March 3, 1870.
Wall Street, New York.
9:15 AM. Fifteen minutes remained before the New York Stock Exchange would ring the opening bell.
A suffocating anxiety permeated the air.
The sky was gloomy, and snowflakes mixed with icy rain fell onto the steps in front of the exchange.
Oliver Sterling was Junius Morgan's chief of staff.
Though he should have been in London at this moment, he was instead sitting in an unmarked basement office on Wall Street.
The room was filled with five telegraph machines and ten stock tickers.
Over a dozen independent traders, hired at great expense, sat at their desks with fingers poised over telegraph keys, awaiting orders.
Sterling looked at his pocket watch; the second hand ticked away.
"Gentlemen, synchronize your watches."
Sterling's voice echoed through the basement.
The traders pulled out their pocket watches one after another.
"9:20."
"Prepare to commence operations according to the pre-established plan."
Sterling took out several thick lists and distributed them to the traders.
"Remember! The second the opening bell rings, immediately dump your holdings of 'Union Pacific Railroad,' 'Pennsylvania Railroad,' and 'New York Consolidated Lighting' stocks and bonds into the market at ten percent below yesterday's closing price. Do not place limit orders and wait; smash the market directly at market price."
A young trader swallowed hard.
"But... Mr. Sterling. Ten percent below market price? That will trigger an immediate panic sell-off. These positions we hold are worth tens of millions of dollars. If we were to offload them slowly..."
"No slowing down."
Sterling's gaze fixed on him like a venomous snake.
"The Boss's orders are to trigger an avalanche. Even if these chips result in a total loss, we must smash through Wall Street's defenses. Use this third of our assets as cannonballs to destroy the market's entire confidence. When the stock prices have dropped by half, then we will use our short accounts to buy them back."
The basement fell into a deathly silence, broken only by the occasional crackle of static from the telegraph machines.
9:30 AM.
Dong...
The brass bell of the New York Stock Exchange was struck heavily.
The chime penetrated the heavy oak doors and reached the street.
Inside the hall, hundreds of brokers in tailcoats were preparing to begin their daily routine of trading.
Arthur Pendleton stood on the second-floor observation deck, holding a cup of coffee and chatting with an acquaintance about the upcoming spring timber tender.
Nathaniel Finch stood by a pillar on the first-floor trading floor. He held his parchment ledger, his eyes fixed intently on the blackboard of the central trading desk.
In the first minute of opening, the market seemed eerily calm.
9:32 AM.
The first abnormal trade appeared.
The quote clerk at the central trading desk drew a heavy white line on the blackboard with chalk.
"Union Pacific Railroad, fifty thousand shares! Quoted at... forty-five dollars!"
The hall went silent for a second before erupting into a cacophony of chatter.
Yesterday, this stock had closed at fifty dollars.
It had opened with a ten percent gap down, accompanied by a massive sell order of fifty thousand shares.
"Fuck! Who's dumping?" someone shouted.
"Dammit, someone must be trying to lure us into shorting so we'll hand over our shares."
However, before anyone could react, another quote clerk screamed at the top of his lungs.
"Pennsylvania Railroad bonds, one million dollars face value. Dumping at a fifteen percent discount!"
"Manhattan Gas Company, thirty thousand shares! Thirty dollars!"
"Erie Railroad, one hundred thousand shares! Sell-off!"
The numbers on the blackboard began to plummet at a rate visible to the naked eye.
Chalk dust filled the air.
The silence in the hall was instantly shattered, and everyone's hearts raced.
This didn't look like a joke.
The hundreds of brokers who realized what was happening swarmed toward the central trading desk like hornets from a disturbed nest.
"Get out of the way, I want to buy! No, cancel the buy orders, sell everything!"
"Whose order is that? Check the floor tickets, who exactly is shorting!"
Nathaniel leaned against the pillar without moving, watching the bleeding numbers on the blackboard.
He knew that the capital hidden in the shadows had made its move.
The divestment by Patriot Investment Company a few days ago was merely the ebb before the storm.
His suspicions were correct; something big was about to happen.
Now, the tsunami had arrived.
9:45 AM.
A messenger drenched in rain burst into the exchange hall, holding a telegraph transcript.
"Big news... news from Europe! News from London!"
The messenger's voice sounded sharp and piercing in the noisy hall.
"A joint consortium from London and Paris has delivered an ultimatum to the State Department! They refuse to underwrite federal bonds and refuse to provide credit for North American railroads!"
This news was like a spark thrown into a powder keg.
The hall spiraled completely out of control.
The panic was no longer limited to a few railroad stocks; it rapidly spread to all sectors.
"Dammit... sell my Federal Government bonds, sell all industrial stocks! Fuck, get my orders in now!"
The coffee cup in Arthur Pendleton's hand fell to the floor and shattered.
He rushed down the stairs and grabbed Nathaniel by the collar.
"Nathaniel, sell everything in my account quickly. Even mortgage those farm deeds for cash!"
Arthur's eyes were terrifyingly bloodshot, his reason completely consumed by fear.
Nathaniel forcefully pushed away Arthur's hands.
"It's no use, Arthur. Look around you."
Nathaniel pointed at the screaming brokers.
"Shit~ there are no buyers. In the entire hall, people are only selling; no one is buying. Liquidity has dried up."
By now, the stock tickers were completely unable to keep up with the market's crash.
The ticker tape spewed out like crazy; every jump in the numbers meant the bankruptcy of hundreds or thousands of families.
10:15 AM.
The streets of Wall Street were packed with people.
Ordinary depositors who had heard the rumors began to surround commercial banks of all sizes, demanding to withdraw cash.
At this point, few people remained rational, as their money was disappearing with every passing second.
The sound of breaking glass, police whistles, and women's screams blended together, playing a symphony of despair.
Amidst this carnival-like destruction, Sterling sat in the basement, watching the constant stream of victory reports from his subordinates.
"Union Pacific Railroad, down fifteen percent."
"Pennsylvania Railroad, down twenty percent."
"Vanguard Military Industry related stocks, down seventeen percent."
Sterling lit a cigar.
"Telegraph London: the first wave of the attack is over. Argyle's outer defenses have begun to collapse across the board."
"Now, we just wait for his core assets to liquidate."
Eleven AM.
New York, Broadway.
Compared to the wailing on Wall Street, the Argyle Empire Building still stood like a silent black giant tower, coldly observing the city that had fallen into madness.
Top floor, Felix's private office.
The thick soundproof walls completely blocked out the screams and siren sounds from outside.
On the large mahogany desk, there was only an internal microphone directly connected to the Argyle Bank's underground vault, and a glass of bourbon whiskey without ice.
Felix stood in front of the huge floor-to-ceiling window, looking down at the crowds scurrying like ants on the streets below.
His pure white shirt was particularly striking in the dim room.
The door slid open silently.
Edward Frost walked in.
His steps were still steady, but the thick stack of reports in his hand revealed the seriousness of the situation.
"Boss, Wall Street is gradually collapsing."
Frost stood five paces away from Felix, reporting in a flat voice.
"The market value of the three major railway companies has evaporated by tens of millions of dollars in the past two hours. The sell-off by European capital has triggered a chain of forced liquidations. Twenty-seven small and medium-sized brokerage firms have already declared bankruptcy. In Washington, President Grant's special envoy is on his way to New York, demanding that we make a statement immediately."
Felix didn't turn his head, but looked at the ships spewing black smoke in the distant harbor.
"How is the situation with Hayes?"
"Patriot Investment Company cleared all non-core positions ten days ago. Currently, we face no risk of forced liquidation. However, the market value of our core assets, including the Pennsylvania Railroad, Union Pacific Railroad, and Erie Railroad, has also significantly shrunk due to the drag on the overall market."
Felix raised his glass and downed the liquor in one gulp.
A burning sensation in his throat made him feel exceptionally clear-headed.
"That old geezer Drexel, and that Old Lion in London, finally have some decent tactics."
Felix turned around and slammed the empty glass heavily onto the desk.
"Do they think that by crashing the market with tens of millions of dollars in chips, plus a so-called diplomatic note, they can make me give up?"
He walked behind the desk and picked up the simple internal microphone that connected directly to the underground vault.
"Connect me to George Templeton."
Templeton's slightly breathless voice came from the other end of the line; he was currently in the vault.
"Boss, this is George."
"Has the inventory been completed?"
"Yes, Boss, it's completed."
Templeton's voice carried a fanaticism born of fear.
"Aside from the working capital needed for daily settlements, we have converted all the cash drawn back from the South over the past two weeks, the proceeds from selling off peripheral assets, and all intercepted depositor funds into physical gold and bearer federal bonds."
"What's the total amount?"
"Seventy-five million dollars, all piled up in Vault Area Three. This is currently the only super liquidity in the entire country that is not tied up and can be deployed at any time."
Seventy-five million dollars.
In this era, this was a cash reserve sufficient to buy several small European countries.
It was also the ultimate fortress built by the Argyle Empire after draining the South's blood and squeezing the marrow out of countless small business owners.
Of course, a lot of the funds belonged to depositors and weren't entirely Felix's.
"Good, very good."
After hanging up the phone, Felix looked at Frost.
"Edward, take this down."
Frost opened the folder in his hand, ready to record.
"Step one." Felix held up a finger.
"No matter how bad the market falls outside, the Argyle Bank's doors must remain open. But only one type of business will be handled: mortgage loans."
"When those bankers, railway magnates, and brokers come begging us with their stocks and land deeds that have become worthless paper. Give them cash at one-tenth of the current market value."
"What if they don't accept?" Frost asked.
"Then let them die, let them line up on the Brooklyn Bridge and jump into the river."
Felix replied coldly; now was not the time for soft-heartedness.
Perhaps he should even thank that old geezer, otherwise how could he acquire these things at a low price?
"At this moment, cash is oxygen. I don't provide oxygen; I buy their lives."
"Step two."
Felix walked to the map of America on the wall.
"Have Hayes take all the traders back to the stock exchange."
"Go shopping, but don't touch useless textile mills and gas companies. Only buy three things: the controlling interest bonds of my three listed railway companies, the upstream coal mine deeds of Carnegie's Scottish steel mill, and the key land along the Baltimore Railroad."
Felix's eyes flickered with amusement.
"Old Morgan wants to crash the market, doesn't he? Let him crash it; we'll take as many chips as he throws down. I want to package and pocket the entire infrastructure of America from the ruins of Wall Street. I want those short-selling European accounts to find out on settlement day that they can't even buy shares to cover their positions!"
Frost recorded the instructions.
"But… Boss, how should we respond to Washington? If President Grant, under pressure, really vetoes the Standardization Act…"
"Hmph… he wouldn't dare."
Felix interrupted Frost.
He walked to the desk, picked up a blank sheet of paper, and took a dip pen.
"Send a clear telegram to Grant, with copies to all major newspapers. No encryption needed; I want everyone in the United States to see it."
Felix spoke while rapidly writing on the paper.
"To the President of the United States:
Today's disaster on Wall Street is truly the despicable act of old European powers attempting to interfere in our domestic affairs and plunder our wealth. If the Federal Government bows to these people, then America will become a financial vassal.
To defend national credit, the Argyle Empire Bank solemnly declares: Effective immediately, this bank will deploy seventy-five million dollars in gold reserves to fully take over all maliciously shorted federal bonds and core infrastructure assets.
The lifeline of America must never be priced by other nations.
Felix Argyle."
After writing the last letter, Felix threw the pen onto the table.
"Send it out, without changing a single word."
Frost took the letter, his hands trembling slightly.
He knew that once this telegram was sent, Felix would no longer be merely a businessman.
He would portray himself as the nation's savior, a patriotic magnate single-handedly confronting all of European capital.
Using the public's anger and nationalist fervor to hijack the White House's decisions.
This move was indeed ruthless.
"Boss, if all this capital is injected into the market…" Frost swallowed hard.
"We would also lose our last retreat. If Europe continues to raise the stakes, we might be exhausted."
"At the gambling table, you have to push all your chips in to see your opponent's hand clearly."
Felix adjusted the collar of his shirt and picked up the black trench coat hanging on the coat rack.
"Get the car ready, we're going to Wall Street. I want to personally hear the sound of those losers' bones shattering."
New York Stock Exchange.
The air was a mix of wet wool, cheap tobacco, and the sour stench of fermenting human sweat.
Beneath the hall's dome, hundreds of traders in dark tailcoats were like beasts trapped in a swamp, shoving and tearing at one another. Cigar smoke condensed into a grey-white cloud layer mid-air, obscuring the dismal light filtering through the skylight.
There were no rules to speak of in this arena.
In this era of Wall Street, there were no circuit breakers or regulatory committees, only savage consumption.
Nathaniel Finch was squeezed against the edge of the hexagonal trading desk. His bowtie had long since been torn off, and the collar of his linen shirt hung open, revealing a neck drenched in sweat.
"Sell Union Pacific! Five thousand shares! Market price, thirty dollars!"
Standing opposite Nathaniel was Barnaby Cole, a British proxy broker with a handlebar mustache.
Barnaby's eyes were bloodshot. He waved a thick stack of stock certificates, spit flying everywhere.
"Thirty dollars? It was forty dollars ten minutes ago!"
Another retail broker howled in despair, clutching his head with both hands.
"Oh no—you're robbing us!"
"Twenty-eight dollars! Any takers? Twenty thousand shares!" Barnaby ignored the retail investors' wails and continued to dump the market.
This was a direct order from London: no profit, only panic.
They intended to use reckless selling to completely destroy America's railroad sector.
Ticker tape spewed frantically from the brass automatic printer in the corner, cascading onto the floor like a white waterfall.
No one picked up the tape, for the ink was barely dry before the numbers became history.
Just as Barnaby was about to drop the quote to twenty-five dollars, the copper-clad oak doors of the hall were pushed open by two burly Vanguard Security guards.
A cold wind carrying icy rain surged into the hall, making the crowd near the door shiver.
Tom Hayes stepped into this battlefield.
He took off his beaded bowler hat and handed it to his assistant behind him, then unbuttoned his double-breasted overcoat.
Hayes did not push into the crowd; instead, he headed straight for the wrought-iron stairs leading to the second-floor VIP observation deck.
The clamor in the hall diminished slightly.
Everyone recognized the head of Patriot Investment Company.
On this bloody morning, the funds of the Argyle Empire finally entered the fray.
On the second-floor observation deck, Felix was sitting in a velvet-upholstered armchair.
Between his fingers was an unlit Cuban cigar as he looked down at the group of traders struggling like ants.
Hayes walked up the stairs and stopped beside Felix.
"Boss, the dumping pressure from London has exceeded expectations."
Hayes handed over a handwritten liquidation sheet.
"They're exploiting loopholes in the margin system. Agents of Barings Bank and the Rothschild family are using cross-lending to amplify their leverage tenfold. Half of the stocks they're dumping aren't even backed by physical shares; it's blatant Naked shorting."
Felix clipped the cap of the cigar and tossed it onto the Persian rug at his feet.
"Naked shorting?"
Felix struck a match, the orange flame illuminating his cold eyes.
"Without a delivery guarantee, if they dare to sell air, I'll make them pay with their lives."
Felix exhaled a puff of blue smoke, which drifted before the railing.
"Hayes, go to the central trading desk. Take all their sell orders. No matter the price or the quantity, absorb everything."
"But Boss," Hayes frowned.
"If they're selling empty promises, no matter how much capital we put on the books, we won't get actual equity. Once the Clearinghouse discovers the sellers can't deliver the stock, the trades will be voided, and our funds will be frozen in the clearing process. This will drain our liquidity."
"Who said I was going through the Clearinghouse?"
Felix stood up and walked to the edge of the railing, his hands resting on the cold brass handrail.
He turned his head and looked at George Templeton, who stood in the shadows.
"Templeton, have the carriages arrived?"
The president of the Argyle Bank wiped the sweat from his forehead and nodded.
"Twelve armored carriages are already parked at the exchange's back door. Miller is leading fifty fully armed guards to watch over them."
Felix flicked the ash from his cigar, his gaze locking onto Barnaby, the British proxy who was still screaming frantically below.
"Hayes, go downstairs and tell those short sellers that Argyle Empire Bank does not accept deferred delivery for any paper checks or credit instruments."
"Every transaction will be settled on the spot. Physical stock in one hand, capital or gold in the other."
Hayes's eyes widened instantly, and his breathing quickened.
He finally understood Felix's tactic.
At this moment, when the credit system was on the verge of collapse, no amount of paper leverage could compare to a heavy gold bar.
Hayes turned and rushed down the stairs, roughly pushing aside the traders in his way to stand at the core of the central trading desk.
"Patriot Investment Company is taking orders!"
Hayes's roar drowned out all the clamor.
He grabbed Barnaby by the collar and yanked the British proxy forward.
"You just said twenty thousand shares of Union Pacific at twenty-five dollars?"
Hayes stared into Barnaby's pupils, which were dilated with terror.
"I'll take it all."
Barnaby broke free and straightened his disheveled bowtie with a dry laugh.
"Mr. Hayes, what are you going to pay with? Every bank in New York has stopped lending. Your checks are just scrap paper here."
"Bring in the chests!"
Hayes didn't waste words; he turned and waved toward the door.
Four burly security guards carried two heavy iron-clad chests, stepping heavily into the hall.
They slammed the chests onto the trading desk. The wooden surface let out a groan of pain as a crack split open.
Hayes pulled out a key, turned the padlock, and flipped open the lid.
A brilliant golden light instantly blinded those nearby.
There were neatly stacked Federal Reserve gold bars and bundles of bearer Double Eagle gold coins.
The hall fell into a deathly silence.
Only the sound of rapid breathing rose and fell.
"Physical settlement."
Hayes grabbed a handful of gold coins and let them slip through his fingers, hitting the bottom of the chest with a crisp metallic clatter.
He pointed at Barnaby's nose.
"The gold is here. Bring out your physical stock, Barnaby. If you don't have the shares on hand, your quote just now was malicious fraud."
Hayes pulled a revolver from his waist and slammed the barrel heavily onto the trading slip.
"On Wall Street, the price of fraud is paid with your life."
Barnaby's face turned pale instantly.
The London consortium behind him was indeed playing a Naked shorting game, hoping to trigger a panic and then buy physical shares from retail investors at a low price for delivery.
He didn't have the physical equity certificates for twenty thousand shares at all.
"I... the delivery date is tomorrow..."
Barnaby stammered as he backed away.
"The delivery date is now."
Hayes pressed forward, step by step.
On the second-floor observation deck, Felix watched the scene, a mocking curve touching the corner of his mouth.
While the European capitalists toyed with ledgers and numerical games, he simply used the most primitive and savage metallic power to smash the gaming table.
This seventy-five-million-dollar reserve had become the only breathable oxygen on Wall Street.
With Barnaby's retreat, the brokers who had followed suit in shorting momentarily collapsed.
Because they realized they had sold stocks that didn't exist, and now, the only buyer was pointing a gun at their heads demanding physical delivery.
To appease Hayes's wrath and avoid being taken to court or directly dumped into the Hudson River by the security team, these short sellers could only turn around and begin scouring the market for the scattered physical shares held by retail investors at any cost to fill the holes they had poked.
The wind shifted instantly.
The stock prices, which had been plummeting like an avalanche, began to soar in a straight line at a speed that defied common sense, stimulated by the gold.
Nathaniel leaned against a pillar, watching the numbers on the blackboard jump from twenty-five to thirty, then to forty. He felt as though he were witnessing a massacre.
Felix had not only temporarily countered the Europeans' dumping but had also used the rules of physical delivery to force a short squeeze, causing those European proxies to turn on one another.
But he knew this was only temporary.