The Samurai Strategy Part 67

Tam proceeded to herd Tanaka and the guards into Noda's office, pausing just long enough to kill the phone wires. As he began to recover, he commenced sputtering about legal action and jail and general h.e.l.lfire.

Who cared? As of this moment, the offices and computer of Dai Nippon, International belonged to us.

Henderson was informed of our progress when his phone rang at exactly 4:48 P.M. He arrived, along with his Georgia Mafia computer expert, at 5:17, and Tam met them at the security doors.

I wasn't actually there to welcome them aboard, since I was guarding Tanaka just then and engaged in a small one-on-one with the man, explaining to him that Matsuo Noda's a.s.s was ours. The president of Dai Nippon, I advised, was a few short days away from becoming everybody's lead story, featured as the j.a.panese executive who'd (apparently) rebelled against his homeland. Noda was no stranger to headlines, of course, but he preferred to engineer them himself, so this definitely wasn't going to be his style. Matsuo Noda was, albeit unwillingly, about to make history. As I broke this news to Dai Nippon's chief of New York operations, I sensed he was definitely less than enthusiastic about the prospect. Well, he'd have a few days to get used to the idea, since n.o.body was going to enter or leave the eleventh floor for a while.

It was still a bit difficult to believe what had happened. Or even more, what was next. But sometimes reality can have a way of outstripping your wildest powers of imagination--a s.p.a.ce Shuttle explodes, a nuclear meltdown in the Ukraine, ten-dollar oil, all of it too farfetched to make credible fiction. It could only exist in the realm of the real.

We were about to start moving billions and billions of dollars, fast.

And since we didn't know how long we could continue before Matsuo Noda figured out a way to stop us, we were going to adhere to a schedule that covered the most vital sectors first--those outfits whose R&D Tam considered strategic to America's future technological leadership. Our goal for the first day was five billion, worldwide.

Thus the countdown began. Henderson's financial artist loaded Tam's new program tape onto DNI's big NEC supercomputer and cranked up. We had roughly sixty hours till the opening bell on Monday.

CHAPTER TWENTY-SEVEN

"It's the worst of times, buddy, and the best of times. Whatever dude once said that didn't know the half of it. He oughta be around now to check out the Street."

That was Henderson's Georgia Mafia co-conspirator, an irritatingly smug young man with red hair and acne who dressed entirely in white, right down to his skinny Italian tie. We were told he went by the handle of Jim Bob. As he meditated upon Wall Street's macroeconomic incongruities, he punched a Willie Nelson tape into his boom box and popped a Coors, pregame warm-up for programming a full-scale a.s.sault on the U.S. securities markets.

Jim Bob allowed as how he'd arrived in the Big Apple four years earlier with a cardboard suitcase, a finance degree from Georgia Tech, and a larger than regulation endowment of natural cunning. After a couple of years' toil in Henderson's quasi-legal vineyards, he'd gone out on his own, whereupon he'd parlayed his winnings with Bill and the remnants of a baseball scholarship into what was now a high six-figure "haircut,"

the name options players use for their grubstake. The way he figured it, he was just hitting his stride.

How, I inquired at one point during that long weekend, had he managed it?

"Chum, it's idiot simple. You buy into fear, sell into greed, and f.u.c.k fundamentals. Main thing is, if something makes sense, don't do it.

America's in the all-time s.h.i.t, and Wall Street's oblivious. It's like everybody's bidding up standing room on the Tttanic. But who cares? You play options like I do and all you have to worry about is not getting stupider than the herd. Which ain't necessarily much of a trick."

Stock options, he went on to a.s.sert, were like having a credit card in a wh.o.r.ehouse--a ton of action for what amounted to tip money up front.

No wonder Las Vegas was in trouble, when Wall Street was beckoning our high rollers to take odds on the direction of the market. Only widows and orphans, he observed, bought actual securities anymore. That action was reserved for the halt and lame.

While country singers tw.a.n.ged beer hall soliloquies on the general increase in faithless women, Jim Bob coded in the brokerage houses and offsh.o.r.e banks we'd be using, the catalog of stocks in the DNI portfolio, and our sequence of transactions.

As noted earlier, the financial setup had been handled by Henderson and friends. Using his connections, he'd opened accounts for hundreds of dummy corporations in about two dozen offsh.o.r.e banks. He stuck to the usual no-questions-asked operations like Banca della Svizzera Italiana and Bank Leu in the Bahamas--the latter a Swiss-owned Na.s.sau laundry that had, in years past, reportedly destroyed records and lied to the Securities and Exchange Commission as a favor to certain of America's more inventive inside traders.

Since the volume of money to be moved was staggering, it would all be handled by sophisticated telecommunications networks. We would pa.s.s it through the anonymous accounts we'd established, accessed both ways by computer, and it would never be touched by human hands. DNI's cash would flash in and out with total cover. Added to that, anybody who tried to trace us would first have to break through a traditional Swiss stone wall.

To dump the stock we were planning to exploit fully the new "globalization" of the financial scene. Now that the National a.s.sociation of Securities Dealers had struck a deal with the London and Tokyo stock exchanges to swap price quotes, worldwide market makers were buying and selling American securities around the clock. Plenty of active market-making was happening off the exchange floors as well, at places like Jeffries out on the coast, which had recently handled a ma.s.sive Canadian takeover of an American company overnight, entirely off-exchange. With all the avenues available it was almost impossible to track the movement in a given issue. DNI's computers would be routing sell orders to brokerage firms around the globe, a block here, a block there, none of them in quant.i.ties that would raise eyebrows.

Maybe I also should add that none of the "corporations" Henderson had set up would be allowed to show a profit, which would simplify Treasury Department reporting requirements. As a matter of fact, before we were through, DNI was going to lose billions. But it would all be done legally, in accordance with SEC regs. It would also lead to a world financial flap of notable proportions. n.o.body would ever take Noda's money for granted again.

While Tam went over her new program with Jim Bob, pointing out her special features, Henderson and I found ourselves at reasonably loose ends. We sat around drinking green tea (G.o.d, how I came to hate that stuff) and puzzling how we'd all managed to get into such a mess. The major plus, however, was that we finally had Matsuo Noda by the short and curlies.

Or so we hoped. The problem was, he'd been a player longer than any of us, and he'd already demonstrated plenty of stamina. How would he counterattack? The question wasn't if, it was when. For the moment, though, we seemed to be on our way with clear sailing; in fact, the communications link with Kyoto was entirely empty. Tanaka also had clammed up, refusing to talk--beyond a rather firm prediction that our wholesale divest.i.ture of DNI's a.s.sets was an insane act doomed to failure. I might also add he didn't appear nearly as concerned as the circ.u.mstances would seem to merit. In fact, he was so complacent I started getting a little uneasy. Finally Bill and I ran his prediction past young Jim Bob. Could somebody get through to Tam's program and devise a way to shut us down?

Henderson's increasingly gla.s.sy-eyed protege took out enough time from popping "uppers" and swilling Coors to a.s.sure us to the contrary.

"h.e.l.l, no way you could stop what we're settin' up here. We got ourselves what you call a closed system. Everything's

going to be handled by that green-eyed monster over there in the corner. We got these numbered brokerage accounts all over the place.

Zip, in go the sell orders; zap, out go confirmations. And since none of the cash sits around, our bank accounts are all just gonna churn.

We'll have billions of buckaroos rollin' at the speed of light. Ain't n.o.body gonna be able to get a bead on the action, take my word for it."

Our computer-generated buying and selling, he went on to declare, was conveniently similar in appearance to the "program" trading of the big inst.i.tutional investors, the arbitrage players who routinely sold millions of dollars of securities in minutes using computers. Thanks to them, the market these days had been conditioned to accept huge, unaccountable trades as part of the territory. If somebody dumped ma.s.sive blocks of stock unexpectedly, it could mean anything--such as, the spread between those stocks' prices and some "index future" had gotten momentarily out of sync. Shuffling securities like poker chips was the name of the game on the Street these days, so n.o.body would really notice or care. The turnover we'd be generating would merely suggest to the market that various investment-house arbitrage desks were unwinding positions.

What the heck, I said to Tam, maybe we could unload the better part of DNI's holdings before Noda struck back. The real key to our attack on Dai Nippon, however, depended on what happened to that cash after we turned it around. When I mentioned that, she just crossed her fingers.

By late Sunday night the DNI offices were a clutter of empty Chinese take-out containers, Kentucky Fried Chicken boxes, and computer printouts. However, Jim Bob claimed the system looked like a go. He'd completed a long sequence of test runs, and he was predicting he could probably swing at least four billion the first day, something in the nature of a warm-up for grander things to come.

Jim Bob, I should say, was fully as efficient as advertised by Henderson. Even if he was now flying higher than a moon shot, thanks to all the pills. He worked methodically, carefully a.n.a.lyzing the program at every step, double-checking the codes, poring over his verification printouts for obscure glitches. Mainly, though, he kept one unfocused eye on the clock, saying he always delivered on time. Point of honor.

Thus it was that, when Monday morning rolled around, we

were primed to move on Wall Street. Tam's program was poised inside the mainframe like some lurking id, ready to be unleashed. We decided to start modestly, sticking to the exchanges in New York, and only later in the day expanding outward as we gained firmer footing.

At the stroke of nine-thirty A.M. Jim Bob inaugurated our maiden run with yet another beer. Henderson and I poured ourselves a bourbon. Tam even joined us, accepting a respectable shot.

"Fasten your seat belts, boys and girls." Jim Bob shakily peeled back the tab on his Coors. The screen in front of him focused our attention down to one small flashing green dot.

"Ignition."

He hit a key on the terminal, and Merrill Lynch got a computerized "sell" order for ten thousand shares of Texas Instruments. The time was exactly 9:31.

It was a textbook lift-off. Rows of green numbers began to scroll up the screen, only to blink and disappear. By G.o.d, the thing seemed to be working. We had just pulled the plug on DNI. All that was left now was to sit back and watch it sink.

As the morning wore on, Tam fielded phone calls from staffers, always claiming that Tanaka was not available just then. Of course, we weren't sure how long we could get away with that excuse, but for now none of us wanted to set the man free to start jabbering in j.a.panese on the phone. On the other hand, we were loosening up a bit on security.

Partly, I guess, because we were all increasingly wrecked, but also because it seemed to fit the situation. By Monday, Tanaka and his two retired sumo bone-crushers appeared to have grown resigned, one might even say philosophical, and I don't mind admitting it bothered me a lot. Tanaka was watching us destroy Noda's grand design right before his very eyes, yet he just sat there as though none of it mattered. How could this be? All he did was busy around brewing tea for everybody.

(Except, of course, for Jim Bob, who stuck to Coors.) However, I was too tired by then to think much about it.

Around two-thirty Henderson began complaining of a splitting headache and declared he had to go home and get some rest. I started to protest, but the man looked half dead. Tam and I weren't much better off, so we flipped a coin to see who would take the first watch. She won, which was great by me, since the long hours without sleep were really starting to unravel my concentration.

To understand what happened next, you have to try and envision the scene. It was three P.M. and things were going letter perfectly. The dollars were sailing through the accounts we'd set up and along about noon we'd even kicked in our buy program.

Yes, buy. That's not a typo. You see, we had to lose billions, not necessarily a trivial task. Think about it. If you merely want to drop a few million, all you have to do is just invest in some high-flying start-up and then sit there till the venture craters. But billions?

That's the part where Tam really showed her mettle (no pun intended).

Look, she said, the Brothers Hunt managed to blow millions by trying to corner silver, bidding up the price and then seeing it collapse. But we've got to get rid of some serious money, so why don't we do the same thing, only with a commodity worth something?

Platinum.

All life's great ideas have an inevitable simplicity. That's right, we were programmed to sell DNI's stock and buy platinum. From anybody, anywhere, at any price. We were planning to just swallow the worldwide commodity markets in the stuff, starting at the NY Merc and ending at Capetown. Of course, what we were also doing was boosting its price into the stratosphere--we were even bidding against ourselves through different brokerage houses. Anything to drive it up. I mean we had a lot of money to get rid of. We figured that by the time we were finished, DNI would be the proud owner of a couple of hundred billion in platinum metal, platinum futures, platinum mining stocks, platinum storage companies, platinum dealerships, platinum reserves, platinum investment coins. All of it at a price as high as we could push. I was betting on two thousand dollars an ounce by Friday.

The nice part was, what central bank was going to step in? Platinum was strategic, sure, but it wasn't a monetary metal. And if we had to bid against governments, so much the better. We were playing a drunken speculator's dream, going all out for the most volatile of all the world's commodities. After we'd squeezed that scam for every ounce it was worth, we would deliberately puncture the bubble and let the price nosedive. We were going to destroy the cancer of Dai Nippon by gorging Noda's takeover machine with financial poison. The eventual collapse should wipe out Matsuo Noda totally.

Platinum. I asked Jim Bob to check the waning moments of Monday's spot market, the latest prices down at the NY Merc, and he reported it had scooted up about twenty dollars an ounce. A little slow maybe, but then we were just starting out. I figured it would probably double in a couple of days.