Kyebaram–The Culture of Money and Investment Fever in the 1970s
Eunhee Park, University of Wisconsin, Madison
Abstract: The August 3rd Decree of 1972 was primarily aimed at rescuing many ailing corporations by freezing an incredible amount of bank loans. Though its goal was ambitious, the decree revealed serious problems of the banking system as quasi-state institutions, and unsettled the public about the arrogation of state authority on citizens’ property. In 1971, 67% of urban families’ budgets were in the red. They had to address limited access to loans from banks, recurrent inflation, and skyrocketing housing prices. In spite of speculative risks, nearly 60% of households practiced RCAs (Rotating Credit Associations), or kye, with close relatives, friends and neighbors. With kye money, numerous housewives could pay off urgent debts, buy houses, and pay for their children’s college tuition.
To control the nationwide frenzy of kye, the Ministry of Finance authorized 299 mutual trust banks, or sangosinyonggŭmgo, on December 20, 1972 for “establishing the financial order, promoting financing facility for low-income families and stimulating household savings.” Though they followed the core rules of kye, it was not until the 1980s that they became popular. The regime also transplanted the ideas of cooperative credit associations, or sinyongyŏptongjohap, nationwide in the 1960s into state-led New Village Banks. Regardless of state efforts to dominate the financial industry, kye fever did not die out until the mid-1980s.
Not every state effort ended in a failure, however. Austerity campaigns invigorated domestic account bookkeeping and savings. Exemplary families (mobŏm kajŏng) and savings queens and kings (chŏch’ugwang) were awarded as a token of rational family and good citizenship. Yet, ordinary people regarded these awardees as “wizards of frugality.” Instead, home appliances sales such as TVs soared, and even a new term, the “my car era”, circulated from 1970 onwards. Investment fever emerged as salaried middle class men went on a tour for suburban fallow land for investment, and wives engaged in group purchasing at Tupperware-style home parties. As shown by these phenomenon, the culture of money stirred from kye was not regulated for the national goal of an advanced nation (sŏnjin’guk), but rather contributed to herald a new era of capitalistic modernization.
Short Biography: I am a PhD candidate in the Department of History at the University of Wisconsin-Madison. I received my master’s degree in 2008 from Seoul National University with a thesis on the Family Rites Code that was enacted in South Korea in 1973. I have long been interested in the intersections between class, gender and economy and how they affect the changing perceptions of middle class identity. I am currently writing a dissertation about middle class formation and women’s roles in the Korean household economy from the 1960s to 1980s.