Wednesday, January 24, 2007

Can't fuck with the Bank of Korea

In the days of "IMF" - those are the days in 97-99 when many Asian economies were rampaged by merciless hedge funds and financial institutions - the Korean government (precisely, the Bank of Korea) did not have any foreign exchange (US dollar) left in their pockets.

Of course, the smart and opportunitistic money makers from the world with handful of dollars flooded into Korean market and played the situation to their advantages. They knew Korean economy needed US dollars but the Bank of Korea did not have any dollar to support the economy. So what did they do? They held on to US dollars, creating big big shortages of US dollars and causing big big havoc for Korean econmoy. Eventually, the Korean government had to borrow dollars from IMF (International Monetary Fund) and people in Korea call those days "IMF period."

Those were good days for those bastards.

Now, the Bank of Korea has so much US dollar in their hands, they can match anybody or any groups who try to play around with the foreign exchange between Korean Won and US dollar. One of my close friends work for a pretty big hedge fund company in New York and he said he and his people sometimes played around with Korean foreign exchange but as soon as they senseed or heard a news that the Bank of Korea was about to make a move, they would back off. Sure, they run a lot of money, but even they are no match for the Bank of Korea.

This is the way it should have been in 1997. They should have crushed those bastards, but unfortunately the Korean gov't at that time was a stupid dumbass government who could not even fight a single group of hedge funds.

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