Inglorious Bank Story by Restive Sage – 4.19.19
None of the bank stories on this site, for 3 plus years, have ever seemed to truly become eventful, at least to our knowledge. I never dreamed I would have one of my own, even if it is second hand. I have tried to reproduce as best I can the details of my friend’s story, which is highly interesting. I had gotten up early and driven the 100 odd miles to his city yesterday morning for a business lunch.
We met at 8:30 for breakfast. He had already told me on the phone that he could not wait to tell me his news. We don’t see each other all that often but do like to catch up and talk about local business goings-on, changes in our local economy, yada yada yada.
For the last three years we always seem to get around to talking about currency intel. Today, he was outside his usual stoic demeanor. His face was literally flushed and his eyes were sparkling.
My friend is a rather well-to-do gentleman who is well respected and known to be a solid businessman in his own city. I’ve known his family for years and he does not lie. His story revolved around an upscale “cocktail party” two evenings ago. Like my own, his is a medium-sized city in the heartland, a dull and stodgy yet stalwart part of our great nation. Nothing flashy.
Attending the party was a montage of the city’s movers and shakers, including a small herd of financial types. He knew most of them by sight and a few by friendship. Present also were at least five well-known attorneys, two prominent real estate developers, two city councilmen, a member of the state Senate, and other scattered people of means who pass for nobility in this our backwater corner of the globe.
The party was hosted by the city’s richest dowager, by all accounts a sweet lady who is well known in this part of the state. According to his gossip, her net worth has been reported (via rumors and whispers) as approaching five hundred million dollars. He seemed to think this was at least partly confirmed by her beautiful and expansive home (worth at least 12 million dollars he maintains).
At this juncture, I will interject to say that we know that wealth in America is definitely not confined to our largest cities. Even among the thousands of small to medium cities scattered all over this land, there are people with a level of wealth that would qualify them, in the currency world, as “whales”. Maybe not London, New York or Hong Kong whales, but a homespun smaller version.
As to the party, he reported that after hors d’oerves and an early round of cocktails, a mini piano recital was given by a talented local lady. Her fait acompli ended in much warm applause, to the delight of the hostess. Then the party re-assembled into multiple small groups, each with its own conversation and theme. He loves parties, my friend.
Money and sports seemed to be popular topics among the men. He smiled when saying that it was mostly marriages and divorces among the women. The more gregarious ladies flitted about from group to group, making sure they met everyone present. No surprise at all, my friend himself hobnobbed and circulated among the various groups.
He had said that business deals sometimes emerged. This part of the event apparently went on for quite some time. The libations continued to flow and the voices grew a tad louder, with the occasional peal of laughter.
He said he had not noticed that the dowager hostess had quietly left the main party room and entered a small parlor down the hall. Searching for a restroom, he saw her there, in passing, out of the corner of his eye. He could not help but notice three of the local bankers circled around her in chairs.
He said he might have thought nothing of it except that there seemed be a degree of intensity to the conversation. His interest was even more piqued when he heard the word “currency” mentioned, for as I said he is himself an investor like us. My friend recognized these guys because he did business with their bank.
One was the head of wealth management. One was the president of the bank. The other one he thought was in wealth management too. He expressed no small measure of disgust to say that their voices were sickeningly deferential. I should add at this point that their bank is a top twenty bank.
Without much self restraint apparently, my friend stopped several feet past the partly closed doorway. He grinned shamelessly as he said he simply had to hear more. The wealth manager was doing most of the talking. It soon became apparent that he was trying to convince the silver-haired dowager to purchase exotic currency.
While some words were inaudible, he said he distinctly heard the word dinar, the word dong and the word Zim. To him, she seemed to be reluctant, not quite understanding what the wealth manager was talking about. He said, the wealth manager finally said flat out, “Mrs Smith, now that we know it is going, you cannot lose in this. But you have to give us the go-ahead by signing for it.” He said there was an urgency in the bankers voice that he was trying to constrain.
At this point my friend said he moved on, not wishing to stretch his luck and get caught eavesdropping. The last thing he heard as he moved further down the hall was the term “first basket”. After that, nothing was audible beyond murmurs.
When he had told me everything, he stopped for a bit to sip his coffee and pushed his fork around with his forefinger. I was still absorbing everything, but said nothing. Finally, he looked up at me and nodded. “Do you know what this means”. I mumbled a few things. He asked me again. “Think”.
After I mumbled around a bit, he said “those three guys just risked their career to try to get her in”. I honestly did not get it at first. Then finally, a light went off. “Oh”. Then he said. “NOW you see. Those guys”, he paused, “would never risk their career by prodding her like that into an exotic investment. She’s an elderly blue chip investor. Stocks. Bonds. REITs.
Can you even imagine the depths to which they would fall professionally if she did as they suggested and then it didn’t happen. “Whoaaa,” I said. He managed a faint chuckle, “They violated their own ethics to ingratiate themselves with her. She had no clue what they were talking about”. Finally getting what he was saying, I said, “and they would not do so if they were not 100% sure.” He looked at me knowingly and smiled “Way too far to fall.”
For a kind of funny moment, our eyes met and he said, “They’re going after the whales”. I pondered that for a second and then I said “I wonder if she signed off for it”. He just chuckled again, and shrugged his shoulders. Then we paid our checks and went our separate ways.
Not much we can do in this game except wait, sell it back, or buy more. It’s a Phd in Patience Theory. Reading all the intel in the world is not going to change anything, except maybe your level of confidence and your capacity for blind faith. But hey, maybe those bankers really DO know something, and maybe we really ARE that close.