Paul Murray - The Mark and the Void

The potent cocktail of fiscal conservatism and perception-altering drugs would shape an entire generation. Many of the figures Blankly encountered at that time went on to become key figures in politics, banking, and in the nascent world of computing, into which they carried the revolutionary concept they had learned on the fairways — that reality was plastic and could be molded as they saw fit.

Though he never completed his degree and had no training in finance, arriving in Wall Street Blankly found his +2 handicap much in demand. He was taken under the wing of the legendary Walter Wriston of Citibank, and, as he quickly came to dominate in interbank and pro-am tournaments, effectively given an open brief. At the time the major banks were plowing money into Latin American dictatorships, but Blankly, never one to follow the crowd, instead staked his money on a then little-known warlord in the Middle East. The bet paid off: While Wall Street lost a fortune when their dictators were deposed, Ahmed bin-Ahmed, as he was then known, went on to become the Caliph of the oil-rich state of Oran, and today remains one of Blankly’s biggest financial backers and closest personal friends.

Tragedy was to strike at the end of the 1970s, when his wife of only six months, heiress Cressida Heinz-Boeing, committed suicide, but Blankly bounced back, taking a position at Drexel Burnham as the junk bond boom began. This was the age of the so-called ‘Masters of the Universe,’ when traders made millions from peddling mountains of practically worthless bonds; Blankly soon became famous for his aggressive acquisitions strategy and his colorful private life, dating a string of models, and being photographed in New York’s hottest nightspots.

Yet behind the scenes, he was under considerable pressure. The collapse of the junk bond market following the indictment of his boss and close personal friend Michael Milken left him with personal losses of over ten million dollars. A greater loss was soon to follow with the suicide of his second wife, Caspian Dupont. Reeling from this double blow, Blankly spent some time in the financial wilderness. According to friends, he thought seriously about leaving banking and beginning a new career, possibly in restoring old boats. However, the dearth of professional-level golfers in the major houses soon had Wall Street beating a path to his door. He returned to Citi in the early 1990s, where he remained a divisive figure — beloved among employees for his inspirational memos, but attracting controversy for his refusal to indulge what he called the ‘mania’ of that time for political correctness. He drew fire for remarking to a reporter that, with regard to Wall Street management structure, ‘women on top [was his] least favorite position’; less than a week later, he found himself in hot water again after accusing African-American golfer Tiger Woods of stealing his wallet at a fundraising event.

This was a challenging time for Blankly, one which in later years he would refer to as ‘the toughest hole.’ His venture capital firm, Tourniquet, which had invested over a billion dollars in websites aimed directly at dogs, cats, and other pets, was wiped out by the Internet crash, while on the home front his third wife, Fanfarla Pinochet, survived only ‘by a miracle’ after accidentally dropping a toaster into her bath (the couple divorced later that year).

But he was to bounce back with the September 11 attacks on the World Trade Center. Now with hedge fund Elite Capital Partnership, Blankly is widely believed to have put in a huge order for gold in the seconds after the first plane hit. By the time the second tower fell two hours later, the price of gold had already risen almost 20 %. In the chaos that followed, this single transaction is believed to have resulted in almost unthinkable profits for a small number of investors, including Blankly’s long-time friend the Caliph of Oran; although no records of the trade exist, Blankly was very soon headhunted by Danforth Blaue, where he became the most highly remunerated CEO in the world. Within a year he was delivering record profits through heavy investment in subprime mortgages. He featured on the cover of Fortune , and in the accompanying interview told the reporter that ‘we are in a new paradigm of growth now that cannot be stopped.’

This paradigm did stop shortly afterwards, however, and with the collapse of the subprime housing market, the subsequent ‘credit crunch,’ and worldwide losses of trillions of dollars, Danforth Blaue was saved from annihilation only by a last-second government bailout. Public anger toward industry chiefs like Blankly, who throughout his career had criticized politicians for any attempts to regulate Wall Street’s activities, was exacerbated by the discovery that Danforth had in fact been betting heavily against the toxic subprime assets they sold their clients. It then emerged that billions of dollars of taxpayers’ money handed over to rescue the firm had been used not only to pay huge bonuses to the failed bank’s executives, but also for a Hawaiian-themed ‘rescue party,’ which featured a live performance from rapper Fugly B of his 2008 hit ‘Bag It and $plit (F*** you B*****s)’ as well as a swimming pool filled with banknotes. Worse, not long after the bailout a lifesize bronze statue of himself that Blankly was having delivered by crane to his office was dropped onto a bus of special-needs students visiting Wall Street for the day. While none was injured, Blankly’s job was felt to be untenable and he stepped down, with a further ‘leaving bonus’ of $33 million and a replacement bronze statue.

Though Blankly had been pilloried by some for ‘turning reality into a fruit machine’ via complex financial instruments of which he himself had little understanding (cf. the leak of his highly embarrassing memo re ‘hoosits’ and ‘whatsits’ for collateralized debt obligations and synthetic collateralized debt obligations respectively), others took a more nuanced view. Following his departure from Danforth, Blankly — still a ‘scratch’ golfer with famously soft hands — was approached with several different job offers, including Special Advisor to the Treasury, Chair of Professional Ethics at Harvard University, and President of the World Bank. It is no surprise, however, that the man who once said he had ‘capital allocation in his blood’ opted in the end to return to investment banking. Previously helmed by Sir Colin Shred, best known for his outspoken views on the Windsor knot, Bank of Torabundo emerged from the crisis punching above its weight and hungry for fresh ideas on loan portfolio management. A statement to shareholders said that Blankly’s brief was to radicalize the bank’s MO and leverage its sound financial fundamentals into market share. Potential joint ventures or other strategic combinations have not been ruled out, though Blankly has refused to comment on rumors that the bank will begin trading on its own account, or that he is seeking to set up a hedge fund within the firm itself.

About his own role in a financial collapse which in the US alone has cost more than the New Deal, the Marshall Plan, the Korean War, the Vietnam War, the 1980s Savings and Loan Crisis, the invasion of Iraq, and the total cost of NASA including the moon landings, all added together and adjusted for inflation, Blankly is unrepentant. ‘We were wrong about a lot of things. But don’t forget about all we got right. We helped people to borrow more money than anyone ever thought possible, and with that borrowed money, they went out and bought their dreams. Yes, they fell far, but only because they had soared so high — higher than the human race had ever gone before, high enough, almost, to touch the face of God.’

‘One thing’s for certain,’ Jurgen says, putting down the magazine. ‘The days of thinking inside the box are over.’