Lee Jae-myung's Stock Market Plunges, 'Foreign Black Rock Ruling Class' Leads to World's Most Volatility in KOSPI
President Lee Jae-myung dismissed the Korean stock market's sharp volatility as a "foreigner absolute market class," leaving the KOSPI exposed to the world's most volatile market fluctuations.
Regarding the stock market, at a Cabinet meeting on the 2nd, President Lee stated, "Some people like it," and added, "When the social environment improves, celebrating, encouraging, and joining forces is the foundation of a community."
He removed foreigners from the "community" of the Korean stock market, which is supported by foreign investment, and instead referred to it as the "KOSPI 5000 Community."
Foreign investors net sold over 5 trillion won in the Korean stock market on the 5th, and 3.4 trillion won on the 6th.
The Korean stock market is solidifying its "no loss, high return" structure, where foreigners sell, take advantage of the plunge, reap high profits, buy back to drive up prices, and then sell again to drive the plunge, securing profits from further increases and even benefiting from exchange rate fluctuations. This is becoming the KOSPI 5000 strategy.
The Lee Jae-myung administration has adopted a strategy that has drastically increased the proportion of foreign investment in the stock market from the low 30% range to 37%. Foreigners, under the 5000 Index system guaranteed by the president and the government, can profit from the plunge when foreigners sell without the risk of loss, creating the world's only guaranteed return market.
This president has been posting late at night twice a day since President Trump announced a 25% tariff hike last month, creating a real estate panic, which appears to be a strategy to “guarantee investment in the Korean stock market” to encourage foreign investors to profit from Korean stocks.
President Lee, in collaboration with BlackRock, the largest US private equity fund and a co-partner in the KOSPI 5000 rebound strategy, viewed foreign investors as "partners," believing they would not experience a massive selloff in the Korean stock market.
Under Lee Jae-myung's administration, the stock market was supported by record-breaking net buying by individual domestic investors, fueled by foreign profit taking. Individuals' margin loans surpassed 30 trillion won in late January, contributing to the largest debt-ridden economy in the world. This contributed to the stock market surge, creating a pyramid structure that sustains the presidential system.
As of the end of January, securities firms' receivables, fueled by "short-term debt investment," surged 8.47% in one month to 1.021 trillion won. This practice exposed individuals to high-risk bets and even burdened foreign investors with risk.
Under the Lee Jae-myung regime, the strategy of expanding personal debt in the KOSPI 5000 is a way to create a short-term surge in Korean stocks centered on technology stocks by attracting foreign investors by relying on the expansion of margin transactions using the rise of the stock market as collateral for stock market investment, and in the middle, pension funds such as the National Pension Service, which are period investors, make small profits by being dependent on the investment profits of foreigners, and the Lee Jae-myung regime expands its power. The structure is exposed to the threat of collapse by individuals who are at a higher risk of ultimate loss from the stock price decline caused by foreigners selling.
The South Korean stock market appears to be exposed to foreign investors' outflows as US President Trump's announcement of a second round of tariff hikes, damaging Lee Jae-myung's black-lock regime, and the April North Korea-US summit strategy was scrapped.
The Associated Press reported on the 6th, "South Korea's KOSPI plunged 3.9%, marking one of the world's biggest swings and falling from its all-time high." Samsung Electronics fell 5.8%, just two days after surging 11.4%.
Reporting the decline in AI technology stocks, Reuters said, "In the accelerating AI arms race, revenues are being watched more than spending. Alphabet, Google's parent company, saw an 18% increase in revenue, but Google's future profit margins may not be as high." As technology stocks faced higher-than-expected investment costs, investors began to react sensitively to the lower returns, leading to declines in AI and technology stocks.
President Lee, at a Cabinet meeting on the 3rd, approved the "Semiconductor Special Act," which provides ultra-low-interest financing to conglomerates such as Samsung, SK, Hyundai, and Hanwha. He stated, "Stock prices are beneficial to corporate activities. Furthermore, no one is harmed by rising stock prices."
However, the Korean stock market plummeted on the 5th as foreign investors, who had previously enjoyed substantial profits, began selling amid the decline in US technology stocks.
At a New Year's press conference, President Lee addressed the possibility of a sharp decline, stating, "We are in the process of normalizing, so there is no need for excessive concern."
He later commented on the sharp decline, saying, "Some people like it," but added, "I don't know why." He avoided commenting on foreign investors, who profited the most from the plunge, and foreign investors began selling.
On the 31st of last month, President Lee responded to opposition criticism, asking, "Why haven't we yet normalized the real estate market, which is so easy?" by saying, "There are people who don't understand what I'm saying, like kindergarteners. Even though valley maintenance and achieving a 5,000-point mark seemed impossible and difficult enough to be ridiculed by the public, we achieved it with all our might. Could stabilizing housing prices be more difficult?" He cited achieving the 5,000-point mark as his own achievement.
Wall Street experienced a sharp selloff on the 5th, with tech stocks falling and Bitcoin plummeting to roughly half its record high last fall.
Several disappointing reports on the US jobs market also pushed bond yields lower. The S&P 500 fell 1.2%, its sixth decline in seven days since reaching a record high. The Dow Jones Industrial Average fell 592 points (1.2%), and the Nasdaq Composite Index fell 1.6%.
The Associated Press reported, "It's the worst January since the Great Depression in 2009," and added, "Employers posted the fewest job openings in December in five years, according to the third U.S. government report. The weak job market could prompt the Federal Reserve to cut interest rates to support the economy, which could also raise the risk of worsening inflation, sending Treasury yields lower across the board."
Regarding the decline in tech stocks, Reuters reported on the 5th, "Stocks sold overnight on concerns that new AI models could eat into the profits of software companies, including the S&P 500 Index," adding, "Growing labor market concerns have weighed on the outlook for the year."
A report released on the 5th by global outsourcing firm Challenger, Gray & Christmas showed that layoffs reported by U.S. employers surged to their highest level in 17 years in January. The report from the OutUp internship firm said layoffs by U.S. employers “hit a 17-year high amid lost business contracts and an uncertain economic environment,” adding that “planned layoffs surged 205% last month to 108,435, the highest January total since the end of the Great Recession in 2009, and announced layoffs are up 118% compared to January 2025.” “Investors are questioning their commitment to AI, cryptocurrencies and precious metals, pillars that have supported the market for the past six months,” Tony Sycamore, a market analyst at IG in Sydney, told Reuters. “This increases the likelihood of a deeper break.” Alphabet, Google's parent company, reported revenue of $113.8 billion in the fourth quarter ended December, an 18% increase year-over-year, surpassing $400 billion in annual revenue for the first time. Its fourth-quarter profit surged 30% to $34.5 billion, but its capital expenditures were increasing.
The S&P 500 Software and Services Index (SPLRCIS) has plunged 4.6% since January 28, shedding about $1 trillion in market value.
Reuters described this sell-off as "a sell-off dubbed 'software mageddon' in the market." "We've seen a lot of these large, crowded positions being unloaded very aggressively, and that's resulted in massive outflows," Chris Weston, head of research at Pepperstone Group in Melbourne, Australia, told Reuters. "It's getting to the point where we could see casualties later this year."
He continued, "Capital markets may not be as generous to certain companies—not the Magnificent Seven, but some of the smaller companies," pointing to further blows to the "Magnificent Seven" mega-cap tech stocks.
Last week, Meta and Microsoft signaled they would each spend more than $100 billion this year on continued AI deployments. Meta's stock surged after reporting revenue growth last week, but Microsoft's shares plunged after the company revealed its AI business hasn't delivered significant results despite significant investments.
The Lee Jae-myung Black Rock administration implemented the V-Strategy, which aimed to rapidly boost the South Korean stock market by leveraging North Korea's special needs, including the Wonsan-Kalma development project, following a sharp rise in the South Korean stock market index by 5,000 points.
This strategy also included the entry of private equity funds into North Korea and the Trump administration's North Korea-US summit in April, and the efforts to attract foreign investment. President Lee responded to the sharp rise in the exchange rate (weak won) by announcing at a New Year's press conference that the won would be "around 1,400 won in 1-2 months."
Deputy Prime Minister Koo Yoon-chul then approved Black Rock, the dominant player in the South Korean stock market, for "dollar market dominance" with the National Pension Service, the largest shareholder. Black Rock, the largest private equity fund in the US, is the largest shareholder of Samsung Electronics and SK Hynix (the owner is the largest shareholder).
Kookmin Bank is the second-largest shareholder, followed by the National Pension Service. Shinhan Bank is also the second-largest shareholder, effectively dominating the South Korean stock market and reaping the largest profits during the market surge. Blackrock already holds a 5.7% stake in Hanwha Ocean's Philly Shipyard, the largest beneficiary of the $150 billion Mars investment the Lee Jae-myung administration made in the construction of US warships and submarines. It is also the third-largest shareholder of Samsung Securities, which served as the chief policy officer and spearheaded the stock market V strategy under the Moon Jae-in administration. SK Group's US asset transfer strategy, relying on Blackrock, led to the establishment of a new AI investment corporation, which diverted 10 trillion won in overseas investments to the US. As the largest beneficiary under the Lee Jae-myung administration, SK's stock price soared.
See S<Trump Tariff Retaliation Strikes Black Rock Regime, Lee Jae-myung Calls North Korea-US Summit 'Breakup', January 27, 2026>
<Lee Jae-myung's Ultra-Low-Interest Samsung SK 6 Trillion Won Loan in January, 'Real Estate Enemy' Psychological Warfare Against the Public, February 3, 2026>
<Lee Jae-myung's 'Economic Recovery Tax', Lee Hye-hoon's 'Gray Rhino Tax for Future Investment', Telephoto Effect, December 30, 2025>
<Lee Jae-myung's 'Exchange is Peace' Violates UN 'Recommendation Prohibition', Kim Jong-un Calls the US 'Peaceful Coexistence', September 24, 2025>