"Recovering Investment in Just One Year" – Why You Shouldn't Only Look at US Stock Prices Amidst the Data Center Frenzy

The most important thing to guard against in investing is 'a single large loss.' Because compound interest works on the principle of multiplication, no matter how high the rate of return is, if you hit a single large downturn, all the performance accumulated so far evaporates. CEO Gwak Sang-jun, appearing in a Jisik Inside video, emphasized that "it is more important to lose less when losing than to earn a lot when winning," and that 'investing without losing,' like Warren Buffett's principle, is the key to enjoying compound interest. Gwak added that once an account grows about 5 to 10 times, one begins to realize that a 10% return is not just a simple number, leading to a change in mindset toward seeking steady and calm profits rather than aiming for massive gains.

The 'Global Infrastructure Revolution' That Changed the Scale of the South Korean Stock Market

As of 2026, the South Korean stock market is showing a completely different pattern than in the past. Gwak analyzes this as a result of the 'global infrastructure revolution.' He explains that while past infrastructure revolutions occurred within specific regional units, the physical world is currently in the process of transforming into an 'online universe' or 'online cosmos,' and the core infrastructure connecting this is IT semiconductors. Civilization history is a history of shortening time and distance, and AI is acting as the most complex infrastructure within this flow.

In particular, the change in the status of South Korean companies is noteworthy. The South Korean market was once a small market on a local scale, but its scale has changed with the emergence of Samsung Electronics and SK hynix, which are the main pillars of global infrastructure. Gwak diagnosed that "if you combine the profits of Samsung Electronics and SK hynix, the current number one and two companies in South Korea, they far exceed NVIDIA," and that because these giant corporations exist in the South Korean market, the size the market must endure has itself changed. This means the quality of the market has begun to change into a developed-country type, to the point where the South Korean stock market appears to be in an imbalanced situation.

Explosive Demand for Data Centers and the Warning of 'Excess'

Currently, massive amounts of capital are flocking to data centers worldwide. Gwak found the reason in 'overwhelming profitability.' According to the video, citing the case of xAI owned by SpaceX, he mentioned that "they invested 15 billion dollars in data centers over one year and recovered 1.5 billion dollars in just one year." Once there is confidence that investment can be recovered in just one year, everyone is rushing into data center construction. This phenomenon has triggered enormous capital demand. The scale of power requested for data center construction in Texas, United States, is enough to reach 400GW, which is four times the total annual power consumption of South Korea (100GW).

However, Gwak warns that 'excess' may occur during this process. This is because massive capital gathers during the process of laying infrastructure, causing overinvestment, which inevitably brings aftereffects. While the margin rate of digital devices is currently very high, between 70% and 80%, Gwak predicted that "this margin rate will bend." However, he analyzed that even if the margin rate bends, the usage of digital devices itself will not decrease, and as total sales volume increases, the scale of revenue and profit will maintain a level that is one step higher than in the past.

China's Semiconductor Pursuit and the Changed Interest Rate Environment

The biggest threat to the South Korean semiconductor industry is the fierce pursuit by China. Gwak was more concerned about the fact that the performance of the existing legacy semiconductor, DDR5, is being rapidly caught up to by China, rather than ChangXin Memory Technologies mentioning HBM5 production. This is because while HBM can maintain high margins due to extremely high manufacturing difficulty, if China catches up in performance in the DDR5 market and carries out low-price offensives while securing yield, it could damage the profit structure of South Korean companies. In particular, he projected that margins could drop much faster due to such influences between the latter half of 2028 and around 2029.

Additionally, changes in the global interest rate environment are also important variables. In the past, due to the emergence of China, a low-interest rate trend could be maintained by 'exporting deflation' worldwide, but as US-China conflict and the reshoring phenomenon (the return of manufacturing to the home country) appear, prices are rising and the interest rate environment is changing structurally. Gwak explained, "The core hegemony for the United States to fight and win against China is AI, and they are clinging to data centers for this," and that such a macro flow will determine the future investment landscape. Currently, financing, such as issuing bonds, is actively occurring to build data centers, and as a result, the supply of bonds is increasing, leading to a phenomenon where bond prices fall and interest rates rise.