"Simon, I don't understand why take on more loans?" In the study, Sophia Fissi was genuinely puzzled by Simon's decision to finance the Gucci acquisition through borrowing. "Daenerys made a fortune last year, didn't it?"
Loans carried costs.
A hundred million dollars in principal, at what seemed a modest four or five percent annual interest, would still accumulate tens of millions in interest over the years.
And borrowing meant negotiations with banks time that could be lost.
Sophia had already failed once with Latour. She did not want any surprises with Gucci.
Simon understood her concern. "Daenerys's profits are earmarked for other things. I can't give them to you. You heard the call earlier: the company is already arranging another loan. You can fly back to Los Angeles tomorrow and talk to Amy about increasing it to two hundred and fifty million. The banks won't object, and it won't take long."
Sophia nodded, though her attention snagged on his phrase "other things."
Wisely, she did not press.
The discussion was essentially finished; it was already deep into the night.
Jennifer had remained in the study the entire time. Sophia knew nothing would happen between her and the young man tonight. She was about to say goodnight when another thought struck her. "Simon, I almost forgot the company name?"
A comprehensive luxury group would need a new identity.
They had agreed the holding company would be registered in Switzerland, a renowned tax haven conveniently bordering France and Italy, the heartlands of European luxury.
Simon considered only a moment, scribbled a word on a notepad, and handed it to her. "Her."
Sophia took the slip and read the rather long word: Melisandre.
"Melisandre," she said softly, looking up. "Simon, that's a woman's name?"
A cryptic smile touched his mouth. "Yes."
The red priestess from A Game of Thrones had left a strong impression on Simon. Daenerys was already taken, Arya and Sansa were out of the question, Cersei he was saving so Melisandre it was.
Sophia, of course, could not know any of that, but the connection to Daenerys Entertainment came to her quickly. "Daenerys, Melisandre… Simon, you seem to favor classical women's names for your companies."
He grinned. "It makes me look deep."
Sophia finally rolled her eyes at him. After a pause she added, "It's a bit long. People might not remember it easily."
"For a luxury group holding company, the lower the profile the better. We want to spotlight brands like Gucci. If no one remembers the parent company's name, that's perfect."
Sophia saw the logic and carefully tucked the note into her bag. She rose. "Then let's leave it here for tonight."
"Is your room sorted?"
Sophia glanced at Jennifer, who had stood as well. She smiled. "Of course. Jenny had everything ready before I arrived."
Jennifer had intended to act nonchalant, but at the mention of her name her cheeks warmed and she avoided Simon's eyes.
Simon escorted Sophia to the living room with light banter; Jennifer followed close behind.
"Good night, boss."
At the door, Sophia unconsciously reverted to the more formal title. She flicked a glance at Jennifer still half-hidden behind Simon, felt a feminine impulse, stepped forward, rose slightly on her toes, and brushed her cheek against his.
Simon had barely registered the silky warmth when he noticed Jennifer trying to slip away. He caught her waist with one hand and firmly closed the door with the other.
Held against him, Jennifer pressed both palms to his chest to keep some distance, head lowered, words tumbling out. "It's… you… it's very late… you have to get up early tomorrow…"
Simon checked his Patek Philippe: 12:35 a.m.
Though they had shared intimate moments more than once, he had not yet fully claimed her and the hour was hardly right for it now.
Still, he did not let her go. He bent, lifted her easily, and carried her toward the bedroom. Looking down at the girl who had squeezed her eyes shut and turned the color of a ripe apple, he said, "I'll spare you for now. But as punishment, you'll be my pillow tonight."
Warmth in his arms was remarkably effective at easing the day's fatigue.
...
Simon woke at six the next morning, refreshed despite only five hours of sleep.
Jennifer's own room was next door; few on the production likely remained unaware of their relationship. All the same, she slipped back to her room for a while that morning before joining him downstairs for breakfast ostensibly to preserve appearances.
To hide the flush still lingering on her cheeks, she had, unusually, left her hair down. The golden strands fell lazily around her face. She thought it disguised things, only to realize it drew more attention.
Embarrassment naturally sought an outlet, and the source sat across from her wearing a wicked half-smile.
Infuriating.
She picked delicately at the salad he had ordered for her, then murmured, "You can't do that again. Janet will be angry."
He seemed agreeable. "Mm."
And that, she decided, settled it.
Changing the subject without much forethought, she asked, "What exactly are you planning to do with that money?"
"The money" meant Daenerys's profits from the previous year.
Though final figures were still being audited, she knew two hundred million had already been transferred to Westeros Company. That sum had left Daenerys's operations untouched, proof of how spectacular the year had been. No wonder Hollywood was buzzing with curiosity about the studio's true earnings.
Because she was always at Simon's side, Jennifer had a rough idea of the total.
The two hundred million was only part. Once the Los Angeles audit concluded and operating reserves were secured, the remainder would follow.
What she wondered was what Simon intended to do with it.
Another move like the '87 crash?
People were not fools.
Daenerys had ample cash yet insisted on borrowing to take its Blockbuster stake and now to buy Gucci.
The implication was clear.
Many were probably watching closely for Simon Westeros's next big play.
Realizing the question was improper, she quickly added, "You don't have to tell me."
Simon felt a touch of helplessness, not at Jennifer, but at the growing awareness that eyes were indeed on him. Ever since his futures operation more than a year ago, he suspected constant surveillance.
After all, if someone could ride his coattails to another '87-scale windfall, it would be generational wealth.
But such opportunities did not simply appear.
Seeing her anxious expression, he smiled. "I'm not sure myself anymore. In '87 I was a small fish; I couldn't move the market, so I could read it clearly. Now, suppose I believed the Chinese market would crash in a month and wanted to profit. I'd have to position myself. But because of '87, too many people are watching. Word of my moves would leak, creating unpredictable effects. Everyone might pile in and short, causing an earlier collapse or Ching Chong's government might take countermeasures and delay it. Either way, my prediction would fail."
He was, in simple terms, describing what Soros would later call "reflexivity," the interplay between participants and the market.
Only Soros had not yet written the book.
Jennifer listened intently and understood at once. She also recognized that Simon now possessed the potential to sway an entire nation's financial markets.
One operation had turned a penniless young man into a billionaire. Under that aura, no one would ignore his view on any market.
After the '87 crash and a brief dip, Japanese stocks had roared back. The Nikkei had closed the previous year above 30,000, more than double its 1985 level of 13,000.
Two years earlier Soros had bet on an early Japanese collapse and lost heavily.
Now, having breached 30,000, the market continued upward, yet everyone knew severe bubbles existed. Average P/E ratios exceeded seventy; Tokyo real estate had reached the jaw-dropping level of $120,000 per square meter.
A major correction was inevitable; only the timing remained uncertain.
Jennifer absorbed his words, glanced cautiously around, then asked quietly, "Do you mean the Ching Chong's market will crash within the next month?"
"Just an example," Simon shook his head. "If I were betting now, I'd still go long."
Jennifer was sharp; she caught the deeper meaning instantly. "So the money isn't for a Fat Bald Chinese guys to play?"
He smiled and nodded. "Post-'87, every major market introduced circuit breakers or limits, Japan included. Even if I timed the Nikkei perfectly, I couldn't replicate those kinds of gains."
Many assumed Japan was his target and that he would short.
Yet according to his memory, the bull run would continue another year, peaking above 38,000 by year-end. From 30,000 to 38,000 was only twenty-six percent.
By comparison, North American markets had fallen twenty-nine percent in a single day on Black Monday.
Relative to his capital, even an untouched Japanese rally would yield modest returns.
His real target was next year's Kuwait crisis and the Gulf War that followed.
Unlike the post-'87 restrictions on equity futures, crude oil futures still had no daily price limits. The wild swings in oil prices during those conflicts offered another extraordinary wealth-building opportunity.
Historically, mainstream Western finance had resisted price limits; many of the post-'87 measures would eventually be rolled back.
Jennifer caught another implication. "You originally planned not to enter, but you've changed your mind?"
"Yes," Simon confirmed. "Going in now could cover the interest on the loans we've accumulated. Even if it loses, the downside should be limited. And it would show the world that Simon Westeros isn't infallible, maybe loosen the scrutiny a bit." [TL/N: He's talking about the Japanese market]
He did not mention that the operation would also serve as cover for next year's positioning in crude.
Jennifer's expression showed understanding. "And after that?"
Simon reached over and flicked her nose lightly. "Little miss, you already know too much."
Caught off guard, she flinched.
Realizing what he had done, she flushed crimson, glanced around guiltily, the other diners appeared oblivious, and glared at him with no real menace. "Don't do that again. And I'm not a little miss."
Simon savored her indignant pout, gave an insincere "Mm," then added, "Find time today to call your father. Ask him to come here."
Jennifer hesitated. "Can't it be done over the phone? New York to Melbourne is a whole day."
She was worried for her father; Simon could indulge that.
He considered. This time he had no intention of hiding the move and likely could not, so even a tapped line hardly mattered. He nodded. "All right. Phone it is."