Decapitation or Supply?
On the morning of August 4, the KOSPI and KOSDAQ became completely different markets. The KOSPI fell 0.6%, Samsung Electronics 2.3%, SK Hynix 2.7% — semiconductors are still losing ground. Meanwhile, the KOSDAQ surged 5%. Biotech, optical communications, and immuno-oncology drove the market higher. The Korean stock market, which had staked everything on the single thesis of AI semiconductors, is beginning to break away from that thesis.
Naver's 9.9% surge is a symbol of this departure. A 200-megawatt AI factory in Sejong, with $9 billion from Brookfield and $1 billion from NVIDIA. It is a shift to a different axis: not semiconductor manufacturing, but AI infrastructure operation. However, whether this is a structural transformation or a temporary flight to stocks that survived the crash remains to be seen. What can be asserted is that the single narrative that dominated the Korean market until yesterday has begun to crack.
Overnight diplomatic threats have entered a new phase. According to NY Post's tally, at least 12 'last chances' have been offered since the war broke out on February 28, and each time they were withdrawn or extended. But this time, the quality of the language is different. The target of the threats has shifted from bombing infrastructure to eliminating leadership. This is no longer a wrapper for negotiations, but war itself stripped of its wrapper.
In Muscat, real negotiations are underway. Iran has proposed a joint inspection system with Oman, and within Iran, cracks are emerging over the proposal. Kayhan attacked it as a violation of maritime sovereignty, while the reformist Shargh countered that it is a political force living in a parallel universe. The Revolutionary Guard has no diplomatic channel of its own, so it can destroy negotiations but cannot convey its demands. Foreign Minister Araghchi has left for Iraq on a personal religious visit. Amid all this confusion, substantive negotiations continue.
On the day of his return, Lee Jae-myung holed up at the presidential office (Cheongwadae) for 7 hours and 30 minutes, from 3 p.m. to 10:30 p.m. Dinner was a lunchbox. According to SBS News, at the meeting he personally diagnosed that the sluggish housing supply since 2022 had led to a supply cliff, and emphasizing that supply and speed are key, ordered the mobilization of all means including administrative measures, financial support, and deregulation. He requested additional reports and follow-up meetings within 2-3 days. What is clear from the reported details alone is that he has begun to recognize the essence of the real estate problem not only on the demand side but also on the supply side. If yesterday's announced property holding tax reform is about curbing demand, the core of today's revealed 7-hour meeting is expanding supply.
The contradiction Lee Jae-myung faces is this. To increase housing supply, cooperation with construction capital, deregulation, and financial support are needed. But the strengthening of the property holding tax that he is simultaneously pushing forward invites resistance from that very construction capital and the asset-owning class. Although the nature of the words uttered on two continents is completely different — one is the language of killing, the other the language of construction — the political terrain they stand on is identical. The difference is that one is an imperialist head of state's threat of decapitation, and the other is a reformist president's technical prescription within a bourgeois regime. At the moment when words no longer control reality, one side flees into physical removal via decapitation, and the other into a technical solution called supply. Both flights are ways of admitting one's own powerlessness.
Today's market, with the KOSDAQ up 5%, nevertheless hints at something beyond this powerlessness. A crack in the AI semiconductor monopoly system. But whether that crack is the beginning of a real shift, or just another rotation of bubble stocks, no one yet knows.
Naver's 9.9% surge is a symbol of this departure. A 200-megawatt AI factory in Sejong, with $9 billion from Brookfield and $1 billion from NVIDIA. It is a shift to a different axis: not semiconductor manufacturing, but AI infrastructure operation. However, whether this is a structural transformation or a temporary flight to stocks that survived the crash remains to be seen. What can be asserted is that the single narrative that dominated the Korean market until yesterday has begun to crack.
Overnight diplomatic threats have entered a new phase. According to NY Post's tally, at least 12 'last chances' have been offered since the war broke out on February 28, and each time they were withdrawn or extended. But this time, the quality of the language is different. The target of the threats has shifted from bombing infrastructure to eliminating leadership. This is no longer a wrapper for negotiations, but war itself stripped of its wrapper.
In Muscat, real negotiations are underway. Iran has proposed a joint inspection system with Oman, and within Iran, cracks are emerging over the proposal. Kayhan attacked it as a violation of maritime sovereignty, while the reformist Shargh countered that it is a political force living in a parallel universe. The Revolutionary Guard has no diplomatic channel of its own, so it can destroy negotiations but cannot convey its demands. Foreign Minister Araghchi has left for Iraq on a personal religious visit. Amid all this confusion, substantive negotiations continue.
On the day of his return, Lee Jae-myung holed up at the presidential office (Cheongwadae) for 7 hours and 30 minutes, from 3 p.m. to 10:30 p.m. Dinner was a lunchbox. According to SBS News, at the meeting he personally diagnosed that the sluggish housing supply since 2022 had led to a supply cliff, and emphasizing that supply and speed are key, ordered the mobilization of all means including administrative measures, financial support, and deregulation. He requested additional reports and follow-up meetings within 2-3 days. What is clear from the reported details alone is that he has begun to recognize the essence of the real estate problem not only on the demand side but also on the supply side. If yesterday's announced property holding tax reform is about curbing demand, the core of today's revealed 7-hour meeting is expanding supply.
The contradiction Lee Jae-myung faces is this. To increase housing supply, cooperation with construction capital, deregulation, and financial support are needed. But the strengthening of the property holding tax that he is simultaneously pushing forward invites resistance from that very construction capital and the asset-owning class. Although the nature of the words uttered on two continents is completely different — one is the language of killing, the other the language of construction — the political terrain they stand on is identical. The difference is that one is an imperialist head of state's threat of decapitation, and the other is a reformist president's technical prescription within a bourgeois regime. At the moment when words no longer control reality, one side flees into physical removal via decapitation, and the other into a technical solution called supply. Both flights are ways of admitting one's own powerlessness.
Today's market, with the KOSDAQ up 5%, nevertheless hints at something beyond this powerlessness. A crack in the AI semiconductor monopoly system. But whether that crack is the beginning of a real shift, or just another rotation of bubble stocks, no one yet knows.