As one of the five major investment banks on Wall Street, Merrill Lynch moved even faster than Bruce had expected. The three-day deadline had not even expired before they called him back.
"Mr. Guo, after completing our review and overall risk assessment, Merrill Lynch is prepared to underwrite the ABS backed by the next ten years of income from your five literary properties," Danny Lewis said from across the table. "We'll also actively support your effort to secure a AAA rating from the agencies."
Bruce kept his expression calm, but his tone carried unmistakable confidence.
"Merrill has made the right decision."
That kind of confidence played well in the West. In business, the jungle rules were often more visible than they were in ordinary life.
Danny smiled. "I agree."
What followed was the real negotiation.
They went point by point through issuance structure, repayment terms, financial oversight, and bond denomination. Of everything on the table, the one Bruce cared about most was the repayment structure.
After a round of negotiation, Merrill accepted his proposal: bullet maturity.
That meant the ABS would not amortize gradually over time. Principal and interest would be paid at maturity, ten years after issuance.
Bruce wanted it structured that way for three reasons.
First, the early stage of his business expansion required as much cash as possible. He needed capital now, not later.
Second, he expected the dollar to lose purchasing power over the next decade. Paying that obligation ten years from now would be cheaper in real terms than paying it earlier.
Third, and most important, there was the coming subprime crisis. Once that storm hit, the price of his bonds would almost certainly fall. If they dropped more than ten percent, he could buy them back himself. At that point he would not just reduce the interest burden. If the price got low enough, he could make money on the round trip.
After nearly a week of negotiations, and with George Davis flown in from San Francisco to assist, a professional who specialized in commercial law, Bruce finally signed the agreement with Merrill.
He also secured a AAA buy rating from Moody's.
...
"Mr. Guo, these are the incorporation documents for Phoenix Asset Management."
Wendy Solo handed him a document envelope.
After wrapping up the Valve Software acquisition, she had flown to Los Angeles to work directly beside Bruce.
Bruce opened the envelope and read everything carefully.
Then he nodded.
This was the third subsidiary registered under Phoenix Holdings.
And more than that, it was the true starting point of his capital strategy.
He looked up.
"What time is it?"
"2:35 p.m.," Wendy answered immediately. "You have twenty-five minutes before your meeting with the candidate Heidrick & Struggles identified."
Bruce nodded. Twenty-five minutes was enough.
Thinking about the meeting ahead, he reopened the background materials the headhunter had provided and reviewed them again. After reading through them twice more and making sure there were no gaps, he leaned back in the rear seat and closed his eyes.
Lately, he had been juggling too much at once.
He was still writing. He had been negotiating with Merrill and Moody's. He was monitoring Matrix Pictures and keeping track of new-book sales at Thornbird Publishing.
Even with all the stamina of youth, the pace was starting to wear on him.
Through the rearview mirror, Wendy glanced at him with quiet admiration.
She watched the time carefully and only spoke when she absolutely had to.
"Mr. Guo, we're here."
Bruce opened his eyes, looked out at the Hayes Resort sign, and nodded.
"Let's go."
The moment they stepped out of the car, a Heidrick & Struggles staffer hurried over and escorted them inside.
The meeting had been arranged in a quiet tea room.
And there, Bruce finally met the man he wanted to hire.
"Mr. Zhang."
The middle-aged Chinese American man across from him wore a black suit and gold-rimmed glasses. He had a lean face, narrow eyes, and the composed air of someone who had spent decades in finance without ever needing to raise his voice.
As Bruce extended his hand, the man stood and took it with a polite smile.
"When someone your age has accomplishments like yours, Mr. Guo, admiration comes naturally."
Bruce smiled faintly. He had heard enough flattering lines by now that they no longer moved him much, but courtesy still mattered.
"Thank you. Please, sit."
Once they were both seated, Bruce chose not to waste time.
He wanted efficiency, not ceremony.
"I assume Heidrick & Struggles already laid out our offer in detail," Bruce said. "Do you have any objections?"
William Zhang folded his hands calmly.
"A five-hundred-thousand-dollar annual package plus performance compensation is a strong offer. I have no issue with the compensation. What I'm more curious about is this: why me? With the capital allocation and terms you're offering, you could easily hire fund managers with much stronger profiles than mine."
Bruce smiled.
"Do you think you're not strong enough, Mr. Zhang?"
William held his gaze for a moment before replying.
"On Wall Street, and frankly in global capital markets as a whole, very few people would dare call themselves exceptional."
He had grown up in the United States, but traces of Chinese restraint still lingered in the way he spoke. The culture of modesty had clearly survived the crossing.
Bruce reached into his briefcase and pulled out a file.
He slid it across the table.
"This is the full background packet Heidrick & Struggles prepared for me on your last fifty-two years. I'm not especially interested in the period before your doctorate. What interests me is the twenty-four years you spent in institutional asset management."
William glanced down at the file.
Bruce continued.
"The first seven years are one thing. The next seventeen matter much more. During the years you served as a fund manager, the portfolios and managed accounts under your care posted an average annual return of eight percent."
He tapped the file lightly.
"But what matters to me even more is how you did it. The performance was steady. No wild swings. No spectacular blowups. That is exactly what I value."
William gave the file another quick look, then set it down.
"Wall Street doesn't usually reward stability. It rewards managers who can post eye-popping returns."
Bruce looked at him and smiled.
"Since you're Chinese, or at least close enough to the culture to appreciate this, let me ask you something. Have you ever heard the phrase: the best generals win without famous battles, and the best doctors heal without famous cases?"
William thought for a moment, then nodded.
"My father taught medicine at Long Island University. I heard that line from him once."
Bruce inclined his head.
"Then you know what it means. The truly great strategist doesn't become famous for battlefield heroics, because he solves the problem before it becomes a war. He uses politics, economics, leverage, pressure, whatever he needs, and ends the conflict before the battle starts.
"The truly great doctor doesn't build his name on dramatic rescues. He keeps the patient from getting seriously sick in the first place.
"It's the same in finance. In my view, the best fund managers are not the ones who get lucky on a spectacular year. They're the ones who can generate stable profits over a long period of time. That's real skill. And that's exactly the kind of person I need."
William listened carefully.
Then he gave a small nod.
"I'll admit, Mr. Guo, that's the kind of thing that sounds very good when you hear it."
He paused, then added with a dry honesty that Bruce appreciated:
"But I'm fifty-two. In a few years, I'll be close to retirement. I'm not sure my energy is enough to support the kind of ambition you clearly have in the capital markets."
Bruce answered without hesitation.
"That part doesn't concern me. I'll set the strategic investment direction myself. Your job is execution and day-to-day management."
That changed William's expression.
A faint line appeared between his brows.
So that's what this is, he thought. I'm not being hired to be a true decision-maker. I'm being hired to run the machinery.
He looked back at Bruce.
"If that's what you want, then there are plenty of people on Wall Street who could do the job. Why spend this much to find me?"
Bruce didn't dodge it.
"There are three reasons.
"First, we're both Chinese.
"Second, your track record tells me you're reliable.
"And third, you've spent enough years on Wall Street to have what matters most in this business: credibility and relationships. With your network, I can get much more attractive financing and margin access in the secondary markets."
That landed.
William leaned back slightly and thought it through.
After a moment, he looked straight at Bruce and said, "I suspect that third reason is the real one."
Bruce smiled, but did not deny it.
There was no point.
The U.S. capital markets were highly developed, but they were also full of rules, thresholds, and practical restrictions. If Bruce wanted to step into the stock and bond markets and use margin or securities lending, he could not simply walk in as a brand-new retail participant and expect meaningful leverage.
For starters, he would need at least six months of account history.
Beyond that, brokerage firms imposed all kinds of internal risk controls on individual clients: total asset requirements, risk-asset ratios, liquidity standards, and more.
But the most important variable was leverage itself.
At this point in time, U.S. financial regulation was still looser than it would become after the subprime collapse. Still, someone like Bruce, with a fresh footprint in the market and no institutional trading history, was never going to be granted the kind of leverage that produced real fortunes.
Which meant he had to get around the problem the smart way.
That was where Phoenix Asset Management came in.
Bruce would establish the firm.
William Zhang, as the named fund manager, would create and file an asset management program.
Then Bruce would allocate his capital into that program.
On paper, William would be the portfolio manager and operating decision-maker.
In reality, the strategic calls would still come from Bruce.
And when it came time to borrow against positions, use financing facilities, or obtain securities lending lines, William's decades of reputation, relationships, and trust on Wall Street would make a major difference.
He could get terms Bruce could never get on his own.
That was the real purpose behind the structure.
The ABS backed by ten years of future income from the five books, the one raising $350 million, had never been the end goal.
It was ammunition.
Bruce was raising the money now so that, when the right moment came, he could move hard in the capital markets with enough size to matter.
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