"No," she said and it smarted slightly. It was disappointing. Maybe she was just trying to placate him, or trying to make him feel better about his ambitions? Neither, apparently—she went on: "I'm glad that you love this woman, but you can't just quit every new opportunity in favor of something more shiny. You have to see this through. If on the other end of it you decide to come back and be with her, great. But you can't be reckless with these things that the fates offer. They offered you your job first. Respect it."
"So, if I were to get fired, then maybe I should consider doing something like that?"
"You're not going to get fired, are you?"
"Of course not. I'm just saying—"
She nodded. They were near her hotel now.
After dropping her off, he rode home in a taxi and processed her message. He was overly vulnerable to her advice, he knew—one of the hazards of being the only child of a solo parent.
By the time he made it to his hotel he'd managed to convince himself that it was basically beside the point. He'd made his move. Now it was a question of how the dominoes fell, and they did not seem to be falling in his favor. So he was looking for a plan B, an indefinite stay in Bolivia and some kind of life with Lenka.
That his mother had not unequivocally embraced this option bothered him, naturally. The problem was with the mechanics of his lie to her, she might disrespect a job as an analyst for a cuddly equity firm contemplating installing solar panels in the desert, but she wouldn't have disrespected a feral animal like Calloway, a company that whipped giant sums of money around the globe based on a secret mixture of cold math and lukewarm leads.
In the business center, Gabriel checked the news and saw no story about Santa Cruz Gas. A glance at after-hours trading showed that the numbers were unchanged. He was losing. He went upstairs and lay in bed, trying not to think about what he would do once he was fired. Specifically, he tried not to think about moving to Bolivia, but he found himself mesmerized by the question of what kind of apartment he could rent for a thousand dollars a month.
He called Lenka's cell phone, and when she didn't answer, he left a message:
"Hey, I realize it's late." He spoke in a low, gentle voice, trying to mask his excitement. "I was calling because I wanted to know if you had any thoughts on how much it would cost to rent an apartment in La Paz. Also, I wanted to know if you were going to be at the meeting tomorrow, because it turns out that I'll be there with my mother. So, anyway—I suppose that's it." He paused, tried to think if he was missing anything. "I'm excited for you to meet my mother. I hope you've had a great trip. I love you. Good night."
He hung up.
An hour later he got a text message from her:
pleased to hear everything is good. wont be at meeting. bring yr mom to my house l8er? xolv
His reply:
will bring mom @ night or b4. cant wait 2 c u 2mrow. xxxx
Still unable to sleep, he went back downstairs at four thirty and looked up apartments in La Paz. It turned out that one could rent a very nice house, fully furnished, in a gated community in south La Paz for $1,400 a month. If his scheme somehow worked and he was nonetheless fired in the next couple months, he'd have made off with $500,000, and he could easily earn 5 percent, or $25,000 a year, on that. He could live comfortably, indefinitely, in La Paz on the interest. It wouldn't be quite the way out that he had sought, but it would be, nonetheless, a way out. Even if the scheme didn't work, he could coast for a couple years. Maybe he could write a book?
The first light of day was already itching at the sides of his eyes when he noticed that it was 5:47. Beyond the window, the city was gasping awake, its earliest engines grinding in their labors. Furtive horns hiccupped below the window.
Upstairs, he showered, shaved, and dressed. Newly spruced and back in the elevator again, only a little delirious from the lack of sleep and still hopeful that he could present a healthy image of himself, he noticed that his right eyelid was quivering. Oh well.
After he'd picked up the largest cup of coffee available from Café los Presidentes Ahorcados, he returned to the business center. He sent his mother a text message saying he'd be at her hotel at ten, two hours before they were due to meet Evo. They'd get a bite to eat, maybe.
Once more, he looked at his e-mail. Nothing. The news: there was none. Drearily, woozily, he grazed on information from cnn.com and nytimes.com and the rest, while his stomach squealed and bleated in the background. He lay down on the carpeted floor for a moment. Closed his eyes, but didn't sleep. Then, in the minutes leading up to the opening bell, he checked the futures on SCZG one last time.
It was down 7 percent.
He blinked. Befuddlement yielded to disbelief, which yielded, in turn, to bright hope. He was wide awake now. The digit was red: 7.0%. He exhaled a groan and then refreshed the browser. The number held. His itchy eyeballs trained on the screen and his eyes opened wider than they had in days. He hurriedly typed in the tickers of several major multinational gas companies. They were set to start flat, or barely down. He raced over to other websites to verify the numbers. It was true. His follicles tickled across his neck and arms as thousands of hairs stood up in unison; he stood up too, and covered his mouth. His mind ran blank for the first time in days.
He ran his fingers through his hair, sat down again. Refreshed the browser. The price had ticked down a few more cents in the last minute. It was at negative 7.6 percent. He leaned back in his chair, wiped tears out of his eyes.
It had worked.
13. Endgame
Thursday, December 29, 2005
THE STOCK OPENED 12.6 percent below the previous day's closing price as insiders continued unloading shares. Judging by the size of the initial drop, Lloyd Pingree himself must have been dumping his shares. The selloff picked up speed in the first half hour as other hedge funds started shorting the shares.
Gabriel's phone rang. He glanced at the screen and saw that it was his mother calling from the Ritz. She wanted, no doubt, to arrange plans for their breakfast. He didn't answer.
After she'd left her message he sent a text: Work probs, not available, c u @ evos @ noon.
He stayed in the business center for another hour, refreshing his browser periodically. The price continued steadily downhill. Prices of other companies overexposed to the Bolivian situation, including a Chilean silver mining company called ANVI that had about a third of its operations in Bolivia's Oruro department, were also sagging more than their multinational competitors'. Any business that drew a significant amount of income from Bolivian natural resources was now considered toxic. Investors who'd been indirectly betting on Bolivia's long-term prosperity were fleeing en masse on Gabriel's rumor.
At 10:32 Edmund published a brief on IBI's website saying that there was a run under way on companies exposed to Bolivian mining and gas operations; it was a result of reports that Evo had developed a workable plan for expropriating foreign gas within his first year. Though it was only a couple of paragraphs long, the online editor recognized that they were breaking the story, so it was given a prominent spot on the site.
For Gabriel's purposes, that signaled the tipping point. Anyone with an indirect interest in Bolivia would be dumping shares by now. Automated trades would be triggered by the falling prices too, spurring further and more automated sales, forcing the price down even further. The rest of this adventure would be brief. It would be over by the end of the day. From here on out, his performance would depend on timing. He needed to pay close attention to the moments.
Within twenty minutes of the posting of Edmund's piece, the price of Santa Cruz Gas had tanked so far that the spreads on E-Trade grew to more than 10 percent. There had been an avalanche of sell orders. Investors were looking for a floor and not finding one.
By eleven o'clock, shares were down 76.6 percent. Gabriel was due to meet his mother and Evo in an hour.
Seven minutes later, when the price started bouncing erratically, Gabriel picked up the phone and called
E-Trade. As quickly as possible, he keyed through to the options desk. A woman answered this time.
"Good morning," she said. "How can I help you?"
"I'd like to cover a short position."
"Well, I'll be happy to do that for you. Can I verify your account number, please?"
In six minutes, he was out.
At the end of the conversation, the woman said, "Congratulations."
"Oh." He cleared his throat. "Thanks." He hung up, refreshed his browser once more, and stood-he stuffed his hands in his pockets, stared at the screen while the computer processed his request. The page materialized once again. The balance was $110,762.55.
He'd made almost fifty thousand dollars in less than two hours. And he was just getting started. The real profits were still to come. At this rate, he'd end the day near five hundred thousand dollars. All he had to do now was reverse the direction of the rumor. All he had to do was correct his "mistake."
First, though, he needed a moment. He needed to do this interview with his mother and Evo, for one thing. He had forty-five minutes before he was supposed to meet them. He'd be back by one, at the latest, and then he'd buy Santa Cruz, all long, and call Edmund and the others.
He could buy long now, of course. That was what he was supposed to do. If someone were to find out that the rumor was false and word of the mistake were to circulate, he (and Priya) might lose out on the reascent. But he worried that it would seem more suspicious, from a legal standpoint, if he went directly from a pure short to a pure long. In any case, the stress of this was too much for him. He was sweating, practically hyperventilating there in the business center. He needed to collect himself.
Up in his room, he did twenty pushups, pounded a bottle of water. He caught his breath for a minute, staring out the window at the Casa Cultura, Lenka's former employer. It was a squat concrete building that looked like an aboveground bunker. He was excited to see her now: the scheme was paying off, thanks to her. She wouldn't be impressed, so he'd hold it back, if he could. What it meant, though—that he'd be wealthy when and if he was fired, when and if he moved to Bolivia—well, he couldn't explain that to her either. She'd be repulsed by what he was doing. Better to just shut up about it. The outcome would be the same, either way.
He lit a cigarette and cracked a window. He put on a suit and a nice shirt, no tie—Evo wasn't interested in ties—and went downstairs.
In the business center, he found that the price had bottomed out at an 81.08 percent decline and then bounced to a loss of 72.99. By now, dozens of investors in New York and around the world were trying to get in touch with Evo's people to confirm or deny the rumor. The press might be pursuing the rumor too, but not with anything like the ferocity of those investors. By the time Gabriel met with Evo, he'd likely have heard the rumor himself.
Gabriel was due to meet his mother at the palace in twenty-five minutes. He was supposed to go back in and buy as much Santa Cruz stock as he could afford, then ride the return lift all the way back up past its starting price. But he hesitated. The first half of his ploy had gone off so well, and it was such a relief to be in the clear for the time being, that he decided to wait. He could do it after the interview. It was a difference of an hour or two, assuming the rumor wouldn't already be corrected by Evo or Lenka or someone else. If it was corrected, he'd just say he'd been wrong. He'd lose the opportunity to ride at least part of the return bounce to parity, but there were worse things. And, honestly, it had been exhausting so far. He felt in the midst of a spiritual marathon.
He called Priya. "Are you seeing this?" he said.
"I am." She sounded remarkably calm.
"Look," he said, "I think you should cover the position. I just spoke to someone else in the cabinet, an economist, and I have some reason now to believe that this rumor might have been false. I'm not sure, but they might be lying. Not lying maliciously, maybe, but they really don't have any idea what they're doing. So just close out now and I'll get back to you when I know more. Is that okay?"
"No problem at all. Hold on." There was a short pause. Gabriel could hear muffled voices as she and Paul spoke. She returned. "Okay."
"You're out?"
"That's right."
He didn't want to linger in the business center. "I've got to walk and talk, so if we cut out—"
"Fine."
"I'm going to look into this and I'll be back in touch soon."
"Great." For the first time since he'd met her, she seemed in no way impatient with him. She seemed serene. She'd made—well, he had no idea how much money she'd made so far that morning, but it was probably in the millions.
He exited the door by Hotel Gloria's cafeteria and headed uphill, still on the phone. He'd been pacing long enough that his feet hurt. He had a headache, and his stomach was churning. He'd barely touched food since Lenka had told him what she knew, and it wasn't because of the arrival of his mother, it was because of this. As he huffed around the corner into the alley that led to Plaza Murillo, he said, "Priya, tell me, is every day like this for you?"
"All day long."
He said, "I don't envy you."
She grunted, amused. "Sure you do, Gabriel."
"Yeah, well, I'll be back in touch soon." He hung up. Ahead of him men in polyester shirts clutched fistfuls of sunglasses, their lenses glinting in the sunlight.
He walked quickly toward Calle Jaen. Jaen was an old street that had been preserved in its colonial glory and was now a popular tourist destination. It emptied out onto the square with his favorite salteñeria. Gabriel stopped at one point to catch his breath on a quiet back street. He'd been charging for the last three blocks, and his lungs ached. Then he ambled on, more slowly now, between ochre colonial houses with wrought-iron balconies. The headache was brutal, so he stopped in at a pharmacy. He bought two ibuprofen and swallowed them with a tiny cup of tap water that the pharmacist handed him.
Jaen was a narrow and curved street, inaccessible to cars. It had been laid, painstakingly, with millions of smooth rocks, each embedded into asphalt. Like cobblestones, but the size of a golf balls. The stones massaged his feet through his shoes as he walked up the road. The sky was dreary, and the street quiet and empty. The doors and windows were shuttered; the narrow balconies lingered aloft, unadorned. He passed a plaque indicating that one of the houses was the former residence of Don Pedro Domingo Murillo, for whom the plaza had been named. The residence was now a museum. Various other museums filled the narrow road, which was supposed to be a tourist hot spot. It looked exactly like a narrow street in some antiquated and gorgeous Iberian town, picturesque, if somewhat unremarkable by European standards. In Bolivia, it was absurd. It was an isolating and lonely place to be, a narrow gorge hidden in the city; it looked nothing like what surrounded it. Not that it was contrived. The buildings were real, hundreds of years old, but it was ludicrous regardless. If it looked strangely European, the reason was that the alley had been created by and for the wealthy Spanish occupiers of centuries past, who lived there when gold still tumbled down the icy waters of the Choqueapu. Though himself a resident of that grand road, Murillo had broken ranks to fight for independence, and being a proper Bolivian hero, he'd lost. Before he was hanged in the plaza on January 29, 1810, he uttered his final words, which—like those of Tupac Katari half a century earlier—would become ingrained deep in the national consciousness: "Compatriots, I am dying, but I left a fire that never will be put out. Long live freedom!"
Gabriel had to get to the palace soon, he knew, but he didn't want to deal with it. He could just call it a day and be done. It had been a winning day. The problem, of course, was that he needed to correct the rumor or run a much greater risk that his manipulation would be discovered. If the truth came to light with no help from him, the SEC would be more inclined to say that he had circulated a lie in order to manipulate the stock price. He needed to "find out" the truth and correct the mistake, not just for reasons of profit, but in order to cover himself.
He'
d made it halfway down the hill when his phone rang. He looked at the number. It was Catacora. He'd forgotten that Catacora had promised to give him a sense of Evo's plan before Thursday. He sat on the curb and answered.
"I'm sorry I didn't get back to you before," Catacora said.
"It's no problem," Gabriel said, "but I've seen that there's a rumor circulating on the Internet today that Evo is going to expropriate gas in his first year. Have you seen this?"
"Yes, I heard. I'm amazed that it's out already. Who leaked it, do you know?"
"What do you mean? It's not true, right?" he said.
"Well, no, it is true, in a sense."
"What?" Gabriel felt his stomach drop. "What do you mean?"
"That's why I am calling. I'm sorry I didn't tell you earlier, but Evo was gone, and—"
"Wait, let me get this straight: Evo is going to seize all of the national gas, including the Brazilian companies, in his first year?"
"He's not going to seize them, of course. We can't do that. And it's not going to happen at once, but we will announce an offer in May. We're going to give them a chance to renegotiate their contracts by the end of the year. In the meantime, between May first and the end of December, they will take seventeen percent of the profits—assuming they want to cooperate."
"And if they don't want to renegotiate their contracts?"
"They will have to leave."
"That's not what I heard was going to happen," Gabriel said.
"I don't know who you were talking to, but that person either doesn't know or is lying to you. I talked to Evo about it this morning after the rumor surfaced."
Gabriel didn't say anything. His mind scanned the possibilities, trying to see how it could be. Maybe Lenka had made a mistake? He thought about it a little and understood that it wasn't likely. No. It wasn't possible. Rather, she had lied to him. She had lied to him when they met at the café. He couldn't guess why, but that was it. He was so astonished that it didn't even sink in, emotionally. It ricocheted off his heart.
A Young Man's Guide to Late Capitalism Page 25