Drummer In the Dark

by T. Davis Bunn

  “If you’ll just—”

  “Hang on, I’m not done here. You claim Hayek is planning to push our financial markets into meltdown, and your only basis for this pronouncement is a hacker and a lowlife flunky who’ve committed a serious felony by breaking into a fund’s trading system? How on earth do you know Hayek didn’t just plant the data, waiting for them to sneak in and steal it?” Bowers choked on his rage, then shouted, “Whatever those jackals in Congress end up doing to you isn’t nearly enough!”

  Jackie slipped her hand out of Wynn’s, and closed the distance between them. “It so happens that I’m not the lowlife in this picture, bub.”

  The man turned a choleric purple. “Young lady, get out of my face or I’ll have these agents introduce you to the local penal system.”

  She moved in closer still, forcing him to stare up or back away. “You try that condescending tone with me once more, and I’ll use your tie for a noose.”

  Bowers rounded on Wynn. “This is our contact? This is the star lead? A woman with no credentials you’ve got the hots for?”

  Jackie reached over, gripped the little man’s lapel, and swung him back around. “If you’d manage to shut up and listen for two seconds you might learn something you can use!”

  Wynn offered, “Why don’t we all ease off a notch here.”

  Jackie ignored Bowers’ futile slapping at her grip, and kept him drawn in close. As the agents hustled toward them she hurried to say, “We know the data wasn’t planted because we used a trader’s own entry code to tap into Hayek’s mainframe!”

  Two sets of arms pinned her and dragged her back. She might as well have been chained to stone peaks. She shrieked at the man, “Hayek isn’t running two funds. He’s got three.”

  “Wait. Let her go.” Bowers shrugged his jacket straight. “What are you talking about?”

  “First you tell these goons to back off!”

  “It’s all right, gentlemen. We all just got a little carried away.” Bowers took a single step forward. “Three funds.”

  “That’s right.” Jackie turned and called back up to where Colin still stood in the doorway of the jet. “Get on down here!”

  He showed no interest in budging. “I’m just fine where I am, thank you.”

  “Colin Ready is the one to explain the details. I just interpreted what he found.”

  “Let’s just stick to you for the moment.” Another cautious step. “Three funds.”

  “As far as I can tell, it’s the old shell game. Hide the pea with sleight of hand, right?”

  A trace of the man’s bullish nature resurfaced. “We’re talking billions of dollars here, young lady.”

  “The name is Havilland,” Wynn snapped. “Use it.”

  Jackie took small comfort in Wynn’s presence. “Hayek supposedly has all his resources committed to the dollar, and he’s bought billions.”

  “Correct.” The bank official showed the root cause of his ire, drawing out a handkerchief, wiping his hands, massaging the cloth until it knotted up and disappeared. “We can’t even determine how much he has acquired. But what makes it worse is how the entire market has followed suit.”

  “Which is exactly what he planned. Today Hayek is planning to dump his dollars. Soon as the market opens. All of them.”

  Bowers’ face resembled a drain whose plug had been ripped away. “He’ll be massacred.”

  “Not,” Jackie replied, “if he has another team waiting in the wings to buy them back.”

  THE K STREET CLOCK ticked to a faster beat than the rest of Washington. By the time the Beltway and local Interstates experienced their daily dose of gridlock, most of the lobbyists had been at their desks for several hours. Even so, Valerie hired a caterer for this particular dawn conference, since many of the senior figures in attendance were unaccustomed to the rigors of K Street attack mode. Behind the boardroom table ran a buffet of smoked salmon, eggs Florentine, baskets of fresh bread, whipped butter, fruit salad, and stacked briquettes of filet mignon. She waited for the team to settle down, then said, “Last night I was invited to a function at the Press Club. They were doing a charity roast of the Vice President. Midway through the evening, I was cornered by Senator Alfons.”

  She resisted the urge to beam, their response was that strong. Hands up and down the table were trapped midair by the news. Senator Alfons of New York was one of the President’s staunchest allies. New York was also key to the President’s chances of reelection. She reveled in the spotlight of anticipation a moment more, then announced, “Alfons is coming out against the amendment.”

  “All right.”

  “This is dynamite,” another agreed.

  “The timing could not possibly be better,” Valerie went on. “So far as we know, the committee will have a vote on the bill this very morning. Before they meet, we need to muscle our way into as many offices as possible. The Department of the Treasury, the Council of Economic Advisers, and the White House staff. They all need to hear the same message—this amendment critically damages America’s sovereignty, and backing it will do irreparable harm to the President’s chances for reelection. The President can’t afford to come out on any side but the senator’s.”

  “Anybody who votes for this thing,” her former boss predicted, “will earn themselves a one-way ticket back to Iowa.”

  Valerie leaned back, sipped from her cup, smiled at chatter she scarcely heard. The senior partner seated midway along the table gave her a fraction of a nod. Things were definitely going her way.

  “HAYEK IS PLAYING a high-finance version of the old shell game,” Jackie repeated, swiveling around in her seat so she could take in Wynn and Bowers in the back. “Switching the pea around in plain sight, but moving back and forth until the placement is lost.”

  She pointed behind them, to where Colin rode in the next car. The snarled traffic had them jammed in so tight she could see the worried pinch to his pale features. “Colin Ready told me how Hayek had built a second trading floor above the main one. He brought in this new team everyone hated, then seemed to climb down again and move them over to this bank he had acquired. At least for a while. But both funds kept growing at this incredible rate, and this week Hayek tells them the bank doesn’t have enough room, they had to bring these new guys back over. But with both funds awash in new money, who’s going to complain?”

  “Hayek’s ownership of First Florida has not been officially confirmed,” Bowers said, his bark muted but still in place.

  Jackie paused long enough to give him a look, then continued, “It wasn’t until last night that it all finally fell into place. I’ve been wracking my brains trying to figure it out. Then it hit me. Something Colin said sparked it off. How there was still activity going on over at the bank. A lot of money being kept in abeyance. Not even listed on the books. Held in offshore accounts, just waiting for Hayek to give the word.”

  “You’ve lost me,” Wynn confessed.

  “It was a trick perfected by Rothschild. Back in the early 1800s, he was the king of the European financial world. Whatever he said basically was followed by the entire market. Just before Napoleon’s defeat at Waterloo, all the banks were wondering if this was the end. Rothschild said nothing, but word spread that he was selling. We’re talking serious panic, getting rid of everything he owned, switching to gold bullion and diamonds. Exactly what you’d expect if you had to flee a nation about to lose a war.” Jackie squinted tiredly into the rising sun. “The markets just tumbled. But what they didn’t know was Rothschild was secretly buying everything back at fire-sale prices.”

  Bowers demanded, “You’re telling us Hayek owns a third bank?”

  “He doesn’t need one. A huge trading floor is required to handle different kinds of trades, and do them fast. But if all you’re handling are forward contracts through the Interbank, a handful of traders could dispose of billions in a matter of hours.”

  Bowers leaned forward, snarled at the driver, “Can’t you make this traffic get ou
t of our way?”

  Agent Welker was senior enough to remain languid in the face of Bowers’ ire. “Sir, unless you’re in the President’s own convoy, the only way to get the Washington rush-hour driver out of your way is with a gun.”

  Bowers drummed on the window, ground his teeth, finally decided, “We’ve got to act. I don’t like it, but we can’t take the chance you’re right. I’ll have my people start gathering a team. But we can’t hit the markets based on this kind of evidence. We’ll just have to wait and see if Hayek starts dumping dollars.”

  Jackie’s eyelids felt coated with shards from the hourglass of lost sleep. “We might have something more. One question first. How has the market responded to all this publicity over the current legislation?”

  “Frantic. Terrified. Think of oil dropped on a red-hot skillet.”

  “There was something Colin found, or a part of something. We were halted before we could download all the files. They shut down their outside access. But what we came across got us wondering.”

  As Jackie outlined her fears, Bowers received the information as he would news of his own demise. He spent a long moment massaging his chest, then kicked the front seat. Hard. “Shoot somebody if that’s what it takes. But get us into the city now.”

  72

  Wednesday

  SO MANY OF THE things Colin told me last night I just couldn’t draw together,” Jackie was saying. “Hayek is one of the world’s most successful currency traders. He lives and breathes controlled risk. The only way to manage risk is through calculated logic. But there wasn’t a logical explanation I could attach to so much of what Colin uncovered.”

  Wynn switched his gaze back and forth between Jackie and Bowers. The Fed board member’s demeanor had undergone a drastic change. Bowers now watched Jackie with something akin to awe. “Give me a for instance.”

  She was seated in the Fed’s basement command center. The walls of the windowless chamber were lined floor to ceiling with monitors, television screens, computer towers, cables, keyboards, dials, servers, and the hum of collective tension. The room was packed. Two local techies remained, both now operating under Jackie’s instruction. Colin sat beside her. Arrayed on the long bench before them were four LCD monitors and two keyboards. Colin looked fairly comfortable for the first time since their arrival at National. He kept his attention fastened on the incoming data, leaving Jackie to deal with the suits.

  Bowers was seated to Jackie’s other side. Wynn stood with the rest of the team, an amalgamation of senior staffers from both Treasury and the Fed. Kay Trilling and Carter stood across from him. The two Fed techies squatted between the bench and the walled array, watching and adjusting. With the sound muted to bare murmurs, the screens showed all the morning talk shows, plus MSNBC, BBC World News, and CNN. The Reuters Board and Bloomberg streamed their constant flows of data. Colin’s monitors scrolled with fast-breaking news. The wall clock read eleven minutes to nine.

  “According to Colin, Hayek was reportedly sitting on a story so big it would rock the markets worldwide when it was released. But there were two problems with this. First, nothing that big could be sat on for weeks. Minutes, maybe. If he was lucky perhaps a whole day. But weeks?”

  “It happens,” Bowers said. “Not often. And not likely. But it could.”

  “Maybe,” she said doubtfully. “But then there’s the other factor.”

  “Which is?”

  “Timing. How could he control the exact moment when the news broke? This isn’t something Hayek is hoping would happen when he wants. He is certain. He’s committed everything.”

  Bowers shifted nervously. Hating to have to ask, “So what conclusion did you draw?”

  “Hayek,” Jackie replied, “is going to plant a false lead.”

  The crew around Wynn shifted and murmured. Wynn was relieved when Kay saved him from having to ask, “Explain that to me, please.”

  “High-stakes trading has bred a number of parasitical offspring. One is real-time journalism. Before, the wire services ran to a very few feeder organizations, most of them news groups in themselves—television, newspapers, weekly journals, the financial trade press. Which meant anything major received off the wires was rechecked and usually redrafted before going out. But all this changed with the explosive growth of Forex and derivative trading.”

  Wynn observed a few of the team between him and Kay turn and ask one another who this woman was, seated there in her sleeveless high-neck cotton top and form-fitted black jeans. Jackie was the only one wearing anything other than standard bureaucratic gray. He saw the shrugs and astonished faces, caught sight of Kay giving the back of Jackie’s head a look of pure approval. He wanted to reach down, sweep her up, hold her for days.

  “Bloomberg is the leader in real-time journalism,” Bowers agreed, directing his words to Kay. “They’ve seen their subscribers expand by two thousand percent in just ten years. Nowadays they employ nine hundred and fifty people in seventy-nine bureaus. They compete head-on with the more established wires of Dow Jones, Reuters, AP, Bridge News.”

  “They all sell the one thing that has value in the trading world, speed.” Jackie seemed unaware of how fatigue was beginning to slur her words, or how the strain on her features was spreading to her voice. “The race is constant, twenty-four hours a day, sprinting around the globe in time to continental trading hours.”

  “Financial wire services generally receive news releases fifteen minutes prior to general distribution. To a trader armed with fresh data, these fifteen minutes are an eternity,” Bowers agreed. “Senator, wouldn’t you prefer to sit down?”

  “I’m fine where I am, thanks.” She asked Jackie, “So what does this have to do with Hayek?”

  “The problem with real-time journalism is the crush of data. News flashes can’t always be checked prior to initial release. The time it would take for a wire service to call and confirm a breaking story means that someone else might carry the scoop. Too many lost scoops, and the wire service would be draining customers and income like a sieve.”

  Bowers moaned one word, “Emulex.”

  Jackie nodded agreement. “Last year, a news flash was released over the wires claiming that Emulex’s CEO had been forced to resign and the company would be restating its earnings. The story was later proven to be a total fabrication, brought on by a hacker who had sold the stock short. Even so, Emulex stock fell through the floor.”

  Wynn watched the shock register around the room, the sudden heightened tension, the newfound reason to watch the screens. Bowers leaned forward and said, “Young lady, would you possibly be interested in a job with our organization?”

  Jackie’s mouth opened, but no words came. She glanced back at Wynn, her gaze fawnlike with fear. He could do nothing but smile, urging her to move forward and accept what was already unfolding. Hoping only there would still be room in her life for him.

  Colin saved her the need to respond by saying, “Heads up, everyone.”

  Jackie swiveled back around. “Who is it?”

  “Harris. New kid on the block. Lower level of coverage, which means lower salaries. Perfect.” Colin leaned forward and asked one of the Fed’s techies, “Can you set a trolling signal for the word Cisco?”

  “No problem.”

  Bowers exploded from his chair. “What are you telling me?”

  “Harris has a flash release,” Colin started, but was cut off by the MSNBC announcer’s voice suddenly shouting at full volume, “This just in. We have an unconfirmed report that Cisco Systems’ chairman is expected to announce this morning that their quarterly earnings were grossly overstated, and in fact the company is now facing a loss greater than its year-to-date profits.”

  “There goes the Nasdaq,” the woman beside Wynn exclaimed. She caught sight of Wynn’s confusion and explained, “Ever since Microsoft went head-to-head with Justice, Cisco has been the Nasdaq bellwether.”

  Bowers was already on the phone. “Get me the Nasdaq chairman.” Then, �
��I don’t care what time it is, and I don’t care what you have to do to get him. Find him now.” He stabbed the connection shut, looked back to where the Treasury guru stood, and asked, “Are we in agreement on this?”

  “Unless we can get official confirmation that this news is for real, absolutely.”

  Bowers pointed at his people among the crew. He had aged a decade in the previous few minutes. “Check this out.”

  Colin pointed at one of his screens. “We’re receiving another flash.”

  “What now?”

  “Harris again.” Colin spoke to the techie poised in front of him. “Chase Manhattan.”

  The woman beside Wynn muttered, “There goes the Dow.”

  It was CNN this time, announcing in grave tones, “We have just received a wire report that Chase Manhattan’s Japanese arm, the recently acquired Bank of Sapporo, has admitted to previously undisclosed Forex losses amounting to . . .” The announcer squinted over the paper in his hand. “In excess of six billion dollars. Which is more than twice the entire bank’s last-year profits.”

  The woman beside Wynn added, “The dollar is going to bomb.”

  Bowers said to an aide, “Get your team to work. Place calls out to the entire Interbank network. Neither Hayek nor First Florida are to receive credit. None. Any purchase they want to make requires a hundred percent up-front payment. Then inform Hayek that we are sending in the inspectors.”

  The aide fled. Bowers said to the room at large, “We can’t close down the foreign exchange markets. They are too big and too global. If the gamblers can’t place their bets in New York, they’ll send them to London. So we have to hope that cutting off his Interbank credit will at least slow him down.”

  He lifted the phone. “I need you to connect me with the President. Yes, now. Tell him we are facing a potential crisis.”