"Did you say we shouldn't sell dollars?"
Chairman Park Tae-hong looked at him, puzzled.
Seok-won nodded as he replied.
"Yes. Not only should we avoid spending them—if we have any surplus funds, now is the time to convert as much of it into dollars as we can."
President Park Jin-hyung, sitting across from them, frowned and interjected.
"The exchange rate was around 826 won per dollar last year. Now it's up to 897. That's a huge jump. You're saying we should be buying more dollars at this price?"
"Exactly. It's only gone up 71 won so far. That means the current rate is still cheap. This might be our last chance to stock up on dollars."
"897 won is cheap?"
Jin-hyung's brow furrowed even deeper, clearly unconvinced.
Chairman Park, still holding a cigarette between his lips, gestured for Seok-won to elaborate with a look.
"You've probably heard that the currency crisis that began in Thailand is now spreading across Southeast Asia."
"Are you saying… Korea could go through a similar crisis too?"
Chairman Park asked with a stern expression.
"Yes. The exact timing might differ, but I don't believe we can avoid a speculative attack on our currency."
Seok-won's voice was calm but filled with unwavering conviction.
His certainty that a currency crisis would hit Korea left both men visibly unsettled.
Their instincts wanted to reject the possibility—it sounded too extreme—but Seok-won had shown such remarkable foresight so far that they couldn't dismiss his words outright.
"It's true the situation looks rough after Hanbo and Samo collapsed, but a full-blown currency crisis? Isn't that a bit of an exaggeration?"
Jin-hyung voiced his doubts.
Chairman Park's expression showed he was thinking the same. After all, when Seok-won had warned them about a possible currency crisis earlier, they had assumed he was simply trying to emphasize caution.
"Southeast Asian countries are collapsing like dominoes. So why do people think Korea is immune? That's what I don't understand."
"Well, unlike Thailand or the Philippines, Korea is one of the 'Four Asian Tigers,' with a strong track record of economic success. We even joined the OECD recently."
But Seok-won shook his head.
"Joining the OECD doesn't mean we're a fully developed country."
"..."
"It just means we've stepped away from our former status as a developing nation—a status that came with various export incentives—and moved to the threshold of the developed world. That's all."
He shrugged, a hint of cynicism in his tone.
"Now, especially with the economy in a slump, we've lost the export advantages we used to enjoy. So in reality, OECD membership is more of a liability than an asset at this point."
As the two men listened quietly, Seok-won continued his explanation.
"The long era of the 'three-lows'—low interest rates, low oil prices, and a low exchange rate—is over. With exports declining, economic growth has slowed, and the current account deficit has widened significantly. On top of that, excessive investments made during the boom years are now coming back to bite—that was the critical trigger for Thailand's currency crisis."
He glanced at Chairman Park, still holding his cigarette between his fingers, and raised an eyebrow.
"Sound familiar?"
Chairman Park let out a low grunt in response.
"It's just like Korea."
"There were problems with over-leveraged management even before, but what really brought down Hanbo Group was their decision to borrow heavily to build that steel mill in Dangjin—despite the downturn in the steel industry. As you know, that project never operated properly."
"..."
"Do you really think Hanbo Group is the only one suffering from overinvestment? I don't."
Back then, borrowing to expand recklessly was considered standard practice—so much so that it was harder to find a company not engaging in debt-financed expansion.
'When even the most conservative of the top ten conglomerates had a debt ratio over 300%, what more needs to be said?'
Not just the top ten groups—most companies had dabbled in everything from construction and electronics to trading companies, setting up subsidiaries wherever money seemed to flow. The result? Massive overinvestment and redundant ventures everywhere.
It was this tangled sprawl of unchecked expansion that people cynically referred to as "octopus-style management."
"When the economy is booming and liquidity is abundant, it's not a problem. But when credit dries up all at once like now, all that accumulated debt turns into poison and starts tightening a group's throat."
Chairman Park Tae-hong exhaled a puff of white smoke and slowly nodded.
"You're right. These days, every time I attend a Federation of Korean Industries meeting, all I hear are groans about debt."
"The ones who raised funds through domestic banks are probably faring slightly better. But the companies that took out foreign loans chasing lower interest rates—they're in real trouble now. Not only are they paying more interest, they're also taking heavy losses on currency exchange."
President Park Jin-hyung seemed to agree, his expression showing that he'd heard similar things.
"With the exchange rate jumping like this, the principal and interest payments have effectively gone up more than 8% overnight. If it were me, I'd be panicking too."
"Like I said earlier, it's only an 8% increase so far."
Seok-won corrected him with a glance.
"If the government and the Bank of Korea hadn't intervened, the exchange rate would've skyrocketed even further. The fact that our foreign reserves have shrunk dramatically and are barely clinging to $20 billion—that tells you everything."
Chairman Park raised his eyebrows, still a bit skeptical.
"You're right, it's definitely concerning. But the government is trying to turn things around. They opened up the capital markets early to attract foreign investment, and I heard this month's trade deficit will shrink a little. Doesn't that count for something?"
But Seok-won shook his head firmly.
"No. If anything, that might make things worse."
"Worse?"
"If the foreign capital flowing in were sound, long-term investments, then sure—it would help stabilize the situation. But unfortunately, most of the money we're seeing now is hot money—short-term speculative capital chasing quick profits."
Seok-won's voice grew firmer as he emphasized his point.
"If investors start sensing that things might go south, they'll try to pull their money out of Korea first, before they incur any exchange rate losses. When that happens, this speculative capital will drain what little foreign reserves we have left, triggering a full-blown crisis."
The image of foreign capital flooding out of the country like a receding tide sent a chill through Chairman Park. He let out a grim grunt without realizing it.
President Park Jin-hyung's face also tightened, clearly recognizing how serious the situation could become.
Seok-won, seeing the tension building in the room, lowered his voice slightly and added:
"Before I came here today, I heard that state-run and commercial banks—including the Korea Development Bank—are urgently recalling the foreign currency loans they issued to merchant banks."
Chairman Park, frowning, leaned forward in his seat.
"The banks are pulling their dollar loans?"
"Yes. With Hanbo and Sam-O Group defaulting, interest rates have climbed, making foreign borrowing more expensive. On top of that, the exchange rate has spiked, adding even more pressure. The banks were slow to act, but now they're scrambling to manage their risks."
"Hmm..."
"With dollars becoming scarce, the merchant banks are barely surviving day by day by borrowing ultra-short-term foreign call money from the banks just to settle their positions."
President Park Jin-hyung looked stunned.
"Merchant banks? Surviving on day-to-day loans? Are you serious?"
"I am. And even that's not enough. I heard they're now frantically selling off assets just to cover the sharply increased interest payments on dollar-denominated loans. They're already taking big losses from the currency exchange, but now they're selling their assets at a loss too, so they're getting hit twice."
Chairman Park Tae-hong stared at his cigarette, which had burned all the way down to the filter. He crushed it in a crystal ashtray and murmured:
"Like pulling out the lower stone to prop up the upper one…"
Seok-won turned slightly toward Chairman Park and met his gaze with a serious look.
"They won't be able to hold out much longer like this."
"I don't doubt it."
Chairman Park nodded solemnly.
"With things this bad, there's no way the speculative forces that wreaked havoc across Southeast Asia will leave Korea alone. It's not a question of 'if' anymore—just 'when.' They'll bare their greedy fangs sooner or later."
"Which is why you're saying we should hold onto our dollars."
"Yes. When the time comes, there'll be nothing more valuable than U.S. dollars."
Chairman Park sat in silence for a moment, clearly weighing his options. Then, having come to a decision, he finally spoke.
"I think you're right. Holding onto our dollars is probably smarter than trying to save a bit on interest for now."
"Good choice."
Seok-won's face showed a brief flicker of relief at the answer he'd been hoping for.
Just then, a thought occurred to Chairman Park, and he asked abruptly:
"How high do you think the exchange rate could go?"
President Park Jin-hyung also looked toward Seok-won, his eyes reflecting the same curiosity.
Seok-won paused briefly, then answered:
"It could go as high as 2,000 won to the dollar."
"...!"
Chairman Park's eyes widened in shock.
"Did you say two thousand won?"
"Yes."
While Seok-won nodded calmly, the two others were stunned, their mouths agape.
If 897 won already seemed outrageously high, then the idea of the rate more than doubling was enough to shake them.
"Two thousand won? That would take a national default-level crisis! Isn't that way too extreme?"
President Park Jin-hyung protested, still unwilling to believe it.
"That's impossible. It can't get that bad."
But Seok-won replied, his face now completely serious, all traces of a smile gone.
"If our foreign reserves are completely drained and we're bombarded with repayment demands on our external debt—but have no dollars to pay with—then the only thing we can do is declare a moratorium. And that's no different from a national default."
A moratorium referred to a temporary suspension of debt repayments, typically declared when a country is unable to service the interest or principal on its external debt.
The moment that shocking word came out of Seok-won's mouth, President Park Jin-hyung froze in place.
Chairman Park Tae-hong's eyes widened, and he asked:
"Do you really believe it could go that far?"
Seeing the stunned reactions, Seok-won answered calmly:
"As of last year, Korea's total external debt was about 104.5 billion dollars. And over half of that is short-term debt that comes due within a year."
Seok-won glanced sideways at Chairman Park, who involuntarily swallowed hard.
"But our foreign reserves? We've got barely over 20 billion left. If lenders don't roll over our debts and demand full repayment, then just like I warned last time, we could face what's called a solvent default—a situation where a company or country is technically solvent but goes under because it lacks immediate liquidity."
Chairman Park, realizing that everything Seok-won had been warning them about until now was leading to this, looked absolutely aghast.
"You… You really think that's going to happen?"
Seok-won didn't flinch, meeting the chairman's eyes head-on.
"We've already passed the point of no return. It's too late to stop this train. All we can do now is try to minimize the damage and figure out how to survive the storm that's about to hit."
Faced with the most serious version of Seok-won he had ever seen, Chairman Park's brow furrowed deeply as his mind raced through grim possibilities.
President Park Jin-hyung's expression had also darkened. His eyes were heavy, reflecting the weight of what he'd just heard.
And how could they not be? Unlike before, the crisis was no longer just a theory—Thailand and other Southeast Asian nations were already buckling under the weight of the financial storm. This wasn't just a warning anymore.
This was a forecast turning into a reality.