Thomas Hoover - Project Daedalus

"You should be ordering champagne."

"Not this time." He turned back to study the river. "The whole thing stinks."

"Who're the players?"

"It's supposedly to raise capital for the Mino Industries Group. I've been 'asked' to underwrite the bonds, then unload them with minimal fanfare and keep a low profile." He looked back. "But it's almost fraud, Michael. I don't think there's anything behind them at all. Nothing. The beneficiaries are just phony Mino Industries shadow corporations. Only nobody will know it. You see, the bonds are zero-coupons, paying no interest till they mature ten years from now. So it will be a full decade before the buyers find out they've acquired paper with no backing."

"Won't be the first time the sheep got sheared by a hustler."

"Michael, I'm not a hustler," he snapped. "And there's more. They're so-called bearer bonds. Which means there's no record of who holds them. Just one more trick to keep this thing below the radar."

"Typical. 'Bearer bonds' always sell like hotcakes in high-tax locales like the Benelux countries. That mythical Belgian dentist can buy them anonymously and screw the tax man."

"Yes, that's part of what makes Eurocurrency ideal for this, all that homeless money floating around over here. No government is really responsible for keeping track of it. In fact, every effort has been made to ensure that these debentures appeal to greed. Their yield will float, pegged at two full points above the thirty-year British government bond, the gilt. As lead underwriter I'll have the main responsibility, but I'm also supposed to form a syndicate of Japanese brokerage houses here-Nomura, Daiwa, Sumitomo, the others-to make sure the offering goes off without a hitch. But that precaution will hardly be necessary. At those interest rates, they should practically fly out the door." He sighed. "Which is a good thing, because… because, Michael, the amount I'm being asked to underwrite is a hundred billion dollars."

"And that's just for the first year, right?"

Nogami looked up, startled. "How did you know?"

"Call it a lucky guess." He took a deep breath. So that's where the funding stipulated in the protocol was going to come from. European suckers. My God, he thought, the play is superb.

"Michael, nobody could float an offering like that and have it covered with real assets. Nobody. Taken all together that's enough money to capitalize a dozen world-class corporations." He paused. "Of course, I won't be offering it all at once. The debentures will dribble out over the period of a year, and then the next year, it starts all over again. For five years."

"So you're supposed to raise five hundred billion dollars in the Eurobond market over five years. Not impossible, but it's a tall order."

"Especially since the ratings will be smoke and mirrors. It is, in effect, an unsecured loan." He looked away, down at the swirling brown surface of the Thames. "You know what it really means? He wants me to sell junk bonds. And I can't refuse." His voice came close to a quaver. "Just when I was well into earning the esteem of the European banking community, I'm suddenly about to become the Drexel Burnham of Eurobonds. I'll be operating the investment equivalent of a shell game."

"Ken, why are you telling me all this?" Vance had never seen him this upset.

"Because I have to find out what this is all about. What the money's going to be used for."

"I take it the Tokyo oyabun’s not talking."

"Michael, no one dares question him. You know that." His voice grew formal. "It's the Yakuza way."

"Well, you're in London now. A free man."

"It's not that simple. You may not know-it's a very well-kept secret-that he capitalized my takeover of the Westminster Union Bank here. He put together a consortium of private financiers for me. A lot of the money was actually his. The whole thing had to be low profile, since none of our banks dared have its name associated with a hostile takeover in London. Our institutions are still squeamish about such things. They all cheered me on in private, but in public they didn't know anything about it."

"Maybe he had this little return favor in mind all along."

"To tell you the truth, I've since wondered that myself. Anyway, now he's calling in my obligation. We Japanese call it giri. I have to play. But either way I'm ruined. If I do it, I'll become a pariah in the European banking community. If I don't… well, the consequences are almost unthinkable."

"Ken, I don't know how to say this, but there's a chance this whole scenario is bigger than anything you can imagine."

Nogami turned to stare. "What do you know?"

"Let's just say I hear things. But first we need to strike our deal."

"Of course. As I said, I'll send a telex, from my secure trading room, for what good it may do. But you've got to help me too. Please." He turned back to the river. "You know, Michael, I like my life here. More and more. Even given all that's going on here these days, the pace is still much more civilized than Tokyo. For all our prosperity back home, I think we've traded something very valuable. Call it our soul perhaps. Here I feel almost free from the old days, part of a real, legitimate world. I hated all the money laundering, the shady deals. These days I can look myself in the face."

"I was temporarily changing professions myself, until about a week ago. Then this problem came up." He waved to a pleasure boat slowly motoring up the river. It was only a thirty footer, but the lines reminded him of the Ulysses. It made him suddenly homesick for real sunshine and real air.

"Michael, what's going on? We need to work together."

"I'll just say this. I think the godfather's got a big surprise cooking. Maybe we're both caught in the middle."

He smiled. "If that's true, we can help each other out. Though I can't push too hard." He took a deep breath and gazed at the murky London sky. "But still… I'll tell you the truth. I'm very seriously thinking I may just refuse to touch the whole thing. Tanzan Mino-yes, why not name names? He's even made vague threats against my family. The man has pushed me too far this time. Somewhere it has to end."

"You're a brave man. He still runs some very persuasive muscle. Better have your life insurance paid up."

"I'm well aware. But I don't want to jeopardize everything I've built here. My whole new life. So that's why I need you. If you could find out what's behind all this, I could decide whether I should risk everything and go ahead with the offering. Or just stand up to him at last. Otherwise…"

"What's the timing?"

"I have to list the first offering with the Issuing House Association day after tomorrow. We've already put together the paperwork, just in case."

"Pretty tight."

"Michael, I'll see what I can do about your problem. And if there's anything else, you know I'll try my best."

"Depending on whether my message gets through, I could be needing somebody to handle some cash. A reasonably substantial sum. Maybe as part of our little quid pro quo you could arrange it."

"Is this money…?" He paused awkwardly. "Well, you understand my question."

"It's laundered. Clean as a hound's tooth."

"Where is it now?"

"Don't worry," Vance smiled. "It's liquid."

"And the sum?"

"Hang on to your bowler hat. It's around a hundred million U.S."

"Is that all?" he laughed. "That figure is barely a blip on the screen these days. For a minute there I thought you were talking real money."

"Seems a reasonably substantial sum."

"It's scarcely more than walking-around money in our business, as you well know. Over two hundred billion passes through the foreign exchange markets every day, a large amount of it right here in London."

"Well, there could be a small complication, if the KGB gets into the action."