“Do you think that’s right?” Candace had asked me.
I said I didn’t know. I was just eighteen. I wasn’t sure I had a heart at all.
“I think it’s true,” she continued. “When a cold heart becomes warm, it stays that way forever.”
It was an intensely personal comment, but she said no more. That was the sort of remark college kids dropped on each other back then, at least at Harvard. We were all secret readers of Emily Dickinson; there was romance in the tap water. And it made me feel better about not being a demonstrative, “loving” person. Perhaps that meant I didn’t have one of those cheap, warm hearts.
We went on with our appointed business, which was her critique of one of my snide theater reviews. But the Graham Greene passage stuck with me. She was obviously talking about herself, and I remember wondering at the time whether her own heart was already slow-baking with passion—or whether it was still stone cold.
HUGO BELL CALLED ME. He said he was having dinner at a Ligurian restaurant—not Italian, mind you, but Ligurian—with a friend who worked as a broker at one of the local investment firms. They had been talking about the commodities business and Carl Galvin’s name had come up, and the conversation was very interesting. He suggested I come over right away for a nice Ligurian dessert—peaches with mulled wine—and listen to what his friend had to say. I wouldn’t normally have ventured out at that hour. I was listening to music, and The Simpsons reruns were coming on in a little while, but this was irresistible. In dealing with Galvin, knowledge was my only weapon.
The restaurant was a noisy little place on Connecticut Avenue. Bell was sitting in a booth in the back, with a row of beer bottles lined up in front of him. His friend was a beagle of a man named Jack Liggitt. They shared an interest in jazz, it seemed. Liggitt in his youth had tried to play drums with Ahmad Jamal; but the black folks wouldn’t have him, so he was stuck in between—loving what he could never fully possess. That was what he and Hugo had in common: They were both stranded.
Liggitt gave me his card, the way brokers always do, and a howdy-do handshake. He must have thought I could help him make some money. “This guy Galvin is a piece of work!” he ventured. “You know anything about him?”
“Not really,” I said. I recounted what little Galvin had told me about his business.
“He left out all the interesting parts!” said my informant, who was only too happy to fill in the gaps. It seemed he had been following the fortunes of Carl Galvin Corporation for years.
Galvin had begun trading oil contracts in 1973, just as he’d told me, but it had hardly been the series of accidents he’d described. According to Jack, he had powerful friends already—people he’d met at the U.S. embassy in Bangkok. When he went to work for the commodities firm in Hong Kong, his embassy contacts had helped him—giving him tips, making introductions, steering their friends his way. He’d been working there only a few months when he got lucky. With a gambler’s sense of timing, he signed a contract in late summer to take delivery of a hundred thousand barrels of Iranian crude in December at a price just above the August spot-market price of roughly five dollars a barrel. He assumed he could unload it on the Japanese.
“Talk about lucky!” Jack said. The Mideast war broke out in October, followed by the Arab oil embargo, and by December the spot price had risen to thirteen dollars a barrel. Galvin’s profit on the deal was $800,000—not bad for a twenty-three-year-old dropout. Any possibility that he would return to Harvard disappeared after that. He stayed in Hong Kong for the next ten years, building his commodities business, branching into lead, tin, nickel, manganese, aluminum—even mercury. By the late 1970s, he had tired of sharing his winnings with the stodgy British firm and formed his own company. Like many speculators, he made and lost several fortunes over the following twenty years, riding the roller coaster of the market, but in the 1990s, he had become seriously rich. The Financial Times had estimated his fortune three years ago at nearly one billion dollars. There were whispers Galvin was overextended, but people always said that about commodities traders.
“This guy’s secret is that he operates at the margin,” explained Jack. I asked what that meant. Galvin hardly seemed like a marginal figure, but I was misunderstanding.
“He’s always ready to do the deal at the margin,” said the broker. “The deal nobody else will do.” When nobody would lift oil from Angola after the Portuguese left in 1975, he did the business—which meant that when the oil shock hit in the late seventies, he had access to crude. When nobody would go into the Persian Gulf during the tanker war in the mid-eighties, Galvin did the business. He bought up rusty old tankers and sent them in and made a killing. Same thing with Russia in the nineties. It was wild and wooly, and most traders were scared off. But it was a perfect opportunity for Galvin.
I asked if Galvin was a crook. Jack found that amusing.
“This is the commodities business,” he said. “The only crime is being on the wrong side of a contract.”
The real problem with commodities, Jack observed, was trying to get out. The business was so highly leveraged that you couldn’t avoid owing people a lot of money. And when the markets turned around, it was sometimes hard to cover your bets.
“I think Galvin wants out,” I said, remembering an elliptical comment he had made toward the end of our lunch.
“Well, he’d better hurry,” said Jack. The market was soft, and when you were playing with other people’s money, you weren’t a free man.
SEVEN
GALVIN WANTED TO KNOW THE DETAILS OF MY LUNCHEON conversation with Candace. I wasn’t sure what to tell him. It seemed unfair, like one of those tricks they play on the guests on The Jerry Springer Show, when they keep the wife backstage while the husband is telling Jerry how he’s having an affair with his wife’s sister. But I didn’t really have a choice. The lunch check had come to nearly $150, so discretion wasn’t a practical option. And I didn’t see any lasting harm in what I was doing. It seemed to me that Galvin could only be good for the Sun and the talented people there, like Candace. But that was the logic of the hired man.
Galvin asked me to come to his house in Georgetown this time. He said he would be selling it soon, and he wanted to get a little more use out of it before it was gone. It was an old town house on Q Street—not much to look at from the sidewalk, but inside it was all creamy wallpaper and dark bookshelves and French doors opening onto a big garden, hidden away in the midst of the city like an emerald in a jewel box. I’m told that houses in Arab cities like Damascus and Cairo are built the same way—with a plain exterior, to avoid rousing the envy of the neighbors, concealing a palace inside.
The butler—not the same one as at the Virginia house, but a different one—said that Mr. Galvin was out back in the garden, taking a swim. He led me toward a gray slate pool, bounded on four sides by the deep green of the lawn. Galvin was swimming laps; I sat and watched. His body churned through the water, arms and legs moving together like a single muscle that created its own wake with each forward stroke, like the prow of a ship. He ignored me until he was done, and then emerged, dripping wet, looking very pleased with himself.
I handed Galvin a towel. I was one of his entourage now—like the butler or the gardener. While he dried himself and sipped a Diet Coke, I described my lunch with Ms. Ridgway. He listened mostly in silence, asking me occasional questions to steer my recollection toward the topics that interested him. When I mentioned Ariane Hazen, he smiled contentedly. Oh yes! He seemed to know all about her. She was the key, he said. She was the only one of the Hazen and Crosby children who had a head for business. If she led, the others would follow.
He pointed a wet finger in my direction. “How much do you think the Sun and Tribune is worth?” I shrugged, so he answered his own question. “At forty dollars a share, the market is valuing the company at about eight hundred million dollars. But that’s only because it’s being run by idiots. In an auction, the price could go as high as sixty or seventy
a share. The question is, how could we get it cheaper—for, say, fifty dollars a share, or fifty-five.”
“You’re asking the wrong guy,” I said. “I flunked home economics.”
“It will come down to the Hazen trust,” he observed, more to himself than to me. He explained that the Sun had two classes of stock, for takeover protection—A shares for the family, and B shares for everyone else. The company couldn’t be sold without a majority of the A shares, and the largest block of stock was held in a trust for Harold Hazen’s children. It had been established in 1963, and was voted by Harold and his son. Galvin said the 1963 trust was the main event.
He squeezed his big hand into a fist and grazed it gently against my chin. “Almost Golden Gloves,” he said. It was odd, but he didn’t really seem like the boxer type. He was the opposite of muscle-bound—there was such natural grace in his movements.
When we had finished talking about the Sun, I handed him the restaurant receipt and asked in my most servile voice if perhaps he could reimburse me, that being quite a lot of money and me being quite poor.
“Of course!” he snorted. “Don’t be a chump.” He retired inside and returned with an envelope. Inside was a check—not for $150, but for $5,000.
“I can’t take this,” I said. “It’s ridiculous.”
“Sure you can. You earned it. Let me know when this runs out, and I’ll give you more.”
I folded the check neatly and put it in my wallet. Who was I to complain if he wanted to throw some of his money at me. And perhaps he was right—maybe I had earned it, though that was a disturbing thought. I was ready to leave, but he put his hand up—bidding me to stay a moment more.
“How did she look?” he asked.
“Who?” For a moment, I wasn’t sure who he was talking about.
“Candace Ridgway. What did she look like, when you took her to lunch?”
He was studying me, waiting for my answer. “Let me think,” I said. “She’s very beautiful. Maybe you’ve heard that already, but it’s true. She was wearing a pastel suit, light green—an odd color, but it suited her. She has bouncy blond hair that’s always falling in her face, and beautiful skin. She’s flirtatious but untouchable, if you know what I mean. What can I say? She looked great.”
Galvin didn’t answer. He closed his eyes as if he were trying to see her in his mind. He sat there for a long time, and it seemed like a good moment to leave, so I said goodbye and let myself out the front door. I glanced back once and saw him bent over, head in his hands, wrapped in his big bath towel. He was like a fighter getting ready for a big bout—or nursing his wounds from an earlier one, it was hard to tell.
GALVIN HAD LUNCH A few days later with Ariane Hazen. He telephoned her, out of the blue, explaining that he was an investor, new to town, who was following her company and would love to take her to lunch. She said yes instantly—she already knew who he was. Galvin said she was nervous at first—she didn’t want anyone to get the idea that she was conniving with a potential buyer. She even wore a hat so that people wouldn’t recognize her at the restaurant. Galvin found that promising, that she would take the meeting seriously enough to think it was something to conceal.
Strange woman, he said. So much energy, but it was blunted. That was the curse of being born a Hazen. Too many times in her life—at the moments when most people want to say “I quit,” but know they can’t—she had been able to bail out. She was a victim of the freedom that money provides to escape life’s unpleasant lessons. The phrases hunker down or gut it out had no meaning for her. That made her a natural target for someone like Galvin.
It was clear from his account that he had put his charm to good use that day. He took her to a small Italian restaurant—a place where people brought their friends, as opposed to business associates—and he sat next to her on the banquette, rather than across the table. He told her stories about his adventures in Africa and in the Middle East years ago, when he was building his business. It’s always surprising how vulnerable people are to that sort of blandishment. They don’t realize what a weapon friendliness can be.
When it was time to talk business, Galvin asked bluntly how she thought the Sun was doing financially. Wall Street was skeptical, he said. The analysts who followed the company thought it wasn’t well managed. And he confided he’d heard that circulation and advertising figures for the second quarter would be below estimates, which would push the stock price down even more.
“You know more than Daddy,” she replied caustically. “He thinks everything’s fine.” The lid had been popped, and out poured her troubles. The paper wasn’t making as much as some younger members of the family thought it should, she complained. It was coasting. Other media companies were trading at twenty times earnings—some even at twenty-five—but the Sun was selling at a puny twelve. That was fine for the older generation. They had everything they could possibly want, and they were living nicely on the dividends. But for Ariane and her generation, it wasn’t enough. The Sun was their principal investment. If it couldn’t match the returns of other media companies, then maybe it was time to find new management—or sell their shares and buy something else.
“What does your father say?” Galvin asked.
“He says The Sun is a public trust. If we’re interested in money, then we should invest in Coca-Cola.”
“A noble sentiment,” Galvin remarked, “but not a very profitable one.” He sketched an alternative vision of how the company might be run—how it might expand from newspapers into broadcast television, cable, magazines, high technology. That was the way the world worked now, he said. Disney didn’t just make movies. General Electric didn’t just sell lightbulbs.
He was goading her, tempting her to imagine the value that was buried inside her father’s stolid public trust. But he cautioned that he shouldn’t be giving advice. The family needed an investment banker—someone who could help them sort out various alternatives.
“Please tell me what you think,” asked Ariane. “We need help, and I honestly don’t know where to turn. I don’t trust anyone.”
“My only suggestion,” Galvin offered, “is that you move soon.” He warned that if the Sun’s current management couldn’t convince Wall Street that it was ready to be more aggressive, the Sun would be vulnerable to a raid by people who thought they could squeeze a lot more than forty dollars a share out of the company. And once that process began, it would be hard to stop.
Ariane nodded gravely. He was, of course, telling her precisely what she already believed. That was why it seemed so profoundly true. She asked if he might be willing to meet with other members of her family, and Galvin said that he would be happy to do so. But he again cautioned Ariane not to wait too long. This was a volatile market. The Sun was a tempting prize. There were rumors on Wall Street that someone might already be planning a raid. Even Harold Hazen wasn’t powerful enough to hold back the financial tide forever.
I RAN INTO CANDACE at the video store. She was slightly embarrassed about what she was renting, which made me curious. Prison Gals in Chains! perhaps? But it turned out to be Bringing Up Baby, the old screwball comedy with Katharine Hepburn and Cary Grant. Maybe she was hiding a secret fixation on Katharine Hepburn. The tawny aristocrat, too smart and quick for anyone but the incomparable Mr. Grant; a woman who understood that men were useful toys, to be inflated and deflated as the circumstances required.
I asked her to come have coffee with me at a Starbucks near the video store. That was all you could find in Washington anymore. In some neighborhoods, there was one on every block. They knew their market: caffeine freaks with status anxiety.
“The world is getting squishy,” said Candace. “Have you noticed that?”
I wasn’t sure what she was talking about.
“Things are falling apart. I keep getting these extraordinary messages from our correspondents. Do you know that property in Hong Kong is worth half what it was a year ago? Russia can’t pay the interest on its debt, it’s so b
roke. Brazil owes three hundred billion dollars. Japanese banks have five hundred billion in bad loans. Do you see a pattern here, David? Does any of this register with you?”
“Not really,” I said. “It sounds bad. But someone must be paying attention.”
“No, they’re not. Even sensible people don’t see it. People are fools! That’s why they need newspapers.” She described a project her correspondents were working on, which would try to make all this global misery interesting. But when she saw the faraway look in my eye, she gave it up, with an oh-never-mind Katharine Hepburn wave of dismissal.
I asked if she’d heard any more from her friend Ariane Hazen, and her eyes widened. “She’s frantic!” she said. “Haven’t you heard the rumor? Someone’s buying up blocks of stock. The Hazens are in a state of shock!”
Really, now! I professed surprise. I loved having a secret. I asked Candace what she thought about the prospect of the paper being sold—this was her livelihood, after all. But she laughed it off—it was bad form for journalists to care too much about the business side of the paper.
She went home to watch her splendid relics on video and try not to think about how squishy the world was becoming. I imagined her curled up in bed, watching the scene in Bringing Up Baby where Hepburn enters a ballroom unaware of the rip in her dress, while Grant gallantly tries to cover her bottom with a top hat. Candace was the rare modern woman who could play that scene herself. That was her problem—she was a thoroughbred, stabled with a team of plough horses.
I CALLED GALVIN WHEN I got home, thinking he might be the mystery buyer. He knew all about the rumors, but he said it was someone else. The only certainty was that a New York investment bank had gone into the market to buy large blocks of Washington Sun and Tribune Co. stock on behalf of an unnamed client. Galvin thought it might be a real estate speculator from California, but he wasn’t sure. The mystery buyer was staying below the 5 percent level that would require disclosure of his identity to the SEC. But trading was so active that the Sun’s stock had awakened from its forty-dollar-a-share slumber and begun to climb slightly in value. Ariane Hazen was calling him hourly, Galvin said, practically begging him to help the family. This was what she had wanted and dreaded: The Sun was finally in play, but Harold Hazen was stubbornly refusing to hire an investment banker—preferring to stay at anchor and ride out the storm.
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