“Still a Fiscal Straw?”.

• “Firefighting is the most headache-inducing fiscal straw,” said Choo Mi-ae (Gyeonggi Governor) during a National Assembly audit, sparking belated outrage.
• Her original remark referred to how firefighting—despite being converted to a national civil service—still relies on local finances. Gyeonggi’s 2025 firefighting budget is 1.7 trillion won, with only 9% from national funds. Personnel costs alone amount to 1.1 trillion won.
• Coincidentally, three days later on Friday, a fire at a metal plating factory in Bucheon left five firefighters injured and one dead. Kim Jin-seok (Firefighter) had just finished a 24-hour shift and was about to leave work when dispatched—20 minutes before his scheduled departure. He entered first, but it was his final call.
• When reporters asked Choo for comment, she waved them off, saying, “Don’t bring that up.” One firefighter turned away and wiped tears.
• After paying condolences, Choo stated, “Since you demand an apology, I sincerely apologize from the heart.”
• The Dong-A Ilbo criticized the remark in an editorial as “a derogatory statement trampling on firefighters’ dignity.”
• Gyeonggi Province declared a fiscal emergency on August 5 and is pushing to cut 770 billion won from the budget. Replacement of aging fire trucks and rescue equipment budgets were slashed significantly. Even the 100 million won allocated for memorial events for fallen firefighters was scrapped.
• The Hankook Ilbo noted in an editorial, “If the issue is the distorted structure of firefighter personnel costs, the central government should be criticized—not labeling them ‘fiscal straws’ or ‘leeches,’ which firefighters would find humiliating.”
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Fire Safety Grant Cut by 28%.

• Of the 6.5129 trillion won in firefighting personnel costs, only 549.6 billion won (8.4%) comes from national funds.
• The Hankyoreh analyzed, “Since local governments handle firefighting finances, personnel scales and treatment vary wildly across regions.”
• For uniform costs required in firefighting activities, Busan and Jeju provide 250,000 won per person, while Ulsan offers 700,000 won.
• The government reduced the fire safety grant in next year’s budget by 28%, setting it at 760.5 billion won. The grant is tied to tobacco excise taxes.
• A Planning and Budget Department official explained, “The reduction is large because the 110 billion won in additional settlements included this year will be excluded next year, and tobacco excise tax revenue is also expected to decrease.”
• A Ministry of the Interior and Safety official added, “We are not specifically reviewing any reforms to the fire safety grant.”
• Lee Yong-woo (Democratic Party spokesperson) emphasized, “More important than political strife is for the ruling party to responsibly address the fundamental issues related to firefighting finances.”
• Kim Min-seok (Democratic Party leader)’s early-morning 5 a.m. visit to a frontline fire station has reignited controversy.
• He stated, “I heard that there are people who work during this time, and the rest should be sleeping or resting, but since it’s already happened, I said, ‘Well, I guess it’s okay,’” adding, “I don’t know if that’s the truth, but I’m sorry.”
• This occurred on the 30th of last month.
• Related Link.
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Youth Employment Declines for 47th Straight Month.

• September employment reached 29.266 million, up 113,000 from a year ago—the smallest increase since 2020.
• Employment for ages 15–29 fell by 147,000. The employment rate dropped to 44.0%, declining for 29 consecutive months.
• Employment in accommodation+food services fell by 97,000, and construction employment dropped by 48,000.
• Nominal national income grew 26.4% in Q2, but household income rose only 8.7%.
• The Dong-A Ilbo headlined on its front page, “Youth surviving on debt.” Among households in the bottom 20% for both net assets and income, 20–30-year-olds account for 15.2%—double the 7.9% from five years ago.
• Koo In-hoi (Seoul National University professor) noted, “South Korea has almost no support systems for working-age youth.”
• Related Link.
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What Matters Now.

KOSPI 5668.1.

• KOSPI closed at 5668.1 on Friday, up 2.1%. Foreign investors net-bought 300 billion won—the first in nine trading days.
• Foreign investors had net-sold 26.1 trillion won over 13 days.
• The Korea Investment & Securities-calculated price-to-earnings ratio for the Korean stock market, based on one-year forward earnings estimates, is 4.9x—significantly lower than the US (19.3x), Japan (15.6x), and Taiwan (18.8x).
• Kim Dong-won (KB Securities Research Head) said, “The recent sharp declines in Samsung Electronics and SK Hynix shares were excessive adjustments driven by weakened investor sentiment.” Kiwoom Securities forecasted, “KOSPI could fall to 5,100 in the short term.”
• All three major US stock indices fell on Friday. The S&P 500, Dow, and Nasdaq dropped -1.09%, -0.34%, and -2.15%, respectively.
• Related Link.
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It Was a Dress Rehearsal for a Bubble Burst.

• K.T. Madyan (Financial Times columnist) assessed, “Last week’s market movements were a dress rehearsal for what an AI bubble burst might look like.”
• “The global stock market is almost entirely propped up by speculative excitement around a single theme.”
• Excessive leverage, off-balance-sheet liabilities, and questions about investment returns have been known for months. Yet prices shifted abruptly when investor anxiety suddenly spiked, according to the analysis.
• Broadcom CEO’s “casino” remark, CoreWeave’s reliance on insurer capital, and failed data center listings in Australia and Asia converged.
• The Korean stock market fell 8% in a day, while data center bonds and some corporate credit default swaps (CDS) wobbled. In contrast, UK equities (with low tech exposure) and US Treasuries held relatively firm.
• George Saravelos (Deutsche Bank) warned, “Concentration risk is enormous,” adding, “Event risks—like AI safety incidents, failed listings, or missed sales targets—are not fully priced into the market.”
• “The era of easy money is over,” he concluded.
• Related Link.

National Pension Service’s Equity Value Plunges by 182 Trillion Won.

• From 516 trillion won at the end of June to 334 trillion won on October 15—a 35% drop. The analysis covers 287 listed companies where the National Pension Service holds over 5% of shares.
• Samsung Electronics and SK Hynix alone accounted for 72% of the total decline.
• Criticism arises that increasing equity exposure caused the fund to miss the peak and fail its market-stabilizing role. Kim Seong-joo (Chairman of the National Pension Service) countered, “If we had sold as planned—over 800 billion won daily, or 10% of the KOSPI’s daily trading volume—it would have shocked the market.”
• Yoon Seok-myeong (Research Fellow at the Korea Institute for Health and Social Affairs) criticized, “The problem is dragging pre-established fund management principles into the political arena.”
• Related Link.

Kim Min-seok Plays the Jo Hee-dae Impeachment Card.

• Kim Min-seok (Democratic Party Leader) said, “We’ve begun discussing all methods and every possible path.” Jo Hee-dae (Chief Justice of the Supreme Court) has refused the Blue House’s request to re-nominate a Supreme Court justice candidate. There were also allegations of improper use of official expenses.
• Park Gyun-taek (Democratic Party lawmaker) said, “Denying the presidential appointment clause and refusing to swear in as a witness during a state audit could be sufficient grounds for impeachment.” Kim Ki-pyo (Democratic Party lawmaker) said, “If we don’t impeach, the Democratic Party will be suspected of lacking constitutional resolve.”
• The Dong-A Ilbo analyzed, “In a conflict between hardliners and pro-Blue House factions, they’ve pulled out a card to unite under ‘one voice’—but actual motion remains uncertain.”
• In an editorial, Chosun Ilbo warned, “If the Constitutional Court rejects the impeachment, the Democratic Party will bear responsibility for ‘undermining the constitution.’” The JoongAng Ilbo’s editorial noted, “Deep concerns arise: is the party truly reading public sentiment?”
• A senior figure interviewed by The Hankyoreh warned, “If the Democratic Party impeaches Jo Hee-dae, they’ll self-destruct—attacking him doesn’t align with public expectations.” A Democratic Party lawmaker interviewed by Kyunghyang Shinmun said, “With both policy momentum and approval ratings falling, a backlash is a real concern.”
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37% of This Year’s Capital Region Housing Supply Target Met.

• As of the second week of October, only 99,000 units had started construction in the capital region. This year’s target is 268,000 units.
• The Ministry of Land, Infrastructure and Transport has scheduled a regular housing supply briefing. The ministry expects an additional 120,000 units to begin construction in the fourth quarter alone.
• Chosun Ilbo dismissed the announcement as empty rhetoric. Donga Ilbo analyzed that up to 50,000 units could fall short of the target.
• Kim Yi-tak (Vice Minister of Land, Infrastructure and Transport) claimed, “Stability is emerging, particularly in the Gangnam Three Districts,” and noted “a slight cooling in buying sentiment.” However, critics call this “a judgment detached from the market.” Seoul apartment prices have risen for 88 consecutive weeks.
• Related Link.

Deep Dive.

Horse Racing Track Relocation Plan Stalls.

• Woo Hee-jong (President of Korea Racing Authority) stated, “We judge that relocation within six years is difficult.”
• The government had planned to build 9,800 housing units on the site of Gwacheon Race Park and the former Defense Security Command, with construction set to begin in 2029.
• Related Link.

3,349 Boxes of Korean Books Sent to Anthropic.

• It was belatedly revealed that Woongjin Books sent Korean books to Anthropic in five separate shipments—3,349 boxes, approximately 170,000 to 210,000 volumes.
• The purchasing entity was Better World Books, a contractor for Anthropic. A Woongjin Books representative stated, “It’s correct that books were exported to Anthropic; at the time, we understood it as a standard book supply transaction.”
• The Korean Publishers Association criticized, “Without transparency, we cannot inquire, refuse, or demand fair compensation.” They demanded disclosure of training data, authors’ consent, and proper remuneration.
• Separately from new book exports, since August, used book retailers Yes24, Aladin, and Seoul Book Bogo have received inquiries about bulk purchases of secondhand books.
• Confirmed shipments alone are estimated at 166 tons, around 410,000 volumes.
• Related Link.
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“Live Broadcasts Are Direct Trade.”.

• Lee Jae-myung (President) wrote on X. He directly refuted suggestions to halt live broadcasts of State Council meetings.
• “At minimum, I am confident no State Council member in this administration fails to speak their mind to the President. Just as middlemen find direct trade between producers and consumers inconvenient, many likely find direct communication between the public and elected officials uncomfortable. I fully understand. However, I cannot agree to blocking direct trade to guarantee distribution margins.”
• Seong Gi-hong (Chief of Staff for Presidential Communications) called it a “signature policy.”
• JoongAng Ilbo warned in an editorial, “Being a ‘bold minister’ before the highest authority is not as easy as it sounds,” adding, “This should be seen as a caution against the risks of Lee Jae-myung’s micromanagement-style governance descending into autocracy and stubbornness.”
• Related Link.
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What’s the Problem with Direct Trade?

• Lee Jae-mook (Professor, Hankuk University of Foreign Studies) criticized, “Blocking all discussion about adjusting the scope, format, and tone of live broadcasts—then suggesting everything should be closed-door—oversimplifies the debate.”
• A senior ruling party figure interviewed by The Korea Times said, “Rather than immediately rebutting calls to scale back live broadcasts, this should be an opportunity to listen to on-the-ground voices and review the system.”
• Chang Deok-jin (Professor, Seoul National University) warned, “Using social media can make one’s network patterns inherently confirmation-biased. If you only engage with those who give positive feedback, you risk becoming ‘a fool who comfortably makes irrational decisions.’”
• Lee Hyun-woo (Professor, Sogang University) noted, “Activities focused on fanbase management are boomeranging into political disgust among the majority of voters.”
• Related Link.
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Three Perspectives on Speed.

• IMF reviewed three scenarios.
• First, productivity rises rapidly, easing inflationary pressures,
• Second, prices and interest rates surge first due to power and equipment shortages, followed by productivity gains,
• Third, investments plummet as expected returns fail to materialize.
• Under the third scenario, global growth in 2028 could fall 1.3 percentage points below baseline projections.
• Kristalina Georgieva (IMF Managing Director) warned, “Our expectations are very high, but they will not be met.” She added, “If disappointed investors withdraw capital, problems could arise.”
• The Wall Street Journal noted, “If U.S. data center investments falter, semiconductor and equipment exports from South Korea, Taiwan, and others could suffer.” “The pace at which expectations are realized,” it concluded, “may lag behind what investors demand.”
• Related Link.

AI Crisis Strikes Debt-Heavy Firms First.

• Even with rising AI demand, AI companies’ stock and bond prices could fall.
• CoreWeave’s debt alone is at least $35 billion. Jordan Challenor (CreditSights analyst) forecasts CoreWeave will burn through an additional $80 billion in cash over the next three and a half years.
• The analysis warns that even with sufficient demand, funding could dry up if capital needs for infrastructure investments grow faster.
• Ali Vohra (AllianceBernstein high-yield portfolio manager) cautioned, “Every company that isn’t a hyperscaler is at risk.” The implication: “The entire AI industry isn’t equally risky—firms with weaker financials face pressure first.”
• The assessment suggests AI investments will increasingly divide companies that can endure from those that cannot.
• Related Link.

Scarcity Now, Surplus Later.

• Richard Waters (Financial Times columnist) analyzed that the AI industry is caught between two opposing risks: currently plagued by computing resource shortages, but could eventually flip to oversupply.
• The five major hyperscalers—Alphabet, Amazon, Meta, Microsoft, and Oracle—are investing around $800 billion in facilities this year, exceeding their projected $700 billion cash flow.
• Demand remains strong for now: spot rental rates for Nvidia’s B200 chips have risen 50% over six months to $6 per hour.
• According to Brookings Institution analysis, these companies need $3.7 trillion in annual revenue by 2032 to achieve adequate returns—equivalent to 9.2% of US GDP.
• The warning: “The industry could suffer immensely between the extremes of acute short-term shortages and the looming shadow of severe oversupply.”
• Ludovic Subran (Allianz Chief Investment Officer) cautioned, “We’re facing a Darwin moment”—a struggle where “companies with the weakest credit will fight to survive.”
• Power shortages, construction delays, local opposition, and funding difficulties might prevent oversupply. But even in that case, stock prices premised on high growth cannot avoid correction.
• Related Link.

“The Road to AI Will Be Very Bumpy.”.

• Kevin Warsh (former Federal Reserve Chair) said, “AI will bring significant long-term economic benefits, but the process will likely be very rocky (a very bumpy one).”
• While calling AI “the most consequential shift in the U.S. and global economy during my lifetime,” he stressed that “price stability remains the immediate priority.”
• Michael Landsberg (Landsberg Bennett Chief Investment Officer) said, “This is not a risk-free investment—there will clearly be winners and losers.” He argued that companies manufacturing AI equipment must be distinguished from those expanding by relying on cheap borrowing.

Where Gas Price Shocks Hit Harder.

• Brown University analysis showed household impacts varied widely: Wyoming ($975) and Oregon ($339) had the largest gaps.
• California and New York saw sharper price rises than the national average, but lower consumption meant the added burden was relatively smaller. The key is how much driving and what kind of vehicle you use.
• Rural areas face bigger shocks due to longer distances and larger vehicles.
• Gas prices are one of the biggest variables in the U.S. midterm elections.
• According to the Wall Street Journal, among nine competitive Senate states, Iowa, Michigan, North Carolina, and Texas faced heavier burdens than the national average.
• Related Link.

A Deal to End the War Only Escalated It.

• Donald Trump (U.S. President) escalated the Russia-Ukraine war by agreeing to import Russian diesel.
• Volodymyr Zelenskyy (Ukrainian President) paused attacks on Russian refineries for three days before resuming them—Russia had not halted strikes on Ukrainian energy infrastructure.
• Ukraine is running out of Patriot missiles.
• Zelenskyy criticized, “Trump is making a mistake if he wants to be friends with Putin.” Trump retorted, “Zelenskyy is harder to deal with than Putin,” adding, “Ukraine needs elections.”
• U.S. diesel prices have not dropped either. Russia cannot supply much diesel, and the root cause lies in the Strait of Hormuz anyway.

Another Take.

France Is Boiling Over.

• 800,000 people took to the streets. 1,800 were arrested and over 500 police officers injured.
• The town hall in Limoges burned down and collapsed. In Bordeaux, the prefect’s residence was stormed. One protester’s right hand was severed by a police stun grenade. Another suffered a fractured jaw.
• The Wall Street Journal described it as “a collision of rising living costs and fiscal pressure.” The New York Times assessed, “It’s a zero-sum game over a shrinking pie due to low growth.”
• Students demand more teachers and repairs to dilapidated school facilities. But the government proposed cutting €43 billion from the 2027 budget.
• Thomas Piketty (Paris School of Economics professor) noted, “Per-student education spending has plummeted 20% since 2017,” adding, “The issue is not a lack of wealth but its distribution.”
• Some observers warn that protesters and looters are merging into an anarchic mix.
• Jean-Luc Mélenchon (leader of Unbowed France) said, “The government bears responsibility for the chaos,” drawing a line: “There is no place for looters among those who share our struggle.”
• Emmanuel Macron (French President) warned, “Those attacking public buildings, shops, and looting town halls will be prosecuted and punished.”
• Sébastien Lecornu (French Prime Minister) stated, “You must choose: stand with the Republic and law enforcement, or stand with the rioters.”
• France’s tax burden as a share of GDP is 43.5%, second-highest in the OECD. Public spending at 57.2% of GDP exceeds the EU average of 49.5%. National debt interest rates have surpassed Italy’s (4.59%) at 4.87%. Growth is projected at just 0.4% this year. Accumulated national debt stands at €3.6 trillion, 119% of GDP.
• Related Link.
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Three Ways to View the French Protests.

• Chosun Ilbo sees profligate public finances as the root cause. Though it said this is not just another country’s story, France’s national debt stands at 120% of GDP, while South Korea’s is now around 50%.
• Kyunghyang Shinmun argues the issue is not about money but distribution. Cuts to housing subsidies for youth and low-income groups were the trigger.
• “Is this a country for the elderly?” JoongAng Ilbo identifies generational conflict as the cause. Reforms to raise the pension eligibility age from 62 to 64 remain stalled. The term “gerontonomia”—combining geron (elderly) and oikonomia (economy)—has emerged.
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A USFK Commander’s Blunder.

• Xavier Brunson (USFK Commander) said at a seminar in Washington, “From the UN Command’s perspective, South Korea begins at the southern fence.”
• Kim Byung-joo (Democratic Party lawmaker) pointed out, “The authority granted to the UN Command by the Armistice Agreement is limited to DMZ access permits and civil administration,” adding, “There is no authority anywhere to define South Korea’s territorial sovereignty.”
• The South Korean Constitution defines even the area north of the Military Demarcation Line, including the DMZ, as South Korean territory. The Hankyoreh argued, “Brunson must retract this outrageous remark denying the territorial sovereignty of an ally and apologize to our government and people.”
• A senior government official met by the Dong-A Ilbo said, “It doesn’t seem to reflect the thinking of the White House or the Pentagon.”
• There is much discontent in the Ministry of National Defense that “Brunson is running amok.” A senior ruling-party official met by the Hankyoreh said, “I understand the U.S. also views Brunson’s remarks as personal opinions.”
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The Biggest Mystery in US Politics.

• “With deficits this large, there’s no real way to address high living costs.”
• It’s a problem Trump created, but the Democrats aren’t offering solutions either.
• Matthew Yglesias (Slow Boring operator) emphasized, “Traditional deficit reduction is necessary.”
• “Fiscal responsibility makes political elites uncomfortable—it limits their ambitions and makes it harder to push their pet projects.”
• The solution? “Progressive taxation, fiscal discipline, deregulation, free trade, and policy humility,” he stressed.
• Related Link.

Where to Hide When AI Collapses?

• US Treasuries are the textbook risk-avoidance tool. Sushil Wadhwani (London School of Economics professor) forecasted, “If an AI collapse begins, the Fed is likely to cut rates significantly.”
• The issue is timing. Even if you buy Treasuries in anticipation of the worst-case scenario, you’ll have to endure losses if rates rise further before then.
• Gold is no different. If the Fed cuts rates, gold prices are likely to surge.
• Javier Coronado (Alpine Macro strategist) noted, “The best risk-avoidance tool for stocks is other stocks.”
• “There’s no simple answer, and probably not just one answer.” An anonymous European pension fund manager met by the Financial Times remarked, “It’s not just equity risk—it’s credit risk, and risk in some commodities, mainly metals,” adding, “The risk is spread across financial markets.”
• Moving to cash isn’t a solution either. It means bearing the risk of missing further gains and losing the opportunity to buy cheaper later.

The Fix.

Focus on the Risk of Repeated Harm, Not Just Flight Risk.

• Seventeen victims have been killed since 2022 despite receiving smartwatches.
• Song Ran-hee (Director of Korean Women’s Hotline) emphasized, “Flight risk and evidence destruction should not be the sole grounds for detention,” adding, “The most critical factor is the likelihood of reoffending and the level of danger.”
• Heo Min-sook (Legislative Researcher at the National Assembly Research Service) stated, “If a victim refuses to file a report or request safety measures, we must consider the possibility that they are in immediate danger—where the perpetrator could kill them as soon as external intervention is detected.”
• In an editorial, Dong-A Ilbo stressed, “Even if victims do not wish to press charges, response protocols must be improved to ensure immediate protective measures when repeated reports, refusal to cooperate with investigations, or loss of contact—clear danger signals—are detected.”
• In its editorial, Hankook Ilbo emphasized, “Even if it involves some infringement of rights, robust institutional safeguards are necessary to isolate high-risk offenders from potential victims.”
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Targeted Support for Livelihood Energy, Not Blanket Relief.

• The oil price cap has indeed played a significant role in stabilizing prices.
• Last month’s 3% increase in gasoline consumption raises concerns about sending the wrong market signal.
• With the government compensating refiners’ losses, estimates suggest over 5 trillion won in public funds will be spent.
• Kyeongyang Shinmun pointed out, “High-income and non-essential users benefit the most in absolute terms.”
• “A phased approach is needed to spread impact and incentivize reduced energy consumption—with clear criteria for ending price controls.
• Selective support for vulnerable, high-energy-use households must accompany broader measures.”
• Related Link.

Why Wind Power Is Withdrawing.

• It’s a front-page article in The Korea Daily. Equinor notified the South Korean government, “We plan to halt all activities related to offshore wind power.”
• Corio Generation has dissolved its Korean subsidiary.
• RWE is pushing to sell its stake in Tongyeong Future Offshore Wind.
• Ørsted is re-evaluating its 1.47GW Incheon project.
• Begoña Díaz González (Iberdrola Head of International Projects) stated, “The regulatory framework for permits was unclear, and uncertainty over potential project changes after a government transition was significant.”
• This year’s first-half fixed offshore wind bid ceiling price fell 3.02% to 171.2 won per kWh.
• Of the estimated 7.0939 trillion won in 20-year operating revenue for the Shinan Offshore Wind project, 74% comes from Renewable Energy Certificates (RECs). Concerns arise: if RECs are abolished, could profitability collapse?
• A Climate and Energy Ministry official said, “To ensure offshore wind’s competitiveness against other renewables, prices must decrease,” adding, “We’re considering preferential pricing as an alternative to REC abolition and investigating appropriate levels.”
• Related Link.
• Related Link.

ICYMI.

Ending the Leap Second.

• The system adds or subtracts a second to align with Earth’s rotation speed.
• July 5, 2024, was 0.00166 seconds shorter than a full day.
• Since its 1972 introduction, there have been 27 leap seconds—all additions.
• This time, a subtraction was needed. Concerns arose that it could require Y2K-level investments.
• The cause of Earth’s accelerated rotation remains unexplained.
• Related Link.

“Greed Got Ahead of Reality.”.

• Australian data center firm Permus failed to secure a $30.5 billion listing. Concerns emerge it may signal the AI bubble’s collapse.
• Zunbei Liu (Tencap Portfolio Manager) stated, “Businesses chasing quick riches will find it harder.”
• Related Link.

Why CXMT’s Stock Dropped.

• The Financial Times reports investors are becoming more selective.
• Nvidia and TSMC held relatively steady, but memory firms like South Korea’s SK Hynix and China’s CXMT fell harder.
• Market sentiment was dominated by fears that memory prices have peaked.
• Adam Turnquist (LPL Financial Analyst) said, “It’s a ‘sell now, ask questions later’ reaction.”
• Related Link.

Opportunity for Bond Investors?

• When bond yields rise, bond prices fall. New investors can secure higher returns.
• Jeff Sommer (New York Times columnist) calculated that the average US Treasury yield since 1950 has been 5.4%. While recent decades of low rates make current yields seem high, historically they are not unheard of.
• Kathy Jones (former Charles Schwab strategist) said, “Current rates present a good opportunity for long-term investors and retirees to lock in higher yields.”

Scratching for Pennies in the Cracks of the Sofa.

• As money moves quickly, companies are trying to spend cash more efficiently.
• Gillian Tett (Financial Times columnist) analyzed, “We’re moving from a world of abundant liquidity and near-free cash to one where competition for capital is intensifying.”
• Related Link.

Can Insurance Handle AI Mishaps?

• Concerns emerge that the insurance market is too small to cover the scale of AI-related accidents and lawsuits.
• George Luin-Smith (Testudo CEO) stated, “Insurance covering billions of dollars in liability simply does not exist.”
• Projections suggest compensation claims from major AI incidents could reach hundreds of billions of dollars.
• The extent of existing coverage is also unclear. According to Aon, over 90% of current insurance policies neither explicitly cover nor exclude AI risks—a “silent risk.”
• Some insurers are reviewing clauses to exclude coverage for generative AI-related incidents.
• Related Link.

Zuckerberg’s Successor?

• As recently as last year, Susan Li (Meta CFO) warned, “If this doesn’t work out, it’ll be a very, very bad financial situation.” What emerged was Meta Muse, and the person overseeing Muse is Alexander Wang (Meta Chief AI Officer).
• Alexander Wang dropped out of MIT and founded Scale AI in 2016. Meta acquired Scale AI for $14.3 billion last year to bring Wang on board.
• A year later, Zuckerberg assessed, “Muse has put Meta at the AI frontier.” Speculation is already swirling that Alexander Wang could be the successor.
• A former Meta executive said, “There were many with vested interests, but they stepped aside because they knew Mark’s attention and support were entirely focused on him.”
• Related Link.

Trucks Running 20 Hours a Day.

• They yield to merging vehicles, obey speed limits, and never honk. While human drivers can drive up to 11 hours during a 14-hour shift, autonomous trucks face no such restrictions.
• Last year, US trucking costs averaged $2.34 per mile—44% for driver wages and benefits, 21% for fuel.
• Aurora’s autonomous trucks maintain optimal speeds, cutting fuel costs by over 10%.
• For now, they focus on middle-mile routes between logistics hubs. Human workers are still needed for loading/unloading, final delivery, and refueling.
• The drivers’ union claims, “Autonomous trucks will eventually eliminate jobs for over 200,000 semitruck drivers in California.”
• Related Link.

Soldiers Have Lost Their Hiding Places.

• As drones expanded their surveillance and strike range, even the once-safe rear became a battlefield.
• Missions that used to take days now stretch into months—moving troops for rotation itself is dangerous.
• Supply and rescue now depend on drones: food and medicine are airdropped, while seriously wounded are evacuated by ground robots. But if a drone is shot down or runs out of battery, supplies can be cut off for days.
• Two soldiers interviewed by The New York Times walked 1.6 kilometers when first deployed, but had to trek 9.7 kilometers to exit. The danger zone expanded so much that they walked for four days, waited another day and a half, before finally boarding a truck.
• Dmytro Putyata (former Ukrainian drone operator) said, “Infantry were vital even without drones, and they remain vital with them.” Drones can destroy positions, but occupying and holding ground is still a human task.

Im Yoon-chan’s Mozart: Students, Don’t Try This at Home.

• Im Yoon-chan (pianist) began a Mozart piano sonata series at London’s Wigmore Hall.
• Richard Fairman (Financial Times music critic) noted, “What appears superficially simple accumulates immense emotion, wit, and drama,” adding that it was “unleashed with a positively nuclear amount of intellectual energy.”
• In the variations of K.284, he opened a window to an unimaginable world of ruggedness.
• K.310 unleashed a storm of passionate emotion.
• K.279 felt slightly unsteady—abrupt pauses, explosive accents, and rapid sprints scattered what should have been a straightforward piece.
• “Students shouldn’t try to imitate this directly. But when the recording comes out, there will be much to explore through repeated listening.”
• Related Link.

Worth Reading.

Heroic Acts and Self-Sacrifice.

• “‘First in, last out’ (enter first, exit last) is a noble expression of duty, but it must not be normalized as a tacit acceptance of excessive risk-taking. Firefighters are ethical heroes, but their bodies are human.”
• Choi Tae-hyun (Seoul National University professor) pointed out, “In understaffed and urgent situations, firefighters often rush into rescue operations without adequate safeguards.”
• Research also found that “in disaster scenarios, professional conduct and heroic actions become intertwined, normalizing firefighters’ self-sacrifice.”
• Choi Tae-hyun emphasized, “While risking danger to save lives is essential, society must find ways to ensure firefighters’ own safety is also secured.”
• Related Link.

If Pro-Moon Is ‘Gemeinschaft’, Pro-Lee Is ‘Gesellschaft’.

• Jo Gui-dong (CEO of Political Consulting Min) warned, “An army without officers cannot sustain a long war.”
• “It resembles Lee Jae-myung single-handedly commanding a million-strong army without independent division or corps commanders capable of autonomous operations,” analyzing it as a “one-man army” scenario.
• Jo pointed out, “With approval ratings as his only asset, Lee Jae-myung has no choice but to act like a short-term investor.”
• “If pro-Moon is ‘Gemeinschaft’ (community society), the organizational principle of pro-Lee is ‘Gesellschaft’ (associative society). There is no shared narrative, language, ideology, or symbol to bind his core supporters—capital-area migrants and their children. A thin layer of core elites, interest groups on the periphery, and the absence of ideology—these define the Lee Jae-myung faction.”
• Jo emphasized, “A political force aiming to lead the nation must possess statecraft commensurate with its status,” adding, “A strategy requires defined targets (who to recruit), exchanges (what to offer in return for support), and sequencing (methodology). The so-called ‘New Lee Jae-myung’ lacked all three.”
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Covert Narcissism.

• While overt narcissism manifests as self-aggrandizement, covert narcissism appears outwardly humble but simmers with the pressure to be inwardly validated.
• Kim Ji-yong (director of Yonsei Well Mental Health Clinic) emphasized two points.
• First, the benchmark for comparison should shift from others to the “past self” and the “ideal self.”
• Second, one must accept that ordinariness and exceptionalism can coexist.
• Kim advised, “As long as we aim for a frustration-free perfect life, we are doomed to remain perpetual failures,” adding, “The goal should not be a life without scars, but the attitude to keep moving forward even when wounded, treating such pain as ordinary misfortune.”
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Don’t Wait for Good Things to Happen.

• Kelly McGonigal (Stanford University professor) said, “Joy helps us appreciate the value of life itself.”
• First, share joyful memories with someone close—you might discover an unfamiliar side of them.
• Second, create small acts of kindness.
• Third, greet people warmly. Interest is a form of care and respect.
• Fourth, participate in others’ joy. Practicing positive empathy—celebrating and cheering for good news—can also be learned.
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Today’s State Council Audit.

• Slow News is covering the State Council Audit intensively.
• [Special Audit Coverage] updates twice daily.
• [Rep. ◯◯◯’s Audit Notes] compiles key issues by individual lawmakers. We also select the top 12 lawmakers daily.
• [Today’s Corporate Issues] highlights major corporate controversies.
• [Daily Audit Report] provides context and key points by committee.
• The list below compiles last Friday’s audit reports:
• October 16, 2026 Legislative and Judiciary Committee Audit Report.
• October 16, 2026 Financial and Economic Planning Committee Audit Report.
• October 16, 2026 Education Committee Audit Report.
• October 16, 2026 Science, Technology, Information, Broadcasting, and Communications Committee Audit Report.
• October 16, 2026 Agriculture, Food, Rural Affairs, Oceans, and Fisheries Committee Audit Report.
• October 16, 2026 Health and Welfare Committee Audit Report.
• October 16, 2026 Climate, Energy, Environment, and Labor Committee Audit Report.
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