Free Web NovelSome time ago, Han Kyungyeong had personally made Alan Schwartz a recruitment offer.
“I have no intention of changing jobs yet. I want to finish what I started before I leave.”
“Alan, I understand how you feel. But face reality. Bear Stearns is already finished. The best thing you can do is either sell the company or personally seize a new opportunity.”
Alan Schwartz shook his head.
“No. There’s still hope. We...”
I interrupted him.
“Hope? Alan, you’re denying reality right now. The collapse of Bear Stearns due to the subprime mortgage crisis is only the beginning. More financial institutions will collapse. A cold wave will sweep through Wall Street. Who do you think will survive that bitter winter?”
Alan merely chewed on his lips, unable to answer.
I let out a deep sigh and continued.
“Being loyal to the company? Fine. But that’s only possible when the people who should take responsibility do so first. They’re handing the rifle to you while the people who should truly bear responsibility are already preparing to retreat to the rear. Are you really going to waste your precious time for such a company and such people?”
Alan remained silent for a moment before quietly saying,
“I’ll think about it again after this negotiation is over. If I move jobs right now, it won’t bring good results to Dreamhigh either.”
It was a cautious and thoughtful answer.
I nodded while meeting his eyes.
“Well, fine. Do as you wish. But what exactly is there to negotiate? According to the reports, considering Bear Stearns’ circumstances, you didn’t even demand the entire insurance payment. Then hasn’t our side already shown enough understanding?”
“Charlie. To pay ten billion dollars, we’d have to sell our assets at dirt-cheap prices. If that were the end of it, then doing that would be the right choice. But... you know, don’t you? It doesn’t end there.”
I had a rough idea of what he was trying to say.
Some obvious words would follow.
Still, I quietly listened.
“Please give us a little more time. We need time to negotiate with the government.”
“Negotiations with the government. Interesting. Care to tell me the specific plan?”
“If the bill currently under review in Congress passes as quickly as possible, and if passage is delayed, then we’ll first work with the Federal Reserve Board and...”
After the negotiations with Eva had fallen apart, they had rushed to contact the government, explained the situation, and begged for support.
After hearing everything, I spoke honestly.
“I understand. But isn’t that just a blank check without any concrete promises?”
Despite the long explanation, there had been no mention whatsoever of how support would be provided or how many dollars Bear Stearns would receive.
“They’re also concerned about the impact Bear Stearns’ bankruptcy would have on the market. They’ll support us no matter what.”
“Very well. I’ll give you seventy-two hours. Within that time, either secure government support or find another solution. Otherwise, we’ll immediately proceed with a lawsuit.”
Confusion spread across Alan Schwartz’s face.
“Charlie. Seventy-two hours is too short.”
“Why are you saying that? Of all people, you know better than I do that seventy-two hours on Wall Street is an eternity.”
“......”
“You seem to be mistaken, Alan. This isn’t because we’re being considerate of you. It’s simply a measure to minimize market chaos. And our offer... well, that’s your personal choice, but you’d do well to think deeply about it.”
“Understood, Charlie. I’ll do my best to clean up this mess.”
His voice wasn’t particularly bright.
Well, it couldn’t be helped. He had a lot on his mind.
“Hm... what measures are you taking? No matter how I think about it, selling the company seems like the best option.”
“We’ve been sounding out acquisition interest here and there.”
“How about looking outside the United States?”
“We’ve already contacted Saudi Arabia and China directly. Saudi Arabia showed some willingness to negotiate but remains cautious, and China...”
“They don’t even intend to sit at the negotiating table, right?”
Most Chinese banks were owned by the Chinese government.
I had already asked them to stay out of this and simply watch.
“Saudi Arabia probably won’t move easily either.”
“I thought so.”
“The most realistic option is for a major Wall Street bank to acquire us. But that won’t be easy.”
“All the major banks have shown reluctance.”
“They’re not exactly in great shape either. JPMorgan Chase is relatively better off, but...”
Alan bitterly finished my sentence.
“They already rejected the acquisition proposal.”
“Hm...”
“Do you happen to have a good idea?”
“Well, I don’t think we’re at the stage to discuss that yet. Let’s talk again after government support is secured.”
Whether Bear Stearns went bankrupt or the U.S. government bailed it out with massive rescue funds, we held the winning hand either way.
If Bear Stearns collapsed, the other banks would begin to shake immediately.
And if Bear Stearns received a bailout, the result would be the same.
It might survive the immediate crisis, but it wouldn’t stop the second and third waves of bankruptcy threats that would follow.
That was the weakness of bailouts implemented with limited resources.
It was why I kept exaggerating the scale of Bear Stearns’ bad assets.
“Yes. I’ll do my best.”
“Then contact me again in seventy-two hours. I’ll be waiting.”
After Alan left, I gazed at Manhattan’s nightscape through the window and sank into thought.
Bear Stearns’ fate would be decided within the next seventy-two hours.
And this was only the beginning.
As soon as the insurance payment for Bear Stearns was settled, I planned to shake Lehman Brothers next.
The storm of the financial crisis was drawing closer.
And I stood at its center.
* * *
“Boss, the U.S. Treasury Department and the Federal Reserve have finally decided to provide emergency support to Bear Stearns.”
The news came seventy hours after my meeting with Alan Schwartz.
In the end, the U.S. government had decided to prevent Bear Stearns from going bankrupt.
And this decision was somewhat unexpected.
“I thought the U.S. government would abandon Bear Stearns. Still, they managed to make it in time. How much?”
“The bailout package the government originally wanted wasn’t approved by Congress. Instead, an emergency bill specifically supporting Bear Stearns was approved. In other words, support limited only to Bear Stearns.”
“That’s the best hand we could ask for.”
I liked hearing that only Bear Stearns was being supported.
After all, Bear Stearns was only the beginning.
If this case failed to produce good results, public opinion would worsen even further, and more financial institutions would inevitably collapse.
I decided to proceed with the scenario I had prepared in case the government chose to save Bear Stearns.
Just as I picked up the phone, Chief Ma’s cellphone rang.
“It’s Alan Schwartz, Boss.”
“Answer it.”
I put down the phone and waited.
“Alan Schwartz is requesting a meeting.”
“Perfect timing. Tell him to come right away.”
After Chief Ma ended the call, I immediately gave him several instructions.
“Since the government decided to support them, I plan to move faster. Contact Eva in advance.”
“Understood, Boss.”
An hour later, Alan Schwartz arrived.
“I heard the news. Congratulations, Alan.”
Unlike last time, there was much more life in his expression.
“Haha. Indeed. What a relief.”
“Please, have a seat.”
We sat facing each other.
As soon as he sat down, Alan opened his mouth.
“Congress approved support for us.”
“Could you explain in more detail?”
“The Federal Reserve and the Treasury persuaded Congress. They requested emergency support considering the effect Bear Stearns’ collapse would have on the entire financial system, and Congress accepted it.”
That couldn’t be all.
I raised an eyebrow.
“I feel like something’s missing.”
Alan’s expression immediately darkened.
“The comprehensive bailout package the government wanted still hasn’t been approved. Congress says they need further discussions on the bill...”
Obama seemed to be doing his best.
Leaning back in my chair, I said,
“In other words, you’ve escaped the immediate crisis, but the long-term solution remains uncertain.”
“That’s right. But even this allows us to put out the immediate fire. We’ve bought ourselves some time.”
“How much?”
“They decided to inject thirty billion dollars immediately.”
I frowned.
“That’s not even enough to cover the CDS insurance payment Eva holds.”
“It’s still a substantial bailout.”
“I’m not satisfied. I wanted to collect all the insurance money this time.”
“......Charlie, then we’d really go bankrupt.”
“What about a sale?”
“Nothing has been decided.”
I sank into thought.
This certainly changed things.
“Since I made a promise, I’ll postpone the lawsuit.”
I took out my phone and called Eva.
— Boss!
“Eva, I’m putting this on speaker. CEO Alan Schwartz is here with me.”
I switched to speaker mode and set the phone down.
— Alan, good to hear from you. I heard the news.
After Eva and Alan exchanged greetings, I instructed her.
“Postpone the lawsuit. The insurance claim for ten billion dollars will be paid. Correct, Alan?”
“Yes. We’ll pay it immediately once the support comes in.”
— Got it. Then what about the rest, Boss?
“Wait for now. But keep preparing the lawsuit.”
— I will, Boss. Alan, congratulations.
“Thank you, Eva.”
I ended the call and put my phone back into my pocket.
Alan couldn’t take his eyes off it.
“That must be the iPhone Jobs gave you.”
“You know about it.”
“It was quite the topic on Wall Street. A gold-plated iPhone... rather tempting.”
“It’s a limited edition shared between Jobs and me. Enough about that, let’s talk business.”
Perhaps he had only mentioned it to ease the atmosphere, because Alan nodded readily.
“To be honest, Alan, Bear Stearns has no way to stand on its own anymore. Putting out the immediate fire doesn’t mean the crisis is over.”
“Things will return to normal with time. Bear Stearns has existed for decades.”
“The damage is too severe. The fact that you were talking about bankruptcy over a mere ten billion dollars in insurance payments is proof that the company has already lost its ability to sustain itself.”
Unable to refute me, Alan shut his mouth bitterly.
“So, sell the company.”
“Sell it? But there’s no suitable buyer.”
I leaned forward and clasped my hands together. freёwebnoѵel.com
As I moved closer, Alan swallowed nervously.
“Sell it to JPMorgan Chase.”
“What? JPMorgan Chase already rejected the acquisition proposal.”
“Then was then, and now is now.”
“What do you mean by...”
“They rejected it back then to push Bear Stearns into an even tighter corner.”
Alan’s expression stiffened as he grasped the meaning behind my words.
“Now it seems like you’ve reached the point where selling would be acceptable. If we push you any further, we’d look like bad people.”
At that moment, someone knocked on the door.
“Boss, Chairman Jamie Dimon has arrived.”
“Send him in.”
Looking at Alan, who still hadn’t uttered a word, I curled one corner of my mouth upward.
“This will be the only way for Bear Stearns to avoid bankruptcy.”
Jamie Dimon walked in and greeted us cheerfully.
“Alan, you were here too.”
Alan’s face was stiff.
Jamie Dimon and I, meanwhile, were smiling.
