Why Wrong Pundits Sell Memberships, Not Apologies

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Subscriber, have you noticed the recent swings in the won-dollar exchange rate? The rate that surged to the ₩1,480 range in the second half of 2025 dropped back down to the ₩1,420 range by late January 2026. Now it’s back up near ₩1,480 again. For reference, I do most of my transactions in dollars, so I tend to be sensitive to exchange rates. But there are people even more sensitive than me. Just a few months ago, there were voices shouting “the dollar’s headed to ₩2,000,” “the won is finished.” So what are those same people saying now?

“We got lucky.” “The market’s gone mad.” “There’s always opportunity in crisis.” “Inverse-leveraged ETFs are the answer.”

Watching these reactions, I felt an odd sense of déjà vu. It’s a pattern I’ve seen many times before. Today’s issue isn’t really about exchange rates — it’s about why people who get economic predictions wrong sell memberships instead of apologies, and the structure behind it.

The Real Reason Behind the Weak Dollar: It’s Not That the Won Got Stronger

Let’s start with the facts. Some people interpret the recent drop in the exchange rate as “the won getting stronger,” but that’s only half the story.

Look at the Dollar Index (DXY)¹​ and the picture gets clearer. The index, which sat around 109-110 in early January 2025, fell to around 99-100 by the end of 2025 — a decline of roughly 7-9% over the year. In other words, the dollar itself weakened against the six major currencies in the basket.

Why did the dollar weaken? There are a few structural reasons.

First, political uncertainty in the United States. In January 2026, an ICE (Immigration and Customs Enforcement)²​ agent shot and killed a U.S. citizen in Minnesota. The incident triggered nationwide protests, and Democrats refused to pass the budget bill, pushing the country toward a government shutdown³​. When domestic politics in the U.S. shake, confidence in the dollar shakes with it.

Second, the Trump administration’s tariff policy is backfiring. The investment pledges extracted from allied nations haven’t materialized, and the back-and-forth on tariff rates has created uncertainty that’s translated into revenue shortfalls and political backlash.

Third, the conflict between the Fed and Trump. President Trump pressured Fed Chair Jerome Powell to cut interest rates, but Powell held rates steady instead. The Fed chair’s job is to safeguard the dollar’s value, and the economic indicators simply didn’t support a cut.

So here’s the core point: it’s not that the won got especially strong — it’s that the dollar weakened because of political turmoil inside the U.S. The Bank of Korea said as much at its January 2026 Monetary Policy Committee meeting, noting that “the won-dollar rate fell sharply due to foreign exchange market stabilization measures, then rose again into the mid-to-late ₩1,400 range.” Even the U.S. Treasury assessed that “the recent weakness of the won is inconsistent with Korea’s solid economic fundamentals.”

No national leader can control exchange rates at will. Trump can want the Fed to “print more dollars” all he wants, but if Powell doesn’t listen, that’s the end of it. Japanese Prime Minister Takaichi Sanae wanting the yen to rise doesn’t make it rise either. The currency market is where government intervention, central bank policy, geopolitical events, and shifts in supply and demand all interact at once. Calling that “just good luck” means either not understanding how markets work, or understanding it and distorting it anyway.

In particular, the FX futures market requires margin of under 5%, maintenance margin of under 3%, allowing leverage of 30 to 50 times.If you truly, definitively knew which way exchange rates would move, why would you be talking about it on YouTube instead of trading FX futures?