Dominion Rising Bonus Swag

by Gwynn White

  “The Congo? The—the Black Terror?”

  “The Gold Terror. We’re on the Emperor’s side.”

  “What if I don’t want to go?”

  “Not crazy about flying into the middle of a war?” Churchill sounded sympathetic.

  Encouraged, Ran nodded. “I’m really not keen on violence.”

  Churchill whipped out a small pistol and shot Ran in the chest. Ran staggered back. Mihal started forward, then stopped, his way blocked by Klawitz’s wheelchair.

  Ran fell against the door. Someone rattled the handle and urgently called the directors’ names. Churchill shouted, “Go away. We’re fine.”

  Pain pulsed through Ran’s chest in seismic waves, faster than his heart could beat. It saturated his body like adrenaline. He yanked his sweater open, got the zipper of his shirt undone, baring his upper chest.

  “Don’t bleed on my fucking floor,” Churchill said. “Thanks.”

  Klawitz said, “Heal yourself. Go on, you little bastard.”

  It wasn’t as if Ran had any choice.

  There wasn’t as much blood coming out of him as he’d expected. The bullet had lodged somewhere in his right shoulder joint. Teeth set, he palpated the pucker of the entry wound with his left hand, spread its torn lips.

  The pain crested and began to ebb. It was just a matter of holding on, not passing out, until it became bearable. Actually, he’d heal even if he did pass out. But he refused to give Churchill the satisfaction of seeing him collapse.

  He worked at the mouth of the wound until the bullet crowned, substantially flattened. A spurt of dark blood came after it.

  Churchill threw him a box of tissues.

  Ran dropped the tissues, picked them up and blotted his shoulder. He tossed the bullet onto Churchill’s desk. He was dripping with cold sweat. “I should just walk out of here and never come back. You sadists.”

  “You think we’re bad?” Churchill said. “Wait until you meet BASI’s unconventional defense technologies research group.” He dropped the bullet into the ashtray on his desk, wiped traces of Ran’s blood on a tissue, crumpled that into the ashtray too and set light to it. When it had burned to ash he said, “Zalyotin, why don’t you explain to him.”

  Mihal said, “I’m sorry, Ran. Yesterday House Wessex and House von Bismarck announced the betrothal of your cousin Fiona to Caspar von Bismarck.”

  “Fiona? She’s just a baby.”

  “That’s no obstacle to marriage, is it? Not for royalty. Anyway, in the usual way, the marriage contract came with a number of addendums. None of them look earthshaking. But there’s one interesting item in the fine print: an agreement to conduct joint research into unconventional defense technologies.”

  “What’s that got to do with me?”

  “We asked around a bit,” Churchill took up the thread. “Turns out that unconventional defense technologies means you.”

  “Translation,” Klawitz said. “Your cousin Madelaine has traded you to House von Bismarck in exchange for a bunch of advanced radio navigation and submarine technologies.”

  “They—my—she can’t do that.”

  “Wanna bet?”

  My mother, Ran thought. She couldn’t have agreed. Or … did she? “They don’t even know I’m still alive!”

  Churchill shook his head. “Of course they do,” he said. “Ran bloody Ireland.”

  “I don’t believe it,” Ran said. “I think I have the worst family in the world.”

  “Give Lady Vivienne some credit, you ungrateful little brat,” Churchill said. “She overcame her own maternal instinct to let you stay here, in safety. It was a good arrangement. But it is now at an end, thanks to your cousin Madelaine’s desperation to obtain an alliance with BASI.”

  “I … see.”

  “The von Bismarcks may not know exactly where you are, but they soon will. And we can’t stop them from grabbing you. If you’re here.”

  Ran took a cigarette from Churchill’s pack, and the director gave him a light. The world had shifted on its axis.

  “I’m not invulnerable,” he said wretchedly. “All I know is what hasn’t killed me yet.”

  “Close enough for government work,” Churchill said. “And if it turns out you can be killed, after all? As it happens, the IMF does not choose to cooperate with murderers.”

  “Right.” Ran hauled smoke into his lungs. “Right. The Congo. When do I start?”

  4

  Filip

  The Next Day. May 19th, 1989. Ibiza

  We got tourney in Egypt, too!” the Egyptian trader shouted. Filip Orlov had to strain to hear him over the baying of the crowd. “But we don’t give ‘em weapons!”

  “So how do they fight?” Filip shouted.

  “That depends! See, we got five castes, apart from the humans. I’m a human.”

  The Egyptian trader flashed a self-depreciating grin. He obviously knew that Europeans saw him as less than human, because of the band of ruby and fish-belly white skin encircling his neck and trailing down into his collar. Europeans called these marks necklace tattoos. The Egyptians called them fidelangiomas. They were the mark of top-caste privilege in the Egyptian Empire, a mark of abomination in the rest of the world. But of course, most Egyptians were even less human in appearance.

  “We got Growers, Builders, Servants, Guards, and Cleaners. I’m translating. For example, the Guards are divided into jaguars, hyenas, and tigers. They fight with their teeth. Builders got big heads, for carrying shit on. They’re bulls or sheep, mostly. They fight with their horns. But even a Grower? A rabbit can do a lot more damage than you’d think.”

  “I bet,” Filip said.

  Down in the open-air pit, torches blazed, billowing smoke over the stands. Two nearly-naked men were flailing at each other with swords. The crowd cheered them on. This type of mini-tourney, known as free combat, consisted of bouts between volunteers with no money, no training, no armor, and no hope of making a bundle any other way. Back home in Berlin, free combats were fought to the surrender. Here on Ibiza, each and every bout went to the death. That had been one of the attractions featured on the circular for this junket. Sunshine, sex, and sport.

  None of it seemed to have anything to do with bond trading.

  Filip had no interest in booze, prostitutes, or fights to the death. He was here on a mission. Typical savant, he guessed. Mysteries bugged him.

  “So, Patenemheb,” he shouted. That was the Egyptian trader’s name. Patenemheb was a rep for a hedge fund in Cairo. “Are you liking these new von Bismarck asset-backed securities? Because I’m loving the fuckers,” he blatantly lied.

  “You kidding?” Patenemheb shouted back. “I love those ABSs so much, I want to fuck them and marry them. No, marry them and then fuck them! Four percent per annum, zero risk? Fuck me sideways! I want more, like fucking now!”

  Filip hated the new von Bismarck asset-backed securities. In fact he hated all asset-backed securities. Normally a mild man, he hated the things with a rare intensity. That’s how he knew he was onto a good trade.

  “I know!” he shouted. Iced fruit punch bubbled in his gut like acid. “Four percent! It’s incredible! And I can’t get my hands on a single one! I’d like to know who’s buying those mothers!”

  Patenemheb tittered. “Hee, hee! I am! Maybe I’ll reprocess some of them and sell you a tranche or two.”

  Filip did not want to inadvertently agree to buy a tranche of reprocessed asset-backed securities. But he had to find out who was buying the things. “Hey, you’re a stand-up guy, Patenemheb! The financial industry in Berlin? It’s a circle jerk. All the big Houses sell to each other. Little outfits like us gotta stand outside with our noses pressed against the window! So how much you gonna screw me for?”

  “Face value!” the Egyptianman screeched giddily. “I’ll sell you a tranche at face value. Pre-insured. Plus my commission, of course!”

  “Hey! So can I get a look at the prospectuses?”

  “The what?” Patenemheb was
distracted by a passing waitress. “Damn, I want to fuck her. What were you saying? Prospectuses?”

  “Yeah. See, I just like to get some idea of what’s in a security before I sign a deal.”

  “I think I got a stack of those somewhere. But not to worry! Everything’s got AAA ratings from the IMF! My principals insist on that!”

  Patenemheb became forthcoming. He explained how he was employed as a mortgage bond expert by a syndicate of Egyptian princes, but he didn’t need to be an expert, because all his principals cared about was ratings—and interest rates, of course. At four percent and up, he had an open commission to buy as many bonds as the Berlin banks would sell him.

  Filip felt dizzy. Patenemheb didn’t give a flying fuck about his investors. All he cared about was doing as many deals as possible to maximize his own commission. “So how much business have you done this weekend?”

  “Like I’d fucking tell you that! But let’s just say more than sixty. But less than eighty. No, seventy. More than sixty but less than seventy. Maybe somewhere around sixty-five.”

  Filip mentally multiplied sixty-five million marks by the number of weeks in a year to achieve a conservative estimate of Patenemheb’s buying activity. He fudged up for rising price trends, down for seasonality, and ended up with a figure that made him feel sick.

  If the mortgage bond market was a country, it would be the size of Holland and Sweden put together. And Patenemheb’s Egyptian princes were holding thirty percent of it.

  Down in the pit, one fighter lay unmoving. Attendants paraded the other fighter around the ring, leaving a red trail in the sawdust.

  * * *

  “I’ve met the long side of the market,” Filip breathlessly told Boris, his brother and business partner.

  Boris was sitting in the corridor outside the suite where Haus Ascania—the A in BASI—was holding its annual party. He was playing with a remote-controlled beetle. “Oh yeah? The missing thirty percent?”

  “The Egyptians. It’s fucking Egypt. That’s who’s buying the crap.” Filip explained about Patenemheb and the AAA-rated junk he was shovelling into the eager hands of his investors.

  “So fucking what?” Boris said. He made his beetle charge across the corridor and smash into the wall. “We’re still getting killed.”

  Filip hadn’t forgotten that. He ate and drank the steady upward march of the bond indices, like a man gorging on poison. He talked about it in his sleep. His wife worried. Everyone in the family worried, not unreasonably. It was all of their money at stake. Actually, it was Cousin Anton’s money at stake, and if he ever found out, he would be a lot more than worried about it. He would probably kill them all.

  Filip was not worried. He just knew he and Boris were onto the trade of the century.

  His only concern, just a nagging doubt, was the possibility that the market could stay irrational longer than the Orlov family could stay solvent.

  A group of people came around the corner, the women rattling with gems, the men exposing flabby white bellies above their beach shorts. Filip and Boris trailed along after the group, as if they belonged with it, and squeezed inside the Ascania suite.

  Wall to wall, sunburnt and semi-clothed, the elite of the global financial industry stood around shouting at each other just like they did in Berlin. A reggae band struggled to be heard over the racket. A fountain in the middle of the split-level room appeared to be flowing with champagne. Small parrot-colored monkeys huddled in the topmost branches of palm trees. Filip got a faceful of saggy wife-cleavage as he dove for a drink.

  Boris said with feeling, “Saints.”

  Filip concurred, “This market’s got to crash. It’s got to, that’s all.”

  They found Leo von Bismarck and his sister Anna, their biggest investors, on a sort of dais at the far end of the room. Lady Anna lay on the floor, staring at the ceiling. Sir Leo was talking tourney, using chess pieces as sandbox figurines.

  Getting onto the dais, for the Orlovs, took balls. There were no bouncers here but there was the social and financial gulf between the wealth managers of great Houses who did billion-mark deals before breakfast, and a couple of Russian émigrés who thought a million marks was a lot of money. Boris was the real problem. The brains of the family was clad tonight in dirty denim shorts and a t-shirt silkscreened with a portrait of the last Tsar, insufficiently obscured by waist-length black hair. He was so obviously a savant, and this wasn’t the place for savants. Savants were supposed to live in cubicles. They did not come on junkets.

  While Filip was trying to catch Leo von Bismarck’s eye, Boris put his beetle down on the dais and started running it around people’s feet. It crashed into Leo’s chair and flipped onto its back. Leo looked down in surprise. “That’s mine,” Boris yelled.

  “Hey! Boris! Can I borrow it?”

  The Orlovs scrambled onto the dais. Leo set the beetle on the chessboard he was using as a sandbox to reenact a joust. Filip stood at his shoulder. “Believe me now?” he said quietly

  “No. I don’t understand why you wanted me to come.” Leo’s face was pink, his hairknot a mess; he was wearing a mesh tank top over baggy hose and bare feet. “I mean, I’m having fun. And Anna’s been enjoying the beach. But I don’t understand the point you’re supposedly making.”

  “Just look around,” Filip said. “Look at these people.”

  “Yes?”

  “They’re shits,” Boris explained. “They’d rape their grandmothers for a half-penny spread over HACOR.”

  Filip said, “You don’t even need statistical probability analysis to see that this market is going to blow up. What’s the case for asset-backed securities? A concept of virtue that just doesn’t hold water. The assumption in back of all this stuff is that people are basically good. All right? Now look around you. Just look around.”

  “Most of these guys are very intelligent,” Leo said.

  “So’m I,” Boris said. “And I’m a shit. But at least I don’t go around raping my investors. We’re trying to help you out. You’d rather go down with the market? Fine. We’ll rip your fucking eyeballs out, too.”

  He wandered off to talk to someone else.

  “Your brother’s a head case,” Leo said.

  “He’s a savant. So am I, but I don’t have it so bad. And he’s passionate because he believes in our trade.”

  “Our trade.” Leo winced. “Listen, Filip, I don’t know if I want to stay in these things, these reinsurance notes or whatever you’re calling them.”

  Filip realized in horror that inducing the von Bismarck scion to come on this junket was having the opposite effect from what he’d intended. He had meant Leo to see for himself that the mortgage bond market was run by braindead pricks who didn’t give a fuck. Instead, their mindless confidence was swaying Leo into doubting Filip’s convictions.

  Filip grabbed the nearest guest, an older wealth manager who worked for House Ascania. “Jorge, my friend. Let me ask you a question. These ABSs. What do you think is going to happen to them in ten years?”

  “Ten years? I’m retiring in ninety-one. I only need this shit to last another two years.” The wealth manager belched.

  “See?” Filip said. “See? Even he doesn’t believe in them.”

  “Two years,” Leo said. “Two more years, or maybe ten, or maybe thirty years of losing five hundred thousand per annum on your negative, cynical view of the world. These premiums are killing me, Filip.”

  Filip bit back a Boris-style response—What the fuck do you think they’re doing to us?

  Just like everyone else in this room, the Orlovs were massively leveraged. The difference was that they were betting the other way. They had purchased reinsurance notes on a selection of the most poisonous ABSs they could find, which would pay out in the event that those securities went to zero. But if they were to stay in the game, they had to get Leo von Bismarck to re-up.

  “It’s simple,” Filip said as persuasively as he could. “Mortgage bond valuations are still risi
ng. So are ABS prices, because ABSs are just repackaged mortgage bonds. But the underlying assets are going bad at a rate of five percent! If the default rate reaches seven percent, B-rated ABSs go to zero. Nine percent, A-rated ABSs go to zero. We don’t even have to wait that long. We’ve bought reinsurance notes on B-rated bonds. The most repulsive, rotten securities on the market.”

  “Which my family is holding several billion marks of.”

  “Which is why you need to be hedged!”

  “Look,” Leo said, “I know you’re right. At least I think you’re right. The bonds are a pile of shit …”

  “Exactly! The market’s pricing the risk of default at a hundred to one. It’s actually more like five to one.”

  “But even if the default rate goes to ten percent, how’s the market going to crash, Filip? Everyone’s insured. We’re not stupid.”

  “The reinsurance policies are the risk. They give people a false sense of security. But all the big banks are insuring each other.” Boris called it the circle jerk of doom. “The idea is that everyone’s loans can’t go bad at once. But we don’t need them to. We just need the crappy ones we’ve bet against to go bad.”

  “You’re betting against ordinary people,” Leo said. “You’re betting on financial ruin for thousands of ordinary Germans.”

  Oh, saints, don’t go all ethical on me. Filip looked around for Boris, didn’t see him. He saw Anna von Bismarck getting up, swaying to the beat of the music. She was the most beautiful woman in the room. She looked a million miles away.

  “The future’s at the bottom of the pyramid,” Leo said. “That’s what our assayers tell us. Who are you to say it’s not? You’re nobly born, too. Why would you like the idea that millions of lowborn jackasses might be more virtuous than we ever were? It was nice to believe that the entitled minority accounts for the majority of puissant saints. It gave us a reason to rule the roost. Gave the lowborn motivation to better themselves. But what if it turns out not to be true? What if everyone’s as good as everyone else?”