“I have the stick,” said Astor.
“The stick is yours,” said his pilot.
Astor lifted the collective and brought the chopper over the landing pad, nose up, and the wheels touched down firmly.
7
Marv Shank was waiting by the elevators when Astor arrived. “Hey, Bobby. Half day? I didn’t get the memo.”
Astor checked his watch. The time was eight-thirty, but Shank looked as if he’d been at work for hours. His shirt was untucked, his tie askew, his face moist with perspiration. Astor patted him on the shoulder. “I knew I could count on you not to bring up my father.”
“You hated the guy. What’s to bring up?” said Shank, hurrying to keep up. “Wanted to make sure I grabbed you before anyone else. Press conference at nine-fifteen from Shanghai. U.S. trade representative.”
“Know what he’s talking about?”
“Not a clue. That’s what makes me nervous.”
“Any change in the position?”
“Nada.”
“Then why are you so nervous?”
“It’s my job to be nervous.”
“If you didn’t get nervous,” said Astor, “we wouldn’t make any money.”
“But this time…”
Astor stopped and turned to face his friend. “This time what?”
“It’s a little rich for my taste.”
“Show a little faith. Have I been wrong on something this big before?”
Shank pulled open the glass door leading into the office. “The market,” he said, “doesn’t care about before.”
Astor walked inside. “Comstock Partners” was written in gold block lettering on a bleached maple divider behind the reception desk. He rapped his knuckles on the counter as he passed through the reception area. “Hello, ladies,” he said, addressing the receptionists, both young and male and hoping for a shot at the trading desk. “Bring me the usual. This time make sure it’s hot.”
“The usual” was a double espresso with a lemon rind on the side, some biscotti, and a shot of wheatgrass, in case he felt so inspired. In fact, the espresso was always piping hot, but he felt it his duty to keep the newbies on their toes. Lesson one: in this business, you couldn’t be careful enough.
Not breaking stride, Astor continued down a corridor housing administrative offices-accounting, legal, IT. “What about my fifty grand?”
“Check’s on your desk,” said Shank. “That was some dive. Your back okay?”
“Don’t remind me.”
“You could have heard that flop in the next county. Great party, though. I’m just sorry it had to end on a sour note.”
“I thought you weren’t going to bring that up.”
“It just slipped.” Shank took hold of Astor’s arm and stopped his progress, guiding him against a wall. Astor stood still, Shank’s compendious belly pressing against him. “Marv, what are you going to do? Give me a kiss?”
“Really, Bobby, you doing okay? We’re talking about your father here. You can talk to me.”
Astor looked Shank straight in the eye. “I’m fine, Marv. Really.”
“You’re sure?”
“Do you want me to pinkie swear?”
“Screw you,” said Shank, dismissing Astor with a shove down the hall. “Shows what I get for caring.”
“If you want a friend…” began Astor.
“Buy a dog,” the two men said in unison. Astor raised his hand and Shank high-fived him.
“Thought you were getting soft on me,” said Astor.
“Thought you had a heartbeat.”
“Never.”
The trading floor was a long open space, a floor-to-ceiling window that looked over Ground Zero and past Wall Street to the East River making up the outer wall. A desk ran the length of the room. Fourteen traders sat across from one another at uneven intervals. A host of flat-screen monitors demarcated each post. Workspaces varied from immaculate to chaotic. He counted three boxes of Pepcid, two containers of Tums, and a bottle of Maalox. Pro ball players got concussions. Traders got ulcers. If you weren’t playing injured, you weren’t playing hard enough.
Aware that the room had gone silent at his arrival, Astor stopped and addressed his team. “Okay, everyone, listen up. I know you’ve all heard about my father. I have no more idea what happened than any of you. If I find out anything, I’ll announce it over the hoot-and-holler. Your condolences are appreciated, but as most of you know, we had a falling-out a while back. Don’t expect me to hide in my office while I get over it. I’m going to be out here on the desk riding your ass like any other day. So get to work and make some money.”
Astor waited, but no one made a move. He clapped his hands. “That means now.”
The room came back to life.
Astor continued to his office. He had founded Comstock Partners fifteen years earlier, at the age of twenty-six. The firm’s name was a lie from the beginning. There were no partners. There was just Robert Astor, sole owner and principal investor. In the world of finance, Comstock was technically classified as a hedge fund. Hedge fund was one of those funny terms that meant everything and nothing all at once. Simply defined, a hedge fund was “a private partnership that invested in publicly traded securities or financial derivatives.” That meant he bought and sold stocks, bonds, commodities, currencies, and just about anything you could legally speculate on with a view toward making a profit. But that was only a beginning.
Most hedge funds had four things in common. First and most important was fee structure, since traders, Astor included, cared about only one thing, and that was making money. Comstock, like the majority of its competitors, used something called a “two and twenty model.” Comstock kept 20 percent-a full one-fifth-of all profits for itself. On top of the 20 percent, it charged a management fee of 2 percent on all funds invested with Comstock, win or lose. In this last regard, Astor was a gentleman. He charged the 2 percent only on the funds actually invested in his positions. Any money sitting in a bank got off scot-free. He even credited his investors the interest.
The other three things hedge funds had in common had to do with the way they invested the money entrusted to them. As the name implied, Astor often hedged his investments, meaning that if he bet that one stock might go up, he bet another might go down. The idea was to guard against swings in the market. Hedging might limit your returns, but it provided the investor with a margin of safety. It was never smart to put all your chips on red or black.
Next, Astor used something called “leverage” to jack up the value of his bets. Leveraging just meant borrowing to increase the size of your bet. Back in the day, an investor would buy stock “on margin,” which meant he used the value of the stock he had bought to double-down and buy some more. That was old school. These days an investor leveraged. Astor borrowed billions of dollars to amplify his bet on anything: stocks, bonds, oil, wheat, pork bellies, and especially currencies.
The last element was freedom. Hedge funds like Comstock operated in a nether region where regulation held little sway. When an investor signed a disclosure agreement and transferred his money into a hedge fund, he was giving Astor his trust to make money the best way he saw fit.
And that’s why Astor loved the business. Hedge funds were a license to bet-and to bet big-without Big Brother looking over your shoulder telling you what to do and how to do it, and, worse, demanding an outsized share of your profits when you won. God bless the U.S.A.
Astor continued to the end of the desk. Though it was summer, most of the traders wore fleecies and sweatshirts. Astor kept the room chilled to a brisk sixty-two degrees. He liked his boys and girls alert. Many of their sweatshirts bore names of alma maters. There were more Stony Brooks than Whartons. Astor couldn’t care less where someone had gone to college. (After all, he hadn’t managed to get a degree anywhere.) He cared about smarts. He’d cherry-picked the twelve men and two women who worked for him from the best firms in the world. He had two Brits, a few Indians, a gal from Shanghai, an Israeli, even a few Americans. They ran the gamut in personalities from extroverted jerks to introverted jerks. Talented traders were not renowned for their people skills. Or, as Alex had often commented, “It takes one to know one.”