How the Chaebol Crashed South Korea in 1997

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[@OpinionatedMatt]

Never heard of an IMF bailout that was well received or wasn’t controversial

[@johnl.7754]

Because the bank/IMF has different objectives (get money back) than the borrowers (growth) but as the lender of last resort it’s the fault of the borrowers for having to turn towards them.

[@OpinionatedMatt]

@@johnl.7754 but the IMF is not a bank per say, it’s an international institution created to promote growth, economic stability, reduce poverty in developing countries and so forth. But even when desperate countries resort to it ultimately their economy doesn’t seem to enjoy any particular benefit from it, at all.

[@3dcomrade]

In all fairness. So long the debtors can finance it and keep spending under control, its going to work even if it hurt. South Korea and Indonesia today is not hellscapes

[@RD-fb6ei]

It’s easy to be generous with other people’s money.

[@thewingedringer]

@@RD-fb6ei not your money, so dont cry

[@WormBurger]

The reason I love your channel is that even in videos on topics I thought I already knew some things (and thats very few videos, i might add), I end up learning things I never knew existed.

[@travis5867]

Just wanted to add that i love the sprinkles of comedy throughout as well. It adds a really nice element to the videos, especially on complex and hard to understand subjects.

[@jddes]

Lots of great compliments in the comments I agree with, but I haven't seen anyone mention your subtitles. They're perfectly in sync every time I need them. Your stuff is just so on point

[@vladilenkalatschev4915]

The quality of South Korean textiles and leather goods was very good back in 90s. We lived in Kyrgyzstan that time and I remember that goods from ROK were highly valued in post Soviet republics. Wigs, looking glasses, leather jackets, suits, pullovers… but not electronics and vehicles

[@parkerbond9400]

Here so early the Chaebol is still controlled by the government

[@williamnemmers2583]

Thankyou for taking the time and making the effort for these videos. I find South Korean political and economic history absolutely fascinating. I was stationed in Daegu and Chinhae for the four years I was there. There is so much underneath the surface when it comes to these topics.

[@thethirdjegs]

Maybe it's Maybelline

[@RERM001]

I had to turn on the subs because it had been decades since I last heard that sentence and was like "did he say that?"

[@freethinker3575]

@@RERM001 same bro, i did same thing hahaha

[@careycummings9999]

His flawless deadpan delivery is what makes these so great. I look forward to finding them every video.

[@RERM001]

As Riddick once said "Family is the answer".

[@xyinterrupted]

All about faaamblyyyy 🏎️💨

[@JK-qi7pp]

There is a real worry about this exact topic, because we are once again in an era where a lot of Chaebol business models aren't profitable enough to keep this house of cards going. The conditions for the employees have improved greatly, although there is still a lot of room for improvement and no one seriously wants to see the government heavily interfering in private businesses again. However we are still waiting for the time that South Korea's policymakers enforce the letter of the law onto the Chaebol. Any time in recent memory that things came to a head some backroom deals were made, too big to fail may not be universal anymore, but it's definitely still the norm.

[@C4rb0neum]

Looking through some of the biggest South Korean companies on Yahoo Finance, debt to assets look fine though. Maybe I’m missing something

[@kindnuguz]

Your videos are the only ones on youtube I watch from the beginning to the end, every word. Thank you

[@leedehao]

Your Maybelline joke just made me spit out my coffee god damn it was hilarious and unexpected

[@rory4989]

He’ll get ya everytime like that. No beverages during asianometry videos

[@horseloverfat6938]

quirky perspectives, impeccable analysis, droll wit - you sir are a gentleman, a scholar and a rare jewel on youtube. thanks as always!

[@dziban303]

I love this channel. Great video about an interesting subject I wouldn't hear about elsewhere

[@Brighton24601]

Is that Charles Bronson as your photo? What a guy. Death Wish 3 might just be the best bad movie ever made.

[@dziban303]

@@Brighton24601 yeah lol, from Once Upon A Time in the West

[@Kylefassbinderful]

Your videos are a big part of why I pay for KZbin premium. Thank you for delivering essays on subjects that I wouldn't normally know about. I hope to stay a Patreon supporter for many years. Anyways that's it, have a good night!

[@Ray_of_Light62]

Great summary, Jon. Thank you! Anthony

[@TheGangsterousG]

These are the types of videos which make me consider this one of the best channels on KZbin. Thankyou

[@kimyseock]

minor correction needs, assassination attempt on Cheon doohwan was not before a trip to burma. it was during visit to Burma.

[@alanywalany6460]

Higher growth under Chun very much comes down to fact that the economy entered a more advanced stage; a stage it would've entered no matter if Park lived or not since the stage had been set by Park.

[@reubennelson4086]

You mean wouldnt?

[@alanywalany6460]

@@reubennelson4086 No, would've.

[@julianpark390]

I do wonder if without Chun and specifically Kim Jae Ik’s economic reforms Korea would’ve not moved up the value added ladder a la Thailand

[@beverlyhills7883]

Bloody excellent content, as always. I have to pause & rewind a few times to better appreciate the content. Thank you Asianometry.

[@Gabriel250100]

Maybe I don't know much about South Korea economy or your video deserves a part two showing how they are so strong with Hyundai owning Kia, Samsung being a giant and with LG totally dominating some markets, like screens. As always, awesome video

[@rollinwithunclepete824]

Ho-Hum! Another great video from Aisianombetry! Jon, your videos are always worth my time to watch .. AND learn from them.

[@Jupa]

They are so incredibly shrewd, it’s actually beautiful in a manic sort of way

[@RinoaL]

I actually have been planning to ask my south korean friend her opinions about south korean politics new and old. Although when we last talked I decided to ask her about their power grid switching to 220v instead.

[@AddyEspresso]

If you think about electrical power for longer than fifteen minutes your realize 220V is the only option that makes any sense

[@RinoaL]

@@AddyEspresso I disagree, 400v works for a lot of things as well. One of the buildings I maintain uses 5,000v AC to transmit power throughout the network as well. 120v is nice for tiny stuff, 220v is nice to bigger things, 400v is great for machines, and 5,000v is nice for pure transmission.

[@hailexiao2770]

​@@RinoaL 115V made some sense back when copper was cheap and insulation expensive, but now that it's the other way around it was a bad choice in hindsight. That being said, I think the right decision today in 115V countries is to put in more 230V outlets using both phases instead of reserving them for dryers, stoves, EV chargers, etc.

[@RinoaL]

@ For houses I actually recommend transitioning to DC 48v for solar tbh. It doesn't really make sense to convert the US to 230v since the 110v works fine for most things, and generally things shouldn't consume enough power to matter. A gaming computer should aim to only take 250W

[@AddyEspresso]

@ What are you talking about. Power supplies are 650 watts.

[@cbaurtx]

Great. On a totally different subject: please do a video on transmeta and the transputer

[@aryehyehudahajzenberg9503]

Oh ! Thank God ! Jon and Asianometry are back ! Happy New Year and Welcome Back ! Keep up the excellent work and may God bless you always !

[@termidzimahmod8806]

17:33 "maybe it's maybelline" that sneaky..

[@Martinit0]

Turkey also has some Chaebols, Koç Group being a well-known one. They manufacture Ford cars in license and there is even the well-known Koç University. Sabanci Group is another Chaebol - they also have a university. Would be interesting to make an episode on Turkey and it's economy - given it's a predominantly Asian country it would be on-brand, too. They also have an interesting case of large military research and manufacturing base: Turkey is producing F16 fighters in license and more recently we saw their Bayraktar drones successfully operate in the Ukraine war.

[@vincei4252]

Never get high on your own supply. -- Elvira, Scarface.

[@cris1735]

Homegrown company > Multinational company Chaebol > some foreign company

[@WenceslaoMartinez-q1g]

This ended too soon. I miss 5 more years to see how things improved That's how interesting it was, I wanted more. Thanks!

[@brentkellogg9977]

I remember the AFC and how ordinary Korean citizens responded w acts of personal sacrifice in a shower of patriotism. Many tens of thousands sold family gold to aid the government during this time. It was remarkable and stays with me even today.

[@MrMatklug]

in brazil there was the matarazzo group, he made the first wheat flour factory and soon after he had to make a factory to make the bags for the flour

[@cjay2]

Wow. Highly-detailed video history of the economics of SK that affects the rest of the world as well. A lot of work went into this. Thank you.

[@CarthagoMike]

Interesting how the core concept of Chaebol can technically also be applied to Philips. Same with the downturn of Chaebol, which in Philips case can be seen in 'operation Centurion'.

[@sungi_ni]

17:51 the maybes killed me 😂 still appreciate your research into this topic, some answers will just be impossible to find ..

[@user-zo2ge3oe8d]

Yoon Suk Yeol is my bias

[@EdS-c1n]

Even though a Chaebol is made up with family releations. Would you compare a Chaebol to a US monopoly or a conglomerate like what GE was?

[@tanker242]

How dare KZbin keep this from my feed for 43 seconds!

[@frank_1991_]

"Maybe its Maybelline" that brought back so many memories

[@LeftHandedAsians]

Part 2 please!

[@shaider1982]

Chaebol sounds like the Zaibatsu of Japan.

[@merzibow]

Great work, super informative.

[@user-85903z]

I had read that the Korean Central Bank was just 2 days from depleting all its reserves.

[@antiquehealbot6543]

One of the factors that effected the economic crash in 1997 was USD-KRW pegging. This gave Korean and foreign lenders false sense of security on USD nominated debt.

[@onlinesongscs]

Another great one, thanks brother.

[@klauszinser]

Well done. I did not know in that detail. It was mid of the 1980's when South Korea opened to Market economy. Eastern Europe started around 1990 after the Soviet Union broke down in 1989. China at a similar time.

[@freethinker3575]

18:30 "Perhaps their managers got high on their own supply" 😂

[@peterpayne2219]

Outstanding topic! Have you done something about the zaibatsu in Japan? Also, you should show us the kanji when you talk about something, we white boys can handle a few kanji.

[@joesligo1516]

got me saying chaebol all funny now, like I got a little je ne sais quoi under my tongue, a little voulez-vos if you will.

[@Maddin1313]

"Folding Chaebol" - Rich Evans

[@ZontarDow]

Everyone knows that Korea needs to break up the chaebol for the country to truely prosper, but they're also afraid of the short term cost of doing it. If this problem had been handled in 1998 Koreans would likely be rich enough to be compared to a US state, something limited mostly to city states.

[@julianpark390]

1. Korea doubled its GDP from 2000 to 2007, maintaining a very respectable (real) gdp growth of 5% during that time. It also weathered the 2008 crisis fairly well. I don’t think there’s enough evidence that breaking up the chaebols would’ve lead to greater economic prosperity than what they already have, considering Korea already became a developed country by the early to mid 90s. 2. Korea’s current economic malaise is because of two related problems: their extremely old population and the Seoul Republic phenomenon. The Korean government hasn’t seriously invested in decentralizing from Seoul, and as a result even Busan, the second largest city’s population has dropped 15% from its peak in 1990. Plus, demographics is what did Japan in the same year and Japan doesn’t have the chaebol ‘problem’ that Korea has.

[@SRNT_SE]

Just as I was about to go to bed, why you gotta do me dirty like this Jon? Joking aside, looking forwards to another video, but will save it for the morning!

[@jburron]

You missed the part about Park Chung Hee getting assassinated in 1979. Not universally loved.

[@hugoboyce9648]

Great video as always!

[@burprobrox9134]

I think this is your best video yet. Very well paced

[@johnniewalker7628]

Please make a video how China’s BYD, shipyards and SMIC are impacting S. Korea.

Why did the overcapacity lead to export caps being imposed? Wouldn't you want to export more, when you have extra capacity?

[@FredericoMirandaBrandaoAlves]

Oil refinery requires raw petrol to be refined. I think they placed an export cap on the raw materials, so that the local companies do not have to compete at global prices for them.

@FredericoMirandaBrandaoAlves I don't think South Korea has much raw oil?

[@be12]

Could it have been under US, er, guidance? It's the biggest export market and has been imposing quotas since the fifties.

@@be12 Perhaps. Though those would only be quotas for exports to the US, not general export restrictions. But our host might have been a bit sloppy in his wording, I guess.

[@hmson4378]

Excellent analysis. lets get an Episode continuing where this one ended: the chaebols influence, system and Power of today.

[@samblue9798]

This ended in too much of a vague way.

[@kevinbarry71]

what you say about Koreans blaming the West for the results of the IMF bailout are certainly true. In my opinion it's a sign of the childishness of Koreans. The results in the consequences are strictly the results of decisions made by Koreans. But it's easier to blame somebody else

[@konst80hum]

Note please that IMF mandated laws and deregulation impact most the lowest earning segments of society, who often rely on a single source of income and have little opportunity of social and economic mobility. The elites can find other revenue streams or migrate to countries where their skill are welcome. Not so the poorer folks. Thus hatred.

[@kevinbarry71]

in that case they should blame the people whose fault it is. Their government and their economic leaders. to be fair, I think Koreans have gotten better over the years at figuring out where the fault lies

[@konst80hum]

@ Not to be adversarial, but the government and their leaders are the ones who control the media and can definitively paint what picture they want and feed it to the masses. Glaring example being the Brexit misinformation campaign. If you control the flow of information you control the people.

[@Bada-mz5jk]

Its an asian thing called "save face" 😅

[@geographicaloddity2]

This explains a lot of what I've observed about Korean products. Thank you.

[@malcontender6319]

2:10 WHAT. That's what LG stands for?!!?

[@SebastianKurek]

Yup, the result of a merger between Lucky Chemical and GoldStar in 1995. Had some GoldStar gear back in the day - a CRT TV and a multimeter.

[@TheGreatAtario]

Aw, we're back to saying "dram" instead of "dee ram"

[@matthewbarry376]

You should do a video on either Quinn group or CRH - Consolidated Roadstone holdings.

[@SB-qm5wg]

I never hear much bad press about US client-states. Working conditions in pre-democracy S.K. were awful.

[@BilTheGalacticHero]

Another outstanding video.

[@3dcomrade]

Will you cover the East Asian financial crisis's impact on SEA? Considering Indonesia fared the worst being the most corrupt country in the region at the time. Not to mention the 1988 deregulation that sow the seeds for the crisis later

[@michaelfabrizio6225]

(Jun 11, 1977) - Jimmy Carter's decision to withdraw ground troops from South Korea goes back at least to January, 1975, and the earliest days of his campaign for President...

[@philippepanayotov9632]

Fantastic video! I learned a lot from it.

[@jannegrey]

That's quite famous story. Though IDK if many people know about it.

[@YoY664]

was wondering if you'd make a video on the asian fin crisis and the policies govt's used to pull themselves out. Thank you man.

[@analogdesigner-Jay]

Wow, what a great mini documentary, thanks!

[@deathshand6971]

I wish we learned this stuff in school here in America, South Korea is one of our key partners and they just gloss over Korea with a single sentence "We fought the communists there" and then they spend 6 units on Vietnam and act like "there was no foreshadowing for this, so unprecedented was the brutally" as if the South Koreans along with the US didnt literally fight tooth and nail in similar conditions and situations and for similar reasons like 'Nam. Thank you for your videos!

[@leonard8299]

Don't forget SKorea also participated in the Vietnam war for a massive economic stimulus and free military equipment from the U.S

[@deathshand6971]

@leonard8299 This I did not know. Honestly, I'm sure Uncle Sam would have showered them with equipment anyway given how strongly held the domino theory was, but it tracks.

[@FiredAndIced]

@deathshand6971 Most education curriculums around the world have omitted segments of their history or an overarching (series of) chapter(s) dedicated to a certain ideology[1] and therefore it is unusual for you to have gaps in understanding your country's role in history[2]. Notes: 1. For example, a large part of Malaysian history curriculum is dedicated towards the history of Islamic civilizations. 2. As an aside, when I came into the next level of my education they skipped out on covering the 1824 Anglo-Dutch Treaty because the narrative that they want to produce is that the British had been the backbone to my nation's prosperity, and they do not want insurgent/irredentist ideas about how the European Scramble [to Africa or Asia] has divided maritime Southeast Asia forever. Consider my nation's sandwich between two major neighbouring (maritime) neighbours.

[@deathshand6971]

@FiredAndIced True, and its sad that the ommission of important events in history that give contextual information on why nations and people as a general whole do what they do and how it leads to so much ignorance, especially in my country of origin. It doesn't help that my country has done so many backstabbing terrible things to many groups around the world that it creates an image that every American is like that. It doesn't help we [The American People] also have the loudest soapbox that further amplifies these ignorances both on a interstate-national scale and a international-global scale. I appreciate the time and knowledge you have bestowed upon me and wish you well. It's sad to see the United States isn't the only country where ommission of history is happening.

[@joeyjoejoejrshabadu]

Americans don't even learn sufficiently about their own country. There's no space to learn about all the others

[@Aikurisu]

For a moment there I misread Jinro as Jin Roh...

[@magnetospin]

The Chaebols now seem more powerful than ever.

[@muhammadnaufalfalah]

17:54 its not kbs, its mbc

[@rory4989]

Is there a meaningful difference in Chaebol and Keiretsu?

[@mikaelsza]

The book is on the Chaebol!

[@KomradZX1989]

Maybe it’s Maybelline 😂😂😂

[@e_sence]

이제 외국채널에서도 킹무위키 사진 퍼오는구나 ㅋㅋㅋ 한국 위키피디아는 죽었나벼

[@jimtalbott9535]

11:10 - These figures are awful - but I wonder how they’d compare to the same time in North Korea……

[@Michigander269]

10:20 Thats just drowning at that point.. The objective in waterboarding is to emulate, not inflict. I think you're safe in saying they drowned him, slowly...

[@paulbush7095]

Yet another word that I will never be able to pronounce properly. Chibol, chirble, cherbor, ugh.

[@rickden8362]

He's confusing/conflating the chaebol financial mismanagement issues and 1997 Asian financial crisis.

[@be12]

Are they totally unconnected?

[@rickden8362]

@@be12 Maybe not totally, but for the most part, yes.

[@torshec8634]

1997 was a really a bad year for Asia.

[@Merle1987]

These chaebol remind me of a combination of mercantilism and communism.

[@jakedee4117]

I was thinking more mercantilism plus feudalism, you still owe loyalty to your Lord. I bet marriages within those prominent families are carefully regulated and negotiated as well.

[@hailexiao2770]

​​@@jakedee4117Under feudalism though your lord leaves you alone as long as you pay homage and support him when he goes to war. Chaebols are a lot more planned inside and out than anything feudalistic. So mercantilistic fascism (private ownership + state control) maybe?

[@edp5226]

your amazing bro. big fan

[@Headwyres]

Soviet have Chernobyl South Korea have Chaebol.... That seems logic....

[@yelowpunk]

🎼maybe it's maybeliiiiine

[@TRIEDZIIDONO]

"thusly" isn't a word thus we say "thus" I also used to say it, but it's wrong.

[@roc7880]

Eventually they came out of the crisis with steady leadership.

[@alpaykasal2902]

Maybe it's Maybeline. Yes, agreed.

[@carlosmiguelteixeiraott3643]

Today i learned what LG stands for...and some other stuff too, I guess?

[@m2useinu]

Sounds familiar

[@scottxiong5844]

History repeats itself.

[@butterchickenandnaan]

I'll call it sweatshop 😂😂

[@cyzcyt]

maybe it's maybelline

[@btbucks]

I remember this, in 99 you had the Asian financial crisis.

[@cpt_bill366]

Just in time for the new Sega Dreamcast! What a hit that was...

[@Dayvit78]

1997...

[@sarthakmunda3914]

Maybe you were hit by inspiration, maybe you have a wicked sense of humor, maybe it's Maybelline

[@JAGFG42]

Pretty short term thinking.