Chapter 121: I Regret

"As of the close of yesterday, the Dow Jones Index plummeted by 508 points, causing an overall loss of $503 billion in the federal stock market."

"Is 1987 equivalent to 1929?"

"Panic continues to spread, SEC officials urgently clarify: There is no plan to temporarily close the stock exchanges."

"James Baker should resign for his inappropriate comments."

"Chicago Mercantile Exchange S&P 500 futures long positions faced a floating loss of $3.52 billion, with massive pressure to post additional margins."

"The Federal Reserve convened an emergency meeting, requiring major banks to provide sufficient funds and credit to exchanges to prevent defaults that could exacerbate the market crisis."

"Leo Melamed, chairman of the Chicago Mercantile Exchange, stated: The exchange's clearing bank has already received $3.7 billion in additional margins; the exchange will open as normal at 8:30 AM Central Time."

"..."

"..."

The crash curve, almost identical to that of 1929, kept countless people awake through the night.

The stock market crash of 1929 led to a series of severe chain reactions, including bank closures, factory shutdowns, and farms lying fallow, causing nearly one-third of the U.S. population to lose all income. During the worst period, the shortage of food even led to nationwide malnutrition.

From 1929 to 1933, in just four years, the death toll in the U.S. reached 7 million, 7% of the population at the time, far exceeding the average death rate of normal years.

In 1987, those at the top of America's economic pyramid still had vivid memories of the Great Depression. Therefore, within just one day, the federal government swiftly launched a series of relentless bailout plans.

On the morning of October 20th, newly appointed Federal Reserve Chairman Alan Greenspan decisively 'opened the floodgates' by announcing a significant reduction of the federal benchmark interest rate by 0.75 percentage points. The Fed also provided $12 billion in liquidity to North American banks through bond purchases.

Subsequently, from the White House to local banks in various states, the nation began to implement substantive measures to rescue the market.

Stimulated by a series of positive news, the Dow Jones Index began to rebound on Tuesday morning, rising from the previous day's close of 1738 points to a high of 2035 points within half an hour.

However, after five years of stock market bubbles, once burst, they could not be hastily remedied.

Following a brief rebound, the Dow Jones Index once again plummeted sharply.

Elsewhere, the S&P 500 Index, closely linked to the Dow Jones, followed a similar trajectory after the market opened.

The S&P 500 Index closed at 201 points on Monday and similarly surged to 245 points within half an hour on Tuesday, only to plunge again.

Los Angeles.

Inside a mansion in Palisades, Simon yesterday squared off 8300 short contracts on the S&P 500 between 200 to 210 points, netting a profit of over $350 million in a single day.

At the same time, Westeros Company established 3500 long contracts within the 200 to 210 points range.

On Tuesday's opening, Simon patiently waited for the S&P 500 to briefly surge before falling again, decisively adjusting his closing zone, starting to sell off at an index cap of 220 points while continuing to establish long contracts within the same range.

Additionally, Simon extracted $200 million from the previous day's profits, turning to the New York Stock Exchange to begin a massive buying spree of planned stocks.

Chicago.

Time quickly advanced to Thursday.

At 7 AM Central Time, Noah Scott, who had averaged less than five hours of sleep in the recent days, hurriedly arrived at the Lehman Brothers' Chicago branch with his eyes red and swollen.

As a vice president at Lehman Brothers, Noah Scott managed a trading team of six analysts and had his own office.

Casually tossing his briefcase and today's newspaper aside, Noah Scott sat down behind his desk, turned on his computer, and spaced out during the booting process, wondering: How much did that guy earn?

James Robinson made a decision to wait and see, but Noah Scott didn't stop there; he borrowed $1 million from his father to secretly buy 55 S&P 500 short contracts.

It was roughly 80% of Simon's previous holding percentage.

Noah Scott really wanted to bet on whether the man whom all his classmates, including himself, had unsuccessfully pursued, was truly that miraculous.

Then.

On Monday, Noah Scott experienced a small taste of overnight wealth.

The 55 short contracts were all squared off at the 200-point bottom of the S&P 500, earning Noah Scott an easy $2 million.

However, looking at the profit figure in his account, Noah Scott couldn't feel happy at all. He kept thinking about the money Simon withdrew from Leh

man Brothers.

Over $350 million in funds, if still maintaining an 80% short position, would be about 20,000 short contracts.

Squaring off 20,000 short contracts at the lowest point of the S&P 500 index was obviously not possible, but even by Wednesday's closing index of 259 points, the short contracts held by Simon Westeros would still yield substantial profits.

Moreover, as long as he wasn't too greedy, Simon Westeros could have squared off all contracts during Monday and Tuesday. Even if he reversed to establish a long position, his earnings would increase significantly.

Noah Scott was a person with strong self-control. After squaring off those 55 contracts, he decisively chose to stop.

Although the federal government had promptly taken a series of strong market rescue measures, no one could be sure whether the U.S. stock market would continue to plummet like in 1929.

At this moment, looking back at the S&P 500 index curve from Monday to Wednesday and considering the young man's past operations, Noah Scott was almost 100% certain that he would reestablish a long position and make another fortune.

On Monday, the S&P 500 index opened at 201 points.

On Tuesday, after a brief surge, it plunged sharply again, still closing at a low of 212 points.

On Wednesday, it opened high at 237 points and closed at 259 points, as the market began to stabilize.

If he were Simon Westeros, perhaps he should have squared off all short contracts on Monday and Tuesday, reversing to establish a long position during this period, ensuring further profits on Wednesday.

$350 million in capital, 20,000 short contracts, 80% holding percentage.

The thought alone was chilling.

Now.

Noah Scott increasingly wanted to know, just how much did Simon Westeros earn?

$1 billion?

Even if not that much, but considering the previous capital, Simon Westeros, still only 19 years old, was probably now a billionaire.

Wrong.

Part of that must also belong to Janet Johnston.

But.

$1 billion!

No matter what, Noah Scott knew he probably could never reach the wealth those two possessed in his lifetime.

Just.

Did a 19-year-old kid know how to spend that money?

Noah Scott thought sourly, suddenly remembering that half a year ago, Simon Westeros and Janet Johnston were rumored to be heading to court over the distribution of profits from "Run Lola Run."

Now, facing such a huge fortune, even if those two were previously in love, intense disputes were inevitably forthcoming.

Family often crumbles in the face of immense wealth.

Let alone love.

Thinking this with some anticipation, Noah Scott's office door was suddenly pushed open, and one of his analysts rushed in, saying, "Noah, it's bad, there's talk everywhere at the exchange that we're going to sell off thousands of contracts after the market opens?"

Noah Scott was still somewhat stunned, asking subconsciously, "What?"

The analyst explained, "It's about those contracts from Quantum Fund, someone leaked out that we're going to sell those contracts."

In early October, Soros's Quantum Fund and Simon's Westeros Company began to build up their positions massively. However, contrary to Westeros Company's operations, Quantum Fund continuously bought over 30,000 long contracts throughout half a month.

After the stock market crash, although additional margins were posted, Quantum Fund's long contracts were still forcibly squared off in part. As the situation stabilized yesterday, Soros began to exit, but such a large holding volume naturally couldn't be cleared in one go.

Now, Quantum Fund's account still had a total of 9,000 long contracts left.

Even though the federal government's rescue measures had initially shown effectiveness yesterday, everyone knew that the S&P 500 index wouldn't likely return to the 300-point high anytime soon. Quantum Fund had no choice but to cut losses and exit.

Lehman Brothers naturally didn't have only one trading team like Noah Scott's. A client as big as Quantum Fund was actually the responsibility of Noah Scott's immediate superior, a senior vice president at Lehman Brothers.

Hearing his subordinate's explanation, Noah Scott relaxed, saying, "Charlie, this has nothing to do with us, right? If Will messed up, that's his problem." Saying this, Noah Scott glanced at his watch, clapped his hands, and said, "Alright, let everyone come in, it's almost time to start working, let's have a meeting first."

At 8:30 AM Central Time.

When the Chicago Mercantile Exchange officially opened, Noah Scott discovered just how bad the impact of the leak about Lehman Brothers selling thousands of contracts was.

Since the news that Lehman Brothers was about to sell a large number of contracts was known in advance, all other brokers at the exchange began to watch and completely refused to accept the large sell orders from Lehman Brothers.

Thus, under accumulated market selling pressure, the S&P 

500 index once again plummeted sharply. Within just over ten minutes, the S&P 500 index had fallen from yesterday's closing at 256 points to 197 points.

Los Angeles.

Inside the mansion in Palisades, it was still early morning, and Janet, somewhat numb, did not wake up early today.

On Monday and Tuesday, Westeros Company had far exceeded Noah Scott's imagination with 26,700 short contracts, and today, less than 5,000 remained. At the same time, Simon had established a total of 7,000 long contracts in the 200 to 220 point range on Monday and Tuesday, and had squared off 2,000 long contracts at a high of 250 points on Wednesday.

Hearing the expected news of the S&P 500 plummeting again over the phone, Simon decisively issued the instruction to clear the remaining short positions. If his memory served him right, he had less than three hours left.

Approaching noon Central Time, after the morning's selling pressure had been absorbed, the S&P 500 index would rise again.

Over the past few days, the traders at Goldman Sachs had become familiar with Simon's trading tactics, naturally needing no further explanation.

Simon then shifted his attention to New York.

Over the past two days, Simon had withdrawn a total of $400 million in capital, all of which was invested in the New York stock market. His buying strategy was also very straightforward: tech stocks.

Before the last arrangement, Simon had already compiled a list of tech stocks he planned to buy. Apple, Microsoft, Intel, Oracle, SUN, and others were naturally included. Of course, Simon also didn't forget to mix in some 'sand'.

In memory, after a brief downturn, the North American stock market would continue to show a stable upward trend until 2000. Thus, the crash at the end of October 1987 was arguably Simon's last opportunity to buy in at low prices.

Since there was a very detailed plan beforehand, within two days, Simon's $400 million investment had all turned into stocks. At yesterday's close, Simon once again withdrew $200 million from the futures account for today's buying operations, and he would continue to do so.

Even if he didn't hold onto these stocks for over a decade, after surviving this crash crisis, the North American stock market would stabilize and rise. Over the next few months, this batch of stocks would still generate very substantial profits.

The tumultuous day soon ended.

The next day was October 23rd, Friday, the release day of "Final Destination."

The S&P 500 index closed at 237 points on Thursday, and the market reopened above 250 points on Friday with no more bearish news coming in.

Having squared off the short positions on Thursday, Simon also cleared all the long contracts he had bought over the past few days.

Then.

It was finally time to tally the final harvest.

A chilling moment.

From October 19th to October 23rd, within five days, Westeros Company sold 26,700 short contracts established around 290 points at between 200 to 220 points, accumulating profits of $1.068 billion.

Simultaneously, Simon's 8,000 long contracts established at the S&P 500 index bottom over the previous three days, all squared off above 250 points, earned an additional profit of $165 million.

Including the original $387 million in capital in Westeros Company's account, within five months of stock index futures operations, Simon's initial $75 million had explosively increased to $1.62 billion.

After thoroughly tallying the final financial data, both Simon and Janet were stunned for several minutes.

Simon remembered that there indeed was a case where someone turned $7 million into $2 billion on the futures market. But at this moment, seeing his funds multiply by over twenty times in just five months, he still found it somewhat unbelievable.

Janet's reaction was more direct; after a moment of daze, she leaned over, curiously prodded Simon a bit, and then said, "You little rascal, I regret it."