A stock price that had been hovering around 150 dollars plunged to 110 dollars in a single stroke.
The shock was so great that the world’s No. 1 company by market capitalization fell(?) to third place in an instant.
Nvidi’s decline began with an 18% drop on the first day and continued weakly into the next, and DeepSync’s model announcement suggested just that much to global evaluators.
First, faith in the AI technological prowess believed to be an overwhelming gap collapsed.
Until now, many experts had forecast the AI market like this: latecomers could never catch up, and it was a technology only America could achieve...
And understandably so. AI development required enormous money and elite talent, and in the global community, the only place overflowing with geniuses and money was the United States.
But that had collapsed. It had not been an overwhelming gap.
Second was the resulting concern over American hegemony.
In truth, the United States had been openly keeping China in check since Baidon. That was why it imposed export controls on the H100 chips considered essential for AI development, but DeepSync succeeded in developing its technology with H800 chips, which had only half the performance of the H100.
Of course, there were many rumors that followed. Speculation that the Chinese authorities had secretly stockpiled a massive number of H100s behind the scenes...
But all of those controversies were peripheral matters that had little effect on the overall trend.
DeepSync had succeeded.
Taking GPT as an example, to develop an AI on the level of GPT-4, one would have to train 8,000 H100s for at least three months—17.5 million hours in terms of time. DeepSync had created a similar level with only 10% of that effort and time.
It was like an apartment that would take at least three years even if every kind of heavy equipment—excavators, backhoes, and the like—were mobilized, being completed by DeepSync in six months with a single shovel.
Whether they secretly used an excavator in the process or secretly ran a backhoe was not the important point.
No one could deny that DeepSync had been working under poor conditions.
“What?!”
“We have to buy.”
“You crazy bastard, seriously!”
The day after Nvidi’s plunge dragged the Nasdaq down by around 3%, I went to see Department Head Oh.
Department Head Oh’s face turned bright red as he sprang up from his seat.
Of course he would. Until yesterday, I had been saying we should sell everything, and then today I suddenly said we absolutely had to buy.
“No... Fine. I take back what I just said. Thanks to you, Team Leader Lee, we avoided losses that should have been in the trillions. I’m truly grateful for that.”
“Then we have to buy.”
“No, you brat, even so! The market is moving exactly as you predicted yesterday! After DeepSync’s announcement, belief in the overwhelming gap has completely shattered. Then, just as you said up until yesterday, we should stay on the sidelines. Why are you taking a buying position?”
“I told you during the risk meeting. This is like the transitional period at the beginning of the Industrial Revolution. Right now, cottage industries may be able to catch up, but in the end, the importance of high-computing chips will continue to grow.”
If my memory was correct, after DeepSync’s announcement, America’s export controls would become even harsher.
Even now, the United States was controlling exports of high-computing chips, but later it would go so far as to block indirect exports through third countries, openly revealing its containment of China.
In response, the Chinese authorities would also throw themselves into semiconductor development and begin their technological rise... but Nvidi’s technical prowess could not be caught up to so easily.
“Haa...”
When I told him the future as I remembered it, Department Head Oh sighed.
He had been adamant at first, but in the long term, it seemed he also thought it impossible for China to surpass America’s technological prowess.
“Even so, does that make any sense...? The investment position you’re talking about is closer to an odd-even gamble than stocks.”
“Department Head, these are the recent returns on gold, defense stocks, the Changcheng Fund, and so on. If you’d refer to—”
“You brat, whenever you have nothing else to say!”
“What stronger proof is there for an investor than this? Heh heh. Please trust me. Nvidi won’t collapse that easily.”
Department Head Oh glared as he picked up the documents.
Since the pension fund managed gold and defense stocks on its own, he already knew the returns, but Changcheng’s returns were enough to make his jaw drop.
Changcheng, which had taken a liquidation position right before DeepSync’s announcement, was now at a point where the numbers had become meaningless. The pension fund had merely prevented losses, but those bastards had even earned profits through short selling. It would not be an exaggeration to call them the best outsourced manager the pension fund had selected in the 21st century.
“Fine. Looks like the overseas team will have to work overtime today. I’ll purchase the volume you mentioned within three days.”
“Thank you!”
“But Team Leader Lee, since I’m granting you this, you concede just one thing too.”
This time, Department Head Oh watched my reaction.
“Investing 50 trillion won in the Sovereign Project... That makes no sense. Not 50—5 trillion won alone would be an outrageous sum.”
The day of the risk meeting.
I had called out a jaw-dropping figure for Korea’s AI project, but disappointingly, not a single person agreed with me.
“Department Head. That’s only the initial investment cost. Later, we’ll have to invest even more.”
“Wh-what? More than 50 trillion?”
“You know how much big tech companies like Meta and MS have invested in AI, don’t you?”
“...”
“Even investments on the corporate level exceed 100 trillion won in Korean currency. Everyone is jumping in, staking their lives on this. So how can support measures on the national level amount to only that?”
“People do what they can within their means. Thanks to you, our seed money has increased a bit, but the pension fund’s current assets under management are around 1,000 trillion won. If it’s 50 trillion... that’s 5%. No, if we calculate after taking out everything that can’t be touched, it’s probably 50%.”
Half of the pension fund’s managed assets were overseas. In other words, only half was domestic investment.
Half of that domestic investment was also in safe assets such as bonds. In reality, the money we could invest in domestic companies was only half of half of the assets under management.
To invest 50 trillion of that in the Sovereign Project... as Department Head Oh said, it was an outrageous idea.
“We have to do it.”
But we had to.
“If funds are short, we should make up for it even if we have to dispose of domestic companies. If we sell off all platform-based businesses like Nave, Gakao, and so on, we can secure enough money.”
“Hey, why would we sell those!”
“If we fail to secure AI technology anyway, those companies have no future. Once Gemini and GPT become more widespread, they’ll lose market share to big tech at an even faster rate.”
Department Head Oh could not continue speaking.
In truth, AI development was not a choice but a necessity. If we tried to supply only pickaxes, Taiwanese companies had already firmly established themselves as the old guard, and even if we defeated them, we had far too many citizens to support compared to them.
If the population was small, perhaps it would be possible to support everyone by selling only pickaxes and jeans, but if there were many mouths to feed at home, one had no choice but to mine the gold as well.
“I will absolutely secure help at the government level. Please trust me.”
In truth, this too was something not in my memory. In the future I knew, Korea had no independence in AI technology.
But if we were in the current transitional period, when it was possible to catch up to big tech’s technology with a mere 8 billion... it was worth trying. In the 1990s, Japan’s electronic devices and semiconductor technology were overwhelmingly superior to Korea’s, but in the end, we took their rice bowl from them.
After thinking for a long while, Department Head Oh opened his mouth.
“Then which companies are you going to invest in, and in what way?”
*
The Prime Minister’s residence in Yeouido.
While waiting for Lee Chanho, I called Meilin.
“Ms. Meilin, have you been well?”
—Yes~ Thanks to you, Sejun, I’m living in luxury. Lately, Representative Ming has been treating me like a princess. I don’t know what’s going on, but it seems he made an enormous amount of money thanks to you, Sejun?
“Hmm... Only like a princess? He should be treating you like a queen.”
—Really? Should I go complain to Representative Ming?
“Haha.”
After exchanging suitable greetings, I told her.
“The reason I called is that I have a favor to ask.”
—Yes, what is it?
“Please tell Representative Ming to close the short positions and switch to a buying position. He must use all the money he earned to buy Nvidi.”
—All right. But it doesn’t sound like anything that difficult, so why don’t you tell him yourself, Sejun...?
“Representative Ming probably won’t accept it. But he absolutely has to change positions tomorrow, right away.”
—Ah... So I have to monitor him again.
“Yes. And this time, I need another large sum. I sent the details to your email, Ms. Meilin. Please explain it well to Representative Ming.”
When I ended the call like that, Lee Chanho entered with a weary face.
“It’s been a long time, Prime Minister!”
Unlike my spirited greeting, he looked extremely tired.
It was only natural. By opening the agricultural market, he had lost a large number of votes from Honam. The departure of his home ground’s voter base had resulted in an administration approval rating in the 30% range, and because of that, signs of factions were slowly appearing within the party as well.
“Yes, good to see you, Team Leader Lee.”
“Have you been well?”
“They say a tree with many branches never has a quiet day, and that is exactly the situation. With 190 family members, there is no end to the ones I have to take care of.”
I fully understood his concerns. With recent by-elections approaching, the infighting within the party had grown worse.
Fair competition, graceful acceptance of defeat... It sounded nice, but how many politicians actually had that mindset? Every single one of those bastards rushing for nominations would betray the party if they were not given a seat, so the party had no choice but to worry deeply.
“Prime Minister. As it happens, I’ve deposited some money into the Singapore account. It isn’t much yet, but once funds come in on our side as well, we will continue to make deposits.”
“I wasn’t saying that because I wanted something like that.”
“Not at all. You should be able to devote yourself to state affairs, Prime Minister. It is an infinite honor for me just to be able to contribute to that.”
Lee Chanho’s face brightened considerably.
“Haha... What a waste. Our Sejun is truly too precious a talent. If it were up to me, I would like to entrust you with a key position in the party.”
“You flatter me. I will help you, Prime Minister, within the limits of my station.”
“That is why I like you even more... No, Sejun, that side of you is truly admirable. You are without greed and pure. You really are someone I can trust.”
“Thank you. And may I make just one proposal?”
“A proposal?”
I held out a single document.
“Yes. It is nothing else, but I understand the government has recently been preparing the Sovereign Project. By any chance, how much has the budget been set at...?”
“Well, the exact amount has not yet been decided, but we intend to increase R&D investment and provide indirect support. For the independent AI project, it will be around 200 billion won.”
“I see. But wouldn’t that be insufficient?”
“Well, of course it would be insufficient. They say big tech companies spend hundreds of trillions without blinking. Still, we have no choice but to do what we can within our means. But why do you ask?”
“If it is acceptable, our pension fund would also like to provide investment funds. Roughly 50 trillion won.”
“Pff— Cough, cough!”
Lee Chanho spat out his tea.
“H-how many trillion?”
“50 trillion won.”
“...You’re saying you’ll put that money into the Sovereign Project as investment funds?”
“Yes. In exchange, there is just one thing I would like to ask.”
I set down my teacup and said,
“Please allow our pension fund to participate in selecting the Sovereign companies.”