This film is based on actual events.
However, all characters and incidents depicted
are fictitious and not exact re-enactment.
As of December 22, 1977,
Korea reaches $10 billion in exports...
Produced by LEE Eugene
City of Seoul will build a
new mega apartment complex for 20,990 families...
I announce the opening of Seoul Olympic Games.
Sampoong Department Store!
Automobiles, semiconductors, and shipyards are the top exporters...
Korea's per capita income has surpassed USD 10,000.
Credit card approval in just one day.
Generation X is leading the fashion trend.
Written by EUM Sung-min ...formally applied for OECD membership.
Directed by CHOI Kook-Hee Korea becomes a member of the OECD.
I wish to share my joy with the nation.
5 Nov 1997 East Asia Division Morgan Stanley Headquarters, Wall Street
LG advances to the Korean Series
Finance Reform Bill likely to pass
15 Nov 1997
KOSPI 583.8 Ms. Han...
Won-Dollar exchange rate 792 won Ms. Han!
Foreign exchange reserves $15.8 billion Oh. Let's go.
The Bank of Korea raised its growth forecast to 7%,
despite the economic crises occurring in East Asia.
Damn hangover...
Due to admittance to the OECD
and stability in exchange rates and exports,
national per capita income remains above $10,000.
The government has submitted the budget proposal for next year.
- Sorry, I'm late. - Morning, Mr. Kim!
Did you have breakfast?
- Yes, sir. - How about you?
According to a Gallup Korea poll,
85% of Koreans consider themselves middle class.
The President has announced that with the accession to the OECD,
the public consciousness should be raised accordingly.
The government dismissed any rumors about economic crisis,
saying that the foundation of Korean economy is solid.
What are we listening to?
That's better.
It's nice. I like that.
Welcome aboard. Here's to our bright future!
Can you turn the volume up?
Korea Merchant Bank Corp. New Employee Training
Attention!
Thank you, new employees, for choosing Korea Merchant Bank Corp.
To prevent you valuable people from getting kidnapped by other companies,
I will temporarily lock you in here.
I heard some companies give money
so we won't go to other job interviews.
Do you offer something like that?
If you take this money and still go elsewhere, it's foul play.
Governor, Bank of Korea
Tell Ms. Han to immediately come to my office!
Mr Johnson? This is Jeong-Hak from Korea Merchant Bank Corporation
I heard that your fund decided to cancel a big amount...
Hey, driver!
- Yes? - Turn off the music!
I'm so sorry. Your fund canceled in Korea...
I'm sorry, I'm in the middle of a meeting
Johnson?
Bye.
Freaking impatient bastard...
This makes no sense.
Many listeners wrote in again.
'The mother's had no customers for days,
and the brother hasn't been getting his salary.'
It seems the economy is really tough these days,
and many are going through a hard time.
This story caught my eye.
She wrote about her father's business.
'My father's business went under, so we were forced to move.'
'We were never rich, but
- Hello? Mr. Yoon? - at least, I had my own bedroom.'
What show is this?
Son Sook's Women's Era.
'How can we escape this situation?'
Hello, Mr. Lee. It's been a long time!
Really?
Wow, that's...
Alright, thank you!
Gap-Su.
Our bowls... they want us to supply them at Midopa.
The department store?
Yeah!
Are you serious?
Don't I look serious?!
It's a hit!
Ms. Han, let me call you in first...
I was asked to come.
Is this true?
Why didn't you tell me right away?
You've been too busy with the Financial Reform Bill.
It's been 10 days since I submitted the first report.
More precisely, 253 hours and 25 minutes.
I have reported six updates since.
Fine, fine! But that's not what's important.
We need to think.
That's what we need to do. Think.
So, now we...
Hold on. Let's think this through.
Okay, now...
First, you have to call a meeting with
the Senior Presidential Secretary for Economic Affairs.
That's right! You mean, right now?
Okay.
Find out where the Presidential Secretary for Economic Affairs is.
Let's go.
Aren't you coming?
Monetary Policy Team
We are a go.
You're keeping up with the currency crisis in Southeast Asia?
Yes.
Get me a summary on the hot money roll-over.
Okay.
The dollars injected
to defend our currency,
organize a report by days.
- Ma'am. - Huh?
We've been through this more than 100 times.
We're prepared.
Foreign Currency Crisis and the Korean Economy
What about supervising loan status of commercial banks?
Put it on hold for now. After today, things will change.
Our report is finally getting accepted?
The country is about to go bankrupt.
They'd be crazy not to take action.
- Be on standby, everyone. - Yes, ma'am.
- See you later. - Break a leg.
Don't think about going home.
Bank of Korea
Yes. I'm on my way there right now.
The situation is quite urgent.
Okay.
Yes sir.
Accession to the OECD, first step as a developed nation!
No more delays in real-name financial transactions!
Secure independence for Bank of Korea!
Independence for Bank of Korea!
Withdraw the Financial Reform Bill!
Withdraw! Withdraw!
Down with institutional dictatorship!
Secure independence for Bank of Korea!
Independence for Bank of Korea!
Presidential Secretary for Economic Affairs Is it true?
Yes...
We're in big trouble. Big trouble.
Why didn't you tell me about this sooner?
I'm sorry, sir.
What do we need to do first?
Well...
Please call a meeting with the Ministry's key officials.
Yes.
Yeah, it's me. Tell these people to come to my office right now.
First, the...
The Deputy Minister of Finance.
The Deputy Minister of Finance and...
The Bureau Chief of Fiscal Policy.
The Bureau Chief of Fiscal Policy and... Who else?
That's enough for now.
Let's go.
The Hong Kong market crashed today,
giving rise to concerns about the economic crisis in East Asia.
Bureau Chief of Fiscal Policy
Countries including Malaysia, Thailand, and Singapore,
which have shown economic growth in recent years...
Hey, the Minister wants to...
Deputy Minister of Finance ...play golf this weekend.
As the man in charge of monetary policy,
I'm sorry to report this situation.
A detailed account of the matter will be briefed by Ms. Han Si-Hyun.
I'm sure you're aware of foreigners pulling out their money, starting in Southeast Asia.
Wait, she's not a secretary?
Due to our inadequate handling of the Hanbo crisis
and the bankruptcy of Kia Motors,
foreigners began to doubt our crisis management ability.
Foreign capital started pulling out since August.
The value of Korean won continues to fall, but the government is defending it
by injecting $2 billion from the reserves every week.
$2 billion is used per week to defend
the currency rate of %300 to $1.
Everyone here knows that, but we can't stop defending the currency.
My team has reviewed
the rate of extension granted for money borrowed from overseas.
Until late October, the rollover rate was 86.5%
meaning foreign investors were willing to roll over their loans.
However, on November 3,
investors simultaneously refused to grant rollovers
and started demanding payoffs by the end of December.
Give me the figures.
As of today,
the Ministry announced $15.8 billion in foreign reserves.
But these aren't accurate figures.
Considering the rejected rollovers
and dollars owed on forward exchange,
the actual amount calculates to below $9 billion.
The fact that the foreign reserves is below $9 billion means
the government cannot guarantee Korea's export and import activities
as you know so well.
If the government cannot guarantee export and import activities...
It means national bankruptcy.
If my calculations are correct,
the time remaining before Korea goes bankrupt
is one week.
Chief Presidential Secretary
Is it true?
Mr. President has a lot on his mind.
If you speak in difficult terms... he'll get angry.
We understand.
Explain to him in easy terms.
In easy terms?
But... how? Should I take out the figures?
We spent borrowed money like water
hoping to get an extension.
And here we are, Mr. President.
I'll explain it to him in difficult terms.
The President's son was granted bail today...
If there aren't enough dollars, can't you just buy more?
The dollars are going out much faster than the purchase rate, sir.
Senior Secretary?
Yes, Mr. President.
Didn't you say it would be fine
because Korea's economy has a solid foundation?
I'm sorry, sir.
The party's over... is that it?
Letter of Resignation
You sure about this?
On a sinking ship,
the first to get out has the best chance of survival.
In movies, the first to leave dies first.
Installment savings reached $200 million!
I'll go my own path. Please accept this.
Let's hear it. That path you'll go on.
I'm going to invest in the crisis.
I believe the Korean economy...
will go bankrupt soon.
Hey, do you think
there haven't been others just like you?
During the oil crisis and debt crisis in 1980,
there were many who quit their good jobs,
but no matter what happens,
a nation's economy is bound to withstand.
Don't you read the papers?
The four dragons of Asia!
Powerful, rising countries!
You should think about investing diligently...
No lectures, please. Just pay my severance.
Do you know what people call your kind?
A conspirator! You son of a bitch!
Go on. Go your way.
It's conspiracist, actually.
Isn't that what I said?!
Hello, sir. This is Yoon from Korea Merchant Bank Corp.
The beacon of success!
If you just give me an hour, I'll present you with the greatest...
Yes, ma'am. Darling? My friend!
List of Top Companies I don't know what to label it
Task force office but this will be the control tower...
Task force office ...for preventing national bankruptcy.
Gently! You're stirring up dust.
I'm sorry, sir.
I wouldn't have called if this wasn't important.
In fact, it's huge.
Only for a few chosen clients...
All you need to do is follow my lead.
Thank you.
While I was working as a personal assets manager,
I secured all of you good returns on your investments.
Isn't that right, ma'am?
Of course.
You helped me get a new building in Gangnam.
Sir, am I right?
I don't think any of us here doubt your skills.
I believe that Korea
will go broke in a week.
- The country will go broke? - Is that even possible?
And this is the reason why.
'Yeo' means 'to give', and 'shin' means 'to trust'.
Or 'loan' in plain language.
When a financial institution loans money.
This word, trust!
What is exchanged is the trust that the money will be returned, but...
this trust was a weak, unfounded one!
From the beginning of this year, I sensed that it was slowly breaking apart.
I'll give you an example. There's a businessman.
Check the document.
Intent of Purchase He wants to run a business but has no money.
What can he do?
Expand your factory, change your car, get a driver.
You should live a better life now.
- No more carrying sheets of steel! - Thank you.
But... This many?
Is that a problem?
Of course not. We'll try and match the order.
The payment will be made in promissory note.
Sorry?
Here's a question.
What kind of a promissory note is this?
This place is not a bank.
Do you have the paperwork?
It is a nonmonetary institution called a merchant bank.
A promissory note is issued to the company at a bank
which is then submitted to the nonmonetary institution.
And what happens next? I'll count to three.
One,
two...
Three!
Here.
Your loan's approved.
Thank you.
Surprisingly and instantly!
You can borrow
the amount on the bank-issued promissory note. Loan Contract
Whether or not the note is effective as collateral
is nobody's concern.
They just give out the loan.
Such promissory notes are passed on to small businesses.
Sorry, but we've always received payment in cash.
Who does business in cash these days?
It's all in promissory notes.
- What? - Who does business in cash anymore?
I have to go.
Call me. I have tons of orders to handle.
- See you later. - Drive safe.
If this is the situation for small businesses, what about conglomerates?
They take loans through foreign banks,
secure them against other loans.
And that debt goes down to subcontractors.
Down and down.
If the business is successful and the debt is collected, everyone's happy.
But if any one party falters?
It's a matter of time before everything comes tumbling down.
Why? But I've never heard of this.
This was a deal made on the unfounded trust that
'everything will be fine'.
This is the screwed up process Korea's
been running businesses in till 1997.
- Pardon my French. - Nonsense.
And I reached the conclusion that
this ticking time bomb will go off this year.
You're overlooking something. What if the government gets involved?
What if they present a solution before the bomb explodes?
What kind of solution do we have
in a free market economy?
Send out a warning that the country's economy is in danger.
Isn't that the first step to deal with any disaster?
Now why would we do that?
'Dear people of Korea, we're screwed.
We're about to go bankrupt.'
You want to advertise it?
People have a right to be informed of the government's decision.
What right? Where does it say that?
If the market economy collapses, we won't be able to do anything.
All this talk of imminent danger will cause more confusion.
We have to prevent that
and find a way to buy more time.
Who will take responsibility for the damage incurred in that time?
People have the right to know about the current situation!
Han!
Ms. Han...
the people's right to know isn't what matters right now.
What's stopping you? This is a huge opportunity!
If we get paid with a promissory note,
how do we pay our vendors?
We can ask them to wait for now
and pay once the note matures.
Let's sign the deal.
At least a warning to people
Intent of Purchase making countless decisions...
that's confusing to you?
What if everyone clears out their account and cancels their deals?
How can you worry about that?
That's making a soft landing.
The government will not notify the public.
How can you be so sure?
There have been clear signs showing how Korea is failing,
and they've been ignoring them!
Sir, we must notify the public as soon as possible.
No, it'll only cause unnecessary confusion.
'In difficulty, because the factory
isn't paying my husband's salary!'
'Putting the house up for sale after the business failed.'
What show is this?
Son Sook's Women's Era.
If we tell the people now,
then the damage can be reduced.
Intent of Purchase
Sign it.
National bankruptcy has already begun,
but the government isn't doing anything at all.
They are either incompetent or ignorant!
Saying that we're facing an economic crisis
will only serve the opposition right before elections.
This is no time to talk politics!
I plan to invest in that incompetence and ignorance.
What's there to think about? Come on.
Mr. Senior Secretary...
The possibility of national bankruptcy...
will be dealt with entirely behind closed doors.
From this point on,
this team will keep silent about the situation
to the press and those in the financial sector.
Everything will be fine.
Mr. Senior Secretary!
Sir, please!
Sir!
Sir, if we hide it, people will suffer helplessly
when the big blow comes.
We have to salvage at least the healthy SMEs...
Healthy SMEs?
And who's doing the health checkups?
Where's everybody else?
Obviously, they weren't impressed by my presentation.
No one believes me.
I'll invest in your words about government's incompetence in crisis.
Man! I was totally blown away!
'They are either incompetent or ignorant!'
Especially that part.
Hey, how old are you?
Twenty four.
Scram, kid.
Wasn't this a presentation about an investment opportunity?
I have money. Shitload of it.
1 million dollars.
Why don't you take a seat, sir?
Yes, Mr. Yoon.
- Mom! - Mom's home!
Hey!
Why'd you come home so late?
Did you miss mommy?
Honey, our bowls... they'll be in department stores soon.
Really?
It's a huge deal. Worth $500,000.
- Really? That's great! - Right?
I was worried about tuition fees when Hyun-ah goes to middle school.
Once we close the deal,
you can quit working.
Let's talk about that when you close the deal.
You did good!
In response to the claim that the Korean economy is facing a crisis,
the Deputy Prime Minister dismissed it as an unfounded rumor.
The economy is entering a recovery phase...
Based on its solid foundation as the world's 11th largest economy...
...appears to have passed the low point.
Korea beat UAE
in the World Cup qualifying round...
...has asked the national team to play well
in the quarter too.
No, it's not official yet.
Nov 18, 1997
KOSPI 542 .4
Won-Dollar Exchange Rate 843
Won Foreign Reserves $10.3 billion
The Bank of Korea is unable to provide surety.
No, we cannot confirm that.
The Washington Post wrote that
foreign banks refused to provide export bonds for Korean companies.
Soros is refusing to roll over matured investments in Korea.
I don't think it helps to keep silent.
There'll be more vicious rumors.
Let's go out.
Sorry?
We need proof to convince
the ignorant and indolent in high positions.
We have to gather evidence they can't refute.
We can look into poor bonds in nonmonetary institutions
and use them to persuade people in charge
at the Ministry of Finance, the BOK, and commercial banks.
Whatever it takes for now.
From now on, we're the system.
Yes, ma'am.
Who is this person we have to meet?
An alumnus.
Alumnus?
This is the bureau chief of fiscal policy.
Nice to meet you.
Good evening, sir.
He's my alumnus from Harvard.
He'll take a seat in the next cabinet.
It's an honor.
Show respect. Bow deeper.
Thank you for coming.
Stay close.
Hello.
Good to see you.
This is the youngest son of the Llsung Group's Chairman.
I'm sorry I didn't recognize you.
I came because my father told me to.
What do we talk about?
We give advice and share information among the alumni.
I see...
Mr. Chairman is in good health?
Yeah, he's well.
So...
Mr. Chairman is no longer in his youth. You should start training to take over.
Well, I don't know much.
Now, you will have something you know.
What we're about to tell you will please Mr. Chairman.
How do you mean?
Pretty soon... there will be national bankruptcy.
Many things will change. In whatever way, you should be prepared.
Why are you telling me this?
Because we're alumni.
As per the Bank of Korea's supervision authority,
we'll conduct an emergency inspection of this bank.
How much did Cheil Bank lend to Hanbo Steel?
Around $1.08 billion.
How much paid-in capital do you have?
$870 million.
Why did you lend more than the capital held by the bank?
I'm sorry.
Who reviewed and approved the loan?
There has never been a review
of the business plan.
There should've been restraints imposed by Bank Inspection Board?
No.
Who's in charge of this bank at the Bank Inspection Board?
Well...
That's me.
What?
I used to be on the Bank Inspection Board,
then I transferred here right before the Hanbo scandal.
If I knew Hanbo would go under, I wouldn't have come here.
I'm sorry.
Why is Hanbo Headquarters in an apartment arcade?
It was on advice from the Chairman's fortune teller.
A fortune teller? That's crazy.
My wife and kids are in Canada.
Do you know how much the exchange rate will go up?
Who made the decision to invest in steel at Hanbo? Sales, Hanbo Steel
Was it the fortune teller again?
Whoever it was, I know nothing of it.
Did the board of directors approve?
What board of directors?
There are no directors.
The arrangement for the loan was made by the President's son.
How much is the total loan Hanbo obtained?
What year did this bitch enter Bank of Korea?
You can't talk like that.
How much is the total loan that's not in the record?
How dare you talk like that to me!
Sir!
What!
Hey,
freaking clueless, aren't you?
Because of the billions
you recklessly obtained by lobbying politicians,
you set off a ticking time bomb.
So, where are we going?
We'll start purchasing dollars.
When Korea's credit level falls, the first thing to change is the currency rate.
The exchange rate is at 800 won. Do you think it'll get higher?
Of course. My prediction is...
up to 2,000 won.
2,000 won?!
That's almost triple!
That much won't do for me.
I want a put option that makes money
when the stocks crash and the currency flares up.
Here.
Stock Options
The currency rate is as high and the stocks as low as they can get.
You're totally going the opposite way.
If you want to make money with this, then this country has to go under.
I just do as requested but...
Then do it.
Companies take on businesses without considering profitability.
Banks lend blindly, politicians lobby to accommodate.
The inspection board doesn't work.
They all fit perfectly.
The bad loans from Hanbo alone are worth $5 billion.
No need to criticize others. Bank of Korea is also responsible.
How come?
How is the monetary policy team responsible?
When Hanbo went bankrupt, when Kia went bankrupt...
we submitted tons of analysis reports.
They never listened.
Foreign investors are selling fast, causing the stock price to plummet.
...dropped by 20 points within 10 minutes.
Only 5 minutes into trading, foreign dumping began...
Nov 19, 1997 Since selling over $300 million last month,
KOSPI 509.4 Won-Dollar Since selling over $300 million last month,
Exchange Rate 909 won Since selling over $300 million last month,
Foreign Reserves $8 billion
foreigners have sold $580 million this month,
as of today.
With foreign investors dumping stocks,
the exchange rate is flaring up.
The foreign exchange market ceased all transactions after 5 minutes.
The currency rate flared up,
causing the market to close after just 5 minutes.
The money exchange services have come to a de facto halt.
The interest rate for promissory notes has gone up by 0.87 % overnight.
Right now, the administration is preparing a statement.
The situation is only temporary
and will not lead to a state of panic!
This is not a serious situation.
Hang up.
The aftershock of the financial crisis in Southeast Asia is hitting hard again.
The currency crisis that began in Thailand and spread across the Philippines,
Indonesia, and Hong Kong is now threatening our financial market.
The currency rate has reached an all-time high again.
Mr. Yoon, it's come true. It's happening!
I can't freaking believe this!
Listen! Tell them it's not true.
Don't say anything else!
Just tell them everything is under control!
We have breaking news.
Midopa Department Store is facing bankruptcy.
I repeat. Midopa is facing bankruptcy.
Midopa is seeking emergency funding,
as well as holding talks with its partners to renegotiate business terms.
Mr. Lee!
There's Lee. Get him!
Mr. Lee!
Wait. Let go!
Mr. Lee!
Lee!
It's not true, is it?
It's not going bankrupt, right?
Just give me a little more time.
You knew about this!
No! Honestly.
What are you gonna do about it?
Lives depended on that money!
Midopa has $310 million in debt
with commercial banks,
as well as $215 million with nonmonetary institutions.
Midopa in debt Total $827.5 million.
Midopa will file for composition tomorrow,
but if the creditors reject,
they will be forced to go into receivership.
Halla Group has gone bankrupt.
Halla
Taeil's filed for bankruptcy.
Taeil Precision
New Core has filed for bankruptcy!
What?
Sir!
Daewoo's in danger.
What?
Chairman Kim Woo-joong wants a special meeting.
#4 Daewoo
Han! Where did Han go?
Please relax and come down, sir.
Come down and talk to me.
Many are going through a difficult time. Please.
Think about your family.
Please come down, sir.
Come down please!
Haetae Group has gone into bankruptcy.
Kia's creditors filed for court receivership.
...New York Times expressed concern on Korea's capability
to pay off its short-term loans.
...unprecedented bankruptcy of a financial institution.
Korea Merchant Bank Clients Left Hopeless
Today alone, 20 out of the top 100 companies have gone bankrupt.
If you include smaller companies,
we estimate around 200 companies.
Merchant banks' low-interest bonds from Southeast Asia are being retrieved.
If they go bust, their promissory notes will become void.
If that happens, commercial banks may become insolvent.
Korea's bankruptcy is reported as an established fact in Wall Street.
Starting with Korea Merchant Bank,
commercial banks are also at risk.
Korea Merchant Bank Corp.
Damn! We were right!
The stocks are crashing, right?
The Korean won is going down, and the dollar's going up, right?
We're making a shitload of money, right?
Korea is screwed.
We're rich, man.
We're stinking rich now!
Mr. Yoon!
I don't think it's time to buy dollars or stocks or any of that.
Then what should we do?
It's time to change our lives.
In life, you have moments that change you forever.
One of those moments is right now.
My life... my position... my status...
All of that is about to change for good.
Hey! Go get more money.
But from now on, keep two things in mind.
Don't talk to me like I'm your friend...
and don't get excited about making money.
Please, share your thoughts.
It's not like we have no options at all.
What else is there?
We can go to the IMF.
What?
If we go to IMF, it could get very painful.
By nature, good medicines taste bitter.
It's a very simple matter.
When Choheung Bank has no money, they borrow from Hanil Bank.
When Hanil doesn't have money, they borrow from somewhere else.
The problem is that our foreign reserves are almost depleted
when we have to pay back bad loans or short-term loans.
Let's get a bailout from IMF.
That's the surest and cleanest solution.
You know the IMF doesn't just lend money.
They'll make demands about running our economy.
I know. I know. But we have to put out the fire first.
Does it matter whose extinguisher we're using?
No.
We can't go to the IMF. That's not the answer.
The IMF is not a bank.
In return for a bailout loan,
they'll require unreasonable conditions
and even take control over our own economy.
We can use this opportunity to make fundamental improvements.
No! The question of improving the Korean economy
should be considered separately from the foreign reserves issue.
Miss bank teller...
this is completely different from the petty cash you count.
This is policy and politics.
You're the one who reported about these problems firsthand.
And now you say that it's excessive? That we should separate the issues?
What is your solution then?
We can take care of the urgent foreign loans by borrowing $10 billion from
government-run banks in Japan, U.S., and European countries.
Then what?
After that...
What happens after we put out the fire with the borrowed $10 billion
when the country's debt is almost $100 billion?
We consider ABS option issuing overseas bonds,
using government-owned assets as security.
Am I the only one who finds that hilarious?
I didn't realize it but you're an emotional person, Ms. Han.
So far, you've presented numbers and evidence,
but have you been making decisions based on your emotions?
ABS? Backup facility?
Do you really believe that will solve this situation?
If we fail to seek a bailout loan
from IMF in time
and end up declaring national bankruptcy,
will you take all the responsibility?
This is why there are
no women in high government positions.
They can't be rational at critical moments.
You see, women are emotional.
That was unnecessary.
Sir, you have to think carefully.
Ms. Han is unable to grasp the gravity of the situation.
It was wrong to bring on board a woman
who writes reports and punches numbers.
Deputy Minister!
Alright, that's enough.
I'll make the decision. Let's take five.
Don't just stand there. Bring me some coffee.
That's enough.
Asshole...
You've got great teamwork going on.
Isn't going to the IMF a bit excessive?
It Is.
What?
To turn this country inside out, an excessive measure is necessary.
Then this wasn't just about foreign currency but-
You can always pay back money.
As Han said, we can put out an urgent fire,
but I believe we shouldn't let this opportunity pass by.
The way I see it, this is the moment Korea can really change.
The labor union bastards whine and go on strikes all the time.
I think this is an opportunity to change this country in a single blow!
An opportunity to build a brand new Republic of Korea.
Tell the Minister to bring in the Managing Director of IMF.
Yes sir.
Excuse me?
The U.S. is already on the move.
We have no choice but to follow.
I've reached a decision.
No matter how bad it is, going to the IMF is not an option.
Let's try whatever we can.
Yes sir.
Ms. Han, contact Japan to see
if a currency swap is possible.
Even though we're late, let's take care of things one by one.
Let's go.
Promissory Note
So, what the hell is happening?
We have a crisis, but why isn't anybody telling us anything?
How much do we owe our partners right now?
$100,000 to the steel company, $150,000 to the sand company,
and $100,000 to Mr. Chung.
We wrote out a check to these companies.
If we don't pay by the deadline, we'll go to jail.
It's temporary. The government and the media all say it'll be fine.
Let's get together cash and company assets we've got left.
I'll put my house up for sale if necessary. Don't worry.
Urgent Sale
Geez...
Hello.
Please take a seat.
There have been many houses put up for sale recently, right?
Yes. From about three months ago.
Mostly small and medium sized?
That's correct.
Put the sale on hold. I'll buy them.
Excuse me? With my money?
The prices will drop further by 10 to 15 percent.
I'll buy them all then.
Yes sir.
It's like I've climbed on the back of a running tiger.
What do you think will happen next?
The government?
They must be busting each other's brains out
about whether or not to go to the IMF.
The IMF...
Where is... IMF?
Just pour me a drink.
There could be a way to overcome this crisis
without going to the IMF.
Of course there are other options.
But if they don't, these bonds will become garbage,
and you and I will be out on the streets.
Still, I put my money on them eventually going to the IMF.
Why is that?
The decision makers have a lot to lose.
They'll choose a way out of this
that doesn't hurt big companies and conglomerates.
Which means there's only one solution.
Receive aid from the IMF, carry out restructuring, and...
set the game anew in favor of themselves.
Such policy decisions won't go down well with the public.
They'll say something ridiculous like,
'The economy collapsed
because all of you overspent' or...
'You spent money recklessly'.
But I won't be deceived.
I'll never let them fool me.
Somebody must be spending a sleepless night.
It'll be fine.
It's alright.
Everything will be fine.
Despite economic crisis,
people's love for foreign brands doesn't seem to subside.
As luxurious overseas trips are on the rise...
Lavish overseas trips are drying up foreign currency.
The 8 O'clock News will run a special on the economic crisis...
What the hell is this?
Nov 201997
KOSPI 460.3
The Senior Secretary's office isn't answering.
Won-Dollar Exchange Rate 1,076 won
Foreign Reserves $5.1 billion
Hello?
Blue House Cabinet Reshuffle - Senior Secretary for Economic Policy Axed
We can't confirm that information.
Good morning.
It was your doing, right?
Why'd you change the head of the task force team?
You bastard.
You're trying to go to IMF.
You bank clerks are unbelievable.
Look, I'm the Deputy Minister of Financial Policy.
That's no way for someone like you to address me.
This is what happens when a bitch like you runs the team.
- Son of a bitch! - Don't do that.
Back off!
- Please! - Let him do it.
Say it again!
You bastard!
What are you doing? We're on the same side!
Even the opposing parties work as one in a time of crisis!
How are you running your team, Ms. Han?
- Sir, I... - I'm sorry. It's my fault.
I believe teamwork is the most important thing.
Get out. You don't belong here anymore.
I'm sorry.
We're dealing with a calamity.
The fate of 40 million people hangs in our hands.
Yes sir.
From now on, this task force is an IMF negotiation team.
The country cannot go bankrupt during this administration,
so we've decided to seek aid from IMF.
With all due respect, that option was discarded.
The decision's been made.
Before we miss the golden time, we'll obtain the bailout loan.
It'll take some time for the IMF team to arrive in Korea...
They're here.
What?
They're already here.
- The negotiations... - It'll remain in strict confidentiality
until the right time comes.
Welcome to Korea.
The negotiations will take place at the Grand Hilton.
The IMF Task Force Team will set up office at the hotel.
We appreciate you traveling all the way to Korea.
That's quite alright. I've always wanted to visit Korea.
C'est magnifique.
Very beautiful.
He's checked into the hotel.
No need to drag out the negotiations. Quickly and swiftly.
Negotiate, get the money, and wrap up fast.
Reporters are waiting outside. What'll you say?
That it's not happening.
You must strongly deny it.
When I say it's not true, they will take my word for it.
There he is!
Senior Secretary! Over here!
Is it true that we're on the verge of national bankruptcy?
It's not true.
Are we facing the worst financial crisis in history?
That's not true.
Is it true that Korea will receive aid from the IMF?
No! Korea is not going to the IMF!
The newly appointed Senior Secretary for Economy
has officially dismissed rumors about an IMF bailout.
He stated that IMF is the last resort.
Get me an appointment with father.
Yes sir.
The government announced they're not going to IMF!
Don't be swayed by them. You just gotta trust me.
They're denying everything. No crisis and no bankruptcy!
They're just bullshitting!
They're flat out lying to people!
If they contain the situation as they say...
You think you can fool me? No... not me...
You're looking at about $150,000.
150? I bought it for 180 3 years ago.
You said with a redevelopment plan, the price would go up for sure!
People who need money are putting their houses up for sale.
More than 10 new houses are coming out every day.
I can't sell at that price.
Considering how much I need... No. Absolutely not!
It's not my call.
This is ridiculous!
I wanna put my house up for sale. It's urgent.
You need to bring the price down quite a bit.
How much?
You should be prepared to lose $30,000.
Overdue Payment Reminder
Excuse me, sir.
Hey.
We haven't gotten our paycheck.
Oh! Today's payday, isn't it?
It was two days ago.
That's right! I'm sorry. You'll all be paid today.
Is everything alright?
Why?
There are so many confusing rumors, and the work was put on hold too.
We're all worried.
Factories close when business is bad,
and when it's good, you work overtime.
Don't worry.
Right? We trust you, and we'll be on standby.
He says not to worry. Everything is fine.
Good job. Well done.
I put my house up for sale. If it sells for $150,000,
we'll pay the sand company first.
Here...
it's $100,000.
Let's pay the steel company with this.
Did you borrow from a loan shark?
No way! It's my wife's family...
They stood surety for the loan.
Good evening, gentlemen.
Mr. Chung!
We're so sorry, Mr. Chung.
Now, now, don't be like this.
Whatever happens, we promise we'll make the payment.
Please give us a little more time.
Come on. I'm not here for the money.
When you run a business, things can get bad at times.
I'm staying afloat for now. You can take more time.
Thank you, sir.
It'll all get better. This can't be the end of it.
Everything's gonna be fine, so let's just hang in there.
Thank you so much.
Come on. Chin up. Don't be so miserable.
- I'll see you later. - You're going?
Mr. Chung...
No need to see me off. See you later.
November 20
Negotiation team's first unofficial meeting
The IMF has kept a close eye on the situation in Korea,
but before we proceed,
we need assurance that the Korean government is
truly committed to moving forward with the bailout.
We are very much committed.
We only ask you to keep the talks private
to minimize any social chaos.
If we reach an understanding today,
we will announce it as early as tomorrow,
and we can start the negotiations right away.
Good, so you're on board.
But as a sign of your commitment,
we would like a statement that says
that our agreement will not be amended nor nullified.
A statement by whom?
I hear the elections are coming up in Korea.
I need the signatures of the top 3 presidential candidates.
No statement, no negotiation.
Okay.
Okay. No problem.
They can't demand a statement before the negotiation.
We don't have much of a choice.
We don't know what we'll agree on.
How can the candidates sign the statement?
I will get those signatures for you.
Well, then...
Now that we know you're committed...
How much do you need?
21 Nov 1997 KOSPI 415.2
Won-Dollar Exchange Rate 1,103 won Foreign Reserves $3.5 billion
As of today, the government has accepted IMF's recommendations
and will officially request a bailout loan of $20 billion.
In order to overcome the foreign currency crisis we're experiencing,
we'll request a liquidity adjustment fund.
The government has been negotiating with the IMF through multiple channels.
Korea has admitted de facto national bankruptcy
in order to seek economic revival with the help of international institutions.
In the press conference, Senior Secretary Kim announced
that IMF agreed to actively support Korea.
As crisis deepens in the financial sector,
Nara Merchant Bank with a net asset of $2.5 billion
was acquired by Bosung Corp. worth $ 250 million,
signaling a massive restructuring.
The government will begin talk with the IMF on the terms.
The bailout loan is estimated to be around $20 billion...
Top 90 Korean companies
November 22 - Second negotiation meeting
This is what we've come up with.
From A to F.
A to F.
So... there are 6 conditions?
Actually, there is a precondition.
The 11 institutions serving as merchant banks in Korea...
we want you to suspend their operations
and declare them bankrupt.
The merchant banks may be going through rough times,
but they loan money to a lot of companies and people.
Declaring them bankrupt will hurt the working class
and drive smaller companies out of business.
I'm afraid we can't discuss any of the 6 conditions
without agreeing to this precondition.
Why ask us to declare the banks bankrupt?
It's a way for them to minimize the risk.
Just accept it.
We gotta deal with merchant banks sooner or later.
We might as well get rid of them now.
Could we give you our answer after we hear out
the 6 conditions?
Well, as I've said, this is a precondition.
If you don't agree to it,
I'm afraid there is no negotiation.
Fine.
We'll suspend the 11 institutions.
Good.
Condition A.
Korea is to raise its interest rate
as soon as it receives the IMF fund.
To 30% from its current 12.5%.
Loans are what got us in this mess in the first place.
More than doubling the interest rate will only make things worse.
Companies are already buried in debt.
This will drive them out of business.
Listen...
We've looked into this,
and we're proposing the conditions and funds
needed to save the Korean economy.
The funds you asked for.
And even though we're willing to negotiate the details of the conditions,
may I just remind you that
you're not exactly in a position to make a deal?
Condition B.
Korea is to open its capital market
as soon as it receives the IMF's fund.
You can start by raising the foreign investment cap
from 7% to 50%.
Moreover, regulations must be amended,
allowing acquisition of Korean financial institutions by foreign entities.
You have until June of 1998. That's next year.
Allow foreigners to set up securities firms in Korea,
which means, of course, allowing more foreign capitals in the bond market.
Also, allow hostile takeovers by foreign capital.
Wait!
What you're suggesting is a direct violation of the very reason the IMF was established.
No international organization has a right to infringe
on the economic autonomy of a nation in exchange for a bailout.
Excuse me.
Han!
No, no, no. Please, please. Let her be.
Let her speak.
You know what? I like people like you.
And I believe we'll be great negotiating partners.
Moody's and the S&P have downgraded Korea's credit rating once again.
To B minus...
Everyone, it seems like we have breaking news from the other side of the world.
So let's take five and catch up on updates.
Credit rating of B Minus is the grade right before junk bonds.
Meaning that Korean currency is about to become worthless.
I hope this news helps you make the right decisions
in this negotiation.
This is driving me nuts.
The promissory notes held as collateral at merchant banks
must be huge.
Whether it's a large or a small company,
all of them did business, involving a merchant bank.
At this point, it's impossible to save all the large and small companies.
Consider the big picture.
In the end, it's the conglomerates that will provide for Korea.
Accept the closing of merchant banks and
grant exemption for the conglomerates' promissory notes
with the merchant banks.
By exemption, you mean...
Not holding them responsible for promissory notes already issued.
Sorry for asking to meet so late.
That's okay.
Actually, this is a better time for us.
Credit rating of B Minus is the grade right before junk bonds.
I hope this news helps you make the right decisions
in this negotiation.
U.S. Deputy Secretary Brown Martin
November 22 - Third negotiation meeting
C. Information Provision and Program monitoring
D. Financial Sector Restructuring
E. Corporate Governance and Corporate Structure
And finally, Condition F.
Enhance the flexibility of the labor market.
Once again, as soon as you receive the fund.
You mean a mass layoff?
It's not limited to layoffs,
just a change in the overall employment structure.
For instance, allowing more non-regular workers and indirect employment.
We just want the labor market here
to be more vitalized.
And by that, you mean easier dismissals.
What is she saying?
Stop talking, Ms. Han.
Han.
Sit down!
Why is the U.S. Deputy Secretary of the Treasury staying at this hotel?
That has nothing to do with this negotiation.
And why is he staying on the same floor as you?
Is it true that the Deputy Secretary
is behind this negotiation with the IMF?
Is it true that the Deputy Secretary went to the leading candidate's house
and demanded his signature on the statement?
Raising the interest rate to drive companies out of business,
opening the market to give easier access to foreign investors,
and letting them take over bankrupt Korean companies through hostile M&A's...
As the BOK's head of monetary policy,
I cannot agree to these terms.
Furthermore, I have reason to believe that you may be taking orders from the U.S. government.
Tell me, why is the IMF suggesting a mass layoff as a condition for the bailout?
Why ask us to open our capital market?
Am I wrong in thinking that the U.S. is seeking to
fulfill its own interests from this negotiation?
You're the chief negotiator, right?
Yes, I am.
So, it's simple.
Life is a series of choices, and so is a negotiation.
We would like to add another precondition.
Either we end the discussion
and you send us home or
you send home the member of your delegation who doesn't want to negotiate.
And this is our third precondition.
Sir, please halt the negotiation.
You're way out of line.
Who do you think you are?
Leave this room.
Which side are you on?
This negotiation lacks legitimacy.
You have to call it off!
I know we can reach an amicable agreement.
Sir, you must call off this negotiation.
No matter what you do...
Han.
It won't change anything.
No matter what you try.
Gap-su...
The rise in exchange rate doubled the cost for materials.
The money I borrowed
didn't cover even half of the materials we bought.
What happened to that promissory note Mr. Lee gave us?
If that clears, we can at least put out an urgent fire.
Lee's company...
Yeah?
Samho Distribution...
What about it?
It closed its business.
What about our promissory note?
This is just a piece of paper.
Oh my god...
I asked my wife's family for that money.
What's gonna happen to my children?
Seizure
Korea joins the OECD Global Korea!
Mr. Chung. It's me, Gap-su.
Mr. Han! Times are tough, right?
Well, yes...
It's hard for you too, right?
I'm barely getting by every day. But let's hang in there.
We gotta stick it out.
Yes, of course.
I will stick it out no matter what.
I want to make the payment now.
Really? You can really do that?
I'll make the payment.
Please send one of your employees.
Wow! Nice apartment!
Good-sized rooms.
Shit!
There's a dead dude...!
What the hell?!
Let's get out of here quickly!
Why?
What do you mean by 'why'? We have to call the police!
Why should I get out?
This is my house now.
Contribute to the development of Korean economy
by establishing and enforcing monetary and credit policy.
The founding purpose of the Bank of Korea.
Somehow I forgot about it.
We get paid to serve this country.
So, let's do our job and contribute.
We'll stop this negotiation
and declare a national bankruptcy.
Declare a moratorium and acknowledge that Korea is bankrupt.
When the moratorium is declared,
the obligation to pay debt will disappear.
No.
It's just too extreme a measure...
What do creditors fear the most?
What is the last thing a debtor can do?
IMF is representing the U.S. interest,
and we'll use it against them.
We'd rather go bankrupt than go through with this negotiation.
We can't pay back the money borrowed from American funds.
This could change the IMF's attitude.
We can't do that.
Moratorium... national bankruptcy... it doesn't matter now.
We could declare a national bankruptcy,
but if you declare it yourself,
you will certainly lose your job.
That's not what matters.
We still have one last card left.
With swift actions of the creditors and fast recovery of the bankrupt country...
But on the downside, by raising the dollar interest rate too high...
It posed a considerable threat to global finance institutions.
The international creditors swiftly
adjusted debt to minimize damage.
The countries that borrowed heavily from overseas funds
ended up in enormous debt.
Post National Bankruptcy Korean Economy Predictions
A world where the poor get poorer and the rich keep on getting richer...
A world where it's easier to fire people
and have more non-regular workers,
where unemployment is the norm...
We must not let IMF take us to that world.
Are you saying that the government knew about the crisis
but didn't inform the people?
Not only that, they tried to deliberately hide it.
And negotiations with the IMF are being handled hastily?
That's correct.
IMF's unreasonable demands are being forced as preconditions.
Mass dismissals, interest rates, issues regarding labor, and investments
are being manipulated behind closed doors by a handful of people not thinking thoroughly.
This government's economic officials are neglecting their duties.
They have no will to evacuate people from a sinking ship.
They're deciding the future of this country based on their individual values.
From the beginning of the catastrophe,
during the process,
and to the end.
3 Dec 1997
KOSPI 379.3
Won-Dollar Exchange Rate 1,610 won
Foreign Reserves less than $2 billion
Thank you.
It's not in any of the papers.
I can't believe this.
The bailout negotiation with the IMF was finalized today.
We'll receive a $55 billion fund
but our economy will be placed under an IMF receivership.
We don't want to be self-deprecating
but this'll be recorded as a day of humiliation for Korea.
A $55 billion IMF fund will be injected
Today, we'll have a special class.
What is IMF?
Let's watch this video
and think about what we can do. Okay?
Yes, Miss.
Save water and electricity. Sharpen your pencils...
Under IMF supervision, wages will be cut by 15%.
IMF demands the raising of interest rates...
Restructuring strikes all industries.
Companies are laying off employees to meet the government's urge for restructuring.
From today, we are unavoidably taking voluntary resignation.
This document is for the resignation,
Application for Voluntary Resignation
and this one is consent to transition to non-regular employee.
Why did he kill himself?
His business partner gave him a bad check.
His business couldn't recover from the damage.
He waited in good faith, but his trust backfired.
After his apartment was foreclosed, he made his family leave and hanged himself.
Yoon! I knew you'd pull it off!
All thanks to you for trusting me.
You led the way. We only followed.
This key is too freaking high!
Sing with me!
Okay! Sing us a song, Yoon.
No, I can't.
Don't be shy. Come on!
Korea becomes 29th member of OECD
Hyun-ah & Hyun-su's bedroom
Ms. Han.
Ms. Han?
This is unbearable.
IMF is not the way.
You know what happened to Thailand and Indonesia
after they got IMF money?
If you do something wrong, you pay by getting punished,
but at the IMF, they kill you without giving a second chance.
There are still ways to fight this.
But you're getting...
Come on. Your dinner will get cold.
Record of IMF Negotiations
Letter of Resignation
Hey...
How's my little sister doing?
Why...
What brings you...
Something wrong?
I have a favor to ask you.
You know people in high positions at banks, right?
I'm really sorry but please help me.
Help me get a loan.
You're the only person left.
I don't care if I get jailed
but think about my wife and kids.
I wouldn't have come to you
if I had a choice.
Please.
I beg you, Si-hyun.
On December 3, 1997,
Korea signed the IMF's negotiation agenda,
and IMF management began.
The next year, the number of unemployed soared to 1.3 million.
Suicides rose by 42%,
the highest rate among OECD countries.
Citizens donated gold to help
recovery of the nation's economy.
$2.2 billion worth of gold
was collected in just 4 months.
Donated gold was used to pay down corporations' debt.
Crises recur.
20 years later
Korea seems to have changed a lot in the last 20 years.
Not at all.
Now, we're exposed to even bigger risks.
Sir! I was deeply touched by your lecture today.
I'd like to treat you to a meal.
It's $5,000 for lunch and $10,000 for dinner.
Lunch is 60 minutes. Dinner is 90.
Wire the money to my bank account.
But you must regard increased crises as opportunities.
It means you get more chances to change your life.
Morning, Mr. Yoon!
Thanks for the good tip this morning.
The hedge funds in the U.S. are continuously changing.
Should I follow them?
Of course! Keep following.
Okay!
And indeed, as you predicted,
the real estate in Gangnam is responding first.
I told you...
They can't fool me.
Dad, it's me. I'll do well today.
All right. Remember what I always tell you.
I know. Never trust a person who's good to you.
Not just those who are good to you.
You can't trust anybody.
Trust only yourself.
Yourself only. Got that?
Got it, dad.
Okay.
Hassan!
Quick! Quick!
S&J Finances open recruitment
candidates No. 231 to 235.
If I get this job, I'll...
CEO Park Dae-young Former Deputy Minister of Finance
Hello, Chairman!
Congratulations! I heard you're at an investment bank now.
It's all thanks to you.
There's talk of reform these days.
Give them what they want, they'll go quiet soon.
Oh, you've heard the news?
Soon...
20 Years Since IMF Bailout, Aftermath Persists
Conglomerates Get Bigger While Households Suffer
I heard she's got quite a personality.
Who cares about personality? She just needs to be competent in her job.
Financial Capital Monitoring Center
Are you Director Han?
Yes... and?
I am the Deputy Minister of Strategy and Finance.
Nothing's concrete yet,
but we might need your assistance.
So we came in person.
You just want me to be the old person sitting in the back...
Why should 1?
This is a report on how the household debt will cause panic within this year.
This is a report on the mass unsold properties in the metropolitan area.
The authorities aren't taking action.
You left a report on IMF when you left Bank of Korea.
It was the only and most accurate report.
Please... help us.
The bomb is ticking, and no one cares.
I work as a team.
Crises recur.
But in order not be helpless again,
we must not forget.
Keep asking questions and check facts.
Do not take a simple thing for granted.
And always watch the world with open eyes.
Because I'm not gonna lose again.