Japan, Korea, and China are all countries that emerged from the monster house of East Asia.

The advantage of the Confucian cultural sphere is that the workforce is of extremely high quality and is easy to manage.

Basically, whenever there is a spillover of technology, these countries in the Confucian cultural sphere can quickly seize the opportunity to develop rapidly.

It took Korea only forty years to go from an underdeveloped country to a developed country.

In the 1960s, their per capita GDP was roughly the same as that of poorer African countries.

By 2004, their GDP had successfully exceeded one trillion US dollars.

Among countries within the Confucian cultural sphere, Goryeo is not the only example; there are many such examples.

Some were lucky enough to seize the opportunity for development and become developed countries, while others were not so lucky.

Annan was also unlucky; he didn't enjoy much of the benefits of the technology spillover process, and international capital began to flow back to its homeland.

As a result, just as Annam's economy was about to take off before it had even developed, housing prices skyrocketed, disrupting economic development and causing annual inflation rates comparable to Argentina's.

If you follow international economic news, you'll often see news about the Argentine central bank raising interest rates, and by several percentage points at a time.

Argentina's central bank interest rates often reach 75%.

It's important to know that even the most extreme scenario for the Federal Reserve to raise interest rates is no more than 75 basis points, or 0.75%.

The Central Bank of Argentina intervened with a 5%, or 500 basis point, injection.

Before Annam could even enjoy China's economic take-off, its capital city experienced the housing prices of China's capital city ahead of time, and also got a taste of what it's like when Japan's real estate bubble burst.

It's like doing in ten years what others take forty years to accomplish.

Japan and China have also learned from each other. During the Tang Dynasty, Japanese envoys came to China, and China's economic system in recent decades has also been modeled after Japan.

Japan is the epitome of China's strategy of using infrastructure to drive economic development.

In the early days, countries like England and America tried to boost their economies through infrastructure development, but none of them did it as skillfully as Japan.

Korea's economy is not driven by infrastructure development, but by receiving economic spillover from the United States and then seizing a few key areas to develop high-value-added industries.

Japan follows a similar path, but in the development of high value-added industries, the government's guidance is relatively weak, and the market economy plays a major role.

Korea, on the other hand, relies mainly on policy guidance. From chemicals and shipbuilding to semiconductors and consumer electronics, the traces of policy guidance are particularly strong.

Examples include the close relationship between the government and enterprises during the development period, including the targeted credit and import restriction policies of the Goryeo government.

Compared to Korea, China's policy support is nothing.

Therefore, the rise of innovative biotechnology has had the greatest impact on Korea and Japan.

Chinese automakers, relying on super lithium batteries, have squeezed out most of the Japanese auto industry's market share in China.

Japan's automotive industry is its core pillar industry, while China is its largest overseas market.

The price of losing the Chinese market was that in 2020, ten of Japan's top twenty companies were related to the automotive industry.

By 2030, of the top 20 companies, only four will be related to the automotive industry; the others will either disappear, barely survive, or be acquired by Chinese companies.

Compared to Japan, Korea has been more severely affected in recent years.

Although their economy is developing rapidly, it also faces serious problems.

That is, Korea's economy was almost entirely export-oriented, with a high debt ratio and a large amount of short-term foreign debt.

Korea's exports account for half of their total GDP.

In addition, Korea has virtually no restrictions on foreign investment.

This resulted in Korea's economic situation appearing particularly bad during the decade when major global economies were experiencing contraction.

Some might say that Japan's foreign debt is much higher, and Korea's foreign debt is nothing compared to Japan's.

That's true; Japan's foreign debt is 300 percent of its GDP.

In 2012, this figure was 219.1%, while Korea's foreign debt was only 35.1% of its GDP.

Japan's foreign debt is so exaggerated that only Zimbabwe has a higher foreign debt-to-GDP ratio.

However, the difference between the two is that more than 40% of the Japanese government's foreign debt is held by the Central Bank of Japan, while about 90% of the foreign debt is owned by Japanese banks and Japanese residents.

The money owed by the Korean government was all from the international capital market.

Because Japan borrows money from its own residents and institutions, it dares to push long-term government bond interest rates below 0.5%.

Would Korea dare to do that? The yield on Korean government bonds is almost 4%.

Therefore, on the eve of the release of the virtual reality device, the most anxious party was not Japan. Although Japan had received the news, the most anxious party was Korea.

Virtual reality technology could cause Korea's economic system to collapse overnight.

Although it's not far from collapsing now.

Samsung's market capitalization has historically fallen below 100 billion US dollars, down from over 400 billion US dollars previously.

The decline exceeded 70%.

The interest rate on Korean government bonds has approached 5 percent.

This is despite the fact that the Central Bank of Korea announced an interest rate hike.

Generally, when the central bank raises interest rates, it leads to a decrease in government bond yields.

The soaring interest rates on government bonds indicate that fewer and fewer investors are willing to buy Korean government bonds and who have confidence in the creditworthiness of Korea.

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