Words Unspoken by Elizabeth Musser

Author:Elizabeth Musser
Language: eng
Format: epub
Tags: ebook
Publisher: Baker Publishing Group
Published: 2010-07-26T16:00:00+00:00

TUESDAY, OCTOBER 20

They named it Black Monday. In one day, the Dow Jones plummeted 508 points. At the end of the day on October 19, 1987, the stock market had lost 22.6 percent of its value and over half a trillion dollars, making it the worst crash in history. A broker from Paine Webber said it best, Ted thought: “The final hour was like a dream sequence. You knew what was happening, but you couldn’t believe it was real.”

Tuesday was just as surreal—the market was deathly calm, with absolutely no trading going on. Who could trade? All the credit had evaporated. The Federal Reserve tried to step in on Tuesday morning to prevent further losses. As the nation’s central bank, it affirmed its readiness to serve as a source of liquidity to support the economic and financial system. Later on Tuesday, the Fed, led by newly appointed Alan Greenspan, held a conference call with members of the Federal Open Market Committee to discuss what role the Fed should play in trying to calm investors and the markets. Greenspan said, “I think we’re playing it on a day-to-day basis. And in a crisis environment, I suspect we shouldn’t really focus on longer-term policy questions until we get beyond this immediate period of chaos.”

This immediate period of chaos. Well, he’s got that right, Ted thought.

By Wednesday the papers were filled with quotes from important individuals, commenting on the crash. Ted read every one with a nauseous feeling in his gut. You’re right, Mr. Iacocca, he thought. We can’t “keep romping forever on borrowed money.”

He set down the newspapers and cursed out loud, so loudly that several brokers looked over and gave him sympathy smiles. If they let themselves, every broker in the firm could shout out a string of profanity that would travel around the world.

Why had he invested so much of his own money in those lousy junk bonds? How could he have been so blind? After all, didn’t the name spell it out in black and white? Junk. Not only had he lost hundreds of thousands of dollars for Dr. Kaufman in illegal trading, but his nest egg had shrunk by 75 percent.

When he awoke on Wednesday morning, he felt something he had not known in years. He was terrified. Not just scared. Fear pumped him up, got the adrenaline going. But terror drained him completely.

This was not the scenario he had imagined a few weeks ago. Then he’d been dreaming of the Million Dollar Club and China; today he was wondering how to stay out of jail. Jail! That’s what he’d get if they caught him.

Ted reviewed the past weeks of trading in Dr. Kaufman’s account. At first just a little hedging, a little more activity. Then he’d done it. Since the market continued to go against what he’d expected … down, down, down … he had made the step over into doing some illegal trading in the account. Ted wasn’t sure how he’d convinced himself to start buying junk bonds and very speculative stocks with Dr.

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