Waiting on the Won
The Korean won and the Korean stock market took a big hit on Friday. Considering that the salary for teachers in Korea has remained relatively unchanged for the past 10 years, the exchange rate and how well the market does plays a big factor in foreign worker's lives. When can I stop crying?
BUSAN, South Korea – Tough time for the economy here in the ROK this past week. Both for foreign folk who send their money home and for those who send their money from home to the Korean stock market. The cherry blossoms have gone, the trees are greening and already that all important green that doesn't grow on trees is withering.
While it has been on the rise this year, the South Korean won suffered its worst week in more than 14 months, falling 4.07 percent--the biggest weekly percentage loss since late February 2009. Friday was the real hurt when the won ended up at 1,155.4 per dollar from Thursday's close of 1,141.3.
Damn shame really--that ugly little dip on the chart that has me wondering when I can send money back home again.
Those days are gone so, brother can you paradigm? Can you figure out some way to set the new standard where a lagging dollar is not followed into the mire by the South Korean Won?
At least it's not as bad as that dark day of July 14th last year when the value of the won dropped to 1,307. That banner day when, over the course of a few short weeks leading up, my monthly salary dropped a couple hundred bucks with the swing of the exchange rate.
And while the won withers so doth the market. South Korean shares closed down Friday with offshore investors' net daily sales hitting a record sell-off on the Korean Kospi. It plunged 2.2%--its lowest closing since March 5. It fell to as low as 1625.83 in the morning as foreign investers offloaded a whopping 1.2 trillion won worth of shares. That is the largest daily sell-off since April 30, 1998 when the Korea Exchange first started logging foreigners' daily stock trading volume.
Luckily, the local players jumped in and propped it up--out of the goodness of their hearts no doubt, not bargain hunting. Domestic institutions and local retail investors snatched up 504.5 billion won and 483.2 billion won, respectively, nursing the Kospi to the point of recovering just above the 200-day moving average.
|The Same Ol' Same Ol'|
But who am I kidding, there are larger problems at hand. Namely this: When I first arrived on the peninsula in 2002, the going salary was about 2 million won per month. Here I am, eight years later, and the going rate is still 2 million won per month. Sure, I am making more than that now, but not much. When adjusted for inflation (and of course the swing in exchange rates) I am actually making a whole lot less than I was when I got here.
"Foreigners are not Korean: Korean society in general makes a great distinction between one's inner circle of family, friends and business colleagues, and outsiders. One should always treat one's inner circle with complete respect and courtesy, while one treats strangers with indifference. Korea is not an egalitarian society; one is either of a higher or a lower status than other people. How do foreigners fit into this scheme? The simple answer is - they don't. Foreigners are completely off the scope."
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