Gold

by Darrell Delamaide

  ALSO BY DARRELL DELAMAIDE

  THE GRAND MIRAGE

  THE NEW SUPERREGIONS OF EUROPE

  DEBT SHOCK

  GOLD

  A NOVEL BY

  DARRELL DELAMAIDE

  GOLD, a novel by Darrell Delamaide

  Third Edition, April 2012

  Copyright © 1989, 2012 by Darrell Delamaide

  Author Services by Pedernales Publishing LLC

  www.pedernalespublishing.com

  All rights reserved, including the right to reproduce this book or portions thereof in any form whatsoever. For information email ddelamaide@aol.com or contact:

  Barnaby Woods Books

  1630 Connecticut Ave. NW, Suite 400

  Washington, DC 20009

  www.barnabywoodsbooks.com

  This novel is a work of fiction. Names, characters, places, and incidents either are the product of the author’s imagination or are used fictitiously, and any resemblance to actual persons, living or dead, events, or locales is entirely coincidental.

  First E. P. Dutton edition 1989

  Second NAL/Onyx edition 1991

  Library of Congress Cataloging-in-Publication Data is available.

  ISBN: 978-0-9839958-3-8

  In memory of my mother

  Foreword to the New Edition

  The more things change, the more they stay the same. In fact, the world now seems closer to the global financial catastrophe depicted in Gold than it did when the novel was originally published. As the financial crisis that started in 2008 demonstrated, markets are more interconnected and fragile than ever. And in the summer of 2011, the U.S. government came within a hair’s breadth of defaulting on its debt – a calamity that once was the exclusive preserve of fanciful writers of fiction.

  Gold was in many ways prescient and for that reason is surprisingly relevant today. Some of the technology in news distribution and commodities trading has changed, but the essential dynamic of the markets and the role of information remains the same.

  The novel’s action reflects the political situation in the late 1980s. South Africa was still under an oppressive apartheid rule, and communism still ruled in Soviet Russia. Gold accurately portrays the forces of revolution that would lead to change in South Africa and thus has become an historical thriller. The Russia of Vladimir Putin is hardly more democratic or less autocratic than that of Leonid Brezhnev, so some things, again, stay the same.

  This new edition is a reprint of the entire original text, without any additions or changes. Gold was first published as a hardback by E.P. Dutton in 1989 and as a mass paperback by NAL/Onyx in 1991. All rights have since reverted to me, and I’m pleased to make the novel, long out of print, available once again as an e-book and paperback under the imprint of Barnaby Woods Books.

  Darrell Delamaide

  Washington, D.C.

  April 2012

  ONE

  Those goddamned anchovies again.

  Drew swiveled toward the screen and tapped quickly on the keys: COM, GRA, FUT, coding the story for the commodities, grain, and futures wires, urg, priority code urgent. Bells? News tickers did away with bells years ago. Computer screens don’t ring.

  The quiet static of his keypunching contrasted with the roar of tension in Drew’s ears. The anchovy schools off the coast of Peru had disappeared again, according to the unexpected announcement from the Ministry of Mining and Natural Resources in Lima. Drew remembered his early days as an economic journalist when the anchovies had reappeared suddenly after a two-year absence. He had been sitting quietly editing a story when the slotman started squirming and muttering about anchovies, just like Drew was doing now. So what? he thought at the time. Only afterward did the filing editor explain to him that anchovy meal is one of Peru’s main exports and the leading substitute for soybean meal. The Chicago commodities pits would go into contortions whenever those anchovies appeared or disappeared. Nobody knew where they went.

  The second take came up on the screen. The Peruvian Ministry spokesman said nobody knew where the anchovies had gone, but gone they were: bad for Peru’s exports, bad for its foreign debts. Shit, yes, he had forgotten to send it on the financial wire. He coded the second take the same as the first, adding FIN for the financial wire. He put it into the computer queue, called up the first take again, coded it for FIN, sent it out again, and sent out the second take.

  Drew sat back and blinked. He should not even be sitting in the slot. It had been a long time. But MacLean had had to leave all of a sudden, and since there were only two junior copy editors on the desk, Andrew Dumesnil, managing editor of World Commodities News, found himself in the slot for the first time—he counted quickly—in six months.

  Just then Tom came in. Drew tapped quickly to code the afternoon gold fixing: COM, FIN, and MET for the metals wire; quk, quick, for the next-to-urgent priority.

  “Tom, can you take over? I shouldn’t even be here,” Drew called over to the dapper young man. Tom, a twenty-seven-year-old Englishman, was the most seasoned editor on the desk, with five years’ service. A graduate of Oxford or Cambridge—Drew could never remember which one—Tom would have been prime material for Reuters, the big British agency, but he had opted for the tiny American-owned news service instead.

  The main editorial office of World Commodities News occupied a surprisingly small space on the fifth floor of the Star building in London’s Fleet Street. The leased space consisted of a large room with a cubicle in one corner formed by glass and plyboard panes that stopped short of the ceiling. The central space was occupied by a round table, open on one side, with what looked like an airline cockpit in the center—a bank of screens and keyboards set in a semicircle at typewriter height. There was the chair for the filing editor, who could operate the various keyboards like an organist in a baroque church, while keeping an eye on the table surrounding him. Around the rim, like spokes on a wheel, were six computer screens and keyboards for the copy editors. Usually, like today, only two or three were occupied. The entire editorial staff at WCN head office consisted of twelve persons working in shifts around the clock.

  Tom stepped in the slot behind Drew. “Where’s MacLean?” he asked, rolling up his sleeves.

  “Toothache,” Drew answered, routing the closing Frankfurt stocks.

  “Toothache? More like headache. I don’t know how he sits in here for eight hours a day, day after day.”

  Drew stood up but kept his fingers on the keyboard to code the report on the Comex opening. He straightened up. Tall at six foot two, he was well built without looking athletic. He was winning the battle so far against middle-aged paunchiness; his twice-weekly squash games kept his preference for beer from getting the upper hand over his figure. There was a softness to his features that testified to a life spent in classrooms and offices, but a lively intelligence in his eyes and animation in his face lent him a certain vigor that belied his intellectual bent. The clothes fit the man—his salary as managing editor allowed him to indulge his penchant for tailored suits and shirts. Drew picked patterns and colors that were neither sober nor flashy, corresponding to his particular notions of what was proper for a financial journalist, a man of letters living in a world of money.

  “All yours,” he said to Tom, stepping around the younger man and dancing quickly out of the slot.

  Drew went back to his office and picked up the phone to make a call. Tom glanced at him in his glassed-in cubbyhole before scrutinizing the report of a bus contract for Daimler-Benz. Too small. Delete.

  “Hello, Bart,” Tom called over to the curly-headed young man on the rim. “How’s things today?”

  Bart turned to Tom, as though he were waking up. “Not too much going on.” As far as Bart could see, not much would ever go on at a commodities news agency. He had someth
ing of the dreamer about him, as though he were a southern novelist in exile. He had joined WCN’s domestic counterpart, U.S. Commodities News in Chicago, straight from the University of North Carolina. After just six months, they had dispatched him to London.

  “What’s all this anchovy shit?” Tom asked, scanning the printout of the outgoing copy.

  “Soybean dealers need to know,” explained Bart, turning back to his story on oil refining capacity in Europe. He’d picked up a few things on the Chicago desk. He was bright, in spite of being a dreamer.

  The phone rang in the slot. “Editorial,” Tom answered, cradling the receiver on his shoulder as he put on the codes for the closing Zurich stocks and sent the item off.

  “Didn’t you get the telex?” The voice on the other end was faint but clearly agitated. “They’ve blown up the mines. They’ve blown up the mines!”

  “What mines? Who is this?” Tom said. He took hold of the receiver and pressed it closer to his ear.

  “This is Van der Merwe in Johannesburg.”

  Tom deleted the earnings report of a small French company and pressed his finger into his other ear to hear better. “Who blew up which mines?” he asked.

  “The terrorists. They’ve blown up the gold mines.” The voice paused. “It’s incredible. All of them. All the big ones on the Rand. Looks like ALF.”

  “Hold on.” Tom looked into the cubbyhole. Drew was gesturing as he talked on the phone. “Drew,” he called, “you better pick up line two in a hurry.”

  Drew looked at him, spoke quickly into the phone, and punched a button on his phone console.

  “Are you sure? How’d you find out?” Tom could hear Drew ask through the glass.

  Drew had picked up a pen and was writing furiously. “What’s the source?” he interrupted. “How sure is this?” He scribbled constantly.

  Tom looked at an analysis of the U.S. Agriculture Department’s crop estimates that had been released earlier in Washington. He routed it into Bart’s editing queue.

  Drew stopped writing. He looked at the phone, jabbed the receiver cutoff, punched some buttons on the console, hung up. He strode out of the office to the telex printer, looked at the copy, and then went over to the clipboards opposite the slot to leaf quickly through the long sheets of printer paper. He went to his phone again. “Try to get me Van der Merwe in Johannesburg,” he said to the switchboard operator downstairs. Then he went over to the desk.

  “Have you seen a telex from Johannesburg?” he asked Tom.

  “Don’t look at me, I just got here,” said Tom. “What’s going on?”

  Without answering, Drew went back into his cubicle and called the switchboard. “Any luck on the call to Johannesburg?” he asked into the receiver. “Keep trying, it’s urgent.”

  “He says the ALF has blown up the big gold mines on the Rand,” Drew said, coming back out. “But the line went dead. He said he heard it ‘through reliable sources in the underground.’”

  Tom sympathized with his superior. If it was true, the report would rock the markets like an atomic bomb. But was it true? “How in the hell would Van der Merwe get a telex out?” he asked.

  South Africa had imposed a draconian news censorship eight months previously. Most foreign correspondents were sent home, and only authorized “pool” reporters were allowed to stay, each one designated to provide news for several media. They were confined to Pretoria and only allowed to report official government communiqués—on any subject. All telex traffic was carefully monitored.

  “I don’t know how he got it out, but he claims he did,” Drew responded impatiently.

  He tapped his notes in the palm of his hand, biting his lip. “Damn.” He turned back into the office and sat down at the phone.

  “Hello, Morgan, lucky I caught you,” Drew said, when Morgan Preston picked up on the first ring. It was his direct line, and Drew was probably the only journalist who had that number. “Saw gold was steady at the fixing,” Drew went on. “Quiet market, I guess.” Preston was one of the five merchant bank representatives who met twice a day to “fix,” or set, the price of gold. That London price became the reference point for all ingot trading around the world.

  “Like a morgue,” responded Preston patiently. He was a busy man; Drew Dumesnil was a busy man. He didn’t call to tell him the price of gold was steady.

  “Hear anything out of South Africa?” Drew asked, in what he hoped was a natural voice.

  The news blackout in South Africa had made the gold market jittery at first. South Africa was still the world’s biggest producer. But the supply of gold bars remained steady, and the market quietly accepted that, although some unpleasant things were going on down there, one consequence of martial law was the continued steady production of gold.

  “No, not really. Seems to be the same as usual.” Usual round of petrol bombs, police action, scattered reports of massacres in the townships, atrocities in the white suburbs—and a steady fifty tons of gold a month. The only wild card was the Azanian Liberation Front—Azania was the “African” name for South Africa—which had split off from the African National Congress two years ago. As the front-line organization opposing white rule in South Africa, the ANC enjoyed the political support of black Africa, several European countries, and was increasingly accepted even by London and Washington. The ALF wanted action, not political support, and someone was giving them guns and explosives.

  “What does the market make of this ALF activity?” Drew asked.

  “Seems pretty sporadic, marginal,” Preston said. “So far.”

  “Any reports that they’ve attacked business installations, like the coal conversion plants, or”—Drew paused briefly—”the gold mines?”

  The journalist felt uneasy because he knew his questions would arouse Preston’s curiosity.

  “No. Have you heard anything?” the banker countered.

  Drew ignored the question. “The gold mines, for instance; I shouldn’t think they’d be too vulnerable to terrorist attack,” he continued, trying to keep his tone objective. Just a hypothetical question.

  “Oh, they’d be very vulnerable, if terrorists could get at them,” Preston responded, to see how far he could push Drew’s hypothesis.

  “Vulnerable in what way?” Anxiety was creeping into Drew’s voice in spite of himself.

  “Well, the mines are spread out under the ground, with tiny entrances on the top.” Preston exaggerated, to rub it in. “You know that, Drew. Blow up the entrances and you could pretty well sabotage the mines. But I should think our fascist friends in Pretoria would have thought of that and posted a few thousand armed guards around them.”

  “Yeah, of course. So you guys aren’t too worried about South Africa keeping up its gold production?”

  “Gold’s trading at a hefty premium already since the township riots got serious,” Preston explained cautiously. “But there’s been no news to make us more worried. Drew, what have you heard?” There was an edge to the question this time.

  “Look, Morgan, I’ve got to get back into the slot. I’ve been trying to reach our fellow in Johannesburg—never know what this ALF might try. I’ll let you know if I get anything that might affect the market.” He hung up before Preston could protest.

  Shit, he cursed again. The greedy bastard was probably buying gold already. He had hated to call him, even though Preston was one of his oldest and most trustworthy sources. Information was literally gold to these people, and Drew knew his questions alone were going to start a rumor.

  He rubbed his eyes. Wouldn’t matter, though, if Van der Merwe’s report was true. He checked with the operator; still no connection to Johannesburg. “Get me Atlanta,” he said.

  Atlanta was the headquarters of Sun Belt Communications, the owner of WCN. The operator was well-schooled. “Atlanta” meant not only SBC but Richard Corrello, vice-president of the News Group.

  “Rich,” Drew said. “Got a humdinger for you. Our man in Johannesburg says the terrorists have blown
up the gold mines.” He looked at his watch. Twenty minutes since his line to Van der Merwe went dead. He couldn’t sit on this story if it was true.

  “Are you shitting me?” Corrello, born and bred in Manhattan’s mean streets, did not speak with a southern drawl. “Does anyone else have it?”

  “Market’s quiet. Don’t think so. Line went dead while I was talking to Van der Merwe, the guy in Johannesburg.”

  “How reliable is this—this Van der Mer-wee?” The way Corrello pronounced the name made it sound like something children were taught to do in the bathroom.

  “He’s an Afrikaner, but he’s been pretty straight since we’ve had him, going on six years. Never had any problems.”

  “The shit will hit the fan,” Corrello said. He had come up on the newspaper side of SBC, but he knew how volatile instant screen communication had made the commodities markets. “Should we go with it?”

  Drew’s stomach tightened; he had known it would come down to this. “Well, we have to if it’s true.”

  “You’re going to have to call it, Drew,” Corrello said. “It’s a tough one, but it’s all yours. You know we rely on you one hundred percent.”

  Drew breathed deeply. “I’m trying to get back to Van der Merwe. Lines are jammed or blocked, or something. I’ll make a stab at the embassy, but I can’t hold it too much longer. I’ll let you know.” He hung up. Tom was at the door.

  “Gold’s up two-forty,” Tom said, turning back to the slot.

  Bastard Preston. “Get me the South African embassy,” Drew told the operator. Damn racists had moved the embassy out to Wimbledon for security reasons. The big building on Trafalgar Square, a monument to the glory of the British Empire, was too obvious a target for terrorists.

  He drummed his fingers nervously on the desk, scanning his notes. Extremely reliable underground sources. Went off in a series last night between 3 and 4 a.m. Maybe 80 percent of total S.A. production. ALF likely. Nobody knows. Roadblocks all around the mines in the Rand and Orange Free State. The phone buzzed. “No answer at the embassy,” the operator said.