Arianna drummed her fingers against the table, trying to quell her impatience. To her, the concepts were simple, but she understood that many people did not find mathematics quite so easy to follow.
“Debt-equity swaps are designed to benefit both parties. In this case, the government paid a lower rate of interest on its debt, and the South Sea Company profited as its stock price rose—you see, a high profit-to-expense ratio makes the company worth more on paper.” She looked up. “It can therefore issue more stock, which in turn generates more blunt for its partners.”
The earl nodded for her to go on.
She paged through the modern papers and quickly explained what the complex mathematics meant. “So you see, the numbers mirror the same formulas used in the last century. And that can only mean one thing.”
“What?” The surgeon appeared hopelessly confused.
Arianna glanced at Saybrook, wondering whether he grasped the significance of her calculations.
“What you mean is,” said the earl slowly, “the scale and volume indicates that the deal can only be a very large one.”
“That’s right, sir. A very large one, and a very profitable one.” She paused to pull out the sheet of numbers that the earl had found in Lady Spencer’s desk on the night of their encounter with Lord Ashmun. “Bear with me while I go over one last thing. Based on what I discovered in the old and new documents—and something that Mr. Henning had said about dockyard mud—I had an idea of what these sequences might mean. So I visited your great-aunt this morning and asked her if, through her many connections in Society, she could get me copies of certain shipping records.”
“And?” asked Saybrook.
“And sure enough, the sequences on this paper correspond to the dates when certain merchant ships arrived in London from the old Spanish Empire trading ports. Perhaps it’s coincidence. But I doubt it. I think what we’ve uncovered is a new business venture—a New World trading company modeled on the financial scandal of the last century.”
Arianna learned forward and propped her elbows on the table.
“Only bigger.”
21
I know that it is not at all fashionable these days to speak well of the French, but there is no denying that despite all their faults, they have contributed greatly to the refinement of fine cuisine. So we must give credit to a Frenchman named Dubuisson, who invented a hand mill for grinding cacao in 1732. Having toiled for untold hours in the kitchen with mortar and pestle, I raise my cup in salute, and I am sure that Sandro will join me. Unlike many men of wealth and privilege, he has a very open mind. . . .
½ cup unsweetened cocoa powder
⅓ cup sugar
½ cup cold water
1 teaspoon vanilla
1 cup half-and-half
2½ cups milk
⅓ cup crème de menthe,
or to taste 2 tablespoons crème de cacao,
or to taste whipped cream and shaved bittersweet chocolate for garnish
1. In a heavy saucepan combine the cocoa powder, the sugar, the water, the vanilla, and a pinch of salt and heat the mixture over low heat, whisking, until the cocoa powder is dissolved and the mixture is a smooth paste.
2. Gradually add the half-and-half and the milk, both scalded, and simmer the hot chocolate, whisking, for 2 minutes. Stir in the crème de menthe and the crème de cacao. (For a frothy result, in a blender blend the hot chocolate in batches.)3. Divide the hot chocolate among mugs and top it with the whipped cream and the chocolate. Makes about 4½ cups.
Henning opened his mouth to say something, but Saybrook signaled him to silence. He spoke instead. “How very clever of you to have figured this all out on your own.”
Arianna drew in a sharp breath and narrowed her eyes. “Just what are you accusing me of, sir?”
“Of having a genius for mathematics which must rival that of your late father,” he replied.
“I . . .” She quickly composed herself, unwilling to show that the barb had hurt. “Yes, I’ve always had a knack for numbers. But I haven’t ever used it for cheating. . . .” Recalling several harbor towns in the Windward Islands, she shrugged. “Well, hardly ever.”
The earl’s brows rose ever so slightly.
“I’m sharing it with you, aren’t I?” she retorted, nettled by the unspoken skepticism.
“A cunning criminal would,” he answered. “I’ve not enough expertise to discern whether you’ve fiddled with the numbers. Or whether you’re lying outright.”
Their gazes locked.
“No,” she responded. “You would have to take my word on it.”
The floorboards groaned as Henning shifted in his chair.
“You have to admit,” continued Saybrook, “it’s rather hard to feel completely comfortable in trusting a person who keeps changing like a chameleon.”
Arianna picked at a thread on her raveled sleeve.
“A master chef, a mathematical genius, a brilliant actress—have you any other hidden talents to reveal?”
“I can sail a schooner single-handedly and I’m rather good at picking locks.” Lowering her lashes, she couldn’t resist adding, “And, of course, I’m a dab hand at leading men around by the nose. But then, you know that.”
The earl stretched out his legs and crossed one booted ankle over the other. “I would imagine that your father found your mathematical genius very . . . useful.”
Oh, what a team we would make, poppet. With our brains and your beauty, we could be very rich, indeed!
Arianna looked away for an instant and fought to draw a ragged breath. “Yes. He would have been delighted to form a partnership.”
“But?” The word was said softly.
“But it wasn’t a life I wanted,” she replied, then quickly added a laugh. “As you see, the one I have chosen is ever so much more respectable.”
“I’m simply trying to gather information, Lady Arianna, not make any moral judgments,” said Saybrook. “It would be helpful to know if you aided your father in constructing any business scams. That sort of information could be relevant.”
“No,” answered Arianna tightly. “I did not. When I was a little girl, my father hinted that we might . . . profit from my talents. But when I expressed my feelings on cheating, he never raised the subject again.” She swallowed hard. “Though it must have cost him dear to hold his tongue. At the end, we were dancing on the razor’s edge of poverty.”
“Thank you.” The earl carefully rearranged the folds of his coat. “Now, getting back to the numbers on the table—”
“You believe me?” blurted out Arianna.
“I didn’t say that.” The earl allowed a faint smile. “But we are straying from the subject.” A pause. “So it is your opinion that these equations indicate that the new company will seek a partnership with the government?”
The tension eased inside her. “Given the size of the sums involved, it’s hard to imagine any other explanation.”
“I possess no financial acumen, so what I’ve never understood is how did the South Sea Bubble expand to such mammoth proportions before it burst?” mused Henning.
“Having just read a great deal about it, I shall try to explain,” responded Arianna. “The real turning point came in 1717, when the King admitted to Parliament that the country’s finances were troubled and that the national debt needed to be reduced. In reply, the South Sea Company presented a proposal to raise its capital to twelve million pounds by selling a new offering of stock.” She glanced down at the faded numbers. “Due to canny promotion by Sir John Blunt, the name of the South Sea Company was continually in the public eye. So, despite the fact that the company was earning virtually nothing from its South American trade, shares in the company were in great demand and the directors were eager to keep increasing the value of the company.”