Chapter 60 — A Knowledgeable Source in the Financial Services Industry

_April 29, 1984, Chicago, Illinois_

{psc} At 3:00pm, I met Kayleigh at the diner I had frequented with Violet when we'd had classes together or at the same time. We had walked up at almost the same time, with me just a few seconds in front of her. I greeted her, held the door for her, and we went in. By chance, the hostess seated us right away in the same booth Violet and I had regularly used after classes.

The waitress arrived almost right away, and we ordered coffee but declined menus. The waitress came back with the pot, filled our cups, then asked once again if we wanted to order anything. Neither of us did, so she left the booth.

"Thanks for meeting me," she said. "I know how we left things last time, but I had a long talk with my grandfather, and I wanted to discuss it with you."

"OK," I said with a bit of apprehension, as I had hoped not to involve Thomas Hart in this because, as I saw it, it could only cause trouble, not help.

"Do you know my grandfather's story?"

"No," I don't.

"He was a Senior at New Trier High School in Winnetka when the 'Japs' as he calls them, bombed Pearl Harbor. When he graduated, he joined the Marines and was eventually assigned to the 6th Marine Regiment. He fought on Guadalcanal and Tarawa and was promoted to Sergeant. He fought on Saipan and Tinian before he was transferred to the 5th Marine Division and fought on Iwo Jima. He won a Purple Heart and a Bronze Star on Iwo Jima.

After that, They returned to Hawaiߴi and were there when the war ended. His unit was assigned occupation duty, and they were in Japan until December, when they returned to San Francisco. He took advantage of the G.I. Bill and went to UCLA for his undergraduate degree, then Stanford for his law degree. Once he finished, he came back to Chicago and joined a small law firm, where he met Paul Lincoln, and they formed Hart-Lincoln in 1956."

"Doing rough math, your mom had to be born sometime after he shipped out but before he returned."

"There's that analytical skill in operation! Grandma and Grandpa met in High School. When he completed basic training and was preparing to ship out, he called her and asked her to marry him. She was only seventeen, but she said 'yes' and took the train to California. They married the day before he shipped out, and Mom was born in 1943.

"She stayed in San Diego with the wives of two other Marines, and all three of them worked in a hospital. Both their husbands died, one on Iwo Jima and one on Okinawa. When Grandpa came home, he and Grandma moved to LA, then to Palo Alto, before coming to Chicago.

"Mom met Dad at New Trier when he was a Senior and she was a Freshman. They married a few days after Mom graduated, and she worked while he finished his degree. I was born about ten months after they married. Dad got his teaching job, and Mom went to nursing school and had my little brother."

"My mom was seventeen when I was born, so not too much different from your grandma and mom."

"Things were different back then, especially with the war. Anyway, the thing I didn't tell you was that both Grandma and Grandpa were devout Catholics. When Grandpa came home, he refused to have anything to do with church and began telling people he was an atheist. He says that the aphorism 'there are no atheists in foxholes' is a lie because nobody who had actually been in a foxhole on those islands in the Pacific could ever believe in God."

"I obviously wasn't there, but from what my teachers in High School said about it, I find it hard to argue with his point."

"I never knew he'd been a devout Catholic until after I saw you the second time. Grandma still goes to church, and she obviously took my mom, who took me. Grandpa never once said anything about it to me, and I don't think he said anything to my mom, either. During the talk, he explained why he thinks it's all 'arrant nonsense', and as you say, it's understandable because of the things he saw. All that is to say that I think I understand you a bit better than I did before."

"That's not a bad thing, but I'm not sure it's sufficient to change the conclusion the last time we met."

"What would be sufficient?" Kayleigh asked.

"I'm not sure I know the answer to that question because it would come down to a negotiated solution. If we assume that your conversation with your grandfather created the necessary conditions for you to reconsider your views, there is still the hurdle that I'm not sure I can provide the kind of relationship I believe you want, at least not anytime soon.

"What I don't want is for you to begin a relationship expecting it will lead to a traditional marriage because I don't know if anything like that is in my future. You also have to take into account the other things I told you when we were together. In other words, it would be anything but conservative or traditional. And that leads me to ask why you're trying so hard."

"Before I knew about you being an atheist and about your baby, you basically matched my idea of an ideal guy, and given how much my grandfather likes you and trusts you, I'd say my judgment was confirmed."

"Those are two fairly big issues, one much bigger than the other."

"Atheism, right?"

"Yes. All things being equal, being a widower with a child isn't that far of a leap, even if the child wasn't from my marriage. I mean, sure, it could be a bridge too far for you, but if that were the case, you wouldn't be here. Your being here tells me you believe you can handle that part of my life. I suppose my question is what you want to do."

"I guess the first question to ask is if you're attracted to me."

"Yes. You're very pretty, in good shape, and seem like a sweet girl."

"I know that's not enough, well, except maybe in a bar, but it's a start. Would you be open to having coffee sometimes and talking?"

I had a flashback to Rachel Kealty and considered my circumstances and Kayleigh's behavior. Ultimately, I wanted to keep Thomas Hart happy, and so long as Kayleigh wasn't pushing hard, there was no reason not to occasionally have coffee. Eventually, she'd find a 'nice Catholic boy', and that would be that.

"Sure," I replied. "Why don't you call me when you want to get together to talk? I promise I'll make the time."

"Thanks."

We finished our coffee, and I left a generous tip for the waitress as we'd only had coffee, then headed back to the condo.

"So?" Bianca asked when I sat down with her after changing into sweats and a T-shirt.

"She's still interested and is trying to find some way forward. She had a talk with her grandfather, which I think opened her eyes a bit about atheism. He was a Marine during World War II, and that experience convinced him no gods exist."

"I could see that. My great-uncle served on a ship that was hit by a kamikaze. He was the first on that side of the family to come to the US from Mexico."

"My dad would have been too young for Korea and died before Viet Nam. My Grandfather wasn't drafted for World War II or Korea. I told you about my mom's friend whose husband was killed in Viet Nam, right?"

"Yes. Your first time in a church was his funeral, right?"

"Yes, then when his widow remarried. I don't remember much, except there was some kind of hubbub about the guy who walked her down the aisle who was around sixteen, I think. Mom never did say anything about it."

"Her brother or cousin?"

"No clue. I could ask my mom when I speak to her next weekend, and I think I will."

"Some of the girls from Loyola are coming over tomorrow in the afternoon — Sally, Julianne, and Lucy. Shelly will be here, too. They'll show up around 4:00pm and have dinner with us."

"OK. I don't have any plans."

"And all of them have serious or semi-serious guys," Bianca said.

I laughed, "I didn't mean it that way!"

"Speaking of 'that way', Esme will be home on Tuesday. I'm sure she'll be in touch."

"I'm sure she will!"

_April 30, 1984, Chicago, Illinois_

On Monday, just after 10:30am, I placed the call to J. William Oldenburg. I had to balance not saying anything that might upset him and harm the relationship with MTB Sports Management but also not trying to bring him aboard as a client based on Pete's research.

"Good morning," I said after I was transferred. "This is Jonathan Kane calling from Spurgeon Capital in Chicago."

"Good morning. Marv said you'd be calling. He mentioned you've been talking to Steve Young, and that you're managing investments for a number of players they rep."

"That's correct. I generally serve pension funds and high-net-worth individuals but recently cultivated a relationship with Marv at MTB to help players capitalize on their playing income, which I know can be short-lived."

"What investment vehicles do you use?"

"Whatever earns the best return," I replied. "Last year, I had a total return of 39.7% on the first dollar in using a mix of investment classes — equities, precious metals, currencies, and government securities. I operate a hedge fund and use the entire set of strategies to insulate my fund from market risk. The assets are all highly liquid and often protected with options for risk management. I understand you're a mortgage banker."

"That's correct. My firm issues mortgage-backed securities, but I suspect those aren't liquid enough for your fund."

"I avoid holding real estate or any related products for exactly that reason, though I personally own real estate. I'm calling about your personal investments to see if we might find some common ground."

"Fees?"

"Two and twenty," I said. "With an 8% hurdle."

"Steep. I had a pitch from Madoff that offers similar returns but without the fees."

"The question you have to ask yourself about that is how he makes his money."

"That was the thing that gave me pause. Why wouldn't I simply buy the S&P?"

"I nearly doubled it last year, so even with the fees, you come out way ahead. That said, unlike an S&P fund, there is a lockup period with a significant penalty if you withdraw the funds before a year is out."

"Liquidity is key for me," he said. "I'm not sure I can afford to lock up assets for a year."

Which was exactly what I had expected, based on what Pete had said about Oldenburg's finances.

"That restriction can't be waived because of the potential tax implications for other investors in the fund."

"Let's say I could work with that. What's involved?"

"A review by our Legal and Compliance teams. So long as you haven't had any trouble with the SEC, or in your case, banking regulators, it's usually a formality."

"How hard do they look?"

"They'll ask about ongoing investigations in each state where you operate, plus from the SEC."

"I'm having some trouble with Utah at the moment. It's a nuisance thing, which I'm sure you've encountered."

"I have," I said.

"Let me resolve that, and I think we can do business."

If Pete was right, he wasn't going to resolve it, and that was my 'out'.

"Sounds good," I said. "Let me give you my contact information."

I gave it to him, wished him well with his team, then ended the call. I was confident nothing I'd said would cause any blowback from MTB, and if Oldenburg called to invest, I'd flag Legal and Compliance with the information Pete had uncovered.

I returned to work and, at 11:45am, had lunch with Violet in the break room. We had just finished eating when Bianca came to say she was leaving for the day.

"How are you feeling?" I asked.

"I really needed to come back to work! I know it was only a month, but I was going stir-crazy! See you later!"

She left, and Violet and I left to go to the gym to work out.

"I was surprised she came back so soon," Violet observed.

"If you think about it, Sofía mostly sleeps and doesn't do much except eat when she's awake. Bianca was never going to be a stay-at-home mom, so coming back part-time is perfect for her. That was why we hired nannies."

"Sure, I was just surprised it was so soon; I wasn't objecting in general."

"I had to leave that to Bianca to decide, though I do agree with her that it doesn't harm Sofía. We won't ever foist her off permanently on hired help the way my friend Jeri is."

"That's just so wrong!"

"I agree, but Jeri seems to have turned out OK despite that, or maybe because of that, given what I know about her mom."

We parted at the gym to go into the proper locker rooms, completed our personal exercise routines, showered in the proper locker rooms, then headed back upstairs to complete the workday. At 5:00pm, I put everything into the desk, locked it, and made the three-elevator trip to the condo, stopping to hand Robert an envelope to cover tips I'd have given him and the other doormen.

My housemates and the girls greeted me with hugs when I arrived, and after I changed, we had a nice evening together.

_May 3, 1984, Chicago, Illinois_

"I could get used to this," Natasha said on Thursday morning when we got out of bed.

"That goes directly against what you told me that first night!" I said with a grin as we got into the shower together.

"Would that be a problem?" she asked as I began to lather her lithe, sexy body.

"It would depend on what you mean by 'get used to'," I said.

"I have two more years before I go graduate school. Every Wednesday until then? Obviously, if something comes up besides that huge dick of yours, we'd work around it."

"I'd be OK with that, so long as we both understand things could change before you graduate."

"Obviously. It's just casual, so if something changes, we'll discuss it and come to some resolution. I won't be upset, and you won't be upset."

"Then I agree."

"Then you get a reward!" she exclaimed.

She lowered herself to her knees and gave me an awesome blowjob before standing so I could finish washing her. She washed me, and after we both rinsed off, we dried ourselves, dressed, then went downstairs for breakfast.

After we ate, she and I left the condo together, she headed for the L, and I continued to the Spurgeon offices. The morning was routine until 10:30am, when Luke Fahey, the new mailroom employee, brought me a box that had been sent via Federal Express. I opened it and extracted an interior box, then called Pete to come into my office.

"This is for you," I said.

"For me?" Pete asked.

"Yes."

He used a pocket knife to carefully slice the tape, then opened the box.

"HOLY SHIT!" he exclaimed. "A ball AND a jersey?!"

"A game jersey," I said.

"I don't even know what to say!"

"'Thank you' is customary! But you need to say that to Gordon DeLisse at MTB Sports Management."

"OK to call him? I know how touchy traders are with anyone talking to their contacts."

"Absolutely. Give him a call."

"Will do. Thanks, Jonathan."

"You're welcome."

_May 4, 1984, Chicago, Illinois_

"What time did you get home last night?" I asked Deanna when I arrived at Ateljé D at 5:30pm on Friday.

"I didn't fuck him, Dad!" Deanna teased.

"You know that's not any of my business! Bianca and I went to bed early, and you don't get up as early as I do on weekdays unless you've slept in my bed! So?"

"About midnight. He bought three paintings at the 'pre-show' prices. Of course, he felt that plus the grand entitled him to a roll in the hay. He went home disappointed."

"Despite 'beating' Noel Spurgeon?" I asked with a smirk.

"Oh, he'll mention that to Mr. Spurgeon, I'm sure, but he won't buy more unless I fuck him."

"Is that a common thing?"

"For female artists? Unfortunately, yes. And it usually doesn't work out anything like it did for you and me!"

"Because we had sex _before_ we entered into the patronage relationship," I said. "Is there anything I need to do?"

"Look hot!"

"He _is_ hot, Dee!" a thin, pretty girl with long black hair down to her waist, dressed in black slacks and a white blouse that revealed cleavage, declared.

"Jonathan, meet Vanessa, a graphic design student.

"Hi!" Vanessa said.

"Hi," I said. "Thanks for helping out."

"It'll be fun!" she exclaimed, then called out, "Hey, Cheryl, come see Dee's patron! He's smoking hot!"

I chuckled, "I'm no Burt Reynolds or Rock Hudson!"

"Hi!" Cheryl, a striking blond with equally long hair, clad identically, said. "She's right! Those clothes look nice on you, though they'd look a lot nicer on the floor of my bedroom!"

"Down, girl!" Deanna ordered, and all three girls laughed.

"Right, like you care?" Vanessa asked.

"No, but we have work to do!"

"Slave driver!" Vanessa growled, and again, all three girls laughed.

"The girls agreed to work during the housewarming, too," Deanna said. "I'm going to hang as many pieces in the condo as possible, including paintings by Kassie, Kendra, and Stacey."

"You have a free hand," I said. "You're the one with an eye for style."

"That was mostly Natasha, but I can arrange artwork on the walls!"

"I never asked," I said, "but what hours are you going to keep?"

"Tuesday through Friday, 7:00pm to 10:00pm; Saturday, 11:00am to 6:00pm. Other times by appointment. I'll be here a lot when the gallery is closed, given I can't paint at home because we can't set up ventilation."

"I think they'd be very upset if we tried to open a window!" I said with a grin.

"I also have half a dozen students who want to display here, including sculptures."

"Very cool. Did you work out a commission structure?"

"Yes. For students, it'll be 10%; for anyone else, the usual 50%."

"Wow! And I thought 20% was high!"

"It is hard to sell art, and it's low volume. Somebody has to cover the costs of the gallery. I mean, you are, now, but I want it to be self-sustaining and be able to take a small salary in addition to selling my own art. Eventually, as I said, I'll supplement with art lessons, both small groups and one-on-one."

"I trust you to know your business! What can I do?"

"Stay by me like a fawning idiot!" she teased. "You'll have to act to be an idiot!"

"Shall I drool?"

"I'm teasing! Just stay by me and look pretty."

"I think acting like a fawning idiot might be a better choice!" I chuckled.

"Boys can be pretty! But I was teasing again because you aren't a pretty boy. You have rugged good looks. We could dress you as the Marlboro Man, and you could pull it off. I see Kendra at the door; would you let her in?"

I went to the door and twisted the knob to unlock the door and let in a very pretty girl with ebony skin in a gorgeous, form-fitting white dress that highlighted her svelte figure.

"You must be Jonathan!" she said, giving me a 'society' kiss.

"And you must be Kendra!" I replied. "Come in, please."

Before I could close the door, two other girls walked up.

"You must be Kassie and Stacey!"

"Yes!" the redhead with curly hair, wearing tight jeans and a skin-tight T-shirt, said. "But which is which?"

"You're Kassie," I said, then nodded to the curvy platinum blonde wearing a peasant skirt and a white blouse, "and she's Stacey!"

"Wow, he's good!" the blonde declared.

"How did you know?" the redhead, now obviously Kassie, asked.

"Trade secret!" I said with a grin. "Come in, please."

The girls came in, and I locked the door. About ten minutes later, I unlocked the door and put an easel outside on the sidewalk with 'Grand Opening: Ateljé D' painted on it with glitter paint. I went back inside and stood next to Deanna as several well-dressed people came in through the door.

There was a steady flow of people, including students, professors, and potential customers, and just before 8:30pm, Stan Jakes arrived with a photographer. He interviewed all four of the artists but spent the most time with Deanna. His photographer took a shot that had Deanna in the foreground and the other three in the background, and then one with me next to her and the other artists to our sides.

"I owe you," I said. "Thanks."

"You can pay that debt right now. I need to talk to you about a tidbit Len Walter fed me, and it can't wait."

"Let's step back into the studio for some privacy."

I let Deanna know, and Stan and I moved through the swinging door to Deanna's studio.

"What's up?"

"This is actually for possible publication. I'll call you a knowledgeable source in the financial services industry. Nobody except my editor will know who you are."

"OK."

"Continental Illinois. Is it going to fail?"

"This part is background and can't be quoted because it would identify me."

"OK. Not for attribution or publication."

"I shorted 400,000 shares in early April and told our executing broker that if that bank isn't a crater of smoking rubble by the end of May, I'd buy him dinner at any place he could name, even if we have to fly there."

"Back on the record — it sounds like you think it's going to fail."

"There are only two options — outright failure or seizure and sale. My best banking analyst, a former Continental Illinois employee, says it's too big to fail. He thinks it'll be seized and sold, with the shareholders largely wiped out. I'd say that's the most likely outcome because otherwise, there will be cascading failures, similar to how the Penn Square debacle is about to take down Continental Illinois."

"Does anyone lose money in that scenario?"

"Not depositors, if that's who you mean. The purchasing banks will make the depositors whole, mostly by buying the performing loans for pennies on the dollar. The FDIC or Federal Reserve will likely eat the non-performing loans and try to make it up with shares in whatever corporation they set up to be sold or to act as receiver if the bank fails."

"Totally not for publication, but my edification, how much do you stand to make?"

"For my fund? About $4,500,000, give or take, if it's seized and sold; around $8,000,000 if it fails."

"What happens next?"

"If that rumor spreads, or you write this article, there will be a run on the bank. The first to pull out will be other banks and large depositors, which will exacerbate the problem and make it a self-fulfilling prophecy. If they think it's going to fail, they'll act that way and actually cause it to fail."

"That confirms what Len said. He heard that a pair of very large depositors transferred tens of millions from Continental Illinois this afternoon."

"Then it's started. And if Len Walter knows it, others know it, and Monday will be a bloodbath."

"How long before something is done?"

"I can't read those tea leaves for you in any exact way, which is why I said the end of May. There are ways to defend against a run, including invoking limits on large transfers, but that is basically pre-announcing your death. They'll make public statements about the bank being safe and offer higher interest rates to keep or attract capital. I don't think it will work, and I'd give it about two weeks before the FDIC, Federal Reserve, and the Comptroller of the Currency have to step in with emergency funding or outright seizure. Or they could let it fail, but our best analysis is that won't be allowed to happen."

"Thanks. I'm going to try to get that in tomorrow's paper. The gallery article will run next Sunday because the _Tempo_ section for this Sunday has already been put to bed."

"Thanks. Do me a favor? Don't use the photo with me or mention my name. Someone will put two and two together and come up with Jonathan Kane."

"Way ahead of you. I'll tell the editor to go with the pretty girls and forget the guy who's messing up the photo!"

I chuckled, "Nice."

"Actually, I'll just tell the editor you're a source, and he'll eighty-six the photo, no questions asked."

"Good."

"I think we're even," Stan said.

We shook hands, left the studio, and rejoined the others. Stan and his photographer left a few minutes later, and I demurred when Deanna asked what we talked about. At 11:00pm, Vanessa, Cheryl, and I gently and politely escorted guests from the studio, and when the last one had left, I locked the door.

"How did we do?" I inquired.

"We sold seven pieces, which is really good for a first showing."

"Does that include the three Margolis bought?"

"Yes. And that's OK because we want to have something to sell tomorrow!"

We cleaned up, then Deanna and I left Ateljé D and got into a Town Car to take us back to the Hancock Center. At the condo, Deanna joined me in my room, and after we made love, she asked about Stan Jakes.

"I mentioned I'm a confidential source, and he asked about a rumor he heard from a business reporter. I confirmed it for him, and I expect to see it in tomorrow's paper attributed to a 'knowledgeable source'. They'll run the story on Ateljé D next Sunday because it's too late to get it into this weekend's edition due to deadlines. If I understand correctly how it works, they've already printed the _Tempo_ section for Sunday's paper."

"The article will help more than the ads I ran. We had just over sixty guests tonight, about a quarter of which weren't personally invited, so I'm happy."

"If you're happy, I'm happy!"

We snuggled close together and fell asleep.

_May 5, 1984, Chicago, Illinois_

On Saturday morning, when Deanna and I went down to breakfast, I picked up the _Chicago Tribune_ and found a third-page article questioning the financial stability of Continental Illinois, citing a 'knowledgeable source' in the industry. It was short on detail, which I knew it had to be, but laid out the case I'd made to Stan Jakes. There was no question in my mind that the transfers late on Friday would cause a run on the bank.

I put the paper down and helped Deanna make breakfast.

"I meant to ask last night," I said, "but what's with asking Vanessa and Cheryl to work the housewarming?"

"It totally fits your 'deluxe apartment in the sky'! And the other three artists will be here the entire time. You have friends who either are, or will be, in a position to buy art. Vanessa and Cheryl will keep the refreshments stocked, serve food and drinks, and otherwise run things so you can spend time with your guests, and Bianca can worry about Sofía."

"I actually hadn't considered that last bit! I'm still getting used to the idea of having to think about Sofía before I decide what to do, and I know it's even more of a challenge for Bianca because Sofía is nursing."

"You extended invitations to your bosses, right?"

"Yes, along with my aunt and uncle, Jeri's parents, Beth's family, and Congressman Hayes, though I can probably only expect him if I toss money into his campaign coffers. And even then, I'm not sure because Marcia and I had a serious falling out."

"Over?"

"Being an unapologetic capitalist rather than accepting her…Marxist views."

"Marxist, really?"

"I make so much money that I am now officially an Enemy of the People who cannot relate to the underprivileged kids Congressman Hayes is focused on helping."

"YOU were an underprivileged kid!"

"Yes, exactly, but Marcia doesn't see me as a _success_ story but as somehow betraying society."

"I never had that picture of her."

"I think it has as much to do with me telling her I wasn't interested in her as more than a platonic friend than anything else."

"A frustrated gold digger? She saw the brass ring, and you moved it out of reach, and now she wants to take it all from you?"

"Bottom line? Yes. It was couched in a way that effectively said the only thing I was good for was contributing money and that I was, in effect, an unproductive member of society. That's reading between the lines, but it was clear she thinks what I do has no value, despite the fact that I pointed out all the people who have jobs because of what I do, including generating capital to start new businesses. She rejected that."

"OK, I'm what you would call a liberal Democrat when it comes to my politics, and I object to unfair tax benefits for people like Spurgeon, but I don't think he should be put out of business or have all his wealth confiscated! Taxes should be higher on people like him, with no special loopholes."

"And me?" I asked with an arched eyebrow.

"You aren't in the same category, at least not yet, and I've heard you object to the tax loopholes! I'd keep the progressive graduated tax system but dump most of the loopholes and special treatment."

"What about unrealized gains? What I refer to as 'carried interest'?"

"I'm still a capitalist!" Deanna declared. "I don't believe in wealth taxes or anything like that. That said, I'd prefer to see lower property taxes and higher income taxes in Illinois because the flat Illinois income tax is regressive. And a better social safety net."

"Which is rational. I think I'm the only person at Spurgeon who doesn't bitch about his taxes, including Bianca!"

"I HEARD THAT!" Bianca called out from the conversation pit where she was nursing Sofía.

"You were meant to, my Republican friend!"

"At least the ratio is better now!" Bianca declared. "Three against one instead of six!"

"Wrong!" I declared. "There were _two_ Republicans, so the ratio is the same!"

"Keiko."

"Yes. She followed her grandfather's principle that no Japanese-American should ever vote for a Democrat because it was Roosevelt and the Democrats who interned Japanese-Americans despite not a single incident of collaboration, unlike German-Americans. And worse, as we discussed before Keiko died, the FBI and military intelligence admitted that Japanese-Americans posed no actual security risk."

"Evil," Bianca declared. "Not to make an excuse, but can you imagine locking up the entire city of Milwaukee?"

"And Cincinnati," Deanna added. "Most of Ohio, actually, I think, along with good chunks of Pennsylvania and Michigan, and probably most of Wisconsin, too. The Japanese were easy targets because there were fewer of them, and, well, pure racism was at play, too."

"And still exists," I said. "You know Spurgeon has no blacks, and Bianca is the only Hispanic in a professional position except for one guy from Spain, but he's considered to be 'white' whereas Bianca is not."

"Because my ancestors moved from Spain four hundred years before he moved here!" Bianca declared.

"In the larger scheme of things, that's a bigger problem than traders «schtupping» their secretaries. I'm not sure how to fix it."

"By running your own firm," Bianca said. "I know you need more AUM, but honestly, I don't see any way to fix Spurgeon as long as Noel Spurgeon is running it."

"I hear you," I said. "And I don't disagree, but as I've said, Noel Spurgeon and Murray Matheson gave me the opportunity, and I won't betray their support. In any event, it's moot until I'm in a position to even think about it seriously."

Deanna and I finished breakfast and cleaned up. She left for her gallery, and I went to sit with Bianca and Sofía. About five minutes later, my phone rang, so I got up to answer it. I walked to the kitchen, pressed the button for my line, and picked up the handset.

"Kane."

"Jonathan, it's Pete. Did you see the article in the _Trib_?"

"I did. Assuming the information is accurate, could you find out who pulled out?"

"I can call a friend who works in private banking and ask. He'll probably know. The stock is going to crater on Monday. And there will be a run on the bank."

"No doubt. What's their move?"

"Find a friendly bank and offer much higher rates, and offer better rates on overnight paper. Runs are liquidity crises because the bank's balance sheet includes all the loans, most of which can't be called. So they have to scramble to find free cash to cover the withdrawals and their usual daily operations. They'll probably sell stock holdings as well, which will generate free cash."

"How long can they sustain that?"

"With a serious run? Thirty days or less, and I can't imagine regulators not stepping in sometime in the next two weeks. They can't let it fail for all the reasons I gave you before."

"But is there political will?"

"That's always the question, especially with a free-market advocate like Reagan in office. I think the professionals will convince the politicians that they can't risk cascading failures which could take down the entire financial system. 'Too big to fail' is a real thing."

"I want you to write something, call it a 'Flash Note' that we have on every desk by 7:00am on Monday. Can you do that today or tomorrow? I'll call Jack Nelson and alert him we need something distributed before 7:00am. His guys won't mind the OT."

"I can do that. I'll go into the office and write it up today. I'll print copies for you and for the mailroom. I'll leave yours on your desk and put the other copy on Naomi's desk."

"OK. I'll call Jack Nelson now. Thanks, Pete. Dinner for you and your wife on me at Smith & Wollensky, Morton's The Steakhouse, or Eli's The Place For Steak."

"Thanks! Let me get on it. Later."

"Later."

I flashed the switchhook and dialed Jack Nelson's home number. His wife answered and called him to the phone.

"Jack, it's Kane," I said. "Pete Mueller is writing what I'm calling a Flash Analyst Note that needs to be on every desk by 7:00am on Monday. He'll leave a copy on Naomi's desk today, and it'll need to be photocopied and distributed."

"Reagan is starting World War III?" Jack Nelson asked.

"No, but Continental Illinois looks like it's about to fail. We predicted it, but there's a blurb in today's _Trib_ that made it public. I want the revised analysis on every trader's desk when they show up."

"I'll call Kasparov and have her send someone in tomorrow to handle it. That way, the overnight traders have it, too."

"Thanks, Jack. I'll bring you a bottle of Maker's Mark."

"As if I could drink it!" he growled.

"So keep it at work, and don't tell Mrs. Nelson!"

"I knew I liked you for a reason, Kane!" he chuckled. "We'll get it done."

"Thanks."

I hung up and went back to sit with Bianca.

"The bank?"

"Yes."

"You're going to make $5 million, give or take a million."

"The fund will, but I get a nice taste."

"That would be a 3% return overall for the year on one trade."

"Yes," I replied. "And well on the way to besting Noel Spurgeon in the yearly league table in terms of total return."

"He's going to hate that!"

"Yes, but he likes the money, so he'll bitch all the way to the bank!"

Bianca laughed, "So he wins either way."

"It's great to be the king! I need to do the grocery shopping before I head to Milwaukee."

"We could come along. I can put Sofía in her carrier that Kristy bought me. The one where she's basically lying on my chest."

"I actually never considered how soon it was OK to take her anywhere."

"The nurse at the hospital suggested two weeks beyond taking her home. Of course, we had to bring her here, too. But those two weeks were also about my recovery. I finally feel almost normal, but I need to lose the rest of the baby weight. I'll start going to the gym again next Monday after I work my half day."

"When does she need to eat again?"

"Probably about two hours. We have enough time if we go now."

"Then let's do that."