The Chaebol Who Flies From Space - Chapter 22
Only Noblemtl
22. Cold but warm winter (3)
“How is Enron’s stock price performing?”
Because Enron was such a large company, the scale of short selling of its stock was enormous.
Since the investment was made through swap transactions using an investment bank’s trust account rather than through direct short selling, it was difficult for outside parties to know the details.
Not only Enron, but also WorldCom, which inflated its profits through line lease swap contracts, was a target of short selling.
[Bankruptcy imminent with demand for $8 billion in repayment. Stock price plummets from highs of $45 to $15. U.S. stocks are also falling due to the impact.]
“Now it’s harvest time. Oh my! I was shocked when the Goldman guys suddenly barged in.”
When I think about that time, a sigh escapes my lips.
Enron’s stock price, which had been rumored to be in crisis for a long time, experienced a huge wave when Goldman intervened and released a positive report.
Goldman later raised its target price to $48, citing Enron’s bright future business prospects and its view that operating profits will increase in the long term.
When this report came out, Enron’s stock price soared from $30 to $45.
Before the IT bubble burst, Enron was a great company and one of the most innovative American companies.
From the outside, it didn’t look like a company that would collapse easily.
But the inside was rotten and decaying. The $100 billion in sales announced in 2001 was a product of complete fraudulent accounting, and the actual sales were only $6.7 billion.
[Goldman also had a lot of ties to Enron, so he probably needed time to get out.]
“They are really bad guys. They are trying to induce ordinary investors to invest with false reports and get out of it themselves.”
[Investment banks on Wall Street are always the same. It’s not just one or two days since they’ve been issuing false reports. Investment bank reports are usually trustworthy, but when their own interests are at stake, they’re ruthless.]
“It’s been a month, so most of it must have been taken out.”
[After the report came out, many of the accounts suspected of being Goldman funds were liquidated. The same goes for WorldCom.]
“There’s no place that Goldman doesn’t meddle in.”
[Because both WorldCom and Enron were considered excellent companies worldwide. Most of the banks had shares in them.]
As the New York Stock Exchange opened, Enron’s stock price fell to $15 and hovered around for a while, but then plummeted again, breaking the $10 mark. Then it fell again, falling to $2.
“Wow! Looks like the news is out? It’s so crazy to see it like this.”
[The news is out. Enron has filed for Chapter 11 bankruptcy protection.]
“Then it’s really over now.”
I got up from my seat and stretched.
I looked at my watch and it was 3am.
Because of the time difference, it was tiring to watch the New York Stock Exchange in person. But I thought it was a historic event, so I looked at the monitor until this late at night.
The money borrowed and shorted alone exceeded $12 billion. If this goes bankrupt, it will be a jackpot. Those who lent the stocks will be crying.
“How much is it in total?”
Telepathy
Even without me telling her specifically, Ariel quickly calculated the return on her investment.
There are 12 large accounts in several investment banks, and if you include small accounts, there are over 82.
[A little while ago, all accounts were settled. The accounts received $11.7 billion as the shorted stocks were bought back at $1.20 and the settlement was completed. Excluding borrowings, the net profit was $3.6 billion.]
Whee~
When I heard the amount, a whistle came out of my mouth without me realizing it.
I opened the bottle of alcohol I had prepared.
Wild Türkiye 101
Since they have plundered the American market, they should enjoy American alcohol. Starting with $24 million sent to the US as money for smuggling, they increased the funds to $3.2 billion in a short period of time.
Some of it is my money, but most of it is my money. I lifted my glass and emptied it in one gulp.
I could fully experience the unique taste and aroma of wide Türkiye that made my nose tingle.
After staying up late at night, I warmed up my empty stomach and felt strength flowing through my whole body.
As I was refilling my glass, the phone rang.
[Master, this is a call from the New York branch]
As soon as I picked up the phone, I heard a familiar loud voice.
– You were watching, Mr. President! This is a big hit. Enron has finally gone bankrupt.
“I was watching too. Manager Song Ji-mo worked hard too.”
– I will organize and report the specific profit figures by tomorrow, but if I roughly calculate it, it will come to around 3.6 billion dollars.
“That’s roughly the expected amount. Please contact me as soon as you have the exact amount.”
Even though Ariel had already calculated the exact amount, he ignored it.
– Okay, sir. But it seems like people are looking into investing in Ariel these days.
“What is the identity of Iriel Investment? Do you know where it is?”
– I’m digging into various places. There’s also a lot of interest in investment portfolios.
Ariel Investments was a mysterious investment firm on Wall Street.
Officially, no one in Wall Street’s inner circle or even outside of it knew the true identity of Ariel Investment.
Although he was clearly making huge profits through oil investments, his identity was not revealed to the outside world, so it seemed that some people were starting to take interest.
“As Manager Song knows, the reason we are hiding the investment company from the outside world is because we don’t see any benefit in revealing our specific identity. There is no need to hide the fact that it is a Korean fund.”
Branch Manager Song Han-young is a veteran of Wall Street investment banks. He is said to be the New York branch manager of WD Investment Trust, but in reality, he is the president of Iriel Investment Company.
He quickly realized what I meant.
– Okay, so you’re saying we should reveal our identities to some extent?
“If he wanted to hide his identity, he would have set up an investment company in Europe instead of in Dalloway, USA. No matter how much the IRS (US Internal Revenue Service) or SEC (US Securities and Exchange Commission) search for investment funds, there is nothing they can find.”
Manager Song seemed greatly relieved by my words.
– I don’t know about other places, but you have to go through the IRS at least once.
The IRS is famous for not letting go once they get ahold of you. If you get caught, they will force you into all sorts of tricky provisions and rip you off.
The company was newly established and had not yet properly paid its taxes, but it had entrusted them to an American accounting firm.
Rather than leaving it to them alone, Ariel also settled the taxes that she had to pay separately.
“When you see someone doing well, you might want to try it out. We’re newcomers on Wall Street. Of course, we’ll feel a sense of animosity. Have a great year-end. Happy New Year.”
– You too, boss. Happy New Year.
I finished talking to the New York branch manager, but the sky over Seoul outside the window was still dark.
Because it was winter, we had to wait a long time for the sun to rise.
I tried to calm my excitement.
Compared to the wealth he had when he was a codger, his current success is very small.
But my heart was pounding.
Even when I was a coda artist, I achieved some level of success but it was just so-so.
“I’m feeling the same way I felt when I first discovered the gerenium vein. My heart is pounding.”
[Yes, yes, I feel that too.]
It was Ariel who felt the changes in my body more keenly than I did.
I tried to calm my excitement at Ariel’s indifferent reaction.
Well, there’s no way this artificial protein guy could understand real human emotions.
[Master, I think you are thinking of something very rude.]
There was no way that the quick-witted guy wouldn’t notice the change in my brain waves.
“I hope you understand it roughly.”
***
The new year has arrived. As the year changes, the EU officially starts using the euro.
As soon as the company finished its New Year’s party, work started pouring in like a bomb.
It was the result of neglecting work for a while while focusing on investments in the United States.
Chief Do and Chief Park followed me into the president’s office and received the overdue payments.
“The operating profit was 630 billion won, and the net profit was 510 billion won? That’s a good deal for the business. In less than half a year, the investment for the acquisition was roughly recovered.”
“As you said, we have reduced operating profit as much as possible.”
It was said that the accounting was done to receive the amount due as late as possible. This was to block out any noise that might arise if too much profit was made immediately after the acquisition.
Even if you say that, there will probably be some people who will grumble later on.
What Chief Park presented was a newly made soju. Even the bottle itself was luxurious.
“Is this a new product prepared by the development team?”
“Yes, it’s a premium soju made for the Chinese market. It’s 53 degrees.”
The alcohol content of liquors like Maotai and Oryangyeok is roughly that, and it is said to be the type of liquor that Chinese people like.
“As soon as the development team created it, there was chaos.”
“What’s wrong? Why?”
“It was so popular. We made about a thousand bottles as prototypes, and there were a lot of people asking for them.”
“You must have had a hard time. Maybe Grandpa too?”
“He took a box because he liked it the most. He asked me to tell him that raising his grandson was worth it.”
My grandfather said that there was no need to come separately because it was New Year’s Day, so I just called to wish him a happy new year.
somehow······.
“There are only a few bottles left. This is the last remaining prototype.”
I accepted the bottle that Chief Park offered.
I wanted to open it and drink it right away, but it was broad daylight and I had work to do.
“Let’s have dinner together.”
The two people’s eyes never left the bottle of alcohol.