long term it ought to be able to repay its debts, especially if the partners were scrupulous about selling all their valuable possessions.
As the afternoon faded into twilight, the outlines of a plan began to form in his mind, and he allowed himself the faintest glimmer of hope.
At six P.M. he went to see Ben Greenbourne.
Greenbourne was past seventy, but still fit, and he continued to run the business. He had a daughter, Kate, but Solly had been his only son; so when he retired he would have to hand over to his nephews, and he seemed reluctant to do that.
Hugh called at the mansion in Piccadilly. The house gave the impression not just of prosperity but of limitless wealth. Every clock was a jewel, every stick of furniture a priceless antique; every panel was exquisitely carved, every carpet specially woven. Hugh was shown into the library, where gaslights blazed and a fire roared. In this room he had first learned that the boy called Bertie Greenbourne was his son.
Wondering if the books were just for show, he glanced at several while he was waiting. Some might have been chosen for their fine bindings, he thought, but others were well thumbed, and several languages were represented. Greenbourne’s learning was genuine.
The old man appeared fifteen minutes later, and apologized for keeping Hugh waiting. “A domestic problem detained me,” he said with clipped Prussian courtesy. His family had never been Prussian; they had copied the manners of upper-class Germans then retained them through a hundred years of living in England. He held himself as straight as ever, but Hugh thought he looked tired and worried. Greenbourne did not say what the domestic problem was and Hugh did not ask.
“You know that Cordovan bonds have crashed this afternoon,” Hugh said.
“Yes.”
“And you probably heard that my bank has closed its doors as a result.”
“Yes. I am very sorry.”
“It’s twenty-four years since the last time an English bank failed.”
“That was Overend and Gurney. I remember it well.”
“So do I. My father went broke and hanged himself in his office in Leadenhall Street.”
Greenbourne was embarrassed. “I am most terribly sorry, Pilaster. That dreadful fact had slipped my mind.”
“A lot of firms went down in that crisis. But much worse will happen tomorrow.” Hugh leaned forward on his stool and began his big pitch. “In the last quarter of a century the business done in the City has increased tenfold. And because banking has become so sophisticated and complex, we are all more closely intertwined than ever. Some of the people whose money we have lost will be unable to pay their debts, so they will go bust too — and so on. Next week
“Action?” said Greenbourne with more than a hint of irritation. “What action can be taken? Your only remedy is to pay your debts; you cannot do so; therefore you are helpless.”
“Alone, yes, I’m helpless. But I am hoping that the banking community will do something.”
“Do you propose to ask other bankers to pay your debts? Why should they?” He was getting ready to be angry.
“You’ll agree, surely, that it would be better for all of us if Pilasters’ creditors could be paid in full.”
“Obviously.”
“Suppose a syndicate of bankers were formed to take over both the assets and the liabilities of Pilasters. The syndicate would guarantee to pay any creditor on demand. At the same time, it would begin to liquidate Pilasters’ assets in an orderly fashion.”
Suddenly Greenbourne was interested, and his irritability vanished as he considered this novel proposal. “I see. If the members of the syndicate were sufficiently respected and prestigious, their guarantee might be enough to reassure everyone, and creditors might not demand their cash immediately. With luck, the flow of money coming in from the sale of assets might cover the payments to creditors.”
“And a dreadful crisis would be averted.”
Greenbourne shook his head. “But in the end, the members of the syndicate would lose money, for Pilasters’ liabilities are greater than its assets.”
“Not necessarily.”
“How so?”
“We have more than two million pounds’ worth of Cordova bonds which are today valued at nothing. However, our other assets are substantial. A lot depends on how much we can raise by the sale of the partners’ houses, and so on; but I estimate that even today the shortfall is only a million pounds.”
“So the syndicate must expect to lose a million.”
“Perhaps. But Cordova bonds may not be worthless forever. The rebels may be defeated. Or the new government may resume interest payments. At some point the price of Cordova bonds will rise.”
“Possibly.”
“If the bonds came up to just half their previous level, the syndicate would break even. And if they did better than that, the syndicate would actually make a profit.”
Greenbourne shook his head. “It might work, but for those Santamaria harbor bonds. That Cordovan Minister, Miranda, strikes me as an out-and-out thief; and his father is apparently the leader of the rebels. My guess is that the whole two million pounds has gone to pay for guns and ammunition. In which case investors will never see a penny.”
The old boy was as sharp as always, Hugh thought: he had exactly the same fear. “I’m afraid you may be right. All the same there’s a chance. And if you allow a financial panic you’re sure to lose money in other ways.”
“It’s an ingenious plan. You always were the cleverest of your family, young Pilaster.”
“But the plan depends on you.”
“Ah.”
“If you agree to head the syndicate, the City will follow your lead. If you refuse to be part of it, the syndicate will not have the prestige to reassure creditors.”
“I see that.” Greenbourne was not the man for false modesty.
“Will you do it?” Hugh held his breath.
The old man was silent for several seconds, thinking, then he said firmly: “No, I won’t.”
Hugh slumped in his chair. It was his last shot and it had failed. He felt a great weariness descend on him, as if his life were over and he were a tired old man.
Greenbourne said: “All my life I have been cautious. Where other men see high profits, I see high risks, and I resist the temptation. Your uncle Joseph was not like me. He would take the risk — and he pocketed the profits. His son Edward was worse. I say nothing about you: you have only just taken over. But the Pilasters must pay the price for their years of high profits. I didn’t take those profits — why should I pay your debts? If I spend money to rescue you now, the foolish investor will be rewarded and the careful one will suffer. And if banking were run that way, why should anyone be cautious? We might as well all take risks, for there is no risk when failed banks can always be rescued. But there is always risk. Banking cannot be run your way. There will always be crashes. They are necessary to remind good and bad investors that risk is real.”
Hugh had wondered, before coming here, whether to tell the old man that Micky Miranda had murdered Solly. Now he considered it again, but he came to the same conclusion: it would shock and distress the old man but it would do nothing to persuade him to rescue Pilasters.
He was casting about for something to say, some last attempt to change Greenbourne’s mind, when the butler came in and said: “Pardon me, Mr. Greenbourne, but you asked to be called the moment the detective arrived.”
Greenbourne stood up immediately, looking agitated, but his courtesy would not let him rush out without an explanation. “I’m sorry, Pilaster, but I must leave you. My granddaughter Rebecca has … disappeared … and we are all distraught.”
“I’m so sorry to hear that,” Hugh said. He knew Solly’s sister Kate, and he had a vague memory of her
