Park Jong-hoon, head of the Knowledge Economy Research Institute, expressed concern that the national pension's increased investment in domestic stocks, particularly in Samsung Electronics and SK Hynix, effectively places the public's retirement funds at risk, akin to investing in high-bandwidth memory (HBM).
On July 7, the economic YouTube channel PLUS TV featured a video titled "Without Samsung and SK Hynix, Is There a Downturn? Breaking the Cycle of Poverty in the Second Half of the Year." The video included discussions with economic YouTuber Shuka, Lee Sun-yeop, CEO of AFW Partners, and Park Jong-hoon.
Park began by outlining the primary role of the national pension fund, stating, "The most important purpose of the national pension is to generate significant returns, not to stabilize exchange rates or foreign exchange markets. Stabilizing the market is a secondary role." He criticized the recent decision to increase the domestic stock allocation as a departure from established investment principles.
He noted, "The fund has traditionally operated based on scientific verification and principles, but this time those guidelines have been broken. With the domestic stock allocation nearing 30% and the KOSPI reaching 8,000, it feels like we are standing on a sandcastle rather than a solid foundation."
Park highlighted the high volatility of the domestic stock market this year, pointing out that the KOSPI has experienced significant drops, triggering circuit breakers 11 times, with five of those occurring in 2026 alone. He warned that without a specific economic crisis, such volatility could lead foreign investors to view the KOSPI as an unstable market, ultimately damaging the long-term credibility of the Korean stock market.
He identified the concentration of investments in Samsung Electronics and SK Hynix as a major issue. "If all stocks were rising together, it wouldn't be a problem, but we are currently seeing many stocks decline," he said, referencing Finland's Nokia as a cautionary example. "At one point, Nokia accounted for about 60% of the Helsinki stock market's market capitalization, and the Finnish economy became overly dependent on it. When Nokia collapsed, Finland experienced years of negative growth."
While acknowledging the positive aspects of the HBM industry, Park emphasized the need for balanced growth across the market, given the unfavorable macroeconomic conditions such as interest rates and exchange rates. He clarified that he does not doubt the competitiveness of Samsung Electronics and SK Hynix, stating, "I personally believe that Samsung and SK Hynix will achieve excellent results in the next year or two, but strong performance does not guarantee that stock prices will continue to rise."
He cited Cisco Systems as an example, noting that despite being a leading growth stock comparable to NVIDIA in 2000, Cisco's stock plummeted after the dot-com bubble burst, even as its revenue continued to grow annually. It took nearly 26 years for its stock price to recover to its previous peak.
Regarding the direction of the national pension fund, Park referenced international examples, particularly Norway's sovereign wealth fund. He explained, "Norway has a high dependency on the oil industry, but its oil fund, which is crucial for citizens' retirement, does not invest domestically. This is to prevent the simultaneous collapse of the national economy and citizens' retirement funds if the oil industry falters."
He expressed concern that South Korea has increased the domestic stock allocation of the national pension from 14.4% to nearly 30%, with Samsung and SK Hynix making up almost half of that. "In effect, we have invested the public's retirement funds in the HBM industry," he warned.
Park concluded, "While developed countries are moving towards separating national economies from citizens' retirement funds, we are going in the opposite direction. Relying on companies to manage currency exchanges is not a fundamental solution; we need to establish long-term principles regarding our economic structure."
Viewers of the video commented, "The national pension fund is breaking its principles too easily, influenced by politicians. This country can easily fall apart," and "The current state of the stock market is largely due to government policy." Others speculated that the decision to increase allocations was influenced by local elections, while some expressed concerns about the market becoming a gambling platform.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.