Chapter 442 |
Until now, the decentralization of the population in the metropolitan area has been truly ineffective.
The same was true for Sejong City, which had garnered much anticipation. Despite being promoted as an administrative complex city and relocating a large number of government agencies, it had little effect.
However, Saemangeum was showing clear results even though the pre-sale plan had not yet been announced.
Internally, a plan has been established to conduct the first round of pre-sales for 200,000 units in the second half of next year, followed by pre-sales of 100,000 units each year.
If the plan proceeds as scheduled, a new city on the scale of a metropolitan city with a population of over one million will be created. Considering that the population of Sejong City is about 300,000, it is more than three times larger.
In addition to companies and factories, it will be a city with perfect self-sufficiency, with the nation's largest integrated resort, theme park, silver town, and international school and Korea University's second campus.
With the creation of a new city that could replace the metropolitan area, where it was already impossible for actual demand to purchase homes, housing prices began to fall sharply.
No one in the world would be happy to see their house price drop. This would be even more true for those who had bought multiple houses with loans.
Korea has a unique housing culture where a significant portion of the population lives in apartment complexes.
As homeowners fiercely resisted, lawmakers from the Free Korea Party with constituencies in the metropolitan area jumped on the bandwagon and raised their voices.
"We must come up with a definite support plan for the common people who own a single home!"
"As retirees and the elderly with no income are feeling a great burden from the increased taxes, we must consider tax burden reduction for actual demand and permanent residents!"
"We will continue our struggle until the government comes up with a proper countermeasure!"
Representative Ma Sang-tae suddenly announced that he would shave his head, denouncing the government's failed real estate policy and demanding countermeasures.
In front of a crowd of homeowners, Representative Ma Sang-tae shaved his head as if to show off.
The head-shaving of opposition lawmakers spread like a wildfire, centered on lawmakers from the metropolitan area. The conservatives fervently supported this, calling it a "head-shaving struggle."
After a period of seclusion following the economic hearing, the leader of the Free Korea Party, Yeon Nakyeong, came to the scene and encouraged the head-shaving.
She hugged the lawmakers who had shaved their heads and shouted with tears.
"Our party will continue a relay of head-shaving until a definite countermeasure for the common people who own homes and the common people who are in the rental business is announced!"
So far, so good.
But the spark suddenly shifted to her.
The host who was live-streaming the head-shaving ceremony on ATube pushed a microphone towards her and said.
"Next, Representative Yeon Nakyeong, please shave your head!"
At those words, Representative Yeon Nakyeong was flustered.
"What? M-me?"
"That's right! The leader of the number one opposition party must show her resolve by shaving her head!"
The supporters gathered at the head-shaving ceremony all chanted her name in unison.
"Yeon Nakyeong! Yeon Nakyeong!"
Representative Yeon Nakyeong just smiled awkwardly with a flustered expression.
***
The controversy over Representative Yeon Nakyeong's head-shaving grew.
There was even a Blue House national petition supporting Representative Yeon Nakyeong's head-shaving, and over 100,000 people agreed.
It seemed that everyone, regardless of their political affiliation, wanted Representative Yeon Nakyeong to shave her head.
After avoiding reporters' questions for a while, Representative Yeon Nakyeong said, as if she had no choice.
"I will make a comprehensive decision on the timing and method in terms of maximizing the meaning of the struggle."
-No, what's so great about shaving your head that you have to make a comprehensive decision?
-Anyone would think she was committing harakiri.
-LOL, she's trying so hard to say she won't do it in a roundabout way!
-As she agreed to the Saemangeum development in the hearing, it is right for her to shave her head as a form of taking responsibility!
-Representative Yeon Nakyeong! Please shave your head and show the opposition's resolve!
-If Yeonkajaki shaves her head, I'll support the Liberal Democratic Party from today!
-I will also join the Liberal Democratic Party as a member!
-LOL, why support the Liberal Democratic Party? You should support your own country's party, LOL.
-You can't do harakiri, but you should at least shave your head!
-Hair grows back anyway.
-If Yeon Nakyeong shaves her head, the Free Korea Party will skyrocket!
-Let's go, head-shaving!
After reading the article, Taekgyu said.
"What on earth is this that they're shaving their heads? Does shaving your head make the falling house prices go up?"
"You shouldn't try to find meaning in what politicians do."
Representative Yeon Nakyeong beat around the bush and clung to OTK Company. She argued that since all of this started with the Saemangeum development, OTK Company, as the main entity, also had a responsibility.
The homeowners also seemed to think so, as they were protesting in front of the company, demanding countermeasures. Of course, there was no reason to comply.
It's not like they would give me a cut of the profits if the house prices went up.
Taekgyu put his hand on my shoulder.
"Now that it's come to this, there's only one way. You have to shave your head too!"
I was startled.
"...Why me?"
What crime did I commit?
Taekgyu called the PR team leader and said.
"First, announce that if Representative Yeon Nakyeong shows a firm resolve, we will also make a comprehensive decision."
At those words, Team Leader Jung Gi-hong was startled.
"What? Are we really going to announce that?"
Taekgyu said with anticipation.
"I want to see Representative Yeon Nakyeong shave her head."
"W-will that be okay?"
"It's fine. She won't do it anyway."
"..."
***
After the announcement from the Vice President of OTK Company, Representative Yeon Nakyeong could no longer back down.
In response to reporters' questions, she shouted with a determined expression.
"I will hold the head-shaving ceremony in front of the OTK Company headquarters!"
Amidst a crowd of protesters and supporters, Representative Yeon Nakyeong sat in a chair and wrapped a barber's cape around her body.
Just as her aide was about to shave her head with clippers!
"No, Representative!"
"Put down those clippers right now!"
Her fellow lawmakers rushed in with awkward movements and snatched the clippers. And as if on cue, party members surrounded Representative Yeon Nakyeong.
"You'll have to shave our heads before you shave Representative Yeon Nakyeong's!"
"No one will lay a finger on the Representative's hair!"
Representative Yeon Nakyeong said to them.
"I understand your intentions, but you cannot break my resolve! Shave my head now!"
"We can't do that!"
"We must find another way!"
"Why won't you listen to our voices?"
Representative Yeon Nakyeong and her fellow lawmakers argued back and forth about shaving her head, and it became a sea of tears.
Representative Yeon Nakyeong wiped away her tears and said, as if she had no choice.
"Since so many people are against it, I have no choice but to stop the head-shaving ceremony for today. But I will not stop here and will continue the struggle until the end!"
"Waaaaah!"
"Yeon Nakyeong! Yeon Nakyeong!"
Just as the big show was about to end, an employee from the OTK Company headquarters came out and delivered a message.
"It seems you're having a hard time because of the noise, so the Vice President says you can shave your head in the lobby."
"..."
This incident heated up the internet for a while.
-LOL, the Vice President is crazy. He's determined to screw over Yeon Nakyeong.
-Who the hell is he?
-Haha, Yeon Nakyeong is really something. In the end, she went home without shaving her head.
-I knew she wouldn't do it. The expressions and movements of the lawmakers and supporters who were stopping her were so awkward. They should have practiced beforehand.
-It's easy to make others shave their heads, but it's not easy to shave your own.
-Everyone's hair is precious to them.
-Then why did she encourage other lawmakers to shave their heads?
-Because it's not her hair.
-A man shaving his head and a woman shaving her head have different meanings!
-Tsk tsk, how can the leader of the number one opposition party raise the falling house prices if she's so scared to take risks?
***
Taekgyu said with regret.
"She could have just shaved it at home and come!"
"..."
Why are you so eager to make her shave her head?
I continued to scan through the documents.
In most developed countries, the ratio of real estate assets to financial assets is below 50 percent. Even in Japan, which is known for its love of real estate, the ratio is around 60 percent. But in Korea, this ratio exceeds 80 percent.
In other words, the assets of the entire nation are tied to real estate. This means that if housing prices fall, it will be fatal to household assets.
That's why the government, which had been saying just a few months ago that it would control housing prices in the metropolitan area, hastily changed its attitude.
The downward trend has slowed down a bit, perhaps due to the various stimulus packages that have been poured out.
The government first eased lending regulations for non-homeowners. This is to allow them to borrow more money to buy a house.
But this will lead to an increase in household debt again.
"At this rate, it will hit 2,000 trillion next year."
For now, it's not a big problem because the interest rates are low. It's also highly likely that the Bank of Korea will lower the interest rate one more time soon.
When the interest rate is 5 percent, a 0.5 percent drop reduces the interest burden by 10 percent, but when the interest rate is 2 percent, a 0.5 percent drop reduces the interest burden by 25 percent.
The problem is that the opposite situation unfolds when it rises. In the current situation, if the interest rate rises by just 2 percent, the interest burden will double.
If you have to pay $2 million in interest per month instead of $1 million, can you withstand it?
"Can't you just pay off the debt little by little?"
"It's not that simple."
Money is easy to borrow but not easy to repay. To repay debt, it's one of two things. Either your income increases, or you sell your assets.
Again, in recent years, household debt has increased by more than twice the economic growth rate. Considering that income increases in line with the economic growth rate, it's unreasonable to repay the debt with income.
In the end, you have to sell your house, but if everyone thinks that way and floods the market with properties, the house prices will fall again.
The subprime mortgage crisis occurred because the financial sector's insolvency became serious as housing prices fell below the collateral value.
However, in Korea, the possibility of that happening is very low thanks to the well-established lending regulations. Considering the fundamentals of the Korean economy, it's safe to say that there is no possibility of housing prices being cut in half. Unless a shock of the magnitude of the IMF foreign exchange crisis hits.
No country, no government likes monetary expansion and asset value appreciation, not the other way around.
It's easy and enjoyable to borrow and spend money, but it's hard and painful to repay the borrowed money. So what should you do when it becomes difficult to repay the debt?
It's simple. You just take out another loan.
"It's similar to maxing out your credit cards."
"Correct."
Even if the debt snowballs, there is no problem in daily life. The problem arises when you can no longer borrow money.
When it is judged that the debtor, whether a person or a country, can no longer repay the money, the creditors try to collect the money they have lent.
Several countries have already exploded while trying to roll over their debt.
Argentina is receiving an IMF bailout because it cannot repay its debt. Greece received financial support from the EU on the condition that part of its debt would be written off, and Italy is also on the verge of bankruptcy.
This is the price for spending other people's money lavishly.
In the process of overcoming the financial crisis, the United States released an astronomical amount of money, and that money flowed into emerging countries, continuously raising asset values. And in the process, the debt continued to grow.
Currently, almost all countries are groaning under massive debt.
China's combined government, corporate, and household debt is more than three times its GDP, and Japan's national debt alone is 250 percent of its GDP as of this year.
If a problem erupts in a large economy, there is a high possibility that the crisis will spread like a domino effect.
That's why there are continuous talks of a financial crisis.
There is no eternal boom, and there is no asset that rises forever.
How much longer can this state last?