Ólafur scowled as he envisioned Cyrus Leeser gloating about Hafnarbanki. Maybe, just maybe, Leeser was bragging to other hedge funds. Encouraging them to short Hafnarbanki. That’s why the Qatari purchases had not juiced the bank’s stock more.
Enough, the banker decided. First, he dialed the Qataris. “Let’s get started.”
“Are you sure, brother?”
“It’s time to defend your investment in our bank. It’s time we send a message to hedge funds everywhere.”
After the two men finished, the banker dialed Siggi on his cell. He went right to voice mail. But the attack had started. Once Siggi wrangled more information from Cy, Ólafur and his Qatari allies would pour it on.
THURSDAY, MAY 22
BENTWING AT $64.33
“This one’s a personal favor.”
“Favor as in freebie?” Rachel asked, yawning, annoyed her employer was calling during lunch break.
“You’ll be compensated. Same as always.”
“Whatever,” replied Rachel in a monotone. She had not slept well and felt lousy.
“‘Whatever’!” The listless response confused her employer. “You’re the one pushing for more work all the time.”
“I need a break.”
“Take a vacation.”
“That’s easy for you to say, Kemosabe. I work two jobs. I’m saving my money.” She paused before adding, “But you know all this.”
“Why don’t I send you somewhere and pick up the expense? We can talk about the assignment when you get back.”
“No thanks.” His largesse surprised her. She had never trusted generosity. It made no sense to her. It struck her as calculating and manipulative. What did he want?
“Surely there’s someplace you’d like to go.”
“I’m partial to Paris,” she admitted, feeling her resolve weaken.
“Have you ever stayed at George Cinq?”
Within five minutes, they worked out the arrangements. She’d give Doc a heads-up, which was a formality more than anything else. He said yes no matter what she asked.
Kemosabe was a different story. There were times when she could not figure him out. Like today—he was brilliant. It took him five seconds to unearth exactly what she needed, and lo and behold he delivered the trip to Paris on a silver platter. Savvy on his part. Rachel would work twice as hard for him when she returned, which was probably what he calculated.
There were other times, however, when Kemosabe seemed like the kind of guy who banged his head in the shallow end of the gene pool. Not all that bright.
CHAPTER EIGHTEEN
WEDNESDAY, MAY 28
BENTWING AT $61.98
By late May tensions were spreading through LeeWell Capital. The signs were subtle, the way poison ivy surfaces in one spot before it spreads and itches everywhere. Bentwing’s share price hit a high of $66.30 on May 19. Since then the stock fell to $61.98, not a collapse, not exactly. But the downward momentum fed sour dispositions and an insatiable need to scratch.
Victor Lee sat in the epicenter of the outbreak. He was the head trader, the guy renowned for his finesse buying and selling stock in companies worth less than $2 billion. Most hedge funds built their businesses around traders, their special skills. And his mood infected the small fund of sixteen employees.
The problem was money, which Victor guzzled three zeros at a time. He owned a 15,000-square-foot cottage in the Belle Haven neighborhood of Greenwich, just the right size for a bachelor. He rented a house in the Hamptons year-round, $75,000 per month, where he installed $125,000 in stereos and flat-screen televisions because there was too little technology to suit his taste. He parked a $250,000 Ferrari underneath Two Greenwich Plaza and spent at least $300,000 on spas and resorts every year, which he justified by taking it easy on clothes. He never spent more than $15,000 on fashion and accessories, though he treated himself to six-figure watches all the time and reckoned his collection was worth at least $2 million.
Like others in Hedgistan who depended on whopper bonuses, Victor spent beyond his means 364 days a year. Budgets, he decided long ago, were for retirees. Spending was more about touch and feel and how the markets felt, good or bad.
“Who the fuck is leaning on Bentwing?” he stormed. It was the last Wednesday of May. He knew somebody was selling the stock, puking it out and sending the price lower. The junior traders never bothered to look up. They had grown accustomed to their boss ranting and raving.
Victor stopped talking to himself and scanned his e-mails. A buddy at SAC Capital forwarded an article with the title “Market Volatility Tied to Testosterone.”
Lee, ever curious, read that testosterone prompted risk taking. That guys, awash in hormonal flood zones, doubled down when prudence dictated otherwise. That women made better long-term investors. That estrogen was more cerebral than testosterone. That women’s hormones showed no reckless tendencies.
“People study this shit?”
“Study what?” replied Cusack, who happened to be walking through the trading floor.
“Fuck you, newbie. Don’t talk to me unless you’re bringing in the assets,” Lee barked. “Know what I mean, jelly bean?”
“Hey, Victor.”
“What?”
“Can I trade you for door number three?”
Victor looked up from his three LCD panels. He blinked through the lenses of his horn-rimmed glasses. After a few seconds, he finally removed them and said:
“I take it back, Cusack. Unfuck you.”
* * *
Back in his office, Jimmy replied to a few e-mails. He tried to forget Victor’s jab: “Don’t talk to me unless you’re bringing in the assets.” But the head trader was right. Cusack had joined a team of thoroughbreds, high-strung to be sure, but talented and capable nonetheless. This stable never lost money. They had until December 31 to earn 10 percent. Seven months for Bentwing to hit $78.79. It was time to deliver.
With the drumbeat of bonuses in the background, Cusack focused on gathering assets. He scheduled investor presentations around ten A.M. and asked Cy to keep the time slot free. The two tag-teamed prospects and grouped them into three broad categories: pension plans, university endowments, and elephants, which was jargon for folks with lots and lots of money.
Afterward, Cusack fell into the routine of hedge fund ennui. He worked out during lunch and returned phone calls and wrote letters and studied portfolio positions and answered e-mails and ate dinner with clients or prospects because there was always an excuse. Monday through Thursday Cusack seldom returned to his condominium before ten P.M.
Long hours seemed a small price to pay for resurrecting a career. The daily grind could have been comforting except for one problem. Jimmy still had no idea how Cy hedged.
Bentwing’s share price exacerbated his concern. The stock should have been soaring. Oil broke through $135 per barrel on May 22, and Goldman Sachs forecast a price of $200 per barrel and no end to the commodity’s climb. Bentwing developed wind farms, a hot sector in a world with an insatiable thirst for fuel. The shares, however, were trading down.
The phone rang as Cusack speculated how LeeWell Capital reduced its risk. “I want to bounce an idea off you,” said Leeser.
“I was just about to call.”
* * *
Cusack was sitting in Leeser’s office. A massive desk separated the two men like the thirty-eighth parallel between North and South Korea. Every once in a while, sonar pings from the computer announced incoming e-mails.
“What’s up?” asked Cy.
“We’re meeting with the Retirement Fund for New Jersey Sheet Metal Workers in thirty minutes. What should I tell them about Bentwing?”
“What’s to tell? It’s our largest position. We already made three times our money.”
“That’s old news,” said Cusack. “Bentwing’s shares are trading like crap, and energy is up fifteen percent since March.”
“People take profits,” argued Leeser.
“You shoul
d discuss how we hedge a thirty-percent position.”
Cy frowned. Then he asked, “You think the pension plan wants to hear about my foray into B-grade zombie movies?”
“What are you talking about?”
“I produced Night of the Living Dead Heads in 2003. It’s a cult classic. All about a rock band of zombies. Ticket sales bailed us out.”
“Is cash flow how you manage risk?” asked Cusack. Hedge funds dabbled in Hollywood all the time. They partially financed The Pursuit of Happyness, Blood Diamond, and Borat. Despite the precedent, he could not believe his ears.
“No, but the movie worked before I perfected my algorithm. And that’s all I’ll say. I’ve got to protect my trade secrets.”
“Please don’t mention zombies,” said Cusack, not amused.
“Here’s the deal.” Leeser leaned forward, confident and commanding. “These guys don’t want to hear numbers. Their eyes will glaze over. There’s a better way to field questions.”
“Okay?”
“I sit on Bentwing’s board. If I can’t comfort New Jersey Sheet Metal about our earnings, who can?”
“Fair point,” Cusack admitted. The rock-solid confidence of an insider made perfect sense.
“So are we good, Jimmy? We don’t have much time, and I need to speak with you about something else.”
“What’s up?”
“Your father-in-law is Caleb Phelps?”
He’s more of a cadaver-in-law.
“Who told you?” asked Cusack.
“One of our partners,” explained Leeser. “I’d love to meet Caleb.”
“He’s funny about investing with family.”
“I’m not family.”
“You know what I mean,” said Cusack. “Besides, Caleb and I have a complicated relationship.”
“I don’t care if he’s dead to you,” replied Leeser. “It’s good business to spend time with successful people.”
Nikki, Cy’s assistant, interrupted and said, “The guys from New Jersey are here.”
“Just think about it,” Leeser said. “That’s all I ask. Just think about it.”
The last thing Jimmy wanted to do was “think about it.” Instead he remembered Geek’s advice about breaking into Leeser’s inner circle: “Once you bag a few clients, he’ll tell you how he hedges.”
“Okay,” Cusack replied to Leeser. “But let’s reel in these guys from New Jersey Sheet Metal.”
CHAPTER NINETEEN
MONDAY, JUNE 2
BENTWING AT $60.08
“No. No. No. Forget it.”
“Hear me out, Siggi.”
“The answer is no. I’m not discussing Cy Leeser.”
Ólafur was dumbstruck. Siggi never argued, never threw a punch in his life. He was the family ambassador, the one weaned on pureed olive branches. Siggi searched for graceful resolutions to conflict, even if it meant saying yes when he wanted to say no.
The two men were sitting on red stools inside the bar named Hverfisbarinn. They each sipped Red Bull and Turi, a syrupy vodka distilled according to a centuries-old Estonian recipe. Siggi removed his black glasses and swept back his wavy hair. He drained the contents of his glass and double-clinked the counter for another round, bracing for what he was about to say.
“You’re obsessed, Ólafur.”
Siggi was a happy drunk on the days he drank, which were more often than the days he went cold turkey. But tonight he shouldered the discussion with Ólafur like an anvil-sized tumor.
“Obsessed with what, Siggi?”
“With Cy. And when you’re not obsessed with him, you’re obsessed with Hafnarbanki. And your share prices. And your portfolio. Why don’t you obsess over a girlfriend?”
Siggi stopped there. He wanted to say: “Before you drink away all your good looks, Ólafur. You look like shit.” But he resisted the urge, even though the banker could use another session at the clinic. His nose was a mess. There were capillaries sprouting everywhere.
Ólafur morphed into Mr. Ice. He was the field general who reassured colleagues. He was the combatant who stayed cool and methodical in the heat of battle, the one who roused a doddering old chairman with demands for Cy Leeser’s head. He was cold-blooded and a ruthless warrior. He could shake hands with the enemy one minute and rip off their faces the next.
He was also a soldier with secret misgivings. Ólafur’s career depended on making Hafnarbanki go up and Bentwing go down. He knew what to do about his bank. The Qataris were buying stock. He had no idea, however, whether LeeWell Capital could make Bentwing climb in price. If so, Leeser would crucify investors who bet against the energy stock. And Ólafur knew better than to underestimate his enemy.
He put his arm around Siggi—swaddling the art dealer with body mass—and asked, “What’s the problem? You can tell me.”
“Forget I ever mentioned Cy Leeser’s name, okay?”
“I need your help, cousin.”
“You’re asking me to slit my throat, Ólafur. Cy’s my best customer.”
“Was.”
“He may buy another painting,” Siggi added, not catching the significance of Ólafur’s one-word reply.
The banker suddenly turned full-tilt toward his cousin and leaned in close, his body language reassuring. “Tell me about it.”
“Why do you ask?” Siggi eyed his cousin suspiciously.
Ólafur ignored the question. “What’s the painting worth?”
“Four million in U.S. dollars.”
“Is that a fair price?”
“No,” the art dealer snapped, his voice a mix of authority and exasperation. “Six million is a fair price.”
“Then why sell so low?”
“The market’s a joke.”
Maybe it was the Red Bull and Turi. More likely it was the topic. Siggi relaxed as they discussed art. He had the home court advantage, rare when dealing with his cousin. Ólafur always, always got the upper hand.
“Does Leeser want the painting?” asked Ólafur.
“Probably. But he’s holding out for a better price.”
“Your ship just came in, cousin.” Ólafur glowed with enough alcoholic wattage to light Laugardalsvöllur, the national stadium of Iceland.
“That’s easy for you to say. Hafnarbanki’s shares are trading over nine hundred kronur again.”
“Forget my shares,” Ólafur barked.
The mild-mannered art dealer started from the rebuke, annoyed about letting down his guard.
“I have a deal for you, Siggi.”
“The answer is no.”
Ólafur persisted, a veteran of ax fights in finance, undeterred by meek protests from his cousin. “The owner of the painting makes money. Cyrus Leeser makes money. You make money, and that’s not the half.”
“You must have corks in your ears, cousin. I said no.”
“Your newest client can buy Cy Leeser one hundred times over.” The banker paused and added, “At least one hundred times.”
“And who would that be?” Siggi sounded skeptical. He raised an eyebrow.
“Tomorrow we’re calling Qatar together. You’re meeting Sheikh Fahad Bin Thalifa over the phone.”
“He’s the one who bought five percent of Hafnarbanki’s shares?” asked Siggi.
“The same.”
Siggi started to smile, his stress whistling free through a steam valve. But then his eyes narrowed, and his look grew far too sly for a gallery owner. “What’s in it for you, cousin?”
“I told you. I need information.”
“What makes you think I can get it?”
“Oh, you’ll get it.”
“You sound so confident, Ólafur.”
“Cy won’t realize he’s telling you.”
“I’m confused. I thought you said he’ll make money.”
“He’ll make money,” said Ólafur. “You’ll earn his trust, and then—”
“And then what?”
“I bury that asni,” Ólafur replied, using the Icelandic word for �
��asshole.”
“I can’t.”
“Relax, Siggi. Cyrus Leeser will never suspect you of anything.”
CHAPTER TWENTY
THURSDAY, JUNE 12
BENTWING AT $59.70
“We’ll start with forty million.”
“Thank you,” Cusack replied into his wireless headset. He was calm and methodical, professional to the core. His inner euphoria never trickled through the mike. Jimmy spoke with all the emotion of a tollbooth attendant, one who had gone without coffee, radio, and much by the way of oxygen, one who was down to the last thirty minutes of an eight-hour shift.
In the privacy of his office, however, Cusack sprang from his Aeron chair and knocked over café au lait fresh from the kitchen. He ignored the foamy suds surging from his toppled cup and victory-danced the twist like John Travolta in Pulp Fiction. Cusack heard the music. He had just landed an account with New Jersey Sheet Metal.
“I’ll FedEx the paperwork, Buddy.”
“Great, Jimmy. And remember one thing.” The union rep spoke with an Oklahoma accent, curious for a guy from New Jersey. “There’s more money behind the forty million.”
“We value your trust.”
“Don’t screw up,” Buddy said, and clicked off.
Cusack started toward Cy’s office but, eyeing the coffee, thought better of it. He grabbed a few paper towels and attacked the spill, soaking up the coffee and milk. He was still twisting to the inner beat of “C’est La Vie” when the phone rang. It was Robby, his real estate broker.
“Don’t tell me,” Cusack boomed, “you sold our condo.” He was fired up. In his experience good news always arrived in threes, which meant two positive surprises on the way.
“Afraid not,” the real estate broker replied, his tone flat. “It’s time to cut our listing price.”
Cusack’s good humor collapsed like a punctured lung. He paused for a long moment and finally replied, “No can do. I say we jack up the asking price.”
As Cusack spoke, he typed an e-mail to Cy: New Jersey Sheet Metal in for forty. On phone now. Debrief in five.
“Are you nuts?” Robby shot back. “There aren’t any buyers.”
BEG ticked up to $59.80. Cusack sighed with his crooked smile, wondering how long it would take for Leeser to reply.
The Gods of Greenwich Page 11
