“What if the Insurrection Had Succeeded?”.

• “As justice minister, he chose to abandon his duty and join the plot.” The court sentenced Park Sung-jae (former Minister of Justice) to 25 years in prison for charges including participation in a major insurrection and remanded him.
• Lee Jin-kwan (Judge, Seoul Central District Court) noted, “He was aware of the unconstitutional objectives and illegality.” The ruling reflected the judgment that “the country could have remained trapped in authoritarian rule for an extended period.”
• Park is accused of actively participating after Yoon Suk-yeol (then-president) declared emergency martial law, including convening a senior ministry meeting to review dispatching prosecutors to a joint investigation headquarters and ordering immigration headquarters to stand by for emergency measures.
• The bench emphasized, “The insurrection was prepared at least since 2023,” adding, “Those involved in the insurrection must be severely punished.”
• Related Link.

What Matters Now.

U.S.-Iran Talks Conclude Positively.

• Abbas Araghchi (Iranian Foreign Minister), known as a hardliner, called it “significant progress toward ending the Lebanon war,” reflecting the upbeat mood. The talks lasted 18 hours.
• They agreed to establish a mechanism to resolve the Lebanon conflict.
• Iran’s agreement to invite an IAEA (International Atomic Energy Agency) inspection team is another major step forward.
• Israel halted airstrikes on Lebanon for the first time since March.

Nex Above Samsung.

• For the first time in 25 years, the top market cap position has changed. As of the closing price on the 22nd, Samsung Electronics and SK Hynix had market caps of 2,245 trillion won and 2,080 trillion won, respectively. Including preferred shares, Samsung remains ahead.
• Excluding preferred shares and counting only common stock, Samsung’s market cap is 2,067 trillion won. Regardless, by stock designation, the market cap lead has indeed switched.
• At the start of this year, the figures were 761 trillion won and 493 trillion won—SK Hynix has risen faster.
• Listing ADRs (American Depositary Receipts) on Nasdaq could attract massive foreign capital. It may happen as early as next month.
• Yesterday, U.S. markets struggled. The S&P 500, Dow, and Nasdaq fell -0.37%, -0.29%, and -1.32%, respectively.
• Related Link.
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The Implications of the Top Market Cap Title.

• Korea Electric Power maintained the top spot until 1999, when it was overtaken by Korea Telecom (KT), and Samsung Electronics has held the leading position since 2000.
• Nomura Securities raised SK Hynix’s target price to 500,000 won.
• Some analysts warn of overheating: Samsung still has larger earnings, and the valuation reversal is risky.
• Favorable supply-demand conditions are undeniable, but historically, this has also signaled market peaks. The same occurred in 2000 when Cisco surpassed General Electric for the top market cap.
• According to FnGuide, the earnings consensus for Samsung Electronics and SK Hynix is 36.1 trillion won and 26.2 trillion won, respectively.
• Related Link.
• Related Link.

“They Should Have Lain Down Then.”.

• “It was indeed rushed. We had doubts from the start about whether it was an appropriate product.”
• Lee Chan-jin (Financial Supervisory Service Governor) made this remark regarding the Samsung+SK Hynix leverage fund. After launching a fund that increased the weight of the two stocks, turnover rates temporarily soared to nearly 200%, and instances of the tail wagging the dog multiplied.
• Lee Chan-jin said, “The side effects are so severe that we are deeply concerned.”

Deep Dive.

Dead Cross in Lee Jae-myung’s Approval Rating?

• An ARS poll by Realmeter. While margins vary across polling firms, there’s been a clear downward trend since the local elections.
• In the fourth week of June, positive evaluations fell to 46.7%, undercutting negative evaluations of 49.7%—the first time since his inauguration.
• A Democratic Party lawmaker said, “The party-government conflict is the biggest factor in the approval drop, and internal party strife has also weakened public support for the administration.” Another lawmaker added, “The president’s direct involvement in party affairs—frequent comments about the party—has created the perception that he bears responsibility for the election defeat and poor campaign management.”

Shincheonji’s Mass Entry into People Power Party Followed Lee Man-hee’s Orders.

• The joint investigation headquarters of the prosecution and police concluded this. They requested an arrest warrant for Lee Man-hee (Shincheonji General Director) on charges of violating the Political Party Act.
• He is accused of coercing 56,472 followers to join the People Power Party ahead of the 2021 presidential primary and the 2024 general election primary.
• Incidentally, Lee Man-hee is 95 years old. The task force assessed that his health does not preclude detention.

Keir Starmer Steps Down.

• Since David Cameron (2010–2016), the Conservative Party has seen five prime ministers: Theresa May (2016–2019), Boris Johnson (2019–2022), Liz Truss (2022), Rishi Sunak (2022–2024), and now Keir Starmer (UK Prime Minister) has also left office prematurely. He took office in July 2024 and served less than two years.
• He is stepping down amid economic crisis and responsibility for the local election debacle. “I accept that the Labour Party no longer believes me to be the best person to lead the country through to the next general election,” he said.
• Andy Burnham (former Manchester Mayor) is the likely successor.
• Six prime ministers have been replaced in the decade since Brexit.
• Related Link.

6 in 10 Stock Investors Hold Less Than ₩10 Million.

• Hence the saying, “A bull market is someone else’s feast.”
• As of late last year, there were 14.47 million individual investors. Of these, 8.74 million held less than ₩10 million in stocks, and 4.43 million held less than ₩1 million.
• A significant portion of profits was captured by investors in their 50s and 60s. For those in their 60s alone, assets grew from ₩170 trillion at the end of 2021 to ₩265 trillion in 2025. In contrast, those in their 20s saw their holdings shrink from ₩17 trillion to ₩14 trillion over the same period.

Gangnam 3 Districts Sell Stocks, Nodogang Buys Homes via Loans.

• Analysis of first-quarter home purchase funds.
• The market is stratifying into those buying homes with assets and those with loans. Assessments suggest unequal starting points on the housing ladder.
• Average home prices: Gangnam 3 districts at 1.5 billion KRW, Nodogang (Nowon, Dobong, Gangbuk) at 560 million KRW—a threefold gap.
• In Gangnam 3 districts, 38% of home purchase funds came from real estate sales. Reflects high demand for upgrading to premium areas. Deposits accounted for 20%.
• In Nodogang, loans made up 35%, while liquid assets were 15%.

0.5% Own Half of KOSPI.

• 80,000 stock millionaires holding over ₩1 billion in shares account for half of the market cap.
• Jeong Joon-ho (Kangwon National University professor) said, “Asset gaps structurally widen during periods of rapid value growth where opportunity and risk coexist,” adding, “We must be cautious that the severity of asset inequality is not obscured by isolated success stories.”
• Last month, the average Seoul apartment sale price rose 33% from two years ago.
• Woo Suk-jin (Myjong University professor) warned, “If we fail to create pathways for wealth generated by semiconductors to flow into redistribution, 2026 will be remembered as the year asset inequality began its explosive expansion.”
• Related Link.

4 Major Conglomerates Cut 12,300 Jobs.

• Among 1.92 million employees across 102 major conglomerates, the 4 major groups account for 730,000—38% of the total.
• Samsung reduced by 931, Hyundai Motor by 2,375, SK by 3,699, and LG by 5,370.
• Coupang added 8,250 employees. It surpassed SK to enter the top 4 in employment.

Another Take.

Why the Preference for Prosecutorial Backgrounds?

• Han Chang-sik (lawyer, Kim & Chang) was selected as Senior Civil Affairs Secretary, followed by the appointment of Park Ji-young (former deputy chief prosecutor, Seoul High Prosecutors’ Office) as Judicial System Secretary.
• Observers suggest this reflects President Lee Jae-myung’s firm belief that figures well-versed in prosecutorial affairs are essential.
• The Roh Moo-hyun and Moon Jae-in administrations distanced themselves from the prosecution. The narrative is that lessons must be learned from Cho Kuk’s (then Senior Civil Affairs Secretary) failed prosecution reforms and his inadvertent role in enabling the Yoon Suk-yeol administration.
• A Blue House official interviewed by The Korea Herald stated, “Lee Jae-myung believes that without a deep understanding of the prosecution or grasp of its operations, it’s impossible to effectively engage with the institution.”

Used Ships Cost More Than New Ones.

• Secondhand vessels now exceed the prices of newbuilds. Building a single ship takes at least three years, and operational vessels are needed immediately. Some analysts draw parallels to the 19-year-old supercycle.
• Even at inflated prices, the prevailing sentiment is that secondhand ships can recover investment costs once deployed.
• A new VLCC (very large crude carrier) costs $130.5 million, while a five-year-old secondhand VLCC trades between $145 million and $175 million.
• Some argue the situation differs from 2007 due to compounded geopolitical risks.
• Related Link.

Triple Highs Hit SMEs: Delinquency Rates Raise Concerns.

• From 0.5% at the end of last year, the rate rose to 0.73% by May—the highest level since 2020.
• Large corporate delinquency rates stand at 0.09%, household rates at 0.35%.
• Warnings emerge that the combination of high exchange rates, high oil prices, and rising interest rates could make the second half even riskier.

How FIFA Makes Money.

• FIFA (Fédération Internationale de Football Association) projects $13 billion in revenue for the 2023–2026 cycle. The previous 2019–2022 cycle generated $7.6 billion.
• Broadcasting rights sales account for the largest share at $4.3 billion, followed by marketing and sponsorship revenue at $2.7 billion. Ticket and hospitality sales total $3.1 billion.
• Dynamic pricing was introduced this year, driving ticket prices higher. FIFA sets the initial sale price and takes 30% of secondary market sales. The original plan capped tickets at $1,550, but prices now exceed $10,990. Secondary sales surpass $30,000.
• Critics note FIFA secures massive profits while host nations often see little to no benefit—or even losses.
• FIFA is a nonprofit association headquartered in Zurich, Switzerland. Its 211 member football associations each hold one vote, making it difficult to oppose the president’s agenda. Whether large or small, nations wield equal voting power, amplifying the president’s influence. Few countries can afford to ignore FIFA’s financial support.
• Gianni Infantino (FIFA President) assumed office in 2016 and was re-elected unopposed twice. As of 2023, his base salary is $2.78 million, with a $1.87 million bonus.
• In 2015, $150 million in kickbacks were uncovered.
• Saudi Arabia’s solo bid for the 2034 World Cup also raises eyebrows. The 2030 World Cup will be co-hosted by Spain, Portugal, and Morocco, with additional matches in Uruguay, Argentina, and Paraguay—spanning three continents. A principle of rotating host regions left only Asia and Oceania for 2034, where Saudi Arabia’s unopposed bid was approved by acclamation.
• While democratic procedures exist, widespread criticism calls the process neither fair nor transparent.

JTBC’s Costly Exclusivity Trap.

• Phoenix Sports, a subsidiary of Contentree Central, acquired bundled broadcasting rights for the 2026–2032 Olympics and 2026–2030 World Cups in 2019 for $500 million (700 billion won). (For just the two World Cups, the cost was around 190 billion won.)
• JTBC secured exclusive rights and proposed resale to terrestrial broadcasters, but MBC and SBS refused—only KBS joined at 14 billion won.
• During February’s Milan Winter Olympics, all three terrestrial broadcasters opted out. JTBC’s sole broadcast of the opening ceremony drew a mere 1.8% viewership.
• JTBC’s cash flow collapse and subsequent rehabilitation filing may ultimately stem from the curse of exclusive broadcasting rights. Intercompany cash transfers and payment guarantees amplified risks, with JTBC’s liquidity crisis likely triggering a chain reaction.
• Central Holdings, Contentree Central, Megabox Central, and Jungang P&I have applied for rehabilitation. The parent company, JoongAng Ilbo, defaulted after failing to repay 22 billion won in corporate notes.
• JoongAng Ilbo’s unsecured bond credit rating plummeted from CCC to D. It has applied for a workout with Hana Bank.
• Shinhan Investment Securities analyzed, “Close intra-group ties acted as a serial link for liquidity risks.” The JoongAng Group’s debt stood at 2.7 trillion won as of end-2023.

Risks of Chaebol Media Groups Evolved from Family-Run Press.

• JoongAng Group is vertically integrated: Hong Jung-do (Vice Chairman of JoongAng Holdings) and his family own 100% of JoongAng Holdings, which controls JoongAng Ilbo and JTBC. While expanding operations and inflating its size through internal transactions and mutual guarantees, it remains a fragile system that could collapse all at once—like the “chain-linked strategy” in Romance of the Three Kingdoms.
• JoongAng Ilbo had an operating profit of 17.5 billion won last year but lent 48 billion won to affiliates and provided 30 billion won in payment guarantees.
• JTBC posted an operating loss of 28.7 billion won yet lent 82.5 billion won to Contentree Central and Phoenix Sports. JTBC itself, cash-strapped, borrowed money backed by an 80 billion won guarantee from JoongAng Holdings.
• Contentree Central is draining cash from affiliates. Its debt stands at 1.0515 trillion won, with accumulated losses of 432.9 billion won.
• Phoenix Sports, a Contentree subsidiary, paid 110 billion won as advance payments for broadcasting rights. It holds less than 4 billion won in cash.
• Immediate cash needs are mounting while the advertising market continues to shrink. Betting everything on exclusive broadcasting rights backfired when resale attempts failed, turning the gamble into pure losses.

The Fix.

Does South Korea Lack Such Reports?

• Germany has released the 20th-anniversary edition of its National Education Report (Bildung in Deutschland 2026).
• A child’s vocabulary varies depending on their parents’ educational background. Even with the same grades, gymnasium enrollment rates differ. One in four children faces risks like poverty and educational exclusion. The conclusion emphasizes the criticality of early childhood gaps.
• “Education policies are concentrated far too late—long after disparities begin,” the report notes. If parents’ occupational status or education shapes children’s futures, should these structural gaps be left unaddressed? The first step, it argues, is to conduct a comprehensive survey.
• Related Link.
• Related Link.

Free Public Transit Age Limit Raised to 70.

• The plan is to use the reduced subsidies to introduce free bus fares.
• Seoul City estimates the required funding at around 50 billion won annually.

ICYMI.

Gender-Neutral Police Recruitment Sees 38% Female Pass Rate.

• When recruitment was gender-separated, the rate was around 20%.
• This year, 1,112 of 2,941 successful candidates were women.
• Last year, 943 of 5,121 successful candidates were women. The process is conducted twice annually—first and second half.
• Despite relaxed physical testing standards, 6 out of 10 female applicants failed the physical exam. Critics argue the system remains biased against women, while opponents insist standards cannot be lowered further due to policing’s physical demands.
• Related Link.

Maestro Alan Greenspan.

• He left at the age of 100.
• He served as Federal Reserve Chair for 18 years, from 1987 to 2006. Praised as an “economic president,” he also bore the infamy of failing to prevent the dot-com bubble.
• The term “Greenspan put”—implying he would bail out markets during crashes—even emerged.
• He was notorious for ambiguous rhetoric. When teased, he quipped, “If you understood my words clearly, you must have misunderstood them.”

3.71 Million Workers Earn Over 5 Million Won Monthly.

• They represent 16.5% of South Korea’s 22.49 million wage workers.
• Disparities vary sharply by industry: 24% of manufacturing workers earn over 5 million won, while only 5% in healthcare and social welfare do.

14.2 Million Dollars Poured into a Green-Latte Pond.

• America’s Lincoln Memorial Reflecting Pool has drawn intense scrutiny.
• Trump vowed to “clean the filthy, disgusting pond” and painted the pool’s bottom “Star-Spangled Blue.”
• After refilling, algae overran the water.
• Most assessments deem it an unavoidable natural phenomenon. The Wall Street Journal analyzed that the blue base may have raised water temperature, accelerating algae growth.

Starbucks’ History Lesson Costs 4.4 Billion Won in Sales.

• Stores halted operations from 3 PM yesterday to attend the training. It’s the first such closure since Starbucks entered Korea in 1999.
• Employees underwent three hours of education on historical awareness and social sensitivity.
• “Why are store staff—unrelated to the controversy—being forced to attend, when the problem lies with management and marketing?” grumbled some employees.

Worth Reading.

No Superpower Stands Alone.

• Iran defeated the U.S. America poured in $29 billion and is about to walk away empty-handed.
• Anna Haswell (Yale professor) noted, “What made America great was not the power to unilaterally impose its will, but the ability to build international institutions others wanted to join.”
• When Trump threatened to withdraw from the WHO (World Health Organization), China pledged $500 million over five years.
• The Iran deal followed the same pattern. The 2011 U.S.-Iran agreement was a joint consensus of the UN Security Council’s five permanent members plus Germany—but this time, only the U.S. and Iran sat at the table.
• Related Link.

Snowballs, Sesame Seeds, and KOSPI Blues.

• These are three scenes from the “Manspi” era.
• First, there are those rolling snowballs to grow their assets. Finding a long hill, as Warren Buffett (Chairman of Berkshire Hathaway) advised, is key.
• Second, there are those who jump in late to pick up sesame seeds.
• Third, there are those who, beyond FOMO (fear of missing out), suffer from KOSPI blues (depression).
• This year’s household survey is likely to show the worst polarization metrics yet.
• Seo Kyung-ho (JoongAng Ilbo columnist) emphasized, “For the sake of tax equity and sustainable development of capital markets, the financial investment tax must be included in the tax reform bill.”
• Related Link.

Three Traps Ahead of China.

• First, the Thucydides Trap, as Xi Jinping (Chinese President) mentioned: the risk that a rising power and an established hegemon may spiral into war.
• Second, the middle-income trap. Per capita GDP has reached $13,800 but remains stagnant.
• Third, the Kindleberger Trap: a warning that a rising hegemon may trigger a crisis if it fails to assume leadership from the incumbent. The U.S. imposed 59% average tariffs in 1930, sparking a protectionist war.
• Joseph Nye (Harvard professor) warned, “If the U.S. and China, consumed by unilateralism, fail to supply global public goods—or prevent others from doing so—they may fall into the Kindleberger Trap again.”
• Park In-kuk (former UN ambassador) noted, “China seems unable to demonstrate the capacity or will to replace the U.S. in providing global public goods demanded by the international order.” Criticism also arises that Beijing is sidestepping its role in North Korean denuclearization, a critical issue.
• Related Link.

An Election Machine Adapted to the Single-Member District System.

• This is said about the Democratic Party, which has abandoned political reform.
• “The Democratic Party is not an organization oriented toward any ideology, whether progressive or centrist-conservative, nor is it based on any class, whether middle class or working class.”
• Jang Seok-jun (Planning Committee Member at Sanhyunjae) pointed out, “It is a ‘election machine’ that operates entirely according to the logic of the presidential system and the single-member district system, reproducing and perpetuating that logic.”
• “There is politics that declares one of the two major parties the winner through elections, but politics that reveals social conflicts, develops debates, and forms provisional agreements is nowhere to be seen. Conflicts spiral further as they fail to find an outlet or resolution. Everyone accumulates grievances, but since the very politics meant to express these grievances is the root of the problem, they simply endure daily life.”
• Jang Seok-jun warned, “The moment of explosion is approaching.”
• Related Link.

Presidential Leeway Is Needed.

• This is the advice of Lee Dae-geun (Professor at Woosuk University). Having emerged from the tunnel of borders, one finds not a snowy country but an election—a tunnel that, once passed, reveals a different world, one from which there is no return.
• He must step back from the party leadership race. He must also abandon the prosecution dismissal request. The time has come to declare he will face trial with dignity after leaving office.
• Lee Dae-geun noted, “Lee Jae-myung is too close to the world,” advising, “He must discern priorities.” The implication: “Citizens may eventually tire of the person with the strongest voice speaking too much.”
• “It is not Lee Jae-myung who has changed, but the citizens. Now, it is Lee Jae-myung who must change.”
• Related Link.