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CH104 | GSI
🕑 Added 2025-02-05 03:35:01 +0000 UTCAndrew couldn't hide his bewilderment at the unexpected order and asked again.
[Did you say to liquidate the position?]
Unlike the startled Andrew, Seok-won responded in a calm voice.
"That's right."
[The crash has only just begun. If we wait, prices will drop even further. Isn’t it too early to sell?]
Andrew cautiously expressed his opposition, but Seok-won didn’t waver in his decision.
"No. Now is the right time to sell."
[….]
Seeing Seok-won’s unwavering conviction, Andrew recalled the many successful moves he had witnessed by his side.
Sensing that he might be missing something, he carefully asked,
[Can you tell me why you think so?]
They would find out within a day anyway.
Besides, to execute the next step smoothly, it was better for Andrew to fully understand why now was the time to sell.
"You're aware of the massive human and material losses caused by this earthquake, right?"
[That’s exactly why we should hold onto our position longer, isn’t it?]
Given the psychological shock of the earthquake and investors' instinct to avoid risk, not just Japanese stocks but even the yen were being indiscriminately dumped. From an investor’s perspective, Andrew's response was the natural conclusion.
"The exact figure will take time to determine, but insurance companies will have to pay out at least 1 trillion yen in claims."
[That’s why Japanese insurance companies’ stock prices are getting obliterated right now, isn’t it?]
"That’s right. But where do you think insurance companies will get the money to pay those claims?"
[Well… they’d liquidate the assets they’ve been holding for situations like this and…]
Andrew stopped mid-sentence as a thought suddenly struck him.
Realizing something critical, he blurted out in urgency.
[You’re saying that to cover insurance payouts, Japanese insurers will sell off their foreign investments on a massive scale, convert those dollars into yen, and bring them back to Japan—causing the yen to surge instead of falling?]
Seeing Andrew quickly grasp the situation, a slight smile played on Seok-won’s lips.
"Earlier, I said insurance payouts would be at least 1 trillion yen. With that much money flowing into Japan all at once, the yen won’t weaken—it’ll skyrocket."
Andrew instinctively swallowed hard, his mind racing as he muttered to himself in shock.
[R-Right… If I’d just thought it through a bit more, I would have realized. How could I miss something so obvious…?]
Andrew had started blaming himself, but he soon realized it wasn’t a matter of making a mistake.
While everyone else was fixated on the yen and Japan’s market crash, Seok-won had been thinking several steps ahead.
'The way he sees things is just on another level.'
Deeply impressed, Andrew now fully understood why Seok-won had ordered him to close the position.
[Understood. I’ll sell off the position immediately. Then, you’re saying we should buy yen right after, correct?]
Andrew’s ability to anticipate the next move without explicit instructions brought a look of satisfaction to Seok-won’s face.
"That's right."
Standing with both hands on the desk while speaking through the speakerphone, Seok-won straightened his posture and said,
"Close out all our short positions on the Nikkei and switch to long."
Andrew’s voice came back, surprised.
[You think the Nikkei is going to stop crashing and rebound?]
"Given the scale of the damage, the Japanese government will soon announce a massive reconstruction plan."
[Ah, I see. If an astronomical amount of money is injected into the economy, it will revitalize Japan’s sluggish economy, which has been suffering since the bubble burst. That would be a huge boost for the stock market.]
"Exactly."
The reconstruction efforts might temporarily inject some life into domestic demand, but they wouldn’t be enough to pull Japan out of its deep economic stagnation.
On the contrary, excessive fiscal spending would likely deal another devastating blow to Japan’s already struggling economy.
But that wasn’t something Andrew needed to worry about right now, so Seok-won chose not to mention it.
"To restore stability after the earthquake, the government will have no choice but to announce a reconstruction plan soon. Get everything done by today."
[Reversing all our positions won’t be an easy task. Looks like we’re in for a very busy day.]
"The harder the work, the sweeter the reward."
At that, Andrew burst into a cheerful laugh.
[Hearing you say that, I suppose I have no choice but to wrap everything up today, no matter what. And of course, we’ll be leveraging to the max, right?]
"Of course. We have to."
Seok-won chuckled.
"Rare opportunities like this must be seized to the fullest."
[Couldn’t agree more.]
"Let me know once all the position adjustments are done."
[Understood.]
After ending the call, Seok-won quickly scanned the Bloomberg terminal, which was continuously updating the latest market data. Then, he reached out and pressed a button on the intercom.
A voice soon responded—it was Na Seong-mi, his newly assigned personal secretary after he had been promoted to director.
"Yes, sir?"
"Contact the head of Team 1 and tell him to come to my office immediately."
"Understood."
As he sat down, his gaze fell on the Nikkei index, which had failed to hold the 18,600 mark and was continuing its downward spiral.
Muttering to himself, he said,
"The demand for dollars will surge soon. We need to lock in as much as possible while the window is open."
***
Nomura Securities Headquarters, Chuo Ward, Tokyo, Japan.
With the market caught in the eye of a raging storm, Nomura Securities’ trading centre was nothing short of a battlefield.
Ring! Ring!
"Sell 25,000 shares of Sony at 3,990 yen!"
"Dump 50,000 shares of Toyota at market price!"
"Mitsubishi Electric is down more than 30%!"
"Tokyo Electric Power is plummeting too!"
"The prices are dropping faster than we can execute orders—what the hell are we supposed to do?!"
"At this rate, the market’s going to collapse!"
The air was thick with traders’ panicked shouts, their voices rising in frantic desperation.
Yoshimura, the head of the trading division, clenched his lower lip tightly.
It was a disaster—an absolute catastrophe.
The Nikkei had been on a downward trend ever since the bubble burst, but no one had expected such a sudden market-wide panic overnight.
Yoshimura had always been on the fast track to success, climbing the ranks as a key member of President Yamakawa’s faction, the dominant force within the company.
Two years ago, he had secured a crucial position as head of the headquarters trading centre. His record had been solid, and he had been eyeing an executive promotion in the upcoming year-end reshuffle.
But now—this disaster had thrown everything into chaos.
He tried to keep his composure, but deep inside, he was seething with frustration, barely holding back the urge to curse.
Unable to remain seated, Yoshimura had been pacing the floor, trying to maintain control of the situation. At one point, he turned his gaze toward a row of six television screens mounted on the wall.
Each screen was tuned to different networks—Japan’s major broadcasting stations, as well as CNN and ABC News.
All six channels were running breaking news footage, showing Kobe City in ruins after the devastating earthquake that struck earlier that morning.
The images were nightmarish—elevated sections of the Hanshin Expressway toppled like dominoes, buildings reduced to rubble, and thick black smoke rising from fires raging across the cityscape.
Looking at the devastation, Yoshimura felt a sinking realization—his dream of an executive promotion was as good as dead.
At this point, he was simply fighting to keep his current position. The only way to do that was to minimize losses, but given the market’s freefall, even that seemed nearly impossible.
To cut their losses, they had to offload their holdings—even if it meant taking a hit.
But panic had gripped the market. The Nikkei was in free fall, and with fear spreading like wildfire, no one was willing to buy. Trading had all but ground to a halt.
"Damn it!"
Just as Yoshimura cursed inwardly, his senior trader, Section Chief Uemura, rushed over, his face twisted with tension.
"Director! There’s an unusual movement in the market!"
"What are you talking about?"
Yoshimura asked, his voice thick with irritation.
"Someone is buying Nikkei futures in large volumes."
"…!"
Yoshimura furrowed his brows and turned to look at Section Chief Uemura, surprised by the unexpected report.
"They’re buying Nikkei futures instead of selling?"
"Yes."
Hearing Uemura’s confirmation, Yoshimura’s expression twisted into one of utter disbelief.
"Who the hell are these lunatics?"
The Nikkei Index was compiled by the Nihon Keizai Shimbun, Japan’s leading economic newspaper, which selected 225 highly liquid stocks from the Tokyo Stock Exchange and calculated a price-weighted average.
Since these companies represented more than half of the total market capitalization of the Tokyo Stock Exchange First Section, the Nikkei Index was effectively a barometer for the Japanese stock market as a whole.
As a result, those optimistic about the Japanese stock market would typically buy Nikkei index futures, while those with a bearish outlook would sell them, taking short positions.
But now, in a market engulfed in fear—where stocks were plummeting, and investors were scrambling to sell—someone was buying Nikkei futures instead of dumping them. It was so irrational that Yoshimura couldn't help but call them lunatics.
"I’m just as baffled as you are, but that’s not what matters right now."
Seeing Yoshimura’s deepening frown, Uemura quickly pressed on.
"For whatever reason, someone is buying. If we sell our futures in bulk to them, we can recover at least some of the losses from this crash."
"…!"
Yoshimura’s eyes widened in realization.
"That’s right! In this situation, there’s no way the index is going to rise—it’ll only keep falling. If we unload our Nikkei futures now, we can offset our losses!"
"Exactly!"
"Haha! Why didn’t I think of that sooner?"
Having just been drowning in despair, Yoshimura now felt a surge of energy as if he had found a lifeline.
In hindsight, it was such a simple solution.
But given the sheer panic gripping the market, the idea that someone would be crazy enough to buy Nikkei futures in bulk had never even crossed his mind—so it was only natural that he had overlooked it.
"Who the hell is buying all these futures?"
"It's an American fund called Eldorado."
Yoshimura tilted his head in confusion.
"Never heard of them… but that doesn’t matter."
Right now, all that mattered was finding a way out of this crisis. It didn’t matter who the buyer was.
"How many orders have they placed?"
"They've already bought over 500 contracts, and they’re still snatching up everything like they’re sweeping the floor clean."
Yoshimura, feeling an urgent sense of opportunity, quickly spoke up.
"Then we don’t have time to waste! Before they run out of ammo, we need to sell as many futures as possible!"
"How much should we unload?"
"As much as we can! Move fast!"
Yoshimura barked out the order, determined to minimize losses through a massive short position on Nikkei futures.
If I can at least limit the damage while the entire market collapses, they might even recognize my ability.
"Understood!"
As Uehara rushed back to his desk, Yoshimura clenched his fist, staring at the giant price board in front of him.
"Yeah… I’m not going down like this."
His eyes gleamed with hope, dreaming of a turnaround victory.
But what he didn’t know was that the decision he had just made wasn’t a lifeline out of hell—
It was a one-way ticket into an even deeper abyss.
