Dear Money (24 page)

"I have no idea what you do," I said to him. "We're in a fine mess. Or I should say, you are. Either this is an enormous joke or you're a complete fool." I opened the door again. "It's a beehive, all those busy bees making so much delicious honey." I closed the door.

"That's a workable metaphor. You'll learn what we do. The good news is, you don't have to understand the whole picture—just what you do specifically. No one understands the whole picture, not really, not these days. Not even Radalpieno, upstairs in his sanctuary. Actually, he probably knows less than anyone down here, and for that reason he has time on his hands, can play a fine game of golf for all his practice. But it doesn't seem to matter too much."

He told me to sit down—an old leather chair, comfortable. "The business is simple. There's only one equation. Profit and loss is what the trader is all about. See those guys?" He lifted his head to look onto the floor, but he did not point. "They come into Manhattan every day, crossing the bridges, the skyline active in that light, and they want it. The whole entire city. They think, each and every one of them, 'This could be the day I win.' I want it that way. Radalpieno insists on it being that way. 'Bleed green, bleed green,' he says."

Then came his used-car-salesman analogy, his humbling way of illustrating how basic and simple the business is, knocking all of them off the pedestal. There are a few dealerships on a block. They have a bunch of different kinds of cars. One guy gets a lot of Pacers—remember those enormous ugly bubbles? And this guy knows that the Pacer gets really good gas mileage for a used car, and he knows that the price of oil is about to go up. He knows too that the economy isn't so good, and the bad news will soon be catching up with the consumer. He knows that the Pacer drives well in wet weather, and big rains are predicted for the coming year. He figures he can make a market. He knows where to get Pacers, knows that another dealer needs to unload them, then decides that he can do something really spectacular with them, so he starts to stockpile, purchasing Pacers with the company's capital. Now he has so many Pacers coming in that he starts offering them low, to see where they'll price, and as people catch on to all the good reasons for owning a used Pacer, and simply because there's so much desire (we all know about lemmings), he creates more demand, starts selling them at a higher and higher price while all the other used-car dealers are scratching their heads as he's poised, making the killing. Now those other guys want the Pacers too. Everyone wants the Pacers. So our guy, he's moving on to the Opel, the Escort, the Aspire, and doing the same thing all over again.

He spoke quickly, with assurance, sort of mumbling his words, though more from fluency than bad elocution—the manner of a native speaker speaking his language fast. Another tool the car dealer had was a reference listing car values, like the Kelley Blue Book. "So our dealer has a hundred Toyotas, and one day some guy with a car rental agency walks in and wants to buy the whole lot. Our dealer knows the cars are worth ten thousand each, based on the book value. He wants to sell with some spread, so he offers the lot for a million-fifty. Sold. Now he has no cars. Is he going to sit around and wait or go out and get some more?"

"He's going to get some more."

"Exactly. But this time it might not be Toyotas. It might be Hondas. Or maybe he comes across a Model T. Very rare. Maybe he has a customer who wants two Model T's, and our guy's pretty sure he can get another one at the same price, so he says he'll sell two at twenty K apiece. Only problem is, he can't find another one. Look as hard as he might, he's not turning up the other Model T. Well, let's say the customer turns it up at twenty-five K. The rule is, our guy's got to pay the coupon on the bond at the price the customer found. That's the penalty."

"Oooh," I said. I was sort of getting it. He sold what he didn't have and couldn't get. "He failed."

"Indeed. Happened this morning with my Chilean. He lost a million over Model T's."

"Did you yell at him?"

Win laughed. "I don't yell. I've got to get the best out of my traders. Yelling won't do that. Yelling will shut them down. If he doesn't keep up, he'll go. They all know the consequences."

I didn't quite believe he didn't yell.

"Who'd ever want a Pacer?" I asked, teasing, but quickly noticed that any flirtation that had existed between us was dissipating. This was business for him.

"Anyone can be convinced of anything. Look at you, here."

"Why?" I asked, suddenly serious, meaning,
Why am I here?

He understood. "Luck played for me" was all he said, explanation enough. If he hadn't run into Pretty Radalpieno, where would he be today? "I'll be taking this very seriously," he said. "You'll need to do something about the teaching job. It will be a lot of work, you know. Long hours. We'll be rolling up our sleeves."

"I understand."

"Are you sure about this?"

"I'm scared—if I can be honest."

"For today, that's all right. But Monday, fear stays at home. Fear and the trader are incompatible. A little fear is all right; it keeps you on your toes. But too much and you're ruined. We'll begin with rolls."

"You're a star at what you do."

"How do you know?" he asked. I wasn't sure if it was a challenge or if he wanted to see himself reflected off me.

"Talking to you. Your passion. It's clear."

"I love the system. Showing it to you makes it new."

"The guy with the Pacers," I said, "he has the ability not only to perceive opportunities before others do but to convince a whole group of people that that opportunity is something it wants and needs."

"You're a storyteller—that's why I wanted you. Most people are driven by consensus, but while they're following that line you're going to be reading, perceiving the larger story, and that's why we're going to win this bet. Then, if you like the business, you'll go deep, to a place where the story will seem irrelevant." He looked through the glass to the trading floor. "There are a whole bunch of guys out there speculating on who this chick is in here with me, asking questions."

Before I left, Win gave me a quick tour of the floor. What struck me most was how young the traders were. Of course that is a well-known description of them, but their collective youth made them seem impossibly young, and being confronted with it, as familiar as it may be to a person who knows about this world, was at first startling. Kids you wouldn't want to leave in charge of your house were in charge of billions upon billions of dollars. In fact, they
were
in charge of your house—you just didn't know it.

No gray hair, kids from everywhere. Indians and Koreans and Chinese and Japanese—they all dressed in uniform: short haircuts, dark suits, light shirts, sleeves rolled up, jackets hanging over the backs of their chairs. They sat at their four-foot desks, eyes intensely focused on the screens before them, each desk space personalized with photographs and decals of sports teams, Yankees and the like, hot-chili sauces. One guy had a signed photograph of Dick Cheney, another one of his newborn. Well over five hundred traders and salespeople and their staff. An all-consuming concentration, each trader driven by the immediate transaction, deals beginning and finishing in less than a minute while holding conversations on the phone and with a nearby salesperson or clerk or another trader.

It seemed the energy of the market infused the room, the traders, the air vibrating with the low hum of voices, punctuated by an occasional effort of one to be heard above the din. Proximity clearly facilitating transaction. Money, though invisible, was in constant motion, and I found the pulse infectious. They all seemed to find it so—the sheer raw enjoyment of winning ... or striving to win.
Today could be the day.
They were a collective lot, a whole. If, to Miss Lane, I were another species, then they too were their own species—these, oddly, her own children: well trained, emotionless, eager for yield and blessed with an aptitude for bleeding green. "You'll never find anything like it in any other business," Win said.

He led me across the floor to a group of traders who worked in the pass-through market, as it is called, a subset of the mortgage universe that handled three trillion of the eight-trillion-dollar market and the safest of the mortgage securities—those backed, or quasi-backed, by the government, known as GSEs, or government-sponsored entities: Fannie, Freddie, Ginnie. Win introduced me to the six in the group, all of them in their twenties, from the top universities, all nimble with numbers, their desks decorated with personal effects. What best described them, as a group, was a perfect rationality and an unambiguous self-interest. Or that is what I recall believing at that moment, before I came to know them, before they became human to me. How does one go back to the moment before, remember those first impressions (often accurate in the end)?

Who were they on that day? Snake, from Calcutta, wearing a starched white shirt without the sleeves rolled, very trim and tucked and neat for a man named Snake, a smooth and handsome face with long bangs swept to the right of his forehead; Tiger, a white boy with a broad, chummy face and a photograph of a slender girl in a bikini on a beach with palm trees, and next to her picture stood six different brands of exotic bottled water; Sam, more of the same, a kid who would have starred on the college lacrosse team, didn't seem to want to be in his shirt; Josh, an African American who had a small framed postcard on his desk of Winona Ryder, the caption reading
FREE WINONA,
next to her a lassoed Clint Eastwood; Gus, an earnest Korean, eyes hard on the screen, on doing the job, not too interested in my intrusion; and Maxi, the Chilean who just lost a million because he sold a Model The didn't have and couldn't get, a determined and self-centered-looking individual.

When Win introduced me, he offered no explanation of who I was or why I was there. They smiled, collectively, kindly. I tried to remember where I'd been at their age. How had they understood to come here? What was the inspiration or the motivation? Money, of course, but how did they understand that so young? I imagined them flying to Paris to have their shirts pressed. It seemed even that would take more know-how than their age allowed. Up close, they lost their edge. They seemed like boys on a team of some sort—like swimmers competing individually yet for the greater good of the team. You could sense it in the focus of their eyes.

"A pleasure," Snake said.

"Good moves today," Win responded.

"Almighty," Snake answered.

"You impressed Radalpieno. He's making jokes about moving you to head subprime."

"The Wild West," Snake said. "I'll take a pass for now."

"Bold," Win answered.

Snake was the handsomest, with his dark skin and light brown eyes and thick lashes. I imagined his parents were immigrants, unsure what to make of this American kid they had created. He offered me his hand, and the others followed. They were working their screens and phones and e-mails while also absorbing me.

Then we drifted away. I smiled farewell over my shoulder as Win escorted me to the elevator, swiping his card once to get us out of the room and again to call for the elevator.

"They're already making bets on you," he said, wrinkling his lips in that all-knowing way. He knew what they were doing even when he wasn't watching them, standing behind their chairs. He made them. He understood them.

"And who will win?" I asked.

"Snake. He's got the instinct. He's telling the boys what my plan is for you. He's telling them that you're raw material that I intend to shape, and he's betting I'll succeed. He's got the willingness to perceive, and that is the key to this trade. That and mastering your emotions."

"How much is he betting?"

"He's going high with this one. I'd say he has four grand riding on you. I'd say he's calling their ideas too, telling them each what he believes they think. He's going to make money all the way around. There will be side bets, derivatives of your success, the over-under, on time, you last. The boy's well trained."

"What do the others think?"

"Maxi thinks you're a girlfriend. He believes in the easiest explanation because he's too busy thinking about racehorses to be bothered. His family owns a few stars in Chile. And it's his desk you'll be filling when the time comes. The others are somewhere in the middle; they want to see a bit more before they commit. But theirs will always be a choice of who is the best person to believe in rather than believing in their own instincts. They'll make good, if slow, choices. But Snake is the star."

The elevator doors opened and I was gone, ushered back into the familiar world.

Outside, the snow still fell, accumulating, abundant, aswirl in strong gusts. "They're forecasting a blizzard," I heard someone say, rushing past me toward the curb with another well-dressed friend, arm out to hail a cab. I looked up. The sky was low and thick with the flakes, a pointillist's point of view. The force of the snow picked up speed, a wonderful New York storm. I imagined Radalpieno above, fists clenched, the architect of it all.

R
EAL ESTATE WAS
in the air, like tech stocks in the late 1990s, like all stocks in the late 1920s when even the shoeshine boys offered tips, famously forecasting the end. By January 2004 everyone—cab drivers, policemen patrolling neighborhoods, short-order cooks, bicycle messengers, children playing make-believe, mothers, fathers—on the street, at cocktail parties, at school during morning drop-off—everyone had discovered the golden-egg-laying goose called real estate.

It had, in its very name, a kind of commanding authority that was solid, unsexy, and it rang true: it was real. "I had a dream last night," one mother said to another, quieting the packed elevator ascending to the classrooms at the girls' school, a captive audience. "We were in your new house in Palm Beach, walking from one magnificent room to the next." Theodor bent to me and whispered into my renter's ear, "Real estate porn." We were not immune; we wanted a house; I wanted a house. I wanted to be part of the conversation.