Ghosts of Manhattan: A Novel(27)

I try to imagine William and Woody with a few years more on their twenty-six. They could be like Jack. Like me. Something better or worse. I’m not just on the outside looking in at them. I’m right in the mix. It occurs to me that during their private minutes in the men’s room tonight when the sound of their snorting reached their own ears, they may have had the same thoughts, made similar comparisons to me. I’m not just a spectator holding tickets to the circus. I’m a clown who can’t leave his dysfunctional circus family because he can’t remember who he was before becoming a clown.

I unlock the cellophane bag, dip in my key, lift it to my nostril, and listen to my violent inhale.





PART II


You can have anything you want but you better not take it from me.

—GUNS N’ ROSES





9 | FREDDIE COOK


December 6, 2005

I AGREE TO MEET FREDDIE COOK AT A STARBUCKS A few blocks from the office. He had called my home again this morning with the hushed and rapid diction of a panicked target in a spy novel. Something serious had happened the night before, he said, and we needed to talk in person right away.

I pull open the door to the Starbucks and see Freddie sitting by himself at a table in the corner drinking a bottle of Pepsi. He’s wearing a suit and it seems his mission is to show that a man wearing a suit can look just as unkempt as a man in a T-shirt, shorts, and flip-flops. He’s making a statement to Bear that you can make me wear a suit but you can’t make me look good. I don’t think it’s deliberate, he just doesn’t know any better.

I pat him on the shoulder as I walk up to him and sit down. Even the pad in the shoulder of his suit is wrinkled and bent. His body looks soft like raw dough and I feel I could push my finger right through him and see it push out against the skin on the other side of him. He has light-brown hair, ruffled like his suit, and it covers his ears with a couple inches not because it is the style he chose but because he hasn’t had a haircut in a few months. He’s probably thirty-five and still speckled with pimples around his jaw and forehead from all the pizza and soda. Not even beer but just soda, like he’s still a nervous teenager.

“Pepsi?”

“I hate coffee.”

“Why the hell’d you pick Starbucks?”

“It’s a long story. Someone’s meeting us later. I need to talk to you first.”

“Okay. Who’s meeting us?”

“I’ll get to that in a minute. Nick, my analysis is pointing to some very strong conclusions. Very strong. People aren’t going to want to see it.”

“Take it easy, Freddie. You’re doing good work. People are going to want to understand your perspective.” Freddie takes an apple out of his jacket pocket and rips his teeth into it like a sailor off a ship. He has no manners at all.

“They’re not going to want to understand it, because then they’re going to have to deal with it. I’m already getting pressure from my boss to put it aside. He’s getting less subtle about it. I think he’s getting pressure from somewhere farther up.”

“You might just be reading into things. Your job is to analyze the risk of the firm.”

“But they don’t want me to analyze the risk. They don’t want me coming back and reporting that our current strategy is dangerously irresponsible. Have you talked about any of this to Joe?”

I report directly to Joe Sansone and Joe reports directly to Dale Brown, the president of Bear who runs all of sales and trading. Joe is inept and insincere and should never be put in charge of another human being. He’s a classic example of a very good sales guy who was then promoted to a management position for which he is wholly unequipped. He has the skills and personality to be a pure sales guy and nothing else. “No.”

“Good. I don’t think you should say anything to him yet.”

“I wasn’t planning to, but Freddie, don’t you think you’re making too big a deal of this?”

“There’s a lot of money at stake, Nick. I’m getting pushback on this report before people have even seen it. They just know what it might say and they don’t want to hear it. We’re selling mortgage-backed securities that are grossly inflated in value. In my opinion, fraudulently inflated. This will crash and at that point whoever holds a significant position in these securities will get burned. Right now, it’s us getting burned. If they get warned on the record about the risk and they don’t do anything about it, they can get burned if things go bad. But I’m not going to be silent. I’m not going to say what they want to hear and hang my own ass out there.”

“How bad is it?”

“This isn’t like losing a bet and you move on to try to win the next bet. Every bet is linked to a thousand other bets. It’s one bet for the whole system. It wouldn’t be like a fire that runs out of wood and burns itself out. Nick, this is like a nuclear reactor meltdown and the first small explosion becomes fuel itself for a growing problem that doesn’t end but keeps growing and getting worse and that can’t be stopped unless you sacrifice everything and shut everything down.”

Freddie looks so nervous and frantic that his story seems less credible. He looks like a mad scientist. But since he’s the smartest guy at Bear and one of the few whose salary is not directly linked to trading commissions, it’s worth hearing what he has to say. “How are you coming up with this?” I ask.