Chương 133: Book 4 - Chapter 14 C

"Jack," I said, leaning toward my head of security as we neared the elevators. I was finally escaping the boisterous crowd at the party.

"Make sure George and his team have the presidential suite for the weekend. And tell the chef to send up whatever they want. They've earned it."

"Already done, Dr Cook," Jack replied, his hand already on the elevator call button.

"The plane is ready for the flight back to La Jolla whenever you are."

"Tomorrow. I'm tired. I'll stay in the family suite tonight," I told him. In the morning I made a phone call to the Caymans. My bank there had Grandpa's pre-IPO loan, and the rest of the funds not yet taken up by interest payments. It was time to talk to my broker again. I was calling from a spare room across the hall, my key letting me open any room on the floor. The line rang twice before a familiar voice picked up.

"Rollins here," he said. He sounded older and perhaps a bit more cautious than he had two years ago.

"It is John Cook, Mr Rollins," I said.

"I trust you are having a pleasant morning in the sun." There was a sharp intake of breath on the other end. Rollins knew that when I called, the world was about to move.

"Dr Cook. It has been quite some time. I have been watching the news. The analysts are saying you are spread thin after that ARCO deal. They think you are burning too much cash on interest."

"The analysts are looking at the wrong set of books," I told him.

"I have the billion dollars from the Grand Lux bridge loan sitting in your vault. I also have the remaining cash reserves from the mortgage of my primary stocks. It is time to put every cent of it into play."

"The market is at an all-time high, John," Rollins warned.

"The junk bond market is a bit frothy, but everyone is still buying. Are we going long on tech?"

"We are going short on everything, but specifically we are targeting the airlines and the junk bond indices. The UAL buyout is the match that is going to light the fire. The banks are going to pull the plug on the United Airlines deal on Friday, October 13th. When that happens, the entire leveraged buyout market is going to collapse."

"Friday the 13th," Rollins muttered.

"That is only one week away. You want to bet three billion dollars that the most stable merger trend of the decade is going to die on a Friday afternoon?"

"I am not betting, Mr Rollins. I am informing you of a fact. I want you to start quietly accumulating put options on the major US indices. Do not use the New York accounts for the initial buys. Spread it through London and Zurich to keep the volume from triggering any alerts. By Thursday morning, I want three billion dollars in short positions across the S&P and the transportation sector."

"John, if you are wrong, you will hit a margin call on your collateral stocks. The banks will take TWP and Euro Motors before the sun sets on Monday," Rollins said. He sounded genuinely concerned.

"I am not wrong. This isn't the total collapse of 1987. This is a correction of greed. The market will drop nearly seven percent in one afternoon. We will buy back our positions at 345pm on Friday. I want that profit liquid and ready to spend by Monday morning. We are going to turn this panic into a debt-liquidation event."

"And if it does not drop?" Rollins asked.

"Then you can join me in the bread line. But it will drop. Max is sitting here looking at the ticker, and even the cat knows the numbers are lying. Start the orders now. Use the anonymous Cayman entity we set up for the TWP merger. I want no fingerprints on this." Stolen novel; please report.

"Understood, Dr Cook. Three billion on the short. I will begin the layering process through the European desks immediately." I hung up the phone and looked at Max. He was batting at a stray shadow on the wall. The world thought I was a boy who had finally bitten off more than he could chew with a thirty-billion-dollar oil company. They didn't realize I was about to make the market pay for its own funeral. The morning of October 13, 1989, started with a deceptive calm at the San Diego house.

I was in the office space in the lower house where the floor-to-ceiling glass offered a view of the Pacific crashing against the La Jolla cliffs. I could hear WBN playing on the big TV in the old wine cellar. Since I had bought and rebranded the old Financial News Network, it had become the undisputed voice of global markets. My anchors were currently dissecting the rumors around the UAL buyout with a precision that made the other networks look like they were reading from a script. Max was in a hunter's crouch.

At six months old, he was a golden blur of black spots and lean muscle. He stood nearly fourteen inches at the shoulder, his long legs giving him the profile of a miniature cheetah. His golden eyes were locked on the purple squeaky mouse in my hand.

"Ready, Max?" I asked. I flicked my wrist and the mouse sailed across the room, bouncing off a side table. Max doesn't just run, he launches. He cleared the sofa in a single, fluid arc, his front paws pinning the toy to the rug before it could stop moving.

"The news is grim for the UAL group," Bill Griffeth said from the WBN monitor.

"We are hearing that the lead banks have failed to secure the seven-billion-dollar credit line. This could be the end of the leveraged buyout craze as we know it." Max trotted back to me, the purple mouse held firmly in his mouth, his long tail swishing with pride. He dropped it at my feet and let out a sharp, chirping trill, demanding another round.

"Good boy," I said, picking up the squeak toy. I looked through the door where I could see the ticker tape scrolling at the bottom of the 43-inch screen. The Dow was starting to wobble. It was down twenty points, then thirty. The volume was spiking as the big institutional players realized the UAL deal was officially dead. I threw the mouse again, this time toward the hallway, bouncing it off the ceiling and the wall.

Max took off, his claws skidding slightly on the polished hardwood before he regained his grip and vanished around the corner.

"Panic is setting in on the floor of the NYSE," the WBN field reporter shouted over a background of frantic yelling.

"The UAL stock is being halted. Traders are looking at the airline index and the sell orders are piling up. This is a Friday the 13th that no one will forget." Rollins and his team in the Caymans were already deep into the trade. They would be selling into every minor bounce, riding the momentum as the "junk bond" fever broke. My three billion dollar short position was likely already in the green by several hundred million. Max returned, breathing a bit harder now.

He dropped the mouse and immediately rolled onto his side, his spotted belly exposed, though his eyes never left the toy. He was lanky and awkward in the way only a growing Savannah can be, all legs and ears.

"One more?" I asked. I gave the mouse a high, arching toss toward the far end of the room. Where it landed at the top of a bookshelf. The harder it was to get to the more he enjoyed it. Max scrambled up, his coordination slightly failing him in his rush, but he recovered with a spectacular leap that brought him to the top in two bounces. He didn't bring it back this time. He just slumped onto the top of the bookshelf where he landed, the purple mouse still between his paws.

His chest was heaving, and his golden eyes slowly blinked at me before his head came down to rest on his front legs.

"Too tired to continue, buddy?" I asked as I walked over and sat on the couch to watch the TV. When he didn't bring it back, it meant he was done playing. On the screen, the numbers were turning blood red. The Dow was down 160 points with less than an hour to go. The WBN anchors were talking about 'Black Friday' and the massive liquidation occurring in the junk bond market.

"The market is losing six percent of its value in a matter of hours," Bill Griffeth said, his voice hushed with the gravity of the event.

"We haven't seen a cascade like this since 1987. Someone, somewhere, is making an absolute fortune on this volatility." I smiled and leaned my back against the sofa, watching the sunset start to purple the horizon over the ocean. My bridge loan was being paid for by the very panic the experts were decrying. I popped the top on a can of Dr Pepper and then reached for the remote to see what the competition was saying on CNN.