[News UP] Stock market 'clean' due to '50,000 Electronics' recovery...Does it go up?

■ Host: Anchor Yoon Jae-hee
■ Starring: Lee In-cheol, Director of Economic Research Institute,

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

[Anchor]
As Samsung Electronics succeeded in rebounding due to favorable stock purchases, our stock market also gained vitality for the first time in a long time. Rising trend, let's see if it continues today. Lee In-cheol's reference is with the director of the Economic Research Institute. Please come in. Let's talk about Samsung first. Samsung Electronics, which has recovered its stock price in the 50,000 won range, seems to be gaining momentum from the announcement of a treasury stock purchase worth 10 trillion won. Now I'm curious about the future prospects. Do you think it's on the rise now?

[Lee In-cheol]
First of all, the treasury stock purchase is intended to prevent the stock price from falling through finance in the short term. There are currently 4.25 million individual investors in Samsung Electronics alone. The average purchase price this year is around 68,000 won to 71,000 won. As a result, as of last weekend, they are usually losing more than 20-30% on average. So starting this week, we're going to buy 10 trillion won worth of treasury stocks for a year, and we're going to buy 3 trillion won for three months to buy stocks on the market and incinerate this.

Samsung Electronics has 5.9 billion shares in total common stock to be incinerated. However, since it is about 50 million shares, the stocks that are incinerated are 1% of the total issued volume. Anyway, I made a public announcement after the market closed last weekend.Ma rose more than 7% on the day. And yesterday, it rose nearly 6% to 56,700 won, but what's unfortunate? Foreigners turned to selling overnight.

[Anchor]
What I bought on Friday...

[Lee In-cheol]
That's right. On Friday, despite the resolution of the board of directors after the closing of the market, if it was a net purchase of 130 billion won in a day, yesterday was the first day. Foreigners sold more than 160 billion won of Samsung Electronics even though it was the first day of the actual treasury stock purchase method.

[Anchor]
I sold more. I think I can also ask you a question about this, but the announcement came out after Friday. However, there is a little doubt that a large number of foreigners came in. What do you think?

[Lee In-cheol]
That's right. This is actually raising suspicions about the advance sale. Because recently after September, foreign investors bought Samsung Electronics for only three days. Even if I bought it for three days, it's around billions of won. But a lot of money came in. In order not to affect the market after the closing of the market, the board of directors held a meeting and announced the timing of the announcement, but 130 billion won worth of purchase funds came in and rose again after the closing of the market. even in after-hours trading As a result, suspicions of advanced trading are being raised, which is something the Financial Supervisory Service should look into. But in a big way, individual investors are very vulnerable to information. As a result, there are complaints from individual investors that the information has leaked anyway, whether it is the institution or not.

[Anchor]
If so, I think it will be important whether Samsung Electronics has more room to rise in the future. Because if you look at this, as you said a little while ago, wouldn't the individuals in the loss section water down? How do you see further upside going forward?

[Lee In-cheol]
The last time Samsung Electronics bought its own shares was in 2017. At that time, the scale was 9.3 trillion won. This time, it's 10 trillion won, so 10 trillion won looks much bigger. At that time, I looked at the stock price growth rate at the time of purchase and until it was incinerated, and it was less than 10%. However, it varies depending on the period, so when I looked at the rate of increase of about 9 months from the first purchase, it rose by more than 50%. But what is the difference between 2017 and now? Business conditions were good in 2017 and 2018.

So, if Samsung Electronics had the best performance ever based on the industry, the industry is a problem now, but not only foreign investors but also ordinary investors have doubts about Samsung's own technological resilience. Therefore, there are two ways for Samsung Electronics to rise further. It's in terms of supply and demand and materials. Foreigners must return in terms of supply and demand, but since September, foreign investors have sold more than 15 trillion won.

If so, meaningful return can be interpreted as a signal to foreign investors that Samsung Electronics' stock price is bottoming out and buying at a low point if foreign investors consistently buy Samsung Electronics, which is almost 20% of all stocks sold. And in terms of materials, it is also whether artificial intelligence chips and HBM will be approved by Nvidia. The fifth generation is already up here. Because SK Hynix and Nvidia dominated the 5th generation artificial intelligence chip first, what is Samsung's card? Securing the competitiveness of the 6th generation HBM, which is scheduled to be released next year, is a variable, but there is actually a hint here.

Are you going to burn all of the 3 trillion won yesterday by buying it on the market within three months? Conversely, there are not many positive news that Samsung Electronics will release within three months. The remaining 7 trillion won will be invested through a resolution of the board of directors means that it will support the stock price a little with financial resources, so it can be quite difficult, but in the short term, there will be a reorganization in December. What kind of strategic changes will Samsung Electronics pursue in its reorganization? We have to see how much the technology team will be promoted and whether the bureaucracy will fall into the back line at the personnel meeting of the relevant deputy directors.

[Anchor]
So it's good to show a willingness to boost stock prices, but you just said, "Isn't it disproving that fundamental materials are difficult to come out within at least three months?" And group stocks related to Samsung Electronics rose, but yesterday, the overall trend of semiconductor stocks was not good. What's wrong with this?

[Lee In-cheol]
That's right. It's an event that leads to the New York Stock Exchange early this morning. In fact, Nvidia is competing for the first and second place in the global market capitalization of artificial intelligence chips. SK Hynix's stock price fell more than 3% yesterday as news broke that the new product, Blackwell, which will be released next year, may have a heat problem during the inspection process. But if you ask me to pick the biggest event of the week, Nvidia's quarterly performance. The announcement will be made on the 20th local time.

What CEO Saxon Hwang said at the time of last quarter is that there is already a lot of demand for Blackwell. We are fully booked until next year's worth. The demand is full, but it seems that it will take some time to make this. As a result, SK Hynix, which now supplies the most to Nvidia, is directly hit. Yesterday, Samsung Electronics, of course, had the effect of buying treasury stocks, but it is a reflective profit. Because it has not yet been delivered to Nvidia, even if the launch of new products is delayed due to the heating situation, it can be said that the increase has increased slightly in that Samsung Electronics has secured time to keep up with the technology.

[Anchor]
The bad news on one side also works as a good news on the other. That's what the stock market means. Let me ask you about the exchange rate. The exchange rate is considered the most important variable that determines the direction of foreigners' supply and demand for our stock market, but yesterday, it calmed down slightly again to the 1,390 won level. Can you tell me why and what you're looking forward to?

[Lee In-cheol]
When foreigners sell Samsung Electronics, foreigners buy or sell Korean won, increasing the demand for currency exchange, so yesterday it was below 1,400 won for two days. The exchange rate refers to the physical strength of our country's national economy. So in addition to the weak global currencies following the Trump rally and the strong dollar, we also have internal problems. We are in a very bad economic situation. It was negative growth in the first and second quarters. The third quarter was also zero growth. But next year is more difficult than this year.

Behind the difficulty, according to a national research institute, exports that have been driving our growth in the first half of the year will be reduced to one-third of this year's export growth due to Trump's tariff bomb. As a result, the depreciation of the won is much greater than that of other countries, so Deputy Prime Minister Choi Sang-mok mentions that 1400 won may become the new normal and new standard. If the exchange rate goes up, some export companies like automobiles can be good in terms of price competitiveness. But since we have to import most of our prices and buy them in dollars, consumer prices can act as a destabilizing factor.

[Anchor]
Since the U.S. presidential election, the investment market has been in full swing so far, and there is also a saying that it is FOMO. I think there are some people who invest a little in don't ask because of the phobia that they say I shouldn't be the only one left behind. In addition, according to a recent survey, people in their 50s and 60s who have been conservative about coin investment are also being observed to be active in coin investment. What do you think of this phenomenon? These days, baby boomers are in their 50s and 60s. Some of them have completed their retirement age, but many have left without meeting their retirement age. However, the characteristics of the first generation of baby boomers are very proficient in IT devices.

As a result, it is in the order of age to get out of the bureau, and if 98 out of 100 individual investors who invested in various bureaux directors lost money, most investors who invested in the U.S. market turned upward to Tesla after the Trump rally. But the same goes for the coin market. They are going to the U.S. stock market or coins to avoid the director. In fact, when senior people aged 60 or older weighed the average investment amount in the coin market, it was in their 20s who had led the coin market the most. I was in my 20s, but it turned out to be nine times more than in my 20s.

In fact, according to the number of accounts of Upbit and Bithumb, the first and second largest virtual asset exchanges in South Korea in their 60s or older, it is 775,000 accounts, with an average of 8,720,000 won invested by people aged 60 or older per person. People in their 20s are less than 1 million won. How are we going to see this phenomenon? If the younger generation armed themselves with information and the coin market jumped into the market, as in the past, it is actually very risky to stock after seniors retire recently. So, it's a very expensive bitcoin. Bitcoin is relatively stable compared to other coins. As a result, it seems that they are leaving their old assets in coins such as Bitcoin, which are very expensive.

[Anchor]
In fact, in order for this phenomenon to be normalized to some extent, I think the attractiveness of the domestic stock market should be revived, but let's talk a little more about coins. In fact, with Bitcoin soaring like this, other coins, so-called altcoins, are also expected to revive, so can other coins such as the second bitcoin appear? How do you view that?

[Lee In-cheol]
Perhaps in the case of Bitcoin, it hit 93,000 dollars in dollar terms and 130 million won in won terms, and the Trump rally took a break as Chairman Jerome Powell said he would control the pace of the rate cut. Currently, it is being traded at around $91,000 and around 126 million won to 27 million won based on the won. What is the characteristic of the second round rally of virtual assets, whether it is a coin that broke through the high point such as Bitcoin and Dogecoin that led the Trump rally like now, and Ethereum is actually the second-largest coin. Ethereum is already trading both spot and futures on the spot ETF market.

Nevertheless, it is missing more than 30-40% from its peak. So whether only bitcoin will continue to go strong alone or, as you said, so-called altcoins will go up together. What's another thing to watch out for? There are two coins that are now incorporated into the regular market in the United States. Bitcoin and Ethereum. Then, what are the promising stocks that will be included in the third regular market? Wall Street is probably talking about the possibility of Solana and Ripple as the third-largest coin. Solana Coin aims to decentralize in 2020 as a transaction in the form of a blockchain that offers ultra-fast treditions and low levels. Also, Ripple was made in 2012. Since it was built on the basis of supporting international remittances between financial institutions quickly and cheaply, attention is focused on these coins.

[Anchor]
Ripple and Solana also mentioned it, so it's soared like this recently. I think you can understand it as the background. I think this will be the last question. Some analysts say that the heat of the Trump rally has been dampened to some extent, while others say that it has not been bent, but that the heat is moving to the other side. What do you think, warden?

[Lee In-cheol]
First of all, the Trump rally, Trump hasn't even entered the White House yet. Before we go, it's a variety of pledges, and we're moving according to our tendencies through appointments. The dollar features the first Trump rally. The dollar went up. Government bond rates have soared. Bitcoin's virtual assets have gone up. There is a relatively small amount of gold. Because in return for the dollar's strength. If you enter in this situation, you have to actually implement the policy. However, to sum up Trump's policy in one word, it means that he will make a warm iced Americano. Would that be possible?

That's impossible even if three Michelin stars come. Prices cannot help but go up to stimulate the economy by releasing money. So what do policymakers give up on between the two? Price or economy? I give up on prices, for the most part. And Trump is already the last one in four years as a stepping stone. So the Biden administration changed because prices were only as high as they were during my term, and in the past, the United States was 9.1 percent, the worst in 40 years. So, while tolerating prices to some extent, by releasing money to stimulate the economy and lowering corporate taxes, we defend them a little even if prices rise.

As a result, central bank president Jerome Powell is guaranteed a term through 2020, so the rate cut could be significantly slower than expected starting next year. According to the dot plot, the rate cut for next year is initially 4 times, but according to current estimates, it could be reduced to about 2 times. As such, I expect that Chairman Jerome Powell and the second Trump administration will have a significant fight.

[Anchor]
I've heard a lot that former President Trump's pledges conflict with each other, but the market is now shifting its sentiment toward what seems more likely to be realized, I think you can understand it like this. Lee In-cheol was with the director of the Economic Research Institute. Thank you.