26 and Change

by Deacon Rie

Mile 15

  The sun continued to push sweat into Stephen's eyes. Whatever rush that blue sports drink had given him, the effects had unceremoniously worn off somewhere over the past couple of miles. His quads began to strain under the announcement of a soon to arrive muscle cramp. A focused tightness evolved around the scar tissue in his leg. His stomach competed for attention and began to feel like a percolator brewing a cup of something he had no interest in seeing. He passed another aid station but other than taking a small plastic cup of water and dousing it over his head, he didn't linger. As he passed the table he saw a pink box of energy gels. The mere thought of eating another one of those things nearly made him hurl. Battling nausea, Stephen began having his first real doubts about even finishing the race. Aware of the risk associated with self doubt, he immediately caught the rogue thought, tossed it into a mental trash bin and set his mind straight again.

  Really? You're going to let an upset stomach stop you? Drive on, soldier. You got this.

  The thought was ridiculous. He certainly wasn't going to quit the race because he felt sick. He had been through too much to let a rumbling tummy force him off track. Not after what he'd been through. He knew the sting of pain; there had been too much of it in his world over the past decade. He thought about the screws in his forearm. The scar in his right leg that would always remind him of the impending end he had faced in Fallujah. There had been other types of pain as well. Though he hadn't thought it at the time, some of the pains he had experienced had been harder than anything the desert could have ever thrown at him.

  In the combat zone, Stephen always knew what was expected of him. When he got up in the morning, he had orders to follow and the ever present responsibility to do everything he could to keep his men alive. For the most part, it was pretty clear cut. Rules of engagement and military bureaucracy could certainly complicate even the simplest of days, but the basics of life in theater were pretty straightforward for a squad leader. Follow the assigned mission, achieve your objective and shoot anyone who threatens you or your soldiers. While that life was anything but easy, Stephen could acknowledge an element of simplicity to a combat soldier's life.

  Things were entirely different when he got home. Before his National Guard unit was activated, Stephen had worked for a small, privately owned company as a commercial real estate appraiser. He had joined McDowell and Associates when the company was still in its infancy. The owner, George McDowell, had undoubtedly taken a risk since Stephen didn't even have a college degree at the time, much less a background in real estate. But McDowell was a risk taker by nature and when he hired people, he hired for attitude and not for skill; firmly believing skill was an attribute which could be taught. He wanted people who already had a hard-charging personality. The way McDowell saw life, much to the contrast of many mothers lecturing their disobedient children, attitude took too much time and energy to adjust. He immediately saw in Stephen, an assertive attitude and a spirit that reminded him of a much younger George McDowell.

  McDowell's faith in Stephen did not have to wait long for a payday. Stephen showed a willingness to put the time in to learn the industry. He successfully acquired the necessary licenses and worked hard to become skilled at his trade. Within the first year, McDowell's bet paid dividends when it turned out Stephen had a knack for understanding the story behind a piece of property. Stephen's gift was not so much intuition or insight, as much as it was his diligence to stay on a project until he knew the real value of a property.

  McDowell gave Stephen the complete freedom to spend days or even weeks on a property. However long it took Stephen to feel comfortable. More than once, McDowell had been saved by Stephen's thoroughness, whether the company was purchasing the building outright or brokering it for a third party. Before long, McDowell and Associates would not authorize the distribution of a single dollar for a property until Stephen Lantz placed his personal seal of approval on it.

  The small company had done well under McDowell's leadership and Stephen's keen eye. After a decade, the firm employed nearly a hundred people and was expanding into other states. Before Stephen left for deployment there were even rumors of the company making a large acquisition so that it could begin eyeing the path to become a publically traded company on a stock exchange. It was something McDowell had talked about for years and Stephen was hopeful it would finally happen. An aggressive expansion plan for a small company meant salaries didn't exactly match the contribution to the company for employees like Stephen. But he stayed content with the compensation structure because he also received part of the company's private stock. Stephen knew a public offering would eventually create an opportunity to cash in some of that stock and allow his family to finally enjoy the fruit of growing another man's dream.

  While overseas, Stephen received word that the acquisition had gone through and McDowell was already in conversation with some high powered bankers from a major New York firm about taking McDowell and Associates public. It was a challenge for him to come back after being gone for the combination of deployment and hospital stay but Stephen reacquainted with the company rather well.

  McDowell was a great supporter of his reintegration but Stephen had struggled with some of the cultural changes made in his absence. The company had completed the talked about acquisition and there were several new employees Stephen had never met before. The new energy in the office was much more aggressive than what he could recall. Though the company had expanded into new markets, he stayed focused on the commercial real estate side. The commercial staff had dwindled significantly since he had left and there was now a small army of appraisers he was asked to coach. Perhaps it was his own downtime spent through the months of recovery at BAMC, but he still felt a different tone in the office; cordial but in many ways less familiar and less trusting.

  It was just after one of his late morning coaching sessions when McDowell interrupted him with an invitation to lunch. Sitting at a table in the nearby Greek cafe they had enjoyed dozens of times before, McDowell seemed out of sorts. Their regular waitress instinctively brought them two cups of coffee. Stephen noticed that McDowell spent a silent couple of minutes perusing over the menu, an act which seemed odd for a man who had ordered the same chicken shawarma platter with hummus, rice and a side of falafel every time they had eaten here.

  Resting the open menu on his plate as if to express his frustration with being unable to make a meal selection, McDowell took a deep breath and spoke. "Stephen, I need to share something with you."

  Stephen's guard went up as it was highly out of character for a self-proclaimed king of small talk to launch straight into business before ordering.

  "The industry is taking a major hit. I think you know it's had a major impact on us and well, to be transparent, the company's not doing very well, Stephen."

  Stephen knew Mr. McDowell well enough to know what to expect but he always saw the older man as incredibly smart with a borderline addiction to optimism. There was a gloom on his boss' expression that Stephen had never seen before. Times were tough, this was common knowledge and Stephen knew McDowell had been under heavy stress with their investment bankers. He had read plenty about the expectation of a continued downturn in the economy, but Stephen didn't see a reason for panic. The company had withstood market swings and commercial real estate was still considered to be an industry relatively resistant to the collapse in the residential housing market.

  "Mr. McDowell, we've seen tough times before." Stephen chimed in. But even before the words finished escaping his lips, Stephen could tell McDowell would give no legitimacy to flippant and uninformed attempts at encouragement.

  "You know," McDowell seemed to express a deep pondering, "When we bought First Jefferson a couple of years ago I was sure it would take us to the next level."

  The acquisition had seemed a bit odd to Stephen. Their firm had historically been a real estate investment company that bought, sold or brokered commercial real estate properties. When McDowell led the company
to buy First Jefferson Mortgage Group, Stephen just assumed it was a way for the company to move into the residential mortgage lending business. It wasn't McDowell's core business but from an expansion perspective, Stephen trusted the boss to know what he was doing. For Stephen's part, he didn't know the first thing about residential property, much less the complexities behind administering residential lending instruments.

  "I thought I saw a huge payday for the company." McDowell confessed, "I knew we were overpaying for their book assets but what did it matter? Investors are more interested in profits than they are free cash flow. The revenue from these loans would have given us a good shot at breaking even in two years and then double our annual revenue by the third. The bankers told me those projections were rock-solid!"

  Stephen could tell McDowell believed what he was saying, or at least, he had believed it at one point.

  He continued undeterred. "This was a chance for us to diversify our revenue streams and then break out with a public offering to take this company to new heights. The profit margins were enormous and besides, we were supposed to have protection on several of the subprime mortgages by purchasing the collateralized debt obligations from the insurance companies." McDowell's voice faded.

  Stephen had no idea what collateralized debt was or why their company needed insurance but he could tell there was more so he let McDowell continue talking.

  McDowell's voice dampened, "You probably heard, at the end of last year, the housing market hit a brick wall. Our insurer stopped selling credit protection on the CDOs four months ago. Now the market is tightening and the subprime assets we bought from First Jefferson are showing a 300% increase in defaults. As an extra smack in the face, our New York investment bankers suggested we ‘postpone' the IPO for a quarter or two. The fact they won't even take my call anymore tells me just how interested they are in taking us public now."

  The jargon was completely lost on Stephen. He was confused and concerned. His friend was clearly distressed and Stephen didn't have any idea of what he was talking about, much less how to help him fix it.

  "It's not just us. Stephen, this whole mortgage market is going to collapse. There are companies out there, major financial firms, who have jumped into this business with both feet. They're going to get their rears handed to them. It's going to crush them."

  "Wait, by major firms are you talking about publicly traded companies?" Stephen was starting to catch on that this really was bigger than McDowell and Associates.

  "I'm talking about Fortune 100 international banks and brokerage firms who employ thousands and thousands of people. They're just as caught up in these mortgage investments and they don't have the first clue how the game works. They're going to get hammered and when they do the repercussions are going to hit the whole country, regardless of what industry people are in."

  "Okay. That sounds bad," he heard himself saying. Stephen had caught up with conversation and decided it was time to look at solutions. "So we'll have to rely on the commercial investing to carry us through. Our bread and butter, right? It might get tough but we're good at it and we've always made a profit in this business." Stephen didn't understand the subprime market or why McDowell had gotten them into this mess, but they were good at one thing and he saw no reason not to go straight back to it.

  "I wish it were that easy, Stephen. The banks slashed our credit so we had to start floating our own projects. We've also been selling our commercial assets on the cheap to try to generate enough cash to keep operations going."

  "To keep operations going?" Stephen blurted out in shock. His words collapsed as if gravity had just been introduced to them.

  McDowell ignored the interruption and continued, "However, housing is expected to continue dropping like a rock and there's a realistic concern it will spill into the commercial market next. As a result, our investors have stopped looking at commercial properties and that bread and butter business of ours is drying up. I've been told our residential default rates will continue to accelerate and we still have to float the commercial properties we own. The bottom line is that we don't have enough revenue to support our overhead anymore."

  "Mr. McDowell?" A tone of parental seriousness washed over Stephen's voice, "What are you trying to tell me?"

  McDowell's eyes wouldn't meet Stephen's and instead drilled a hold through the cup of coffee resting between his palms. His voice was firm but strained. "It means, Stephen… that I have to let you go."

  Stephen's mind went blank for a moment. After everything that had happened at home and at war, one of the few stable things in his life was his career at McDowell & Associates. What some could have seen as mundane or monotonous, he relished as predictable and reliable. Home life had been a tedious routine of arguments with Sarah. The ever-volatile ride of Hailey's health concerns, the daily attempts to regain his own physical stamina and strength, he felt turbulence in every other part of his life except for work. Coming into the office each day provided him the distraction he needed. After the war, the pain, and rehab he knew that the stability of his daily work routine was the start of getting his life back to normal again. His work gave him consistency and satisfaction. It gave him something to look forward to.

  McDowell's words echoed in the empty valley of his mind. Stephen focused for a second to grasp them and make sense of the statement he had just heard. He wanted to respond with a calm and controlled tone that wouldn't reveal the growing embers forming in his gut. It didn't work.

  "You can't fire me!" Stephen commanded.

  "I'm so sorry, Stephen. Besides being an employee who’s been the backbone of this company for years, you've been my friend and it kills me to be in this position."

  Stephen's defensive nature fanned the flames and the ember began to burn hotter until his face was flush. "I was a Guardsman who was activated and returned wounded from war. You can't just fire me after I return from being on active duty. There are laws against this."

  "Stephen, it's not that."

  Stephen thought about the wealth McDowell had created over the last several years. Wealth Stephen had helped him make. Long hours and sacrifice Stephen had committed that were now being treated like it was something to be flushed down the city sewage drain. Feeling justified in his anger Stephen lashed out at McDowell personally, "You can't fire me, terminate my job or demote me just because you're not making enough money. If you needed to cut back then you shouldn't have bought the latest eighty-thousand dollar Hummer model last year."

  Unresponsive to the attack McDowell drifted for a moment as his eyes reached beyond a nearby window.

  "Stephen, you don't understand." Seemingly talking to someone beyond the cafe window he continued, his voice nearly void of all emotion. "We're bankrupt, Stephen. All employees will be released and the doors will be closed in a week and a half just after the next payday. The final payday will only be a 75% payment. I don't have a choice. There's no money left and the banks have frozen our lines of credit."

  "This is crap, George!" It was the first time Stephen had ever called his mentor by his first name and by doing so, he knew he was crossing a line of professional courtesy that McDowell had generously extended to him over the years. Burning hot and raising his voice, Stephen continued his protest, "This is total crap and you know it! You got greedy. You got greedy and wanted to be some big shot who everyone would know. So you went out and you made stupid decisions that ran this company right into the ground."

  Deflated, McDowell looked away from Stephen, "You're upset. I get that. You have every reason to be mad at me. But unfortunately, you're also right. I'm sorry, Stephen. I truly am."

  Stephen's anger burned as he struggled to find the right words which could express his outrage, "I can't believe you let this happen to us."

  "Look, I've seen young guns like you before. You're phenomenal at what you do and you're absolutely going to land on your feet after this."

  "Is that supposed to make me feel better?" Stephen rebutted.

&n
bsp; "Come on, Stephen. You've worked for me for years. Let me introduce you to a guy I know. This guy is an up-and-comer and he's incredibly smart. I used to do a lot of work with his father. You know who Don Rockwell is? Ah, never mind. Honestly, the old man's time has passed. But his son. Man, his son is a pit-bull. The two had a falling out and, well, why don't I try to introduce you guys and see what happens."

  "Can he give me a job?" Stephen said curtly.

  "I don't know if he's hiring right now but you never know what can happen." McDowell appealed with a mistaken hint of cheerfulness.

  "I don't need to make new friends. I need to make money," Stephen argued, his temperature rising with each word uttered. "I don't have a year's worth of padding in the bank account, George. I'm getting screwed here and I don't have the same cushion you have. So forgive me if I'm not interested in having a brainstorming session over who I can meet at the 19th hole because I won't even have enough money to pay for the round of golf in the first place."

  "Stephen, you're going to be alright. I know that." McDowell pleaded.

  "That's your conciliation? You just know I'm going to be alright? You're kicking us all onto the street in the middle of a global economic meltdown and you can feel better just by saying I'll be alright?"

  McDowell retreated, "No, that's not what I'm saying. I really am concerned for your well-being."

  "Your concern sounds about a year too late. You should have been more concerned when you were making decisions which would affect people's lives instead of thinking about your own damn fame and fortune."

  Stephen looked directly at the man he had trusted with his family's financial life. McDowell was crushed, humbled and hurting as well but Stephen felt no sympathy for the man. McDowell's gaze retreated into a safe house of distant nothingness beyond the window. Realizing decisions had been made and that questions or even continued conversations were utterly pointless, Stephen joined McDowell's prolonged stare through the window and cringed at the thought of how he would explain this situation to Sarah.