was now spreading again.
"The plan wasn't bad, but to pull a collapsing market back up, they needed to take much bolder action."
"Are you saying that even dropping the benchmark rate by two notches at once with a big step wasn't enough?"
Landon asked, eyes wide.
Seok-won answered by jutting his chin toward the massive market board installed in front of them.
"Isn't the fact that the indices are plunging proof enough?"
"Ah… I see."
Landon smacked his lips as if he finally understood.
Andrew, standing nearby, also agreed that the barrage of measures unleashed all at once had been insufficient to stop the wave of panic selling, and added,
"Even though OPEC threatened to increase oil production, refinery-related stocks like ExxonMobil, Chevron, and BP aren't falling at all. They're actually continuing to show strength, which makes it clear the impact has been limited."
Taking in the sharply surging trading volume, Seok-won spoke.
"Even after playing such strong cards, the market is still collapsing this helplessly. That's only going to amplify investors' fear."
"Whether they intended it or not, it's practically showing that even the U.S. government and the Fed can't stop the crash. If it were me, I'd be anxious enough to dump whatever stocks I'm holding."
At Landon's words, Andrew nodded in agreement.
"The Philadelphia Semiconductor Index is now down more than 7 percent!"
As airline, hotel, and insurance stocks that had been directly hit by the terrorist attack plunged, and even financial stocks fell by an average of more than 10 percent, Landon rubbed his hands together and spoke with an eager expression.
"Citi, JPMorgan, even Morgan Stanley. Financial stocks are getting absolutely crushed today."
Seok-won shrugged as if it were only natural.
"With so many financial firms housed in the collapsed Twin Towers, and massive losses being unavoidable due to the market crash, the shock was bound to be severe."
"I never imagined that loading up on short positions against Wall Street investment banks because of Enron would end up turning into a jackpot like this."
Landon laughed with a low chuckle, and Andrew, standing beside him, smiled along.
"At this rate, our returns will be far greater than we originally expected."
This was exactly the scenario he had anticipated when placing the bet, but Seok-won simply nodded slightly without saying more.
"We were lucky."
"They say luck favors the prepared. You anticipated that the stock market would be weak this year and placed short bets in advance, and the timing lined up perfectly, magnifying the profits. You can't just dismiss that as luck."
"That's right. And having the conviction to make such a bold bet is something only the boss could pull off."
As the two praised him, Seok-won remained silent, a faint smile on his lips. At that moment, Dan, who had returned to his station, hurried over with a flushed face and raised his voice.
"Breaking news from Bloomberg. Dynegy, which was negotiating with Enron, has completely abandoned the acquisition!"
"Is that true?"
Andrew asked, his eyes gleaming.
"Yes. They say the due diligence revealed that Enron may have even more hidden debt than it disclosed, so Dynegy decided to walk away. According to Bloomberg, the decisive factor was Enron suffering massive losses after investing heavily in crude oil and natural gas derivatives, losses that were amplified by this terrorist attack."
"What? Are you telling me those Enron bastards were holding short positions?"
Landon said incredulously.
"Up until before the attack, the prevailing outlook was that energy prices would fall due to reduced demand from an economic slowdown. They had plenty of reason to make short bets."
Seok-won said this while stroking his chin with one hand, and Andrew nodded as he added,
"That's exactly right. On top of that, rising debt and credit downgrades had drained their cash reserves to a dangerous level, which likely pushed Enron into making high-risk investments."
"If that's the case, Enron's stock, which has already fallen through the floor and into the basement, is going to plunge even further."
As Landon let out a short exclamation, he turned his gaze to Dan, standing in front of them.
"What's Enron trading at right now?"
Dan, as if he had been waiting for the question, answered immediately.
"When I checked just now, it was at six dollars and twenty cents per share."
"So it's taken a hit of more than 16 percent in one shot."
Andrew's eyes gleamed behind his gold-rimmed glasses.
"After the major investment banks, now even Enron. All the stocks we shorted are collapsing together, so our returns are going to surge massively just today. Hahaha!"
Landon burst into loud laughter, clearly delighted.
Yet even in this situation, Seok-won remained perfectly composed.
"No matter how big the returns look, until we close the positions and lock in the profit, they're nothing more than numbers."
"Of course, that's true. But in an atmosphere like this, it feels like the profits will only grow, not shrink. Don't you think?"
Seeing the grin on his face, Seok-won finally let out a small smile.
"Enron doesn't look like it has much time left before it needs to close its positions either, so make sure you're ready in advance."
At the mention that the long-awaited moment was finally approaching, the three of them all brightened at once.
"Yes!"
"Understood."
"Heh. I had my doubts, but it really has come close to the price range you mentioned, boss."
At Landon's words, Andrew recalled a conversation they had once shared.
To short a stock that had been soaring as high as ninety-one dollars just earlier this year and drive it down this far, generating well over a 90 percent return. Who could have imagined something like that?
Andrew could only marvel and look at Seok-won with undisguised admiration.
Meanwhile, Seok-won, watching the large market board, saw that the declines in the three major indices had deepened even further, pushing past the brief rebound zone and sliding steadily downward. It was clear now that the market's direction had fully solidified.
"I don't think there's any need to keep watching."
Turning to Dan, he continued,
"I'll be upstairs, so report to me immediately if there are any changes."
"Understood."
With that, he turned and walked away, and his aide, Manager Han Ji-seong, quickly followed behind.
The three who remained stared blankly at Seok-won's retreating figure as he left the trading floor.
"If it were me, I'd be fidgeting nonstop, worried the market might rebound again, and I'd be glued to the monitor until the very end. His nerve is as impressive as his investing skills."
"Doesn't that just mean he has that much confidence?"
Andrew shot a sidelong glance at Landon as he spoke.
Dan then cut into the conversation in a trembling voice.
"We're already managing one of the largest pools of capital on Wall Street. Once this entire bet is finished, won't the assets under management double?"
"Probably."
As if the mere thought sent shivers through him, Dan clutched at his chest.
"Then just how much money are we talking about? Damn, my jaw won't even close."
Landon shook his head as if he had started to do the math, only to give up partway through.