[Starting economy] The railway union is fighting against compliance from today...Are we going on an indefinite general strike in early December?

■ Host: Anchor Lee Jung-seop, Anchor Cho Ye-jin
■ Starring: Professor Seo Eun-sook, Department of Economics and Finance, Sangmyung University

* 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 deliver the latest economic news quickly and kindly. Start Economy, today we will be with Seo Eun-sook, a professor of economics and finance at Sangmyung University. Please come in. We just met through video composition, but first of all, the national railway union announced a general strike early next month. I'm going into a law-abiding struggle from today, what's the reason for going into a job?

[Seo Eun-sook]
It seems that this is due to the large difference in opinions on labor standards between labor and management. First of all, in the case of public institutions, there is a fixed number of people. It is known that about 800 people are not enough for the number of current employees who are currently working compared to the quota. However, the Ministry of Economy and Finance seems to be pushing for a reduction of the number of people by 1566 recently, despite the fact that about nine routes, including the West Sea Line, which the corporation opened this year, and the Central Line and the Donghae Line, which are scheduled to open at the end of the year, need more manpower. So, regarding the situation in which Korail's manpower gap continues, the union's countermeasures against this manpower gap continue to outsource. So, along with issues such as privatization and privatization of public enterprises, they are very sensitive to this.

And the union's argument is that at least it should not be handed over to the private sector regarding safety issues. However, from the perspective of Korail's management and management, it seems that they are continuously considering reducing manpower due to issues such as resolving deficits or normalizing overall management.

[Anchor]
It seems that the two sides will face off strongly, so the train operation could be disrupted depending on the job?

[Seo Eun-sook]
In fact, what we often call a strike is just to suspend operations. So, it's not on strike, but in the case of compliance struggles, they generally ask for their requirements according to the manual of safe driving. So, instead of running around the railroad, for example, securing personnel for the monitoring team. Nevertheless, since it means that we will unconditionally do these parts in accordance with the work manual, there is a high possibility of delay in the operation itself.

[Anchor]
When the railway union goes on strike, you can see workers wearing vests or other clothes instead of uniforms, but first of all, the issue of manpower expansion is very controversial. What do you think of the possibility of negotiations on this part?

[Seo Eun-sook]
First of all, the Ministry of Strategy and Finance has announced a reduction in the number of people. Not only this part of the workforce, but in fact, there are incentives and payments that the government was supposed to give, but this 23.1 billion has not yet been paid. And then, as I said earlier, even though the manpower recruitment part is very large, there is a big difference of opinion in these areas that are trying to reduce the manpower. In a way, it is not easy to reduce the disagreement between labor and management. As a result, the union will go on strike in early December if it does not follow the procedure.

They're saying they're going on strike indefinitely. But in fact, as we all understand, the railway operation itself is directly related to the convenience of the people. So we really need to communicate with labor and management. In a crisis situation, we think we should look forward to the leadership of management.

[Anchor]
Although there is a big difference in position, as you said, it is an important means of transportation for citizens, so I hope the conversation will proceed well so that it does not lead to a long-term strike. Let's move on to the next topic. Recently, young people's view of marriage and childbirth has changed dramatically, and there seem to be a lot of statistics that feel that there are many changes, but I heard that more people in their 20s think that they can have children without getting married.

[Seo Eun-sook]
In the past, marriage and childbirth were a bundle. So the perception that the two were essentially going together seems to be the fact that young people can now gradually choose between marriage and childbirth. Therefore, according to the data released by the National Statistical Office on the 17th, 42.8% of 20 to 29 years old this year said they can give birth without getting married and have children. If you look at the data 10 years ago, we can say that it's about 10 percentage points more than 30.9 percent of the respondents were positive. So, in a way, the open perception of unmarried childbirth is gradually increasing, and the number of young people who say they will not marry or give birth in the first place is increasing.

This is a trend of increasing number of young people who do not feel the need for marriage itself. In 2014, 51.2% of the respondents in their 20s said they must get married or should get married, and more than half thought so, but now only about 40% of them think so. So, as it's decreasing a lot, it seems that this trend is coming together with this.

[Anchor]
So, is there a statistic that actually increases unmarried births as awareness increases positively?

[Seo Eun-sook]
If you look at the number of non-marriage births per year, the number has increased from 6,900 in 2020 to 9,900 in 2022 and has continued to increase to 10,900 last year. So if you look at the proportion of non-marriage births among all babies born last year, we are 4.7%. So this is probably the highest since statistics were compiled in 1981.

[Anchor]
Looking at the trend of changing perception itself, it seems that the system and the government's policies should also be in line with it, so what systems do you think will be needed?

[Seo Eun-sook]
In terms of culture, people's mindsets are changing a lot with the times, but in a way, uncertainty about the future is growing for young people, and I think the government's concerns about how to change uncertainty about the future in the long run should continue.
And in the short term, if we look at it now, we have a lot of policies on childbirth and parenting, which are all married. However, in such a situation where the proportion of perceptions of marriage and childbirth is changing rapidly, I think it is necessary to apply institutional parts to non-marital childbirth without marriage. So there are a lot of policies that the government is doing right now. If you bring these parts into the system, in other words, if you think that it applies to non-marital childbirth, the biggest problem the government originally thought of is the low birth rate issue. I think I can solve these problems. From the perspective of experts, the institutional support system for unmarried childbirth could be a way to solve some of the low birth rate problems. According to OECD data, in France, unmarried births are 62.2%. In the case of
U.S., it's 41.6% as well.

So, these are the issues that the issue of low birth rate in Europe or the United States was very big in the past, so I think it will help solve the problem of low birth rate together if we think about this together.

[Anchor]
Certainly, with the birth rate low, it seems that encouraging perception statistics have come out. We're going to move on to the next topic, but it repeats when it's worth forgetting. It's about a financial accident, but it's Woori Bank again. What kind of story is it?

[Seo Eun-sook]
This wasn't embezzlement or anything like that. It's an accident that occurred when an outsider submitted false documents. For example, an accident occurred when a real estate buyer and a seller signed a behind-the-scenes contract, submitted this document to the bank, and took out excessive loans. So there was a situation where this was borrowed much more than the actual sale price, and this is what happened in March, and it seems to be such an incident that is now disclosed.

[Anchor]
But this is Woori Bank's fourth financial accident this year.

[Seo Eun-sook]
In September, a financial accident of about 5.6 billion won occurred due to the submission of similar false documents. Although it is a slightly different issue, 10 billion embezzlement accidents occurred in June. There was also an issue of unfair loans related to the relatives of the former chairman of our holding company. In other words, from the bank's point of view, the operational risk is getting bigger, and this problem occurs. . But what we have to pay close attention to is that if we don't recover all the losses, the bank is eventually checked for losses. It is very likely that these parts will eventually be passed on to consumers again, so it can be seen that countermeasures are needed for this part. However, it is not easy to respond to the submission of false documents in advance.

Because in the end, people have to check everything, so they have to review the documents very carefully to see if it's false. Systemically, big data and AI detection of abnormal transactions have recently been provided as solutions, but it takes a lot of time to move on. However, one of the indicators that we have to keep a close eye on is that the four major financial holding companies, financial companies, and banks have reduced their manpower by about 5,500 over the past five years. As the number of branches decreases and the number of non-face-to-face people increases, I think the decrease in the number of people who can check financial documents and these parts is also the reason for raising operational risks.
So the improvement of finances and the improvement of the financial sector is actually what we often call interest income per person and profitability, but I think we should think that the efforts of banks to reduce these operational risks are also very important.

[Anchor]
In fact, whenever there is an accident, it always comes out in words to come up with measures, so I hope that the implementation of that part is carried out properly. Next, we will look at the New York Stock Exchange in the U.S., and we have passed the Trump rally, which was very short and thick. What other issues will there be this week? [Seo Eun-sook] In the case of the stock market, people's expectations, that is, the expectations of the market. In the future, the expectation that this event will raise the stock price or not is one of the most important markets.

So in the case of the Trump trade, in a way, it went up a lot right after the presidential election was over.
If that happens, most people will have a lot of short-term arbitrage, which is what we're trying to make a profit on. And secondly, the current issue in the United States is the consumer price index, and so representative price indices are on the rise. So, what Fed Chairman Powell said while focusing on this part was that he would control the pace of interest rate cuts. That means that there is a very high possibility that they will not actively cut interest rates, so these two issues came together and fell very significantly last week. In a way, it fell more than I thought. So, it seems that all three major indexes of the New York Stock Exchange have fallen. In a way, the Trump trade is losing momentum, and it's very important for people to have a system of personnel appointments and such, but I think we'll watch closely about how the economic conditions of the second Trump will affect the stock market. So I think it will be an adjustment market during that period. And as I said earlier, the Fed is still very concerned about inflation. For example, it's something like this. So far, I've been very careful with the employment index and looked at the indicators, but from now on, I'm focusing on prices. So I think it will be difficult for the stock market to continue to rise or rise because of those parts.

[Anchor]
Among the several schedules that are likely to have a major impact on the U.S. stock market are Nvidia earnings reports.
How do you think it's going to come out?

[Seo Eun-sook]
When it was announced in the second quarter, it also announced that sales of about 30 billion dollars were about 30 billion dollars. At the same time, we released an estimate of about $32.5 billion in the third quarter. But the important thing is that the stock price did not rise significantly after the earnings release in the second quarter. So how we should look at this is that the stock price fell by more than 10% in short-term after-hours trading, even though the sales itself met or rose above market expectations. With expectations in the
market continuing to increase and investors' expectations increasing, Nvidia's stock price will not be easy to rise in the market without some earnings surprise. So, it seems that the markets are paying close attention to how much performance will come out and how much surprise issues will come out.

[Anchor]
There was a story that it wouldn't move unless it was a surprise. And now, with the performance just around the corner, Nvidia CEO Jensen Huang is a famous conference. I'm going to come out and give a keynote speech at Supercomputing 2024, what should I talk about?

[Seo Eun-sook]
As we said a while ago, Nvidia has risen a lot, so if people don't break their expectations for the market to some extent, it's hard for the stock to rise, but I think it's still a very important company in determining the direction of overall investor sentiment in the market for technology and AI. In addition, I think it will be very important for the CEO to announce what directions related to their next government's policies in the future. On top of that, Samsung Electronics and Hynix are also participating, so Nvidia is one of the very important consumers of Korean semiconductor companies. Therefore, especially in the case of Samsung Electronics, it is also linked to HBM's Qualcomm, so I think they will attend very closely and communicate a lot there.

[Anchor]
I see. We'll also watch how the third quarter's performance comes out. Today, I was with Seo Eun-sook, a professor of economics and finance at Sangmyung University. Thank you.