"It's Not All Because of Leverage" Remarks Draw Heavy Criticism

[Anchor]

Kim Yong-beom, Chief of Policy for the Blue House, stated that the extreme volatility in the domestic stock market is not solely due to Samsung Electronics and SK Hynix leverage products and that structural characteristics must be examined. The People Power Party criticized the remarks as being out of touch with the public eye.

Reporter Kim Bo-mi.

[Reporter]

Blue House Policy Chief Kim Yong-beom, who is accompanying President Lee Jae-myung on his state visit to Brazil.

Regarding the recent extreme volatility in the domestic stock market, he remarked, "People talk as if a considerable number of issues boil down to a single-stock leverage ETF, but that is not necessarily the case."

He emphasized, "We need to examine the overall situation, not just leverage ETFs."

His remarks placed weight on the structural factors of South Korea's capital market.

At yesterday's (July 29) full meeting of the National Assembly's Political Affairs Committee.

People Power Party lawmakers criticized Kim's remarks as "sophistry intended to evade responsibility."

[Shin Dong-wook / People Power Party Lawmaker : "You are saying things like 'It's not just happening in our country.' Are these remarks fitting for the public eye?"]

They also demanded a parliamentary investigation, asking for the background behind how the product in question was swiftly approved in just four months.

[Park Dae-chul / People Power Party Lawmaker : "We diagnose this crash as a man-made disaster originating from the Financial Services Commission and the Financial Supervisory Service."]

[Lee Chan-jin / Governor of the Financial Supervisory Service : "We are taking this matter very seriously right now."]

Criticism also emerged from the Democratic Party, stating that responsibility for amplifying stock market volatility cannot be avoided.

[Kim Yong-man / Democratic Party Lawmaker : "I think it is reasonable to view that this (leverage ETF) is causing volatility right now. Do you agree?"]

Voices also called for prompt measures, such as adjusting the current 2x leverage ratio and restricting new purchases to professional investors only.

[Kim Hyun-jung / Democratic Party Lawmaker : "(The ratio) is currently 2x, right?"]

[Lee Eok-won / Chairman of the Financial Services Commission : "(Lowering the ratio) seems like it would be effective in terms of mitigating volatility."]

Financial Services Commission Chairman Lee Eok-won and Financial Supervisory Service Governor Lee Chan-jin expressed their apologies, stating that they "take the expanded volatility very seriously."

(Video Shooting: Lee Seung-hwan, Shin Dong-hwan | Video Editing: Lee Seung-hee | Design: Park Tae-young)
※ Please note: This article was translated by AI and may contain errors.