The Futures(41)

“I think you have better taste than your friend.” He ran his hand up her bare arm. I grimaced. She was at least thirty years younger than he was.

The redhead stood up, dress slipped off her shoulder to expose a lacy black bra, and went to the other couch. She snuggled up to Brad, but Brad just kept his eyes on his phone.

“So what do you guys do?” one of the women asked. “You must be big shots with a room like this.”

“You should see my room, honey. We’ll take a field trip later.”

“We’re in finance,” Brad said abruptly. “Hedge funds.”

Silence, then one ventured, “Hedge funds. What does that mean?”

“It’s a way of investing designed to mitigate risk,” Brad said, alert again. “Hedging your bets. At any given point in time, we’re betting on a number of different scenarios, so no matter which way the market goes, we’re protected. So an example would be—if I met a woman out at a club, but I wasn’t sure how she felt about me, maybe I’d bring her friend along, too. See? I’ve hedged my bets. In case one says no, I have a backup.”

Michael snorted. “Brad’s a nerd, in case you couldn’t tell. Don’t get him started. But this is boring. Let’s talk about something else.”

“Actually.” Brad’s voice was rising. “Actually, I don’t think it’s boring at all. It’s interesting, in fact. I was going through the books this week, and there was some fascinating stuff in there.”

“Not now. We have company.” Michael slid his hand up the blonde’s skirt and kissed her neck. She was giggling and blushing. Her friend attempted the same with Brad, but he pushed her away impatiently.

“I think we do, Michael. I think we want to talk about this right now. We can do it alone, or we can do it in front of these two. Up to you.”

Michael laughed. “Ladies, I’m sorry. I apologize for him. No manners at all.” He tucked several crisp-looking bills into the blonde’s dress. “Some other time.”

The high heels obediently clacked their way back across the marble foyer, and the doors opened and closed a moment later. Michael turned to Brad.

“You mind telling me what the fuck that was about?”

“I need to talk to you about this, Michael. Right now. We have a big problem on our hands.”

“What? For God’s sake, what is it?”

Brad took a deep breath. “I was looking at the books, getting ready for the conference. I noticed something wasn’t lining up. So I went deeper into the numbers, and I saw we have a lot of exposure—a lot of exposure—in one particular area. Which I’d heard nothing about. The lumber markets.”

“And?”

“Do you know about this? All the money we have tied up in lumber futures?”

“Of course I know about it. I’m running this company. It’s my deal.”

“Well, then explain it to me. Because I’m sure as hell not seeing it. The housing market is the worst it’s ever been. And yet we’re betting that the demand for lumber is going to go up? For there to be massive, imminent growth?”

“Correct.”

“What the hell, Michael?” Brad stood up and started pacing. “This isn’t some murky situation where we don’t know what the economy is going to look like next year. We do know. No one in their right mind is going to be building.”

“In North America, maybe. But before you get any more worked up, Brad, I suggest you look at the bigger picture. We’re not betting on there being demand here.”

“Where, then?”

“China.”

“China? Are you serious? We have no idea what the Chinese are going to do tomorrow, let alone next year. Since when do we make predictions about their market with any kind of confidence?”

Michael chuckled. “Brad. Are you sure this isn’t some kind of personal animosity? I know the Koreans aren’t big fans of the Chinese, but—”

“Stop. Just stop. Does Kleinman know about this?”

“It doesn’t matter. Kleinman put me in charge, and frankly it would look bad for him to be overseeing every little deal while he’s in Washington.”

“Every little deal? Michael, are you even listening? Our exposure on this is massive. If it goes the wrong way, we are totally fucked.”

“You’re getting hysterical about something that’s going to make us a lot of money. Will you listen for a minute, please?”

Brad stood in place, quivering with anger. He seemed on the verge of shouting, but he clamped his mouth shut and crossed his arms over his chest.

“Thank you. Sit down, too. You’re acting like a lunatic. We’ve been working on this position for a long time. Months and months. Demand from the Chinese market for North American lumber has already gone up this year. Every single one of our predictions has played out, and I guarantee you that demand is going to continue to skyrocket in 2009. Our calls on WestCorp are going to make you a very rich man.”

My mind was racing. So the deal wasn’t dead. Not at all. It was very much alive.

“What I don’t get,” Brad said, “what I don’t understand, Michael, is that if this bet is such a sure thing, why isn’t everyone else all over this? We don’t specialize in this. There are a dozen shops that know lumber better than we do.”