[Start Economy] Unbreakable Household Loan Growth...2nd Financial Sector 'Pulling in' Clear

■ Host: Anchor Lee Jung-seop, Anchor Cho Ye-jin
■ Starring: Professor Heo Jun-young of Sogang University's Department of Economics

* The text below may differ from the actual broadcast content, so please check the broadcast for more accurate information. Please specify [YTN News START] when quoting.

[Anchor]
We give you the latest economic news quickly and kindly. Start Economy, today with Professor Heo Joon-young of Sogang University's Department of Economics. Welcome, professor. Today, we will talk about household debt, and it turns out that household loans have increased by KRW 6.6 trillion in all financial sectors. Even though financial authorities continue to regulate, what is the background of this increase?

[Heo Joon-young]
Since there is a tightening of loans for the first financial sector and the banking sector, demand seems to be shifting a lot to the second financial sector. In fact, if you look at the total number of household loans, it continued to increase by about 5 trillion won until July, jumped to 9.7 trillion won in August, and then 5 trillion won again in September, and now it has risen to 6 trillion won. In that sense, the increase in household loans has risen again. And if you look at it a little bit, the overall support has been decreasing since August. In fact, housing transactions have been decreasing since August. It seems that the policies that tighten household loans are working in a way. The problem is, as I said earlier, loans are increasing in the second financial sector. But I don't think we can see this as one cross-section. I think there are two kinds of flows happening together. First, mutual financial companies are increasing their mortgage loans. And this is housing demand. On the other hand, when you look at insurance, women's companies, and savings banks, credit card loans, insurance contract loans, and others are increasing. Then, I think the increasing loans here are very livelihood loans and rapid demand loans from vulnerable measures of the common people. These two trends seem to be the direction of increasing loans again now.

[Anchor]
As you said, more and more people are trying to borrow money from the second financial sector, so how do you forecast future trends?

[Heo Joon-young]
In any case, the economic growth rate was 0.1 in the third quarter just now, but it grew 1.4 last year, and this year, KDI will make the announcement today, but I think it will be difficult to grow in the middle of 2%. It's a case where it's in the early 2% range. And if you look at next year's growth forecast, it seems to be slightly below the 2% range. Then it will be a new year with a very low economic growth rate for almost three consecutive years, and in the end, domestic demand and economic conditions are not good. In that situation, interest rates will go down, but I predict that the rate will not be fast. In that sense, it seems that the increase in loans, such as the rapid demand of the vulnerable, will continue in the future. In the case of mortgage loans, the composition ratio has changed slightly recently. That's why the proportion of policy loans is slightly increasing. So, even if the financial authorities sign up for household loans, these policy loans are loans that must be given to those who are required. Therefore, policy loans seem to have been continuously going out recently, so I think that the upward trend will slow down for the time being as the composition ratio has changed a little.

[Anchor]
However, the Bank of Korea analyzed this phenomenon as a temporary rebound. Where is the reason?

[Heo Joon-young]
What a temporary rebound is that we usually do in September and at the end of the quarter, we erase bad debts and pay Chuseok bonuses, so there are many people who pay off their debts then. So, household loans may temporarily decrease a little in September. The thing that popped up a little again in October right now, that is, it wasn't something trending up in October, but it was unusually low in September. I think it's the Bank of Korea's position to talk about these things.

[Anchor]
As the Bank of Korea analyzed, we will see if it will be temporary or if the trend will continue for quite a long time. Let's move on to the next topic. It's commonly called a glass ceiling by companies. It's a female executive story, has it improved a lot, how is it?

[Heo Joon-young]
Compared to last year, the number of female executives in the top 100 companies stood at 439 last year, up 24 this year to 463. And compared to the past, there were 13 people in 2024, 20 years ago. Compared to that, it's improved a lot. In terms of the recent rate, it's just before COVID-19. 3. From 5% to 6% for the first time last year, it seems to be in the early 6% range this year. But if you think about it easily, the ratio is still not that high when we consider the overall ratio of men and women in the workplace as a whole. That's how it feels.

[Anchor]
What I'm curious about this survey is what each company is like. Which company had the most female executives?

[Heo Joon-young]
Samsung Electronics had 81 female executives. Next, there are companies where we understand a lot of female executives. For example, more cultural or content-related companies or retail-related companies. CJ CheilJedang, Naver, Hyundai Motor, AmorePacific, Lotte Shopping, and LG Electronics were in order, and of course, AmorePacific had the highest percentage of female executives. And among them, there are four female executives who are even in-house directors, so even CEO directors. Hotel Shilla President Lee Boo-jin, followed by Gas Corporation President Choi Eun-hye, Naver, and LG Household & Health Care are companies where female CEOs are currently working.

[Anchor]
Of course, the figure is 6.3%, the highest ever, but if you look at the graph, it doesn't seem to be that many. What are the challenges that need to be solved in the future?

[Heo Joon-young]
If you look at it, I'll start by introducing two recent interesting research results first. Recently, a survey of Korea's 500 largest companies by a very large consulting and global consulting company in Korea showed that there was a positive correlation between the number of female executives and the soundness of financial statements. Second, researchers from Columbia and Illinois University in the United States found that diversity of leadership eventually helps to derive more innovative ideas, make better decisions, and solve problems. Then, if we think about it on the one hand, I think it is necessary to increase the number of female executives in a way that benefits the company and the company, rather than just increasing the number of female executives from the standpoint of gender equality. In terms of that, in Korea, the university graduation rate, women's university graduation rate, 92%, and as of 2022, it is the highest among OECD countries in the world. And the employment rate is also higher than the OECD average. So many people graduated from college, were well educated, and many people were working. However, one of the lowest levels of gender equality indicators among OECD countries. After that, we investigated and found that there are a lot of women leaving the deputy level and the deputy level. So, it's the second time that there are people who quit their jobs and their careers are cut off when they give birth to children or have to take care of them in the middle of work. Then, when I surveyed female executives, there were survey results that there still seem to be various prejudices against the leaders because they are women. I think these things are also something we need to think about.

[Anchor]
Anyway, the encouraging thing is that the glass ceiling is cracking and breaking little by little, so it seems that social consensus is needed in the future. Let's take a look at the next news as well. This coin is very popular right now. It's about bitcoin. As we told you a while ago, we also told you that it exceeded the $88,000 mark, and now in Bithumb in Korea, so it's about 120 million won in Korean money. There's a saying that today is the cheapest, what do you think about this phenomenon?

[Heo Joon-young]
I wrote 85,000 won when I received the questionnaire four to five hours before today. But just now, it was 88,000. So the upward trend is really incredible. In the end, this trend seems to have continued since Trump's election as the 47th president. So if you think about how long this will last, if you look at the future anyway, President Trump promised to move in the direction of removing various regulations in the virtual asset market anyway, and even posted a picture of Trump's son turning an American flag photo of the White House into a Bitcoin photo. If you look at this, the direction is very that way. I think I can think that there is a possibility that the upward trend will continue for the time being.

[Anchor]
What is the situation with coins other than Bitcoin? Is there a chance that altcoins will also break the high price?

[Heo Joon-young]
What I think is that there is a very high possibility of breaking the highest price right now is that when it comes to altcoins, what viewers think is called altcoins, including Bitcoin, the number one coin, Ethereum, and so on. In a way, this part is more regulated than bitcoin. Because there are a lot of different coins in here. Of course, the regulatory intensity is very high because there are coins that we can trust and coins that are not. However, there seems to be a lot of investment in altcoins recently because I think this is the part that will benefit a little more if there are a lot of regulations removed.

[Anchor]
Elon Musk's coin, Dogecoin, is also attracting attention, and articles continue to appear that a lot of money is focused on virtual assets in the coin market. There are also reports that more than 18 trillion won has been poured in, so is there a possibility that it will rise further in the future?

[Heo Joon-young]
The short-term thing to watch out for is that as the policy is actually formulated, and who will be in charge of these policies before they are formulated, and when these things are revealed, if someone is a little less than what the market expects, it may fall again. I think there are definitely some areas that we need to be careful about. Nevertheless, I think the upward trend itself will be maintained for the time being. And in fact, there was a lot of order in the Biden administration that we were talking about Gary Gensler, that the financial sector always said that we should fire him. After all, I was a virtual asset regulator. However, since the change to President Trump this time is expected to ease such trends, I am naturally thinking that money will flock to the coin side for the time being.

[Anchor]
This anchor mentioned it a while ago, but there's someone who's seen the Trump effect properly. It's Elon Musk, and his assets have become enormous due to the rise of Dogecoin.

[Heo Joon-young]
Dogecoin was originally a very playful coin. This is almost the coin that Elon Musk posted as his personal talent. Then the reason why Dogecoin is similar is that this value tends to be similar to Elon Musk's value and Tesla's value. But as you just said, I'd like to basically tell you this. What President Trump said was that Tesla CEO Elon Musk, of course, helped the campaign very hard. So what I was talking about was that I think the information is very inefficient because I was an entrepreneur. When I did the first stage, it was very inefficient. And Elon Musk feels the same way. Even after developing all the technology to go into space, I couldn't use this because my license didn't go out. So let's break this regulation and make the government efficient. That's why it's said to create a government efficiency committee, and there's a rumor that Elon Musk will be put as the head. If this happens, the soccer referee plays soccer. It could be a case where you decide your own regulation. I think this is reflected in the market.

[Anchor]
It's because the president was elected as an entrepreneur. Then, I wonder what Tesla's stock price is like.

[Heo Joon-young]
It went up 30% last week. It's up 8% this week alone. So this is almost like a runaway train. Regarding Tesla, as I said, rather than reflecting the business conditions of the company now, there seems to be a number of expectations that this person, Elon Musk's influence in what can shake the company, and his influence can reach the government.

[Anchor]
The Trump effect is appearing everywhere, and the momentum is scary. Let's move on to the next topic. We will continue to look at the New York Stock Exchange, but all three major indexes have reached record highs.

[Heo Joon-young]
All three major indexes are at an all-time high, and what's interesting is that Nvidia, Microsoft, and Apple lost some stock yesterday. Rather, manufacturing and small manufacturing indices have risen a lot. These seem to have the Trump effect here after all. And traditionally, tech companies didn't get along with Trump. I think these things are being reflected. The Three Major Index All-Time Highs, Bitcoin All-Time Highs. Housing prices are also at an all-time high. The U.S. asset market is boiling.

[Anchor]
I'm worried that inflation won't come again, so what do you think?

[Heo Joon-young]
Inflation is likely to be realized in the mid- to long-term, although it will not be realized today or tomorrow because Trump's policy itself is very much inflationary, and there are factors that can push inflation up. What I want you to see is that it's a red swing, so don't you think the Republican Party is taking over the House and Senate? I think it's going to push a very strong drive for two years because there's a midterm election in two years, and the popularity of the government after that, and the Democratic Party may come up a little bit because the midterm elections are government-judged elections. So over the next two years, over the first two years, we're going to drive very hard, so I think we need to look at the future of inflation in that sense, in a year or two.

[Anchor]
Now that it's like this, it's a kind of Seohak ant. There are many cases where Koreans invest in beauty market, and more than 11 trillion won went to the U.S. stock market. How should I look at this phenomenon now?

[Heo Joon-young]
We think buying stocks is basically buying innovation or growth. Then, the most representative country where innovation and growth are taking place at the same time is the United States. And the direction of Trump's policies in the future is that if it was a weaker version of Biden's America First, it would push it to have a much stronger and shorter time effect. Then more funds from around the world will be forced to flock to the United States. In this way, I think that for the time being, the movements of West Korean ants will inevitably become more active, and in that sense, Korea's economy, which lives mainly on exports, is a little worried.

[Anchor]
I see. Let's stop here. Today, I was with Professor Heo Joon-young of Sogang University. Thank you very much.