The Proud Shall Stumble

by Gerald N. Lund

  “And that price has already nearly doubled again.”

  Frank felt the wind go out of him, and he knew that he had lost. “Then I’m happy for you.”

  “Oh, please!” Celeste cried in disgust. “What I do expect out of you, Frank, is an apology to my father. He’s downstairs in his office. I will get him on the phone.”

  Frank laughed derisively. “In your dreams.”

  He barely heard her start to respond as something hit him like a freight train. “Wait! Celeste, the date on those stock certificates in the safety deposit box was early July of this year.”

  “Yes, I know. I saw them. Daddy, Mama, and I went down to the vault and examined them after he told me you had been there this morning.”

  “So let me get this straight. While both of us were gone in Europe, your father got into our safety deposit box, took out the old certificates, then put in the new ones, all without asking you or me first?”

  “I was in France, Frank! You yourself know how hard it was to get in touch with me. But he told Mama about it, and she approved. He changed her stock, too.”

  “That’s not my question. By law and longtime practice, safety deposit boxes are accessible only to the person who rents them. No one but the renter has access to the second key, which is required to open it.” Suddenly Frank could tell that he had Celeste’s full attention. “And that applies even to presidents of banks,” he added softly. “So how did your father get access to our box in order to change those stock certificates out? Even if he came and got our key, each person has to sign in to the vault. And only those whose names are on the account can access the box. So I ask you again, how did he get access to our safety deposit box?”

  There were several seconds of silence and then a sharp click, followed by the dial tone.

  9:19 p.m.—Westland Residence, Newton, Massachusetts

  Frank went out of the bedroom and moved quickly down the hall to the phone. He picked it up on the third ring. “Hello?”

  “Frank, I would like you to just listen. No questions, please.”

  “Oh, that sounds fair,” he drawled sarcastically.

  He heard Celeste draw in her breath sharply. “The divorce papers will be waiting for you when you return from Utah. I won’t contest the money you withdrew from our account. But I’m taking—”

  “My money, you mean?”

  “It’s a joint account. I could contest it, but I won’t. But just so you know, I am removing your name from my trust account as part of the divorce.”

  “I never considered any of that mine. I told you that back at Christmas.”

  “I know, and I appreciate that. You don’t have anything personal in the safety deposit box, so removing your name there shouldn’t be a problem.”

  “Celeste, I—”

  “Please!” It came out as a sharp bark.

  “Go on.”

  “The house is in both of our names, but since we purchased a home in Newton specifically so I could be close to my work at Wellesley, I would like to keep it. I have instructed Mr. Fuller to prepare another bank draft for you in the amount of ten thousand dollars. That’s half of what an appraiser thinks the house is worth.”

  “Your father paid for most of it in the first place,” Frank said. “Tell Fuller not to bother. I’ll send the money back if he sends it.”

  Celeste considered that for a moment and then murmured something he didn’t catch. But when she went on, the icy detachment was back. “I will be asking for full custody of Reginald, and considering the photographs I have in my possession, I assume you will not contest that.”

  “The photographs you have in your possession prove nothing except that I foolishly kissed a woman twice and that we went to dinner together a few times. But as I have thought about it, I have decided that I will not contest it. That’s only because I believe that if our son is going to have only one parent, it is better that he be with his mother than with me.”

  There was a long silence and then a very soft “Thank you.”

  “But, Celeste, I won’t renounce my visitation rights, or any other rights I have. And one of those rights is having a say in our child’s education. So if you try to send him back to that damnable boarding school, I’ll fight it with every dime I own.”

  “Then you’ll lose,” Celeste retorted. “My father will see to that.”

  “Oh, yes. Dear old Daddy. Always there to help his little girl.”

  “Good-bye, Frank.”

  He stepped forward and hung up the receiver before she could hang up on him.

  September 4, 1929, 11:22 a.m.—

  Utahza Bank and Trust Co., Salt Lake City

  The receptionist looked up and smiled warmly. “Good morning, sir. May I help you?”

  Frank smiled back. “Yes. I’m Frank Westland. I have an appointment with Mr. Brockhurst, but I’m a few minutes early.”

  “Oh, yes. He has someone in with him, but I’ll let him know that you are here, Mr. Westland.” She motioned to some leather chairs surrounding a coffee table. “Have a seat.”

  When she returned a moment later, she came over to him. “He’ll be just another minute.”

  “Thank you,” Frank replied.

  It was less than a minute later that the door to the corner office opened and what looked to be a secretary came out, followed by Aaron Brockhurst, Adelia Reissner’s father and president of the Utahza Bank and Trust Company.

  “Frank,” he boomed, extending his hand as he came up to him.

  Frank jumped up and they shook hands firmly. “Thank you for seeing me, Mr. Brockhurst.”

  The banker held up his hand. “Frank, it’s Aaron to my friends. Okay?”

  “Okay, Aaron.”

  Aaron led Frank back to his office. “I knew you were in Monticello, but when I spoke to your father the other day, he said you and your son would be going back east by way of Denver. So your call yesterday came as a surprise.” Aaron took his seat behind an expansive walnut desk and motioned for Frank to take one of the side chairs.

  “Slight change of plans,” Frank said. “First of all, I have decided to leave Reggie with his grandparents until Christmas. Things back in Boston are . . . uh . . . a little unsettled right now, and. . . . Well, he’s pretty happy there.”

  “And your family adores him.”

  “Yeah, that’s part of why he loves it there,” Frank said with a smile. “Reggie likes being adored.”

  Aaron laughed and then leaned forward, opened a desk drawer, and removed two white cards. “So as per your telephone call yesterday, we have opened up savings and checking accounts in your name.” He glanced at the card. “Five hundred to be deposited to your checking account and the rest put in savings, right?”

  “Yes.” Frank withdrew his billfold and extracted the bank draft. “But I did have a question I meant to ask you yesterday. I know it’s a little unusual to have your bank in Utah when you live in Boston.” Especially if your father-in-law owns one of the largest banks in Boston. “I don’t expect to use it often, but in case the need arises, do you do wire transfers?”

  “Of course. If you send us a telegram, we can have the money sent to any bank with wire transfer facilities. You’ll have your money in a couple of hours.”

  “That’s perfect. Thank you.” Frank handed the bank draft across the desk. As Aaron took it, he pushed the two cards across the desk to Frank and removed a pen from its holder. “If you can sign both cards there at the bottom, we’ll get this deposited for you.”

  Frank signed them, and the banker got out of his chair and took the cards and the bank draft and went to the door. “Wendy?”

  An attractive young teller came over. “Yes, Mr. Brockhurst?”

  “Will you deposit this for Mr. Westland, please, and—” he turned to Frank. “Do you need any cash today?”

  “N
o, I’m fine.”

  He turned back. “Just the deposit, then. Five hundred of it into checking, the balance into his savings.”

  “Yes, Mr. Brockhurst.” The girl took the papers and left.

  Shutting the door again, Aaron returned to his seat. “So you’re going home via the northern Union Pacific route instead of through Denver?”

  “Yes. I decided that since I was coming this far north to see you, the northern route looks a little shorter from here. And it will give me a change of scenery on the way back. Anything to change the monotony of three days on a train.”

  “It’s a big country.” Mr. Brockhurst sat back and laced his fingers together across his stomach. “All right, Frank. You said you had some questions for me. How can I help?”

  “Well, there are two or three things, actually. Thank you for making time for me. Some of it has to do with what you talked about in the meeting Dad and I attended here last June. I’ve thought a lot about what you said, and to be honest, that’s why I decided to bring my money out here. I like your conservative philosophy and the more cautious approach to investments in these boom times we’re experiencing right now.”

  “I appreciate you saying that, though I would have thought that your father-in-law’s bank would be pretty conservative too.”

  Frank smiled faintly. “In some ways they are, even more than you, but they’re also pretty aggressive in their investment strategies.” If only you knew just how aggressive.

  “They’re not alone in that,” Aaron said. “We’ve lost several customers because they don’t think we are aggressive enough. And you can see why. The stock market is still rocketing upward. When we met last June, I was sure we would soon see a correction in the market and that things would level out. But shortly after that, the Dow Jones hit two hundred and eighty points. Then two ninety. This week it broke three hundred points, the highest level in history. And still it climbs. It’s like a shooting star, streaking across the sky, and everyone wants to get a pailful of some of that stardust.”

  “But not you?”

  “Oh, yes. We have some investments that are doing well, but we keep our eye on things very closely.”

  “Okay. That’s one of my questions. What do you look for? How do you know when it’s time to back off?”

  Aaron chuckled. “Well, this is probably going to sound a little quaint, but I keep my eye on what I call the level of confidence.”

  “Level of confidence? Is that some kind of data matrix you use to track how things are going financially?”

  Mr. Brockhurst laughed softly. “No, it’s just good old-fashioned common sense, which incidentally is not as common as it should be. It’s an Aaron J. Brockhurst thing. I’ve been doing it for years, and I find it to be one of the most reliable indicators out there.”

  “I’d like to hear more about it.”

  “All right. Here’s an example I like to use. It has to do with a bank failure, but the principle applies to the stock market and other investments as well. Bank failures are pretty common nowadays. There are about thirty thousand banks in the United States, Frank, and about five thousand of those have shut their doors in the last few years.”

  “Whoa! Five thousand! Really?”

  “Yeah. And while there are typically weaknesses in their financial structures, or sometimes it’s outright fraud, in most cases the failure comes about because the confidence level of the bank’s customers drops sharply. So here’s my analogy. Let’s say that we have a farm out in the Midwest somewhere. This is a small farm owned by Farmer Bill, a hardworking, fairly successful farmer. Not far away is a small town we’ll call Plainsville. Plainsville has its own bank, what I call a Mom and Pop bank owned by Banker Bob and his wife, who are the most prosperous family in Plainsville and highly respected.

  “One day, Farmer Bill comes into town late in the afternoon. He goes to the bank to make a withdrawal. To his surprise, it has already closed for the day. As he peers through the doors to see if anyone is still inside, he sees Banker Bob in what appears to be a compromising embrace with a young female whom he assumes is a teller in the bank. We shall call this female Miss Cutie.”

  Frank found himself chuckling. This was hardly what he had expected from this sophisticated banker in a business suit. “Got it,” he said.

  “Well, Farmer Bill is very upset when he sees this. It appears that Banker Bob is up to no good. Plainsville is an upstanding community, and such an indiscretion is scandalous. And scandalous is not a word you like to hear applied to your banker. So that night at home, Farmer Bill tells Mrs. Bill what he saw. She too is horrified and suggests that they immediately take all of their money out of Banker Bob’s bank. At first, Farmer Bill thinks, Don’t be ridiculous. This has nothing to do with the bank itself, and besides, the next nearest bank is twenty miles away.

  “But as he broods on that all night, another thought comes to him. What if Banker Bob decided to run away with Miss Cutie and absconded with all of the bank’s funds during the night?”

  “That would indeed be terrible,” Frank grinned.

  “So, first thing next morning,” Aaron continued, “Farmer Bill goes to town and withdraws all of his money. As he is returning to his pickup truck, he sees his old friend, Farmer John. ‘John,’ he says, ‘you’ll never believe what I saw yesterday,’ and he whispers the whole thing to his friend.” Aaron stopped and looked at Frank. “What do you think happens next?”

  “Farmer John goes right into the bank and withdraws all of his money, too.”

  “And why would he do that?”

  Frank was nodding. “Because he has lost all confidence in Banker Bob.”

  “Correct. Well, very soon, down at the town drugstore, Farmer Bill and Farmer John have a crowd of people around them. The owner of the hardware store. The barber. The grocer.”

  “And next thing you know, you have a run on the bank,” Frank broke in.

  “Yes, and this is not good. Why? Because it is a rare thing for a bank to have enough cash on hand to pay every one of its customers everything they have in their savings. Banks make their money by taking your money and lending it out at interest. And by law, banks are only required to keep a percentage of their total assets in cash reserve. So we have a very bad situation in Plainsville on this summer afternoon.”

  “I think I see where you’re going with this.”

  Aaron smiled, obviously enjoying himself. “So by three o’clock down at the bank you have a very angry group of citizens demanding their money from Banker Bob, who is trying to explain why he can’t give everyone their money. Things are very tense. But just then, Mrs. Bob comes strolling up with a beautiful young woman in tow, whom she introduces to everyone as her niece from Chicago who has come to spend the summer with her and Banker Bob.”

  Frank slapped his knee. “Miss Cutie?”

  “Exactly,” Aaron drawled, thoroughly enjoying himself now. “When Miss Cutie runs up to her uncle and gives him a big hug, the mood of the crowd instantly changes. Everyone feels a little foolish, they put their money back in the bank, and all turns out well in the end. And all because. . . .” He nodded at Frank to finish his sentence.

  “All because their level of confidence in Banker Bob has been fully restored.”

  “That’s it. And please note that it doesn’t matter if the rumors or true or not. If people believe they are true, the confidence is gone.”

  “So apply that to the stock market,” Frank said.

  “Stocks are much more complicated, but the principle works the same. Why do you ask? Can you give me an example of what concerns you?” Aaron asked.

  Frank hesitated but then decided to lay the whole thing out for him. “I have a specific case in mind,” he began, “but before I tell you what it is, I need to ask you a question. Is there a banker-client privilege of confidentiality, just as there is with lawyers and their clients?�
�

  “Absolutely. I cannot share anything you share with me without your express permission.”

  “Good,” Frank said, “because this involves my father-in-law.”

  Aaron’s eyebrows shot up, but then he nodded soberly. “I’m listening.”

  12:03 p.m.

  Frank sat back, relieved to have it all out. “So, what do you think?”

  Aaron leaned forward, putting his elbows on his desk. “Well, let me get to what I think some of your questions are, then you can ask me anything else you want. Okay?”

  Frank’s head bobbed once.

  “Let me guess your first question: is your father-in-law a crook?”

  Frank coughed. “Well, that’s not exactly what I meant, but. . . . Yeah. Has he been breaking the law?”

  “No,” Aaron said. “He has been bending some of the rules—selling your wife’s and your mother-in-law’s stock without prior permission, getting into someone’s safety deposit box without them knowing it.” He frowned. “That alone could get him in real trouble if you pressed the matter.”

  “Which I won’t, because. . . . Well, I think you know why I won’t do that.”

  “I do, and to be honest, I wouldn’t recommend it, and here’s why. Number one, there is no fraud involved here. It’s not like he took the money he got from the sale of their stock and absconded with it. Just the opposite is true. He has made them a great deal of money. The courts would definitely take that into account. Number two, this was his family, and not just any bank customer. He might get his hands slapped by bank examiners, but that’s about all, because, number three, in the United States right now the government has what we call a laissez faire policy.”

  “French for ‘don’t interfere, let things take their own course,’ right?” Frank asked.

  “Yes. I like that philosophy in many ways, because too much government regulation and interference stifles business, but it also opens the doors for a lot of opportunists to take advantage of others.”