New York, Lower Manhattan.
Salomon Brothers headquarters, the CEO's office on the top floor.
Morning light cut through the massive floor-to-ceiling glass curtain wall and spilled across the polished walnut desk.
John Gutfreund sat upright in his leather office chair. Today he wore a perfectly tailored deep-blue pinstripe suit. His tie was knotted meticulously, and his silver cufflinks caught the sunlight.
Last night's multinational clash had left no trace of fatigue on the face of this Wall Street oligarch. He held a cup of freshly brewed black coffee and looked calmly at the Chief Actuary standing across the desk.
David looked entirely different. The Chief Actuary had deep bags under his eyes, and the eyes behind his gold-rimmed glasses were bloodshot. Because of one sentence from Gutfreund, he and his team had pulled an all-nighter.
He held a stress test report over a hundred pages thick.
"President, the stress test results for the Japanese banking system are out."
"The data anchors provided by Miss Saionji have all been verified by the Actuarial Department."
He flipped to the third page of the report. His fingertip pointed at a set of data models highlighted in red.
"Accurate and without error. Not only that, the model also uncovered deeper loopholes."
Gutfreund sat in his leather chair, took a sip of black coffee, and fixed his gaze on the report.
"The Japanese banking industry has long used 'Tobashi accounts' to hide massive wealth management losses off-balance sheet. To keep their books looking good, they've counted the floating profits from cross-shareholding between companies toward the core capital required by the Basel Accords."
David paused for half a second to let his superior absorb it.
"Now that the Nikkei has fallen below 30,000, these floating profits serving as the foundation are evaporating at the speed of light. Once the market drops below the 28,000-point threshold, this defensive web of cross-shareholding will become the fuse for a chain reaction of liquidations."
"A chain reaction after the foundation collapses?" Gutfreund set down his coffee cup. The porcelain base clinked softly against the saucer.
"Yes, indiscriminate loan recalls."
David flipped directly to the last page of the report.
"To fill the holes in their capital adequacy ratios, banks will have no choice but to bleed the underlying real economy enterprises. Japan's core manufacturing and real estate developers will face widespread breaks in their capital chains. To repay debts, these enterprises will be forced to sell off hard assets at ten percent of value or even lower."
Looking at the final projected figure, David's breathing quickened slightly.
"The model shows that the entire Japanese market will generate trillions of dollars in high-quality Non-Performing Loans."
Trillions of dollars. A liquidation price of ten percent.
He leaned back in his leather chair. His gaze moved past David and landed on the unsigned agreement on the edge of the marble coffee table.
A twenty percent channel commission. A sky-high bill of seven billion dollars.
At the card table last night, Saionji Satsuki had agreed far too readily.
Now, as the actuarial model laid the grand blueprint of the hunting grounds clearly before him, Gutfreund fully understood the other party's true intention in throwing out such a massive sum.
Earning seven billion dollars for nothing was certainly lucrative. But compared to the ultimate windfall of carving up the core assets of the world's second-largest economy and acquiring trillions in distressed debt, this seven billion was merely an insignificant appetizer.
The Saionji Family paid this astronomical bridge fee so readily because, in essence, they were using cold, hard cash to force Salomon Brothers into the game. They needed Salomon's multinational capital mobilization capabilities, and even more, they needed their lobbying machine in Washington to serve as a compliance fortress for this multinational harvest.
But obtaining such massive profits so easily... would capitalists like the Saionji be so kind? Could they have other schemes?
This thought flashed through Gutfreund's mind.
The Ministry of Finance's exclusionary iron curtain had always been impenetrable. The Saionji Family not only took the initiative to provide local political channels but even paid the seven-billion-dollar bridge fee without hesitation. This posture of excessive compliance itself carried an aura of extreme danger—the other party likely wanted to use Salomon Brothers as a shield against regulatory backlash.
But...
He lowered his eyes, his gaze falling on the actuarial report on the marble coffee table.
Trillions of dollars in high-quality non-performing assets. A liquidation floor price of ten percent.
Risk and profit are always proportional. Wanting profit without bearing risk is fundamentally contrary to the basic principles of investment.
As long as the profit was sufficient, what did it matter if they were being used by a Far Eastern family to gain leverage?
Scratch, scratch, scratch. Ink soaked into the texture of the paper. John Gutfreund's name was signed steadily.
He closed the file and looked up.
"Your report is very valuable, David," Gutfreund's voice was steady. "Go and rest. I will have the clearing department take over the subsequent process."
David nodded slightly, turned, and exited the office.
Gutfreund pressed the internal intercom button on his desk.
"Notify the Head of Clearing. Immediately initiate the thirty-five-billion-dollar delivery procedure for S.A. Investment. Use the internal hedging channel of the proprietary trading desk."
Releasing the button, he grabbed the red direct-line phone at the corner of his desk. His finger pressed the speed-dial button for the K Street lobbying group in Washington.
A few seconds later, the line connected.
"It's me." Gutfreund's tone turned low. "I don't care which congressman on Capitol Hill you use, or how much in political donations is required."
"Apply pressure to the top brass of the U.S. Securities and Exchange Commission."
"The freeze orders and related investigations regarding S.A. Investment's offshore funds must be lifted before the sun sets today."
"If anyone tries to block it, tell them Salomon Brothers will withdraw its sponsorship of their campaign funds for this quarter."
...
Washington D.C. Headquarters of the U.S. Securities and Exchange Commission.
In Arthur Vance's office, the air conditioning was set extremely low.
Thousands of transaction logs and clearing records were piled messily on the desk. The liquid in his coffee cup had long since dried up, leaving only a dark brown stain.
A layer of dark stubble had grown on Arthur's chin, his eyes were bloodshot, and he was staring intently at the CRT monitor in front of him.
The freeze order from the U.S. District Court for the Southern District of New York was still in effect. That billion dollars was securely locked in the underlying accounts of the clearing center.
On the surface, Arthur had won. The Seventh Investigation Team had successfully intercepted this multinational fund.
But in the subsequent legal battle, the Manhattan legal team had thrown out countless jurisdictional disputes and hearing applications, seemingly to deliberately delay them.
Soon, Arthur felt a sense of dissonance.
The other party had lost a billion dollars, yet their reaction was too... calm.
Although the top-tier lawyers' defense was intense, it felt more like a deliberate attempt to consume his administrative time.
That left only two possibilities. One was that a billion dollars didn't seem like much to them, not worth making a huge fuss over.
The second was that they had another scheme, and this billion dollars was just bait placed out in the open.
Arthur gritted his teeth, his hands typing rapidly on the keyboard.
I must... bring these speculators to justice.
No matter how sophisticated the algorithm's disguise or how solid the offshore company's firewall, as long as the other party attempted to pocket the hidden profits...
The money would ultimately have to undergo physical delivery.
He bypassed the verification of the securities trading phase. Using his underlying authority as an SEC Senior Investigative Officer, he pulled the abnormal settlement logs from the North American Clearing Center. The green data stream on the screen scrolled down rapidly as his pupils scanned every line of code.
"Stop." Arthur pressed the Enter key. The scrolling data stream froze instantly.
In the center of the screen, a line for an OTC derivative delivery application highlighted in red appeared.
Amount: Thirty-five billion dollars. Status: Triggered a Level 2 Anti-Money Laundering alert. Currently in the clearing node queue.
Arthur's breathing became heavy. He grabbed a magnifying glass from his desk and pressed it against the screen.
The routing for this massive sum had gone through complex jumps. The final destination address was precisely the offshore trust gateway in the Cayman Islands, shrouded in mist. At the throat of the underlying physical settlement, the legal firewall had finally revealed a tiny crack.
I found it!
Arthur suddenly stood up from his chair. The leather swivel chair slid backward from the reaction force, hitting the filing cabinet behind him with a dull thud.
He grabbed a blank piece of official stationery from his desk and picked up a fountain pen. The nib rubbed quickly against the paper, drawing out messy streaks of ink.
Offshore trust barriers and jurisdictional disputes were all just scrap paper in the face of physical flow that triggered the Anti-Money Laundering Act.
As long as he slammed this underlying data onto a federal judge's desk and obtained a comprehensive freeze order, that thirty-five billion dollars would become a stagnant pool. The hidden opponent would have no choice but to stick their neck out.
The dot-matrix printer in the corner buzzed. An investigation report bearing the SEC seal emerged from the paper outlet.
Arthur grabbed the stack of documents, still warm, and stuffed them into his briefcase. He grabbed his windbreaker from the back of the chair and threw it on haphazardly, his gaze fixed on the wall clock.
2:15 PM. Less than three hours until the federal court closed.
These three hours were a race between Washington's administrative machine and multinational capital. Even a minute's delay could allow that massive sum to slip away completely through the clearing center's channels. He had to personally put this noose around the opponent's neck before the judge left his desk.
Arthur reached out to grasp the brass handle of the oak office door. Just as his wrist was about to exert force—BANG! The heavy oak door was pushed open violently.
Caught off guard, Arthur was pushed back two steps by the door, his back hitting the edge of his desk. The Head of the SEC Enforcement Division strode into the office with a grim expression, clutching a document stamped with the seal of the K Street lobbying group.
"Sir?" Arthur steadied himself, protecting his briefcase with one hand. "I was just about to go to the federal court to apply for a freeze order. I caught an anomaly in the North American Clearing Center's underlying data. There's an offshore clearing of thirty-five billion..."
The moment the supervisor heard 'thirty-five billion dollars,' he instinctively wanted to cover his ears, but desperately realized he had already memorized that damned number.
Bastard! I don't want to hear it! If you want to seek death, don't drag me down with you!
"Put the documents down, Arthur." The supervisor's voice was icy, his face darkening further.
"Sir! This capital is involved in market manipulation using offshore accounts!"
Arthur questioned loudly, the veins on his forehead bulging.
"As long as we get a judge's signature, we can intercept this delivery!"
The supervisor had no intention of listening to Arthur. Mentally chanting that he didn't understand English, he strode up to Arthur and reached out his right hand, pressing it against the briefcase Arthur was holding tightly.
"I told you, put the documents down." The supervisor stared into Arthur's eyes. "Do you think you've discovered some secret that no one else knows?"
The supervisor's voice dropped, carrying a heavy weight.
"An hour ago, a call from Capitol Hill reached the Chairman's desk. Several senators personally inquired about the ownership of this clearing channel."
Arthur's pupils contracted.
"The exclusive prime broker for this thirty-five-billion-dollar delivery channel is now Salomon Brothers."
The supervisor's fingers gradually applied pressure to the briefcase, forcibly pulling it from Arthur's arms.
"The higher-ups in Washington don't need to know who this money originally belonged to. They only know that Salomon Brothers' lobbying group just submitted a compliance memorandum."
The supervisor tossed the briefcase casually onto the walnut desk.
"This money is now defined as a legitimate institutional transaction flow for Salomon Brothers. Salomon can take an astronomical channel fee from this bridge clearing."
"You are now standing in the way of a Wall Street oligarch's path to the vault."
Arthur's lips trembled. "This... this is selling out the bottom line of regulation!"
He let out a hoarse low growl, his hands clenched tightly into fists.
"Immediately destroy all report backups in your possession."
The supervisor turned and walked toward the door.
"If you still want to keep your federal pension, or the safety of your family, forget about this case."
The oak door slowly closed behind the supervisor. The latch made a crisp click. The office fell back into a silence broken only by the hum of the air conditioning.
Arthur Vance stood there dejectedly, as if all the strength had been drained from his body.
He slowly turned his head. His gaze passed through the gaps in the blinds, looking out the window.
Beneath this Washington monument that symbolized power, the shadow of super-capital obscured all sunlight.