Silver Justice (32 page)

“So you say.”

“I do. First, you have your people design the guts of the system so you have backdoors for all the electronic trading and can manipulate everything. Next, you create a network of brokers and money funds that will participate in an organized attack, using those backdoors when you pull the trigger. Third, you lobby to keep the identity of the money in the funds anonymous – can’t have anyone know who’s providing all the liquidity in the market, because some people might think it’s a bad idea to have every criminal element and enemy of the state in the world investing in the largest funds. Next, lobby to remove all the safeguards that were put in place after the 1929 crash so it can happen again. Because the real profit in all markets is made when they crash, not when they go up. In the ’29 crash, fortunes were made. Same in 2008.”

“It can’t be that straightforward.”

“Of course it isn’t. You need a lot of time, and to spend billions lobbying lawmakers to pass favorable legislation and to ban any regulation of the mechanisms you plan to use. Your Ponzi scheme cronies write the trading regulations so you have loopholes you can exploit. You send your kids to Harvard and Wharton and they get MBAs and go to work with the biggest financial entities, and eventually they’re fifty and running them. All the time, you’re putting the building blocks in place. But the final piece is to convince the entire country to put its money into the market you plan on crashing. That’s the hard part. The test run was the dot com crash. A lot of money was made pulling the rug out from under the system, but not nearly enough to end the U.S. as a global power within a generation, which I believe was the ultimate goal of this crash. To weaken it sufficiently so the population will allow the unthinkable to happen.”

Howard coughed alarmingly, then composed himself, but his eyes were still streaming as he continued.

“That’s where the big banks came in. Everyone was told for seventy years that the one safe investment was real estate. So how do you destroy the value of the one thing everyone agrees is a wise investment? Easy. Create an industry that turns the mortgages into securities that can be manipulated. Then have your mob associates set up loan companies that will give anyone with a pulse a million dollars to buy a house, and have your friends at the central bank drop interest rates to nothing so there’s a ton of liquidity available for gambling on home values. That creates a bubble where everyone becomes a speculator with all the easy cash. Just like all the easy money that led up to the 1929 crash. There are no new ideas.”

“I remember reading a lot of articles about how ridiculously easy it was to get loans for about four years.”

“Yup. A golden retriever could get a loan with no documentation. It got insane, but nobody would stop it – for good reason. Everyone was getting rich, and the big money was preparing to kick the chair out from under the market.” Howard rubbed the moistness from his eyes. “Then one day, at the height of the mania, you pop the bubble. Because you know when you plan to pop it, you’re in position to make hundreds of billions when you crash the market, and the ensuing devastation not only makes you a fortune, but guts the country and plunges it into an inevitable downward spiral. That’s it.”

“That’s impossible. There are safeguards…”

“Are there? Really? Like what? Did you know that some of the biggest Wall Street firms created billions and billions of dollars of securities they
knew
would fail? Such toxic junk there was no way they
couldn’t
fail? Of course, they didn’t tell their customers that. They sold the securities to trusting customers all over the world. But did you know they allowed the big money managers who were betting on a crash to select the mortgages that went into those securities, which they had sold short? In other words, they let those who would make billions from the mortgages failing
to custom-design pools that were guaranteed to fail
.”

Howard spat through the door into the basement.

“And you know how many people have gone to jail for defrauding the entire world and causing the largest crisis in history? None. Not one. Nobody has, and nobody will. Because the interests that destroyed the U.S. economy are too rich and powerful to prosecute.” Howard looked disgusted.

“I still don’t get how they made money doing it.”

“Many ways. Through credit default swaps, which are like insurance policies that pay you if whatever they’re insuring drops in value. The industry lobbied to keep those unregulated, so a company could sell hundreds of billions of dollars of them, but not have to actually possess the money to pay on them if the market collapsed. That would be illegal to do if credit default swaps were called insurance. But by calling them something else, presto, it’s legal. Look, it’s illegal to take out insurance on your neighbor’s house and then burn it down to collect the payment. But if you call that insurance a credit default swap, and you get your former CEO to run Treasury so it will step in with the taxpayer’s checkbook when your neighbor’s house burns down, you have a winning recipe to profit handsomely from destruction.”

Howard reached into his jacket for a small bottle of water and took a pull before continuing.

“Another way is by short selling. My second to last victim? His brokerage was one of several that came from nowhere to account for a ton of the trading in the markets every day during the 2008 crash – most of it short selling. The vast majority of the selling never had any shares delivered, so whoever sold those millions and millions of shares never had to come up with any – they were literally selling shares that didn’t exist, getting paid as if they had delivered them, and if the company went belly up, they never had to deliver – ever. Do you see how creating unlimited supply of a commodity during a panic could dump the price, no matter how much buying took place? It’s simple supply and demand.”

“But surely that’s illegal…”

“Don’t you get it? Since when has fraud not been illegal? But do you see any criminal cases being brought against anyone who was known by the government to be committing fraud on a daily basis? No. Why? Because they’re ‘too big to fail’. That means they’re too powerful to prosecute. That’s the simple truth. All the regulators would have to do is look at who sold ten times as much stock as existed in a bank like Bear Stearns – a deliberate fraud that destroyed the economy – but nobody dares. Nobody is curious about who was trading that twenty percent of the total market through a couple of tiny brokers.”

Howard stopped to catch his breath, then glanced at the time. “I need to go get something. I’ll be right back.”

He walked out of the room. Silver and Cassidy listened as he mounted the stairs.

“Sweetheart, see if you can get my wrists free. If I can use my hands, we have a better chance.”

“Mommy, you were bleeding really badly. It scared me. He closed the wound and stopped the bleeding, but he said if you moved around it would be really dangerous. He told me to just wait until help came. Maybe we should listen…”

Silver tried to move and realized that her head was worse than she’d originally thought. Even the slightest attempt to move blinded her with pain. Before she could argue, they heard the sound of Howard’s boots descending the steps and approaching.

“Sorry about that. So where was I?” he asked.

“You were telling me how the crisis was a deliberate event. Although I still don’t buy it – there are protections that would keep it from happening the way you say.”

“Really? You mean there are rules. Well, guess what – nobody enforced them. The people who were supposed to stop the barbarians at the gate were instead lining their pockets, looking the other way.” He retrieved his water bottle and took a final sip. “How can you tell a population that the system that’s supposed to protect it has allowed the worst miscreants in the world to plunge it into a depression that was a hundred percent engineered, and that it happened because not a single group that was supposed to do its job even tried? What would happen if the average person understood that? It would be anarchy. Nobody could get elected. People would stop paying their taxes. There would be massive social unrest. The only way you could maintain order would be to become China and start shooting anyone who didn’t follow your rules. It would be the end.”

“I just have a hard time believing any of this is possible,” Silver said.

“Of course you do. Because you were raised to believe that the systems are there to protect you. Why? Because you were told they were by the schools that teach whatever is printed in history books by the winners of wars. The media repeats over and over that the system works and that nobody is above the law, and because we want to live in a world that’s safe, we believe it. It’s a comfortable lie. It makes us feel good, so we’ll fight to insist it’s true.”

Silver had no rebuttal.

He gave Silver a hard look. “You’re a fed. You’re part of the machine that enforces the law. But what if you discovered that there was a whole system that didn’t obey it? What if you discovered there were two worlds – one where you had to obey the rules, and one where the people with real power ran the systems for their own enrichment and didn’t observe any of them? If you let that leak out, what would your job be like? How would you maintain control? Wouldn’t that create a society where you have to keep order with the point of a sword?”

“You’re describing a conspiracy theory. Not reality.”

“Sure I am. Anytime someone calls it like it is, it’s described as a kooky conspiracy theory – because the powerful understand that the best defense against understanding is to label the truth as nuttiness. Just have all your pundits say it’s nutty and absurd. Lenin knew that – he said to just repeat a lie until it became accepted as truth. That’s why a few small groups control the media and why this story will never, ever get printed. Because the same group that engineered the greatest transfer of wealth in history runs that machine, too.”

“So your solution was to kill these six men? How did that help anything? How did it change anything?”

“It cut off one of the heads of the hydra. One of the groups that carried it out. There are others. Much more powerful others. But I can’t get to them. I don’t have the time, or the means. But what I do have is my legacy. The ugly reputation of The Regulator. People will want to know why I killed these very rich men. I intend to explain why and to name names. That was the whole point. To create a set of events that would get even the apathetic titillated enough to want to read about why I did it. Why I killed these seven men, and how they were part of an evil that’s perverting the basics of the society we live in. Because as strange as it sounds, I believe in good and evil – and they were part of something that can only be described as evil.”

She looked at him strangely. “Six men. You’ve killed six men. You said seven.”

He glanced at his watch. “Did I? Well, when you take my statement downtown, I’ll tell you about number seven. Now let’s get you untied and properly armed so you can arrest me and stop this senseless killing spree, shall we?”

“You’re serious.”

“Absolutely. I surrender. You solved the case, you captured me dead to rights, and I will make a full and complete confession. Hold still, and I’ll snip the ties off your wrists. Sorry I had to do that. I needed to keep you out of trouble until your team could make it here.”

“My team?”

“Silver. May I call you Silver? Do I look stupid? Of course you have a team on its way. Now hold still, and I’ll give you back your Glock – loaded, of course – and if you don’t have a team coming, you’ll be free to call one and get it here. Time is running out for me, so there’s no point in delaying. I suppose if all else fails, you could call 911.”

Howard walked over to her and flicked open a pocketknife, then severed the ties with its razor-sharp blade before closing it and flipping it aside. She watched in dumfounded amazement as he walked out the door and returned a few moments later with her weapon and her purse. He handed her the gun, which she pointed at his head as he reached into her purse and withdrew her phone and a set of handcuffs. He dutifully placed them on his wrists and locked them before tossing her phone onto the mattress.

“There. Now let’s see if we can get me processed without getting shot by one of the good guys, shall we?” he said.

The sense of surrealism she had been experiencing intensified as she watched him calmly walk to the far corner and sit down, smiling as if without a care in the world.

“Honey, did he hurt you?” Silver asked Kennedy.

“No, Mom. Although he did make me read a lot.”

She squinted at him and then checked the Glock to verify it was indeed loaded.

“What do you mean, your time is running out?” she asked softly.

“I’m dying. I mean, we all are, but I’m dying a little sooner. That’s all. That’s why the rush.” He shrugged.

“You’re going to make it this easy? It’s over, just like that?” she asked unbelievingly.

“I was actually planning to go into your headquarters this afternoon and surrender. You just saved me the trouble. And this is more dramatic, I think you’ll agree.”

“I don’t believe it.”

“I gave your daughter some books. One of the favorite expressions of the hero, Sherlock Holmes, is also one of mine. Something to the effect of: when all other explanations are proved false, what’s left, no matter how unbelievable, is the truth. You’re out of all other explanations. Which leaves you with me…and the truth. Now make a call so we can get out of here. You look like shit and could pass out at any minute if you’re not careful. And I’m not getting any younger. Come on. Chop chop.” Howard smiled, and for a moment, she felt an altogether inappropriate emotion. “It wouldn’t look too good if I was brought to justice by a ten-year-old, would it? Call in the cavalry. I’m going to get a little rest while we wait. Kennedy, keep the ice on her head until we’re rescued. Don’t be a slacker.” Howard leaned back against the wall and closed his eyes, a look of peace on his face.

She felt the ice bag press against her head a little harder as her daughter endeavored to be attentive.