“You know,” Taylor said, “this has been really wonderful talking with you and sharing a quiet moment.” She stopped to bid him goodbye. “Thanks for being my biggest fan, Jason. Thanks for being my bestest friend. I love you.”
Jason began to speak but couldn’t find the words. He felt the same kind of love for her that she had for him. No woman had ever told him she loved him. She loved him, she loved him as he was. His eyes welled in tears and he looked away. He looked back at her again, tears streaming unashamedly down his face. She stood on tiptoe and kissed him lightly on the cheek, and then turned lightly and walked down Mifflin Street toward her apartment.
CHAPTER 44
After he had found the key and gotten the cuffs off, Martin had gone into the bathroom and examined himself in the mirror. His head hurt. He had several big red welts around his ribs which were already turning an angry dark blue. His lower back ached when he stood up straight—probably a bruised kidney—but other than that, he was in amazingly good shape. That game of Russian roulette had really freaked him out at the time. Looking back at it now he couldn’t believe how crazy Hilton could be. It wasn’t the smooth, confident Hilton with whom he had gone to lunch. This Hilton was desperate. Once Martin had convinced himself that he was in one piece, he scoured the apartment to see if anything else had been touched. There was no evidence that anything had been moved about, but the place still felt dirty. He had no idea how Hilton had gotten in; probably had learned to pick locks somewhere along his illustrious career. Martin checked the locks anyway. From the time he had started this, he had known that Hilton, or one of Hilton’s thugs, would come for him, but he hadn’t known where or when. He thought a logical place would be the parking lot before work. Martin had been on the outlook for trouble. He even thought Hilton might call him and simply arrange a meeting. This place, an apartment complex with the security and all the apartments one on top of another had always felt pretty safe to Martin. Martin wanted to take a shower, but the thought of Hilton, or someone else coming in was overriding. The television was still on, but he shut it off, listening for the smallest movement of the lock or the lightest scratch on the window. An occasional thud of a neighbor’s door made him jolt. After an hour, he gathered up the money, putting it into his briefcase, and selected some of his favorite clothes, and packed them neatly in a carry-on bag. He peered at his car through the small window over the shower. He saw nothing out of the ordinary. Moving to the kitchen, he peered again from left to right and back again. Nothing. Readying his keys, he quickly opened the door and locked it behind him. He moved swiftly to the car and opened the door and quickly threw his bag and his briefcase into the passenger seat. He hopped into the driver’s seat and slammed and locked the doors. Then he fumbled to get the key into the ignition while scanning the area around the car in all directions. The car started, and he backed away from his apartment and out onto Memorial Drive.
He checked his rearview mirror repeatedly. After about a mile, he stopped alongside the road at the big bend in the road out by Woodway, but no one seemed to be following. When the light turned red, he made a U-turn back down Memorial and drove down Post Oak Lane. He checked himself into the Ritz Carlton using an assumed name and paid for three days in cash, explaining sheepishly that he was visiting from Dallas and hadn’t expected to stay overnight. Arriving in his room, he suddenly felt very tired and very relaxed. It was Wednesday. Taylor had told Martin that Conlan’s big press conference was coming up tomorrow, on Thursday. Conlan and the big oil guys had taken the bait. Oh, sure thought Martin, Hilton thought he had it all under control. Hilton knew nothing about the tapes from the capitol that had been “discovered.” Hilton was working off the same data as the “discovered tapes” but Hilton didn’t know that together Martin and Taylor were out to get Hilton and Governor Conlan. In his hotel room, Martin stared at himself in the mirror. A few bruises; he’d get over it. He took two Tylenol and drifted off to a tormented sleep. Tomorrow was going to be a big day.
CHAPTER 45
Big price moves in oil were not in the least bit unusual. A big refinery fire could raise gasoline prices in minutes. A huge new crude discovery, especially one that was easy to produce, could move crude oil prices dramatically—especially in the country of discovery. In 1973, the Arab Oil Embargo raised crude prices from three dollars a barrel to twelve, almost overnight. In 1980, prices doubled almost overnight when Iraq invaded Kuwait. Oil prices were just known to be volatile and prices moved fast on big news. That’s why oil traders could make so much money—or lose so much—in a comparatively short period of time.
Martin was going to bet that the discovery of a giant new oil field in the heart of the Midwest would drive down crude prices—dramatically. He was at the first stockbroker’s office at 8:00 a.m. Word was going to get out about the big Wisconsin oil discovery as soon as the press conference started. Taylor had set the hook with the governor and his buddies, and now she said they were going crazy.
Martin was racing against the clock. When he got to the first stockbroker’s office, he had been a little nervous. He didn’t want to seem too anxious or cause too big of a stir. He had done enough research to know that, assuming the brokerage house or bank was actually complying with the law, cash transfers of more than $10,000 had to be reported to both the Federal Reserve and the IRS. He had chosen seven brokerage houses around the Galleria to spread around the transactions. It was pretty well known that these offices around the Galleria were frequented by wealthy clients from Mexico, Venezuela, and Colombia. Even some Russians with oil money dealt with a lot of these banks. The banks wanted the business, and the fees, and they were more than willing to handle large amounts of cash in a confidential manner. There were rules about reporting large cash transactions, but in a complex international bank it was easy to hide money simply by moving it around from one country branch to another. Most of the law enforcement was focused on chasing down drug money, not oil money. Martin had heard stories about guys being stopped at the airport with millions of dollars in cash in their luggage. When he had opened his accounts, Martin had chosen a mix of banks and brokerage companies that were both US and foreign-owned. He guessed that doing so would make it a bit more difficult to track or consolidate his activity. Two of the offices were owned now by the Germans and one was owned by the Dutch. The transactions weren’t going to be huge. Martin had taken care to break the money into lots of $70,000 each and had made several copies of the withdrawal slip from his profit-sharing account transaction. At each institution, it showed how he had pulled money out of his pension account. Once he had been shown to a broker’s desk, he would explain that he was moving money to a new self-managed account and wanted to deposit $70,000 of the $87,000 into an investment account at each institution. He’d show the receipt he had gotten for the $87,000 cash withdrawal. At each office, once the account was set up ,he would place five thousand dollars into a big blue-chip stock ETF and leave the balance in a money market trading account, explaining that he wasn’t ready to make other stock selections at this time. The offices all had online Internet access, too and Martin signed up for online banking. Just to make sure, he had gone out and visited each website to make sure they were fully functioning sites. When he filled out each of the account deposit applications, he made sure that he completed the form that would enable him to trade electronically. Because he was opening his account with cash, the funds were available almost immediately. In fact, in the second office, a cute girl from customer service walked him over to the trading customer service center and helped him while he logged on for the first time and saw his $70,000 balance staring back at him from the other side of the computer screen. At each subsequent office, he asked to do the same thing and all but one of the remaining offices were able to get him online even before he left the office.
Some were a bit faster and some a bit slower, but it more or less took a half hour at each place. It was noon when he left the last office. He had a little less than $
10,000 left in his briefcase and a trunk full of bank and stockbroker brochures and pamphlets on bank services. One of the places had vacation giveaways and he had picked up a nice new ice chest.
Hilton had surprised Martin by bringing $500,000. Perhaps Martin had underestimated Hilton’s wealth. Anybody that could come up with half a million in cash in a day had some serious assets. When he first made his plan, long before Hilton had attacked him, Martin thought there would be at least one meeting—and probably two—where Hilton would pressure or threaten him. Martin had planned to hold out for $300,000, but under pressure he had determined that $250,000 would be more than enough. It surprised him even more how Hilton had just brought all of the cash over to the apartment and left it there. Martin had thought that there would be some negotiation and then Hilton would take a day or two to get some money together. Either way, it had gone fairly closely to the plan that Martin had laid out. Just faster. It still made him shudder when he thought about Hilton jumping him in his own apartment and putting a gun to his head. He just never appreciated how ruthless Hilton could be.
Martin drove back to his hotel room at the Ritz, changed into jeans. and plugged in his computer. He was starving, so he ordered room service. He went to the first investment office web site, found his account, and signed in with no problem. Using some simple calculations, he went to the “investment purchase” section and clicked on the commodity futures and options box. Martin picked an option contract that would reserve the right for him to sell one thousand barrels of oil at a set price any time before the end of next month. Oil traders at big companies used these options all the time to guard against price swings in the market. Even farmers used such options or futures contracts with corn or wheat to lock in a good price. Speculators used them all the time when they expected a big change in market conditions. Options were relatively inexpensive, but they were just a contract giving him the option to sell. If prices generally stayed the same through next month, an option to sell at today’s price was worthless. But if prices went down, the option could be worth a substantial sum.
For $352, Martin could lock in an option to sell one thousand barrels at the current price. The cost of this “put” option at the current price averaged out to about thirty-five cents a barrel. With the $60,000-$70,000 cash balance in each bank’s account, he could buy an option to sell about 185,000 barrels of oil. The option was simply a bet. If the price dropped a dollar a barrel, he could make a hundred and eighty-five thousand dollars back on each of his seven accounts. If the price stayed the same or went up, his option was worth nothing. His bet would expire, and he would lose all of his money. He clicked “OK” and saw the transaction begin to process. In a few seconds, the transaction was confirmed. It restated his account balances to show the investment in the blue-chip stock, the 185 oil options contracts at a thousand barrels each, and a few thousand in cash left over in his money market cash account. The New York Stock Exchange and the NASDAQ close trading in late afternoon, but you could trade oil and most other commodities around the clock these days. He quickly repeated this process at all seven bank and trading offices. When he was done, he had “put” options on almost 1.3 million barrels of oil. It was Thursday afternoon. The Governor Conlan press conference was about to begin. Martin was ready for everything. When the news broke, Martin would make a fortune if the price of oil dropped on news of the big oil discovery in Wisconsin.
CHAPTER 46
Martin sat back and marveled at modern news sources. He was flipping between CNN and Bloomberg on the television, and he had Reuters and Google News open on his laptop. A Reuters reporter had been the first one to break the news when he stepped out of the early part of the Conlan press conference and made a phone call. It was only six minutes after the Wisconsin governor had announced a major new oil discovery. The report was running as a newsflash banner at the bottom of the Reuters website. Bloomberg and DowJones and other companies employ dozens of people whose sole job is to sit all day and follow news releases from all of the major networks and decide which stories get routed to their network. In another ten minutes, all of the major newswires had the story online. The Bloomberg digital business feed that ran on the desks of nearly every trading house in the world ran the story with the banner, “Kuwait-like Deep Oil Field Discovered in Wisconsin.” It was 1:30 p.m. in Houston. The commodity traders were back from lunch and working at their desks.
The price of a barrel of oil immediately dropped one dollar on the news. The oil industry executives present at the governor’s press conference gave the story added credibility. The price continued to fall and was down another two dollars over the next hour. The governor himself had made the announcement after what sounded like a careful study by the university. Several commentators said this field sounded bigger than anything in North Dakota—maybe as big as the old Permian Basin down in Texas. On one of the cable channels, one of the analysts interviewed had been in college in Michigan and recalled the date in history when the big Saginaw field was discovered in that state for the first time. There had been oil in Michigan when no one expected it. Maybe it wasn’t so surprising that a giant field could lie deep under the northern forests of Wisconsin. Oil dropped almost two dollars more per barrel. There was a slight rally when one of the analysts reminded the markets that it would take years to fully develop and produce this oil. Prices came back up a dollar or so, but rapidly dropped off again. Heading into late afternoon, the price was still four dollars a barrel lower than it had started the day.
Martin spent the entire afternoon watching the prices fall on his computer screen while replays of the press conference itself had now covered every major network. The financial networks played their expert interviews over and over again. An occasional clip would even show Taylor on the stage with the governor, encouraging everyone to ask for further analysis to be completed so that they could move forward with “all of the facts.” She was good. Damn good. She looked great, too. He desperately wanted to call her but could leave no trail between the two of them. He didn’t really have anything to tell her anyway; he just wanted to hear her voice and find out what she was thinking.
Martin watched and waited. He knew the New York Mercantile Exchange didn’t close until 7:00 p.m. eastern time on weekdays. It was open much later than the stock markets. At 4:00 p.m. he sold out his first account when oil had fallen four dollars and forty cents below the strike price on his first set of option contracts. He kept his calculator and a yellow legal pad in front of him and jotted down the trade confirmation number. He sold out the next two positions at nearly five dollars per barrel below his option price. When the drop got to $5.30, he sold it all. He sat back to tally up his records. His back was drenched in sweat. He had exercised all of the options. In total he had sold his 1.3 million barrels at a profit of $5.08 per barrel. On paper, he had made $6.6 million.
Oddly enough, it was Hilton who had told Martin over lunch that a good trader could make just as much money when the oil price was going down, as they could make when it was going up. Hilton was the one who had explained how to take big oil futures positions when the oil price was going to move. Hilton was bragging about his own exploits at the time. Martin had been listening carefully. Martin went over to the mini-fridge and looked over the contents. There was ice in his ice bucket—typical Ritz-Carlton service. He filled a glass with ice and poured over a Tito’s. Six million dollars. A month ago, he and Liz had his $87,000 401k and some equity in their house. Now he was worth six million. Liz. That image from dinner lingered before his eyes. Their last dinner together. Had she been right about him? Did he have the “killer instinct?”
He had the $6.6 million spread across the seven accounts. It was an hour before the commodities market closed. Martin held his breath and logged in to the first account, only he was getting an option to buy this time at the current market price. The price was five bucks lower per barrel than it had been a few hours ago, and the only two people on the planet that knew it w
as fake were Martin and Taylor. When it was discovered that the giant new oil field was fake, prices should shoot back to where they were before the big market move. Somebody would be digging through the details. Somebody would discover it was fake. When that happened, prices were going back up.
He spent almost six million dollars on “call” options to buy at this low price. Martin reflected on this. On the first round he had only a half million to place his bet, but on this round he had six million dollars to invest. Again, he had the orders spread across each of the seven accounts. He completed his last transaction just as the market closed. He was exhausted from the pressure-packed day. He was relieved. He pulled a chair over to the window and looked out over downtown Houston from his hotel window, cradling a second Tito’s in his lap. He smiled. Finally, he called the front desk for an early wakeup call and then fell into bed for a fitful night of sleep.
CHAPTER 47
The University had created two copies of the original digital tapes and sent one to Mack’s company and one to Jensen’s. Conlan was putting the heat on them to review the data and rapidly determine the first four drill sites. The next day the polls had shown Conlan’s popularity had risen almost seventeen points in one day. Conlan was already planning a second press conference to announce commencement of drilling activities. In fact, the governor had given his staff a picture of the Oval Office of the White House and he asked them to recreate, as much as possible, the exact same look and feel. First, they had hauled in a different desk and chair. Then they had spent the last three days cleaning and painting his office, taking down the Wisconsin flag and replacing it with the US flag, carrying out old files and finally putting in the gallery section for the press.
Nothing Ventured Page 27
