The Y2 Kaper

by Jim CaJacob

  He was wise enough to know that logic didn’t really apply, but that didn’t stop him from trying to figure it out.

  Val had dated a few times since his divorce, when friends set him up in spite of his requests to the contrary. He was not into the bar scene, if there even was a bar scene any more. The bar scene Val knew about was the one downstairs in the hotel lobby, the one where business travelers complained about the travails of the road to virtual clones of themselves.

  Val owed Max a report on Friday. He would talk to Wilton and Jenny first thing and decide what to say. He turned on a movie, promised himself he would exercise tomorrow morning before breakfast, and dozed off on the floral bedspread.

  Chapter 26

  Val set his alarm early to try to reach Professor Crawford before his daily schedule became unmanageable. Horace Mann Crawford had retired from the active faculty at Ohio State in 1991. Even so, he kept his normal 7 a.m. to 7 p.m. schedule in the office the University had given his as Professor Emeritus of Macroeconomics, Financial Markets; Econometrics.

  Val had had Crawford as a graduate student at Ohio State in the late seventies. Crawford was by then already a legend in the business school. The son of an Alabama sharecropper, he was born on the farm where his great-grandfather had worked as a slave. His family moved to Detroit when he was eight. He had served as a truck driver in a segregated unit in Europe, then used the GI bill to begin an unlikely academic career culminating in his Ph.D. from Wharton.

  He was in demand as a corporate board member, early on because of disequilibrium of supply and demand that placed a premium on board members who were not aging white men, later because of his competence and stature.

  Val had kept in touch over the years. For all his patrician demeanor Crawford was genuinely interested in the lives of many current and former students.

  Mrs. Luettke, Crawford’s indispensable aide-de-camp, had, thankfully, also taken a liking to Val when he was a grad student. She politely put him on hold. A few seconds later Val heard Crawford’s changeless baritone:

  “Horace Crawford.”

  “Professor Crawford, hello, it’s Val Kovalczyk calling.”

  “Mr. Kovalczyk, how is your mother? When did you last speak with her?”

  Val had forgotten that Crawford had met his mother at some reception over twenty years ago. “Fine, Professor, just fine. As a matter of fact we spoke just yesterday. Plus, she has discovered email.”

  A deep chuckle. “A rising tide of technology floats all boats, does it? Has she reached the point where she automatically forwards all jokes, no matter how hackneyed, to all electronic pen pals?”

  “You’ve got it. Growing up, I assumed she had never heard any of those bad words.”

  “To what do I owe the honor of this call?”

  Val had long since learned to take Crawford’s lead when it came to the transition from small talk to content. “Professor, we’ve just come across a situation in our work that, I hope, you could help us understand. I know this is presumptuous but I wondered if it would be possible to have dinner with you tonight to discuss it.”

  “Tonight? Give me a moment.” Val heard the phone go on hold. Crawford would be checking with Mrs. Luettke. In less than a minute he was back on the phone. “Done. I shall make a note to attend one additional supercilious faculty dinner next month as penance. May I suggest Schmidt’s? Will 7:30 do?”

  “Excellent, sir. I’ll be with a colleague if that’s all right.”

  “See you then," Crawford said, and hung up.

  Val had the hotel operator ring Jenny’s room.

  “Hello.”

  “Good morning, Jenny. Did I wake you?”

  This was a ritual. It appeared to Val that Jenny was both a morning and an evening person. He actually had no concrete evidence that she ever slept at all.

  Like Crawford, Jenny wasn’t much for chat. She waited silently.

  Jenny, I want you to go with me to Columbus today. I have a dinner meeting with an old professor who, I hope, can shed some light on what our boys might be up to.”

  “Who’s the professor?”

  “Crawford.”

  “You studied with Horace Crawford? Don’t tell me how you did in his course.”

  Val wasn’t surprised that Jenny knew about Crawford. He ignored the second comment.

  “Our flight is at 2:30. We need to leave the Bureau by 1:15 latest.”

  - - -

  Val’s policy was to upgrade on every possible flight, even short ones like the one from National to Columbus. He was at the highest frequent flyer level on several airlines. Even so, his batting average was sub-500, and with the late booking he found himself in a middle seat in coach, nowhere near Jenny.

  There was a certain code of acceptable behavior that a surprising number of travelers observed. One principal tenet was that it was never all right to recline a coach seat. If the person in front of him did so, Val’s tactic was to dig his knee into the back of the seat while feigning innocence. This was easy to sell since the alternative was to wedge each knee on either side of the intruding seat. His fellow-passengers were well-behaved today.

  Walking through the concourse in Columbus, Val noticed a subtle difference in the reaction of the people he passed going the other way. He realized that most of them were men and he was walking beside a good-looking woman. Each passing male face did a slight but observable double take. Val made Jenny divert to the store where they sold, he claimed, the best airport popcorn in America. There was an experiment on price elasticity of airport popcorn underway at O’Hare in Chicago. Every time Val went through there it seemed like the price had been bumped by another quarter. There was apparently no upper limit. They’d be taking credit cards soon.

  In thirty minutes Val and Jenny were driving down Broad Street toward downtown. Val pointed out the affluent, largely Jewish community of Bexley, surrounded on all sides by deteriorating neighborhoods of Columbus proper. Val was very uncomfortable with racial divisiveness as it applied to real estate. He couldn’t blame the people in Bexley, or for that matter in his neighborhood back home in Toledo, for wanting to keep their property values high. But that didn’t give them the right to apply de facto segregation. A friend Val knew when he was in school told him about putting his house on the market. A black man, a disabled war veteran, had looked at the home. That evening three different neighbors had knocked on Val’s friend's door and urged him not to sell. One of these neighbors had a Nazi death camp tattoo on her forearm.

  Val used his usual technique for navigating to Schmidt’s: go to German Village and drive around until you happen to see it. As a native Midwesterner Val was slightly uneasy if the street system was not rectilinear. They found it all right, parked a block away, and were inside the steamy restaurant fifteen minutes early.

  Professor was right on time, as usual. He somehow made wearing a Homburg, dark overcoat, carrying a rolled up umbrella, look classy rather than phony. The maître-de recognized him at once and led them, past a jovial crowd, to a small private room. They took Crawford’s lead and ordered a house draft and a sauerkraut platter.

  “Ms. Chen, our mutual acquaintance here has told me nothing about you.”

  “Well, Professor, this trip was somewhat last minute. I’ve been a colleague of Val’s for several years. My background is in mathematics, especially statistics. My parents are both professors at the other OSU.”

  “Aha, Stillwater.”

  “Yes sir.”

  “Levin has put together a good program there. Not the easiest task given the, ahem, enticements of the surrounding countryside.”

  “Oklahoma is an acquired taste that even many Oklahomans have some difficulty acquiring," Jenny said.

  Dinner, copious and comforting, arrived. Val noticed that Jenny tucked in with apparent relish.

  “So, Mr. Kovalczyk, how can I try to help?”

  Val explained the background of t
he assignment, their recent findings and their suspicions. He did not need to stress the need for confidentiality.

  “So, sir, I guess we’re asking what might be a low risk, high reward approach to making money from rigging these numbers? By ‘risk’ I mean both of being caught and of losing money," Val said.

  Crawford put one finger over his lips and thought for what seemed like a couple minutes. “Well, as you know, or should I say as I hope you remember, there are few independent markets. Certainly an indicator as prominent as the American CPI would reverberate through the world’s centers. Someone with unbalanced information would be able to make money in any of them. I mean, it’s the equivalent of knowing what number would come up next on the roulette wheel.”

  “Sir, we have of course considered this. But if you had to venture a guess which market might our subjects choose?" Jenny said.

  “Well, let’s think. What is the ultimate goal of these people?" Crawford said.

  “To make money. A lot of money we would guess. Millions," Val said.

  “Then I would start with where the money itself is bought and sold, on the Foreign Exchange market. The world’s eight biggest currencies are bought and sold with each other. The CPI would have a direct and immediate effect on the rates between the dollar and each of the others.”

  “Would it require a large move in the index to make big money?" Val said.

  “Goodness no. The index hardly moves at all these days, a tenth of a point or so per month if that. Back in the days of the OPEC oil shock and double-digit inflation we might have seen a big move – several points. What’s important is not the size of the move, it’s the direction compared to what the so-called experts have predicted in advance.”

  Val and Jenny waited.

  “Recall, every trader, institution or person that makes money does so directly at the expense of another trader. People have placed bets, in the form of foreign exchange futures, on all possible scenarios of how two currencies relate to one another. Every time a major index like the CPI is published the market evaluates the relative value of the currencies. No move at all may be as meaningful as a two point jump, depending on how the market has been betting.”

  “No move at all?" Jenny said.

  “Right. It’s all about expectations and realities.”

  Dinner went on for two hours, until Crawford’s driver came to take him home.

  “I hope I’ve been of some service.”

  “More than we could have hoped, sir. It’s been an honor," Jenny said.

  “The honor has been mine. I hope we have the opportunity to discuss your parents’ trip from the same Hakka village to the prairie.”

  “I hope so too, sir. Perhaps you and they could meet someday.”

  “I’d enjoy that. Mr. Kovalczyk, I assume you will remain in touch and fill me in on the denouement of this assignment.”

  “I will, Professor.”

  Later, in the car, Jenny stretched out with her hands behind her head.

  “Kovalczyk, just when I think the only people you know are shallow mercantilists you introduce me to someone like the Professor. I hope you appreciate his quality.”

  This was uncomfortably close to a compliment. Val thought his best move was to remain silent.

  “This is a man who has a made a material contribution to society, and has retained his humanity.”

  Val drove by the Ohio State campus. Even at night it looked like an aging industrial park. The challenge of finding some place for fifty thousand or so students to sit down at the same time overcame the aesthetic appeal of ivy-covered gothic halls.

  “So, Kovalczyk, where to next?”

  “Where to?”

  “Yes. Isn’t this your former stomping grounds? Aren’t you going to show me some hot spots?”

  Val felt himself blush. “Sure. I mean, are you serious?”

  “Just because I matched the good professor stein for stein, while you, and I do appreciate it, did your civic duty by abstaining, does not mean that I have lost my ability to reason! I repeat: where to?”

  “Well, let’s see. If we eliminate for the sake of argument the 90% of campus joints that feature either burgers, pizza or some combination, we’re still left with a number of places that have an intellectual bent.”

  “Can’t we just go dancing? And what’s wrong with burgers and pizza, not that I’m hungry? I tell you what. We’re near the hotel, right? Why don’t we go there, check in, and take a cab back here to High Street?”

  Val ran a yellow, smiling to himself and shaking his head.

  Chapter 27

  Val had made the three-hour drive home to Toledo from Columbus dozens of times in college. As usual he hadn’t really planned to visit his mother but for some reason felt like taking advantage of being in Ohio. He decided he could spare the time, so he dropped Jenny at the airport and headed north.

  He had only a small headache, appropriate for the more than one but less than I forget how many beers he had drunk. On any given afternoon between three and four he was at significant risk of falling asleep at the wheel – or in the conference room – but he figured he’d be OK after three coffees. He could nap on his mom’s couch. She had converted his room into a combination office and sewing room.

  Then and now he found the countryside somewhere on the boring side of serene. He wondered how, in the age of agribusiness, these farmers working a couple hundred acres could make it. Probably most of them worked at a plant somewhere too. Val spent his summer breaks from college working for a package delivery company. Each town on his route was dotted with interchangeable small cinder block factories with names like Dieco and Stirnweiss Grinding, built to feed Detroit. These places were uniformly dark, with weird yellowish light filtering in through high windows. They smelled like sweat and oil. He couldn’t imagine what it would feel like to go every day to Stirnweiss Grinding, put in eight hours with guys you grew up with in Leipzig or Ottawa Lake or New Baltimore, toss back a couple boilermakers in the same bar where your dad shattered his capillaries, and go home for the meatloaf and succotash. On the other hand, he couldn’t say that his high-tech, frequent flyer-miled life was that richly gratifying either.

  As he took the Toledo exit, he remembered his dad saying that someday he’d like to take the expressway all the way around the city. He was denied even this small gratification when he died at his desk in the Purchasing office of the Overland. People of Val’s generation and older still called the massive old jeep plant the Overland even though Willys had sold the company in the fifties.

  He got off the expressway early so he could drive along the river. He liked the big houses near Toledo Country Club. He often thought that if, against long odds, he ever moved back he would buy one. The valley was pretty enough but the view was marred by the big glass plant across the river in Rossford. Toledo called itself the Glass Capital. Owens-Illinois, Owens-Corning and Libbey-Owens-Ford were all headquartered there. Apparently Mr. Owens was a smart engineer who made some smarter businessmen very wealthy. Now OI had been KKRed into submission, LOF has a manufactured name that sounds like a word but isn’t, and Owens-Corning had gutted itself to keep from a hostile takeover. While the famous Toledo Mud Hens had the favorite team name of sports fans across the country, Val preferred the 1950s triple-A edition: the Glass Sox.

  Lagrange Street hadn’t really changed much. He wondered if the Syrian and Lebanese neighborhoods had survived. He remembered eating raw lamb kibbeh at the Beirut at two in the morning while the owner’s weightlifter sons flexed for each other. That’s probably what put Val off any serious attempt at physical conditioning.

  His mom didn’t know he was coming. He wondered sometimes whether she enjoyed his little surprise visits as much as he did. His favorite was the time that he flew into Detroit on a Friday afternoon and drove around Ypsilanti until he spotted a boat store. He bought a paddleboat and duct-taped it to the roof of his Hertz Crown Vi
ctoria. He then drove to the small lake where his parents, fulfilling a life-long dream, had just leased a small cottage. He schlepped the boat to the water, paddled across the lake in his business suit, and performed an Inchon-worthy amphibious landing. Just as he expected his folks were sitting on the porch reading their foreordained sections of the Toledo Blade. His dad swore that when his mom spotted Val approaching she simply said, matter-of-factly, “Oh, here comes Val.”

  The light changed. Just like he remembered, the pedestrians changed from black to white within a few blocks. Blood had been and would again be shed in that DMZ. Val had once read that Chicago had the least racial diversity, block-by-block, of any city in America, but Toledo had to be up there. Or maybe they didn’t analyze Toledo when they compared cities. Growing up you read the annual population rankings, checking whether Detroit was catching up with Philadelphia. Toledo was mired in the low to mid thirties, bigger than Dayton, smaller than Des Moines. He remembered being shocked when San Antonio crashed the top ten from out of nowhere.

  Mom’s LeSabre was in the driveway. One of its predecessors in the long line of Buicks had surrendered its rightful spot in the garage ten or more years ago to an impressive collection of garden tools, painting paraphernalia and birdbath parts. He decided not to let himself in the back door so he wouldn’t scare his mom. Only the screen door was closed in the front. He could hear the TV in the kitchen. He yelled “Mom?”.

  He saw his mom walk into the living room with a quizzical look on her face, which became a smile of recognition. “You. You love to surprise your mother. Is something wrong?”

  They were not a very physically demonstrative family – a kiss on the cheek was appropriate. She started to signal him to sit in the little-used living room, but he went directly to the kitchen table. It seemed like most of his mental images of his childhood were from the point of view of the chair right by the wall phone, across from the TV.

  His mom had never been a coffee drinker, but the old fashioned pot stood at the ready, as did a cache of Yuban, probably purchased in the late sixties.