I headed to the hotel where my mother was staying with Ellie.
Since my mother was out for a moment, we sat in the hotel coffee shop and waited. As luck would have it, a group of chaebol wives came bustling in, seemingly from a social gathering.
Seeing me, they quickly approached our table. There were many faces I had greeted before.
"Hello, CEO Kang Jin-hoo."
"You've come with your wife today."
"Your wife is so beautiful."
"How can you two look so good together?"
"Congratulations on your marriage."
The chaebol wives all called Ellie "madam" and acted friendly. After they moved to another table, I asked Ellie.
Ellie smiled brightly.
"Why not? I like it."
She seemed to be enjoying the situation.
Well, if Ellie liked it, I suppose it didn't matter.
I asked her.
"What are your parents like, Ellie?"
As she had told me before, Ellie was born to a Korean-Hong Kongese father and a British mother. And both of them are currently working in Hong Kong.
"They're good people. They're always worried about me."
Ellie, like me, is an only child. As an only daughter, they must be very worried. That's why when she said she was going to the Korean branch, they had hoped she would stay if possible. Still, they respected their daughter's wishes and sent her.
"After I met you, Jin-hoo, I told my parents I had a boyfriend. Though I didn't tell them it was Kang Jin-hoo."
"They must have been very surprised when they found out."
"Of course. They're still surprised."
After the advertising photoshoot, the fact that we were dating was reported in the media and became known to the whole world. Ellie's family was apparently turned upside down. They probably never imagined their daughter's boyfriend would be the richest man in the world.
"I hope your parents will like me."
Ellie said with a smile.
"I'm sure they will."
"I hope so."
After the formal meeting of the families, will it really feel like we're getting married?
As we were drinking coffee together, I saw snowflakes fluttering outside the window.
Ellie looked at the snowy sky with a happy expression.
"It's so beautiful."
"It's the first snow of the year."
The people who had been sitting and talking in the coffee shop were now all looking out the window.
Ellie jumped up and pulled my arm.
"Get up."
"Where are we going?"
"Let's go outside to get some snow on us."
I laughed, finding it absurd.
"Are you a child?"
"Come on!"
"Ah, alright."
***
December is the month of settlement.
As the year's business wrapped up and the accounting was finalized, all companies were busy, and financial companies were especially so.
Although there were some differences between individual companies, the general assessment was that Korean financial companies had done well this year.
This was because the market was good.
The KOSPI, which had been stuck at the 2,000 level for 10 years, broke through 3,000, and with expectations of inter-Korean economic cooperation, it was now on the verge of 3,500.
With a cyclical rally continuing in sectors such as batteries, semiconductors, automobiles, electronics, and bio, there was even a forecast that it could break through 4,000 next year. Talk of expanding the weight in the MSCI index was also beginning to emerge.
If one were to pick the single biggest reason why the Korean economy could grow like this amidst a global low-growth trend, it would undoubtedly be OTK Company.
OTK Company was so overly dependent on Kang Jin-hoo's personal abilities that it could be called his personal company.
If he made a mistake, the entire company would falter. However, as if to mock such concerns, Kang Jin-hoo once again demonstrated his outstanding investment skills this year and led the global economy.
There was one more noteworthy point about OTK Company.
That was the leap of OTK Games. With the success of Lost Fantasy Online following Lost Fantasy M, its corporate value soared.
At the current growth rate, it was highly likely that OTK Games would overtake Faceit and, along with CarOS, become one of OTK Company's two main industries.
The person who had decided to invest in OTK Games was none other than the Vice President. Moreover, he had recently turned the entire game industry upside down by announcing a hostile M&A against Ice Storm.
Although he was overshadowed by Kang Jin-hoo, the market's assessment was that the Vice President also possessed excellent insight.
As the market flowed without major fluctuations, shocking news from the United States hit the financial world.
The US Federal Reserve announced that it was raising interest rates by 75bp, or 0.75 percent!
Federal Reserve Chairman Robert McClay spoke to reporters after the Federal Open Market Committee meeting.
"We are raising the federal funds rate, which is currently operating at 1.75 percent to 2 percent, to 2.5 percent to 2.75 percent. We have achieved our employment and inflation targets early, and because we believe the US economy will continue to be strong, we have judged that a continuous and gradual increase in interest rates in the future is appropriate to achieve and maintain the Fed's goals."
As soon as he finished speaking, a flood of questions from reporters poured in.
***
The world was shocked by the news of the US interest rate hike.
The financial sector was at a loss. The stock market also showed a mixed trend of repeated ups and downs.
Raising interest rates is proof that the US economy is doing that well. But at the same time, it meant that they would be tightening by recovering the money that had been released into the market.
One might think, "Why all the fuss over a 0.75 percent interest rate hike?", but the story is different when it's the US benchmark interest rate.
As soon as I saw the announcement, I headed to the Golden Gate Building. Taek-gyu followed and asked.
"Is it that big of a deal?"
"The benchmark interest rate is the most powerful card a government can play against the market."
Golden Gate was also in an emergency meeting. The employees were also busy monitoring the market.
After waiting for about an hour, Hyun-joo noona and Ellie returned to the branch manager's office.
"Did you expect this announcement?"
Hyun-joo noona shook her head.
"Interest rates were at rock bottom, and the economy was booming. Everyone predicted that interest rates would go up. But this is too steep."
Until now, the Fed had raised or lowered rates by 0.25 percent at a time, checking the market's changes. But this time, they raised it by 0.75 percent at once. It was as if they had raised the rate in one go that they would have raised over three times.
"The problem isn't the US, it's other countries."
As Chairman McClay said, the US economy is strong. They must have raised the interest rate because they judged that they had enough capacity to withstand it.
But what about other countries?
It's no exaggeration to say that in the recent global economy, only the US is doing well.
What added fuel to the already booming US economy was the California restoration project. Thanks to this, not only the IT and other high-tech industries but also the construction and manufacturing industries revived, entering a state of full employment, and now it has reached the point where they have to worry about the economy overheating.
The two main factors considered in a benchmark interest rate hike are employment and inflation.
Ellie said.
"Due to the economic boom, prices are fluctuating in the US. Inflation has also reached a 10-year high."
Both conditions were ripe for an interest rate hike.
Taek-gyu crossed his arms and said.
"Didn't President Ronald hate interest rate hikes?"
Chairman McClay had expressed his opinion on raising interest rates several times before, and each time, President Ronald had spewed insults close to curses, calling it an act that would ruin the US economy.
I shook my head.
"Raising interest rates is the authority of the FRB Chairman. Even the President can't interfere with that."
A fact that many people don't know is that the Federal Reserve is not a government agency but a private corporation, and it operates independently.
This isn't particularly strange. Although the form may differ, almost all countries guarantee the independence of their central banks.
The reason for this is the difference in their roles.
The government prioritizes economic growth. Naturally, it prefers low interest rates over high interest rates, and expansion over austerity. On the other hand, the central bank's top priority is price stability. So, these two sometimes cooperate and sometimes check each other to lead the national economy.
This is also the case for South Korea.
Just as the US is divided into the Treasury Department and the FRB, South Korea is divided into the Ministry of Strategy and Finance and the Bank of Korea. And the benchmark interest rate is also decided independently by the Governor of the Bank of Korea.
However, this is just the principle, and in reality, the government's influence does play a role to some extent.
"At what point will the interest rate hikes stop?"
At my question, Hyun-joo noona pushed up her glasses and said.
"Well. As you know, the US has never been one to be concerned about other countries when raising interest rates."
During the oil shock, they had once raised the benchmark interest rate to 21 percent in a short period.
This meant that if you just kept your money in the bank, your principal would double in four years. Money flocked to the banks, and the price surge caused by the oil shock stabilized.
However, as a result, the dollar became overvalued, and the US manufacturing industry faced a crisis. The US solved this crisis by forcing its trading partners to appreciate their currencies. This was the famous Plaza Accord.
In addition, they raised interest rates to 6.5 percent per year before the dot-com bubble and to 5.25 percent per year before the global financial crisis.
The Federal Reserve is the central bank of the United States.
When a central bank raises interest rates, it is correct to consider only domestic circumstances without being concerned about other countries. But there is one thing that makes the Fed different from other central banks, and that is that the dollar is the key currency.
The dollar is the standard for currency, and the prices of all other currencies move in conjunction with the dollar. Because of this, it is no exaggeration to say that the Fed is practically the central bank of the world, and the interest rates of central banks around the world are determined by the benchmark interest rate set by the Fed.
Ellie raised a counterargument.
"But isn't the situation a bit different now? It won't be as easy as before to ignore other countries."
The current global economy is linked in a way that is incomparably more intimate than in the past.
The IMF crisis in South Korea in the 90s and the collapse of the real estate bubble in Japan did not have a major impact on the global economy.
But now, even a crisis in Greece can shake the global economy significantly.
If other countries are shocked by the interest rate hike, it is highly likely that this will come back as a boomerang to the US economy.
"No one knows what Chairman McClay is thinking. But judging by the strength of his statement, this isn't the end."
The immediate interest rate hike is a problem, but Chairman McClay's statement was a bigger problem. He said he would raise interest rates "continuously and gradually."
This was a signal that the Fed would continue to raise interest rates until it achieved its set target.
"Even if it's the same 0.75 percent, raising it by that much when the rate is 5 percent is a different story from raising it by that much when the rate is 1.75 percent. In terms of percentage, the former is a 15 percent increase, but the latter is an increase of over 40 percent."
In other words, for someone who has borrowed money, the interest burden would increase by over 40 percent in an instant.
"What if it goes up to more than 5 percent?"
Hyun-joo noona shook her head.
"Impossible. How many countries do you think could withstand that kind of interest rate? At that point, an unimaginable shock would occur."
"Right, that makes sense."
Until the financial crisis, you could easily find savings accounts at any bank that offered more than 5 percent interest.
But after the financial crisis, the situation completely changed.
Advanced countries, including the US, lowered interest rates and released money without limit to prevent recession and deflation. And this money flowed all over the world.
Low interest rates increase debt. And the increased debt in turn makes it difficult to raise interest rates.
"The maximum they can raise it to is probably the high 3 percent range. Inflation is also a temporary phenomenon."
In the past, it was natural for prices to rise when a lot of money was released. But the development of production technology, the realization of economies of scale and reduction of production costs due to the global value chain, the emergence of giant distributors like AMZ and Alligini, and low oil prices actually brought prices down.
As noona said, it would be a heavy burden for the US to continue raising interest rates.
Ellie muttered to herself.
"Chairman McClay isn't this hawkish a figure. No one expected him to make this choice. What on earth could have been the change of heart?"
At those words, I paused. I felt an inexplicable sense of anxiety.
Normalizing low interest rates is a natural thing to do. But is that all there is to it? Could there be another reason?
At that moment, Ellie looked at me and asked.
"What's wrong?"
"Huh?"
"You suddenly have a serious look on your face."
I smiled and said.
"It's nothing."
It's probably just a useless thought, right?