She was right. He had spent the day in Tokyo talking to some of the institutions whose money our firm managed. He should have finished his meetings by now.
I turned to Karen, 'Get hold of Hamilton. He's at the Imperial, I think. Hurry up.'
I still had a couple of minutes. It took Karen only one of them to track Hamilton down at his hotel.
'Hallo, Hamilton. I'm sorry to disturb your evening,' I said.
'Not at all. I was just catching up with some reading. I don't know why I bother. This so called 'research' is all drivel. What's going on?'
I outlined the deal and repeated the negative comments of David, Claire and the others. I then told him what Cash had said about the Japanese.
After a few seconds' pause, I heard Hamilton's soft, calm voice with its mild Scottish intonation. Like a good malt whisky it soothed my nerves. 'Very interesting. We might have something to do here, Paul, laddie. I spoke to a couple of the life-insurance companies this morning. They both said that they were worried about the stockmarket in America and have been selling shares heavily. They have several hundred million dollars to put into the bond market, but have been waiting for a big new issue so that they can buy the size they want. You know how the Japanese are; if two of them think like this, then there are probably another half dozen with the same idea.'
'So maybe Cash was telling the truth?'
'Extraordinary as it may seem, that might be the case.'
'So shall I buy ten million?'
'No.'
'No?' I didn't understand. From what Hamilton had said, it looked as though this deal was going to work.
'Buy a hundred.'
'A hundred million dollars? Are you sure? It seems an awful lot of money to invest in a deal that nobody likes. In fact it seems an awful lot of money to invest in any deal. I'm sure we don't have that much cash available.'
'Well, then sell some other bonds. Look, Paul. Just once in a while we get the chance to make some real money. This is it. Buy a hundred.'
'Right. Will you be at the hotel for the rest of the evening?'
'Yes, but I've got some work to do, so don't disturb me unless you really have to.' With that, Hamilton hung up.
Buying $100 million was a big risk. A huge risk. If we got it wrong our losses would ruin our performance for the whole year. It would be very difficult to explain this to the institutions that trusted us with their money. On the other hand, if the Japanese really had bought $300 million, and we bought $100 million, that would leave only $100 million for the rest of the world. Hamilton had a reputation for occasionally taking large calculated risks, and getting them right.
A light flashed. It was Cash.
'We are launching it now. What do you think, buddy? Do you want ten? I feel lucky on this one. Let's make some dough here!'
I felt my throat tighten as I said slowly and deliberately, 'I'll take a hundred.'
Even Cash was silenced by that one. I could just hear a whispered 'Wow!'. He put me on hold for five seconds.
'We can't do a hundred at 99
I was damned if I was going to let them get away with that.
'Look. You know and I know that the rest of the market hates this deal. I just happen to like it, but only at a price of 99. It's a hundred at 99 or none at all.'
'Paul, you don't understand the way these things work. If you want to buy that many bonds, you've got to pay up for them.'
Cash's wheedling voice was irritating me.
'A hundred at 99 or you have a dog on your hands.'
A pause. Then, 'OK, you're done. We sell you one hundred million dollars of the new Sweden at a price of 99.'
My hand shook as I put down the phone. This was by far the biggest position I had run in my life. Betting a hundred million dollars against the opinion of the rest of the market made me more than a little nervous. My mind conjured up the awful possibilities. What if we had got it all wrong? What if we were to lose hundreds of thousands of dollars in the next few minutes? How would we explain it to Mr De Jong? How would we explain it to the institutions who trusted us with their money?
This wouldn't do. I had to banish all the what-ifs from my mind. I had to transform my brain from an emotional jumble of wild conjectures to a totally reliable calculating machine. I had to relax. I noticed that my knuckles were white as they clutched the handset of my telephone. I forced my fingers to loosen their grip.
The lines were all flashing. I picked one up. It was Claire.
'What did I tell you? A howling dog. Did you buy any?'
'We did buy some, actually, yes.'
'Oh no.' She sounded sympathetic. 'You really must be careful of that Cash. But, if you want any more, you know where to come. We are offering them at 98.90.'
'No thanks. Bye.'
So BLG was already offering bonds below the initial offering price of 99. But Claire had mentioned that they would try to sell short bonds they didn't have in the hope of buying them back later. No wonder their offer was low.
I picked up another line.
'Hi Paul, David. Have you bought any of these new Swedens?'
'A few.'
'Well, this thing is falling out of bed. We are bidding 98.75 and offering bonds at 98.80. None of my customers like it.'
Oh God. This was all going horribly wrong. The price was falling fast. At a bid price of 98.75, I was down $250,000. Should I take my loss? I remembered an old maxim, 'Cut your losses and let your profits roll.' Then I remembered another. 'If you have a view, stick with it.' Great help. Think, Paul, think.
Another line flashed. Claire again. 'This doesn't look good, I'm afraid. We are now bidding 98.50. There are sellers of bonds everywhere. This bond is only going to go down. Do you want to do anything?'
Ninety-eight fifty! My losses were now half a million dollars. A voice inside me screamed, 'Sell!' Fortunately I managed to answer in a quiet, hoarse voice, 'No, nothing right now, thank you.'
I called Bloomfield Weiss. Cash answered.
'What's going wrong with this deal? I thought you had placed most of it?' I asked, just winning the struggle to keep my voice below a shout.
'Relax, Paul. We sold the three hundred million into Japan. We sold you a hundred million. We sold an American fifty million. And we just bought about fifty million from the other dealers. That makes five hundred million. There are no other bonds around.'
I could have screamed at him. I could have shouted foul abuse at the telephone. But I didn't. I just murmured goodbye.
I felt cheated, betrayed. Worst of all I felt stupid. Anyone can read a market wrong. Only a fool would trust a hundred million dollars to Cash Callaghan. He hadn't even admitted his lie when the collapse of the bonds had shown it up for what it was. I tried to call Hamilton in Tokyo, but couldn't reach him. I left Karen to keep trying whilst I tried to work out the best way to limit the damage of this mess.
During all this I had been totally absorbed in the world at the other end of the telephone. For the first time I looked up to see Debbie watching me. She had been following everything. The smile that always seemed a second away from her lips was nowhere to be seen. Her face was concerned.
'What was that you said about jumping out of a window?' I said, struggling to keep my voice steady.
She forced a brief smile and then the worried look reappeared.
'Any ideas?' I asked.
Debbie frowned for a moment. It was wrong of me to ask her. There was no magic solution to this problem, and I couldn't shift the burden of responsibility for such an enormous cock-up on to her. But as she paused, I found
