Slow Letter is
a curated snapshot of Korea.

We go beyond the headlines, connect the dots, and show you what really matters — with insight and edge. We surface the stories behind the noise and bring the context you didn’t know you needed. It’s not just about what’s happening. It’s about why it matters.

This English edition combines AI-powered translation with careful human editing — using Upstage Solar-Pro-2 — and it’s still in beta mode.We’re learning as we go, and your feedback is invaluable.

Base Rate Hike: Stopping a Hemorrhage with a Spoon Instead of a Shovel.

• The Bank of Korea’s Monetary Policy Committee raised the base rate from 2.75% to 3.0%. Many had expected a freeze, but this marks the second consecutive monthly increase.
• The committee emphasized, “Proactive measures are critical to preventing the spread of inflationary pressures.”
• Shin Hyun-song (Bank of Korea Governor) stressed, “Back-to-back hikes are unconventional, but they send a strong signal to the market.” He used the word “spoon” six times, inverting the proverb “What a shovel can’t stop, a spoon can.”
• Shin added, “Interest rates alone cannot control housing prices,” but conceded, “We believe they will at least help somewhat.”
• The won-dollar exchange rate fell to 1,377 won immediately after the rate decision was announced.
• Shin reiterated, “Central banks must anchor financial markets through preemptive action.”
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Bank of Korea Tightens, Government Loosens.

• Park Hong-geun (Minister of Planning and Budget) said, “We will set next year’s total expenditure at over 800 trillion won, a 10% increase from this year’s main budget.” Some point out that a clash with the Bank of Korea is inevitable.
• Lee Yoon-soo (Seoul National University professor) warned, “Expanding government spending will inevitably stimulate prices in the short term,” adding, “The polarization of a ‘K-shaped boom’ could deepen.”
• The JoongAng Ilbo wrote in an editorial, “This could halve the effect of monetary policy and prolong the pain of austerity that citizens must bear.” The Kyunghyang Shinmun emphasized in an editorial, “Every effort must be made to provide pinpoint support for vulnerable borrowers and mitigate the shock of interest rate hikes.”
• Shin Hyun-song said, “If fiscal spending boosts potential growth rates, it could avoid clashing with monetary policy and instead create a mutually supportive structure.”
• Ham Young-jin (Head of Woori Bank’s Real Estate Research Lab) forecasted, “The real estate transaction lull, slowed by high home prices, rising loan rates, and total volume regulations, will likely continue until the end of the year.”
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What Matters Now.

A 9-Meter Wall of Water in 30 Minutes.

• The Nepalese flood was equivalent to simultaneously releasing the discharge of the Soyang River Dam into two swimming pools.
• Twelve villages along the Himalayan range and the Bhotekoshi River were completely wiped out.
• A climate chain reaction has exploded. Himalayan glaciers retreated by 34 cm annually before 2000, but since then, they’ve been shrinking by 73 cm per year. Twelve percent of glacial area vanished between 1990 and 2020.
• Ahn Jin-ho (Director of Seoul National University’s Glaciology and Climate Education Research Center) stated, “Global warming is accelerating the melting of Himalayan glaciers,” adding, “If warming continues, such large-scale climate disasters will become more frequent.”
• The Kyunghyang Shinmun emphasized in an editorial, “Post-disaster recovery alone cannot prevent large-scale climate disasters and damage.”
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Five More Dams in the Works.

• Inherited a plan from the Yoon Suk-yeol administration. Reduced from 14 to 5.
• The dams are: Jicheon (Chungnam Cheongyang-Boryeong), Amicheon (Gyeonggi Yeoncheon), Byeongyeongcheon (Gangjin), Hwoyagang (Ulsan), and Gohyeoncheon (Gyeongnam Geoje).
• Opposition: Kim Myeong-suk (co-chair, Jicheon Dam Opposition Committee) protested, “Does it make sense to build a dam supplying water for 380,000 people in Cheongyang County, which has less than 30,000 residents, without their consent?”
• Opposition: Baek Kyung-oh (Hankyong National University professor) stated, “The government conceding to corporate water demands without verifying their investment plans and water needs violates water management principles.”
• Support: Chosun Ilbo assessed, “The government, which once opposed dams, has admitted that dams are the only viable option to address climate disasters and meet high-tech industry water demands.”
• Support: Jo Won-cheol (Yonsei University professor) argued, “High-tech industries require significant water, so securing ‘water reservoirs’ in advance is essential.”
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Kim Min-seok’s Microphone Dictatorship: Rude and Violent.

• This occurred during the Democratic Party’s workshop yesterday.
• Kim Min-seok (Democratic Party Leader) unleashed criticism at Jeong Cheong-rae (former Democratic Party Leader) in front of the room. Key remarks included:
• “People’s livelihoods, pragmatism, and an expansionist line are our government’s path, and the party’s chosen path this time.”
• “Jeong Cheong-rae is a leading ‘no centrists’ advocate, arguing that our camp can unite and win.”
• “We’ve tentatively concluded that it’s difficult to compromise on where we’re headed.”
• During Kim Min-seok’s keynote speech, the background screen displayed, “Centrist-Conservative Expansion & Structural Majority Vs Unite! No Centrists!”—a declaration of alignment with Jeong Cheong-rae’s line and a commitment to capture the center.
• Jeong Cheong-rae abruptly stood up during Kim’s lecture: “This isn’t a topic where the party leader can grab the microphone and unilaterally condemn, ‘Your argument is wrong.’ Isn’t this too rude?”
• Kim later posted on X, emphasizing, “The tensions from the party convention, stemming from methodological differences, should be overcome through healthy debate.”
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Kim Min-seok’s ABC Doctrine.

• He emphasized politics of affordability (A), politics of broadening and expansion (B), and competent politics (C)—a concept countering Yu Si-min’s (author) old ABC doctrine.
• Kim Min-seok stated, “We need a ‘zero-point shift’ different from mere political engineering like alliances or mergers,” adding, “If we fail to achieve generational change that structurally enables this zero-point shift, I doubt our party will be entrusted with state affairs continuously in five or ten years.”
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Seok-Cheong Conflict.

• Kim Min-seok emphasized, “Only if our entire party goes through a fiercely dedicated process of work—whether anyone is watching or not—will we have a chance to compete in the general election two years from now.”
• Jeong Cheong-rae sharply retorted, “Doesn’t this mistake your own argument for absolute truth?” He added, “I spoke with Kim Min-seok about the so-called centrism theory for only one or two minutes, and I truly had no idea that brief conversation would become today’s presentation material.”
• Moon Jeong-bok (Democratic Party lawmaker) remarked, “I felt genuinely sorry for anyone who had to listen to that.”
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Lee Jae-myung’s X Posts Decline.

• June saw 78 posts, July 81—August dropped to 31 through the 27th.
• Yesterday’s Central-Local Cooperation Meeting released only statements, no live broadcast.
• A key ruling party insider told Korea Herald, “We understand advice has been relayed through multiple channels that the president’s communication style needs change.”
• In JoWon C&I polling, approval fell below 40%. In NBS polling, it rose 1 percentage point to 50%.
• Korea Herald warned in an editorial, “Unless he decisively abandons lingering attachments and dispels concerns by withdrawing the special prosecutor demand and declaring he will not seek re-election, no remedy will work.”
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Deep Dive.

Jang Dong-hyeok’s Summoning of Park Geun-hye.

• Park Geun-hye (former president) appeared at the People Power Party retreat. “In difficult times, we must unite under the leadership and move forward together,” she said—words Jang Dong-hyeok (People Power Party leader) would have wanted to hear.
• Kang Myeong-gu (People Power Party lawmaker) said, “The message to ‘rally and unify around the leadership’ particularly resonated.”
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Kim Hyun-tae Sentenced to 12 Years.

• Kim Hyun-tae (former commander of the Army Special Warfare Command’s special task unit) was convicted of participating in a rebellion’s critical mission. He is the officer who ordered troops to break windows and enter the National Assembly.
• Lee Sang-hyeon (former brigade commander of the Army Special Warfare Command) and Kim Dae-woo (former head of the Defense Security Command’s investigation unit) received 10- and 5-year sentences, respectively. All were immediately remanded.
• The court ruled, “There is no obligation to follow clearly illegal orders,” and determined that “the orders Kim Hyun-tae received were manifestly unlawful.”
• The Hankyoreh emphasized in an editorial, “To ensure no such cowardly soldiers reappear, severe punishment for rebellion must be carried through to the end.”
• The Kyunghyang Shinmun demanded in its editorial, “To prevent ‘superior-subordinate discipline’ from being an excuse, mechanisms to reject unlawful orders must be strengthened.”
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Not Just Crazy.

• Debt accumulated by AI companies this year has reached $600 billion. Next year, it will hit $1 trillion.
• Robin Wigglesworth (Financial Times editor) analyzed, “If the 2025 AI frenzy was merely bonkers, it has now entered a ‘bonkers squared’ phase of madness.” He likened it to “boarding a rocket without a seatbelt.”
• Off-balance-sheet liabilities are even greater. According to Goldman Sachs, lease and purchase commitments by hyperscalers add up to $3 trillion.
• Insurance has even emerged to hedge against the possibility of hyperscalers like Alphabet or Microsoft going bankrupt.
• After the railroad bubble burst, railroads remained. After the internet bubble burst, the internet truly began to grow. AI will ride a major wave—but can all current companies survive? Robin Wigglesworth warned, “There will be painful economic setbacks in the short term.”
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What Nvidia’s Earnings Reveal.

• Second-quarter revenue and operating profit were $96.2 billion and $64 billion, respectively. Operating margin: 66.5%.
• Data center sales reached $89 billion, accounting for 92.5% of total revenue.
• The consensus next-year revenue growth forecast is 45%, but the company has set a 70% target. That would mean annual revenue of $700 billion. An ambitious goal to quash AI bubble talk.
• Colette Kress (Nvidia CFO) said, “Memory supply shortages are just one symptom of the surging demand driving growth.”

Bubble or Not?

• There are 4+4 signals.
• First, sales and profits are both strong.
• Second, the stock isn’t overpriced. The 12-month forward P/E ratio is around 20x. Earnings have grown faster than the stock price.
• Third, orders are still overflowing. Amazon placed an additional 2 million GPU orders.
• Fourth, demand will rise as token costs decrease. It’s Jevons’ paradox.
• But doubts remain.
• First, circular finance risks are unresolved. Guarantee volumes have exceeded $100 billion.
• Second, if GPU depreciation periods are shortened, hyperscalers’ profits could plummet.
• Third, interest rates keep rising. Financing costs are surging.
• Fourth, the token spending index has turned downward.

Another Take.

Gangnam Down, Gangbuk Up.

• Gangnam home prices fell for the third consecutive week.
• Seongbuk, Gangbuk, and Jongno districts recorded the highest increases since statistics began.
• Nam Hyuk-woo (Woori Bank researcher) said, “The phenomenon of areas dense with apartments under 1.5 billion won driving Seoul’s price increases is expected to continue for the time being.”
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Real Wage Income -2.1%.

• Second-quarter household income was 5.295 million won, with wage income at 3.218 million won.
• Real wage income adjusted for inflation fell by 2.1%.
• Of the 230,000 won income increase, 158,000 won came from transfer payments—the effect of high oil price subsidies.
• The JoongAng Ilbo analyzed, “Earned income shrank while government money patched the gap.”
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65% of New Jobs Are Temporary or Daily Wage Work.

• July employment at business entities reached 20.718 million, up 226,000 from a year ago. Of these, 65% were temporary or daily wage workers.
• Wages at firms with 300+ employees rose 4.4% to 5.933 million won, while those with fewer than 300 employees increased only 2.3% to 3.698 million won—below the 3.2% inflation rate.

National Debt Tops $350 Trillion.

• Global debt exceeds 300% of GDP. It is projected to grow by $18 trillion in major developed economies this year.
• Ludovic Subran (Allianz CIO) said, “We’re watching which country will be the first to succumb to the bond vigilantes.”
• The U.S. is in poor shape, but France, Italy, the U.K., and Japan are also seeing soaring government bond yields.
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The Real Winner of the U.S.-Canada Trade War Is Xi Jinping.

• If Canada stops buying American cars, Chinese-made vehicles are likely to fill the gap. After GM and Ford withdrew from Australia in 2017, the share of Chinese cars surged from 1/250 to 1/3.
• Trump is fighting China while pushing away allies. Canada is one of America’s few remaining allies. Now, Canada is considering breaking with the U.S., not just with China.
• Chad Bown (Peterson Institute Senior Fellow) noted, “You can’t kill Canadian manufacturing and keep Canadian consumers.”
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CPTPP Accession: A Death Sentence for Agriculture.

• Government is reviewing accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). It is a trade bloc involving Japan, Australia, Canada, the UK, Mexico, and others.
• The Korean Federation of Young Farmers (Han Nong Yeon) issued a statement: “Immediately halt trade policies premised on agricultural sacrifice.”
• Koo Yoon-cheol (Minister of Economy and Finance) said, “We will carefully assess concerns and impacts, fully incorporate field feedback, and proactively prepare supplementary measures.”

Dropping Charges, Abolishing Breach of Trust—Case Dismissal Ahead.

• As a government official told Chosun Ilbo,
• “Initially, the Justice Ministry—responsible for the issue—was torn between two options: maintaining the current breach of trust law with amendments to prevent its abusive application, or abolishing it entirely and drafting a new replacement. In this context, the Blue House effectively set the course toward abolition.”
• Though breach of trust law has long been criticized as malleable—“a ring for the ear or a pendant for the nose”—abolishing it risks accusations that the administration is trying to erase Lee Jae-myung (President)’s Daejang-dong case.
• A Blue House official dismissed the link, stating, “The president has long argued that breach of trust law must be reformed” and “abolishing it and ongoing trials are unrelated.”
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“Not a One-Time Prosecution Withdrawal.”.

• It means they must proceed slowly, mindful of public opinion. Kim Han-gyu (Democratic Party lawmaker) said, “Even after the special committee on manipulated prosecutions was active, public sentiment doesn’t seem to have turned in our favor.”
• Park Seong-jun (Democratic Party spokesperson), appearing on Kim Eo-jun’s News Factory, stated, “The special prosecution bill for manipulated prosecutions is not yet on the leadership’s discussion table.” Media reports that it would be handled during the September regular session were personal opinions, he clarified. Kwon Chil-seung (Democratic Party Policy Committee chairman) also drew a line, calling it “entirely Park Seong-jun’s personal opinion.”
• A Democratic Party lawmaker interviewed by Kyunghyang Shinmun said, “If such a bill passes at a time when the overall governance tone needs to shift, approval ratings will ‘crash.’” Another lawmaker added, “Everyone is thinking about next year’s possible Seoul mayoral by-election or the 2024 general election—who would dare support a special prosecution bill for manipulated prosecutions?”
• Chosun Ilbo wrote in an editorial, “If a law wavers with approval ratings, it cannot be called a law.”
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The Fix.

“Intrinsic Capacity,” a New Aging Metric.

• Not being sick is important, but maintaining function is also critical.
• Intrinsic capacity comprises cognition, locomotion, sensory capacity, psychological well-being, and vitality.
• One can be free of disease yet still have diminished intrinsic capacity. The WHO does not classify aging as a disease, but it does categorize the decline in intrinsic capacity due to aging as a medical condition.
• Two studies are underway: First, is intrinsic capacity linked to lifespan? Second, can exercise or medication enhance it?
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Human-Reserved Zones Are Needed.

• “AI will either become the greatest equalizer in history or the worst source of injustice.”
• Bill Gates (Chair, Gates Foundation) emphasized, “This time, it’s truly different. We must act now,” proposing three risks and three solutions.
• First risk: Many jobs will disappear forever. White-collar workers may hold on longer, but blue-collar workers are likely to be replaced by robots within a decade. Gates warned, “Without intervention, good jobs will keep shrinking, and profits will concentrate among the few.”
• Second risk: AI could become a weapon. While bomb-making methods have long circulated online, AI can facilitate their execution. The same applies to cyberattacks and deepfakes. AI can aid drug development but also be weaponized for bioterrorism.
• Third risk: AI might replace human relationships. Studies show that overreliance on AI diminishes critical thinking. Conversations with AI are like a large, safe greenhouse.
• First solution: Establish shared norms. Gates repeatedly criticized the “absence of a plan.”
• Second solution: Preserve “human-reserved zones.”
• Third solution: Introduce token taxes and robot taxes. Funds are needed to expand social safety nets.
• “This unprecedented technology demands an unprecedented global response,” he stressed. “If done right, the world could become a far fairer place.”
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ICYMI.

Settlement Fees? We Can’t Be the Only Ones Paying.

• Big tech platforms aren’t the only ones criticized for driving children’s social media addiction—Instagram isn’t alone. While Meta appears to have settled for up to $18 billion, this might not be the end.
• Meta insists all social media should be regulated. Here’s how their “sinking-ship” strategy works:
• The base settlement is $12 billion. If YouTube, TikTok, and others pay $5 billion, Meta will add another $5 billion.
• Meta agreed to limit children’s daily use to 2 hours, but if YouTube and TikTok agree to a 1-hour limit, they’ll reduce it to 1 hour.
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Will Instagram+Facebook Regulations Work?

• Katarina Koff (Deputy Director, Digital Democracy Center) noted, “Parental controls only function properly in households where children have stable relationships with adults,” adding, “Children who meet these conditions are often already the most protected.”
• Sasha Howes (Founder, Tech Oversight Project) observed, “Meta’s ‘good corporate citizen’ act is ultimately just a PR campaign.”
• The New York Times compared the situation to “an ad agency that lost tobacco clients running an ad titled ‘Why We Quit Smoking’”—a critique of Meta’s framing of a coerced settlement as voluntary reform.
• Teens use TikTok more than Instagram or Facebook. A Pew Research study found YouTube and TikTok usage at 92% and 68%, respectively, while Instagram and Facebook trailed at 63% and 31%. “Regulating only Meta could drive teens to less-regulated platforms,” some experts warn.
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Worth Reading.

Collaboration of Patches and Rags.

• “Legislation that overlooks the complexity of markets and society inevitably invites unintended consequences.” These are the words of Friedrich Hayek (economist) from *The Fatal Conceit*.
• The supplementary investigation authority was first abolished, then to be improved later—and the comprehensive real estate tax for non-residential single-homeowners is set to revert. The Yongsan Park project remains in disarray. “The more they tinker, the more it becomes a patchwork,” grumbles the backroom.
• Choi Min-woo (Deputy General Manager, JoongAng Ilbo) pointed out, “Why does this keep happening? Because they don’t deliberate.”
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1+2 Mega Bundled Product.

• Marketed as three mega-projects, but the semiconductor cluster is the main event, with the AI data center and physical AI serving as tacked-on add-ons to round out the package.
• The “TSMC of robotics” remains a pipe dream, and the 18.4GW data center has neither legitimacy nor feasibility to its name.
• Kim Hyun-woo (Director, Institute for Degrowth and Alternatives) pointed out, “The flagship product in this bundle was in need of a recall, while the two add-ons were either overhyped or should never have been included in the first place.”
• The argument goes: “If bundling these means abandoning climate goals, suspending labor rights, and deregulating at will, then this should not be accepted as is.”
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