Darke Mission by Scott Caladon Read Free Book Online

potential unemployment. He’d only just been employed! He loved it at MAM and he sure didn’t want to be seeking a new job, especially as it was nearly Christmas. No joyeux Noel for him if he was in the dole queue.
    JJ and Toby briefly filled in Yves-Jacques about the problem, Toby refrained from too many ‘fuckin’ Popadopadopolases’ insults and JJ didn’t drop the F-bomb once.
    â€œRight,” said JJ in a manner that meant his two colleagues needed to pay attention now. “Here’s the plan. It’s plan A and it’s the entire alphabet plan. We have neither the time nor the luxury of a plan B so we’re going with this one for better or worse. Toby, the face value of our entire holding of Greek bonds is, what, approximately €400 million?” enquired JJ. Toby had a spreadsheet open on his laptop.
    â€œâ‚¬420 million JJ.”
    â€œHow much could we reasonably unload between 8am and 12 noon this morning without markedly moving the price against us and assuming there is no breaking Greek news to our detriment?” continued JJ.
    â€œWell, if I get the guys on the trading desk to help…”
    JJ interrupted, “Forget it Toby. It’s just down to us. If you get the guys on the desk to help, they’ll blab whether they know they’re blabbing or not. It’ll be on their BBMs and within twenty minutes it’ll be all over everybody’s BBMs that MAM are dumping Greek bonds. That’ll cause the dealers and brokers to smell a rat and they’ll start digging. Loose lips don’t just sink ships, they torpedo hedge funds as well.”
    Toby knew JJ was right. The time between one Bloomberg instant message and then getting the initial message back to you from some random dealer was often no more than twenty minutes.
    â€œOK,” reassessed Toby. “Spread evenly over three or four hours with multiple dealers, I can probably sell around 120 million of the 420 million without triggering chitty-chatty price anxiety amongst the community.”
    â€œFine,” responded JJ. “Toby, that’s your target and your job. Spend the next half hour or so preparing your call list. Once you’ve done that get a nap on the sofa in my office. You’re going to need to be as sharp as a tack from the off,” instructed JJ. Toby stayed where he was and browsed through his laptop to begin the process of listing the victims he’d try to sell his bonds to.
    JJ continued. “We’ve still got €300 million of toxic Greek junk even if the first part of the plan works. If Greek yields go from 10% to 20%, which they surely will immediately on the first hint of a parliamentary showdown, we’ll lose €75 to €100 million, potentially more if our information turns out to be right. We can’t do anything about that; we have to hold them, not least of which because liquidity will dry up until the picture is clearer. So Yves-Jacques, here’s your task. This is a multi-faceted game. You need to run your correlation and variance-covariance matrix model programs. We need to have a target of liquid macro assets that are inversely correlated to the price of Greek 10 year bonds. These asset markets need to be open from the first thing this morning till at least the release of US NFPs at 1.30pm our time. We need to have more than one asset available for selection because, again, we don’t want to tip-off the market vultures that there’s something afoot. As you know, every asset has different volatility characteristics. 100 contracts of gold futures are not the same as 100 contracts of silver futures. Once you’ve got the target list, run it through my portfolio optimisation program and that will spew out how much of each asset we need to buy to match the expected loss on the Greek bonds. Got it?” enquired JJ of Yves-Jacques.
    â€œYes I can do this. It’ll take me an hour or two to run these