From legendary short seller to god of American capital

Chapter 403 Three Refusals and Three Withdrawals Lead to Forced Acceptance of Ford Motor Company Equity (Part 2)

After McMillan took his leave, Kennedy remained lost in thought. After a while, he nodded silently and turned to look at Larry.

"Mr. Livingston, you did a fantastic job this time! I was on my way to accompany Mr. Cleveland on his campaign, receiving updates from the governor about your operations, and what you did this time—was absolutely flawless!"

Larry felt no relief, but rather a surge of tension. He couldn't help but recall the principles Mr. Potter had instructed him on—one should share the spoils with one's opponent, for after sharing the spoils, the other party would also value you; and at this time, one should expose one's weaknesses to make them lower their guard.

Fortunately, I was prepared for these things.

Larry's worldly-wise composure vanished suddenly. He leaned forward, a youthful, burning light flashing in his eyes, and lowered his voice, preparing to share an important secret with Mr. Kennedy.

"Mr. Kennedy, as you know, money is just a string of numbers to me, a tool to achieve my goals. What I really want is—"

Larry paused briefly, seemingly choosing his words carefully, "—like Mr. James Keane, or Jay Gould, no, surpass him."

I hope that when future generations write financial history, the name "Larry Livingston" will not represent...

Not just another speculator who got rich overnight, but someone who reshaped the rules, a benchmark for making the market more authentic. I hope that my opponents, even my enemies, will have to admit, when talking about me, "That guy, at least, played by the rules."

When Larry said this, his tone was very urgent, even a bit idealistic, a stark contrast to the cold and precise image he had projected when he was analyzing the market conspiracy.

Kennedy frowned slightly, because to him, Larry's desire for "historical fame" was very "naive" and "idealistic".

However, compared to an elusive ambitious person, a genius with "vanity" and "spiritual pursuit" is obviously easier to understand and guide.

Kennedy smiled and nodded, continuing his compliment, "I heard—you've achieved nearly seven times the fund's profit target. The fund's total size has now reached nearly $20 million. My God! You've done a fantastic job! That's an incredible achievement."

Larry didn't nod; instead, he frowned and then told Kennedy everything about why Gage had been so insistent on seeing him. He also relayed to Kennedy his doubts about whether the "temporary credit certificate" contained deeper considerations from Republican bankers.

Of course, he claimed McMillan's previous analysis as the result of his own thinking.

Finally, Larry added hastily, "Sir, you know me. This isn't because I doubt Gage."

"Sir, you mean well, but I have an innate dislike for the Republican Party—I can sense their difference from ours. I always feel they harbor malicious intentions—"

Lacking a strong foundation and heavily reliant on my support and that of the Democratic Party —

This conclusion flashed through Kennedy's mind in an instant.

However, he abandoned his analysis of Larry's personality and seriously considered Gage's scheme. Of course, with Larry's previous analysis of Gage's "credit certificates" and his understanding of bankers and their internal rules, Kennedy quickly found the answer: "Hmph! He actually wants to issue 'greenback banknotes'! That guy, he's got some pretty good ideas!"

"Huh? What's a greenback banknote?" Larry's face showed surprise—this time he wasn't faking it, he genuinely didn't know.

Kennedy thought for a few seconds and said, "The greenback banknotes were legal tender issued directly by the U.S. government in response to the financial crisis of the Civil War, based on the national credit. Its value was not guaranteed by gold or silver, but by the federal government's ability to collect taxes and the expectation of military victory—regardless of whether it counts as a dollar or not, you must remember one thing: the greenback banknotes set a precedent in the American financial world: in times of crisis, sovereign credit itself can create a means of circulation."

"Issuing currency?" Larry had already vaguely sensed Gage's line of thinking, but after Kennedy brought it up, Larry found it somewhat unbelievable.

Kennedy nodded and began to explain to Larry that Gage's approach was essentially imitating the logic of the "greenback" banknotes, except that the issuing entity changed from the federal government to a private banking consortium led by him.

The certificates he issued were essentially a kind of "quasi-legal tender in a local area".

"Didn't that guy Gage mention something in the meeting? He wanted farmers to get temporary credit certificates that could be used to pay for freight, agricultural supplies, or even taxes—basically, the bank would accept the certificate no matter who it was given to?" Kennedy asked Larry with a sneer.

Larry thought about it carefully for a while, then nodded in confirmation, "That's right! Mr. Gage said that convertible bank credit instruments have a wide range of applications and that the bank's acceptance guarantees the credit of the instruments—but he said it was to relieve the farmers of their worries and urgent needs."

"Hmph—" Kennedy snorted coldly and continued, "If he really wanted to solve the farmers' urgent problems, he should have had the banks pay directly in dollars. It's not like they can't afford it—Larry, have you figured out the essence of this? In paying the farmers what you owed, he not only didn't use the bank's capital, but he also created $2000 million worth of currency out of thin air," and guaranteed that the farmers would accept this currency in your name?"

Larry was genuinely shocked this time! He had only previously suspected that Gage was exploiting his credit and manipulating it.

However, it didn't go as far as Kennedy thought, directly exposing the true nature of the so-called "greenback banknotes".

Larry was not at fault for being used by Gage, but it is clear that Gage himself had been planning this for a long time—and his thinking was on a much higher level than the average person could comprehend!

It's important to know that the United States does not currently have a Federal Reserve! The Federal Reserve's status depends on its role as the "lender of last resort."

Gage's scheme was actually to issue "private quasi-currency" on a small scale and act as a "lender of last resort" within the experimental scope.

Brilliant, Mr. Gage! Ruthless, Mr. Gage!

While Larry pondered, Kennedy continued his analysis, "Gage is guaranteed to profit from this! Look, he seized your grain, and now he's going to collect debts from the short sellers on Wall Street—with 200% collateral! He also wants to issue greenbacks, profit from clearing out the Third Pole's bankrupt assets, and even become the liquidator of the Chicago Mercantile Exchange—damn, what a brilliant plan! He must have been plotting this all along!!"

Larry's eyes lit up, and he nodded emphatically in agreement.

"So, Mr. Kennedy, what should we do? Reject his offer?" Larry countered.

Kennedy hesitated, for he was also clueless. After all, he had only been able to see through Gage's scheme after Larry's prompting.

He thought for a long time, then shook his head hesitantly.

"Should—no, although his approach is more self-serving, in a sense, it's the only solution to your food problem—ah, those old money Republicans, they've really got deep pockets; they can even come up with an idea like this!"

Larry thought for a moment and came to a preliminary conclusion: there was no need to confront them directly! Instead, they should quickly form an alliance of interests with Gage.

Mr. Gage's ability to make money on this line is his skill; the key question is, how much can I personally profit from it?

Before, when I didn't understand, I was afraid of being sold out and then having to count the money for the banker; but now that I know the other party's scheme, this good thing can no longer be monopolized by the banker alone.

Of course, Larry had just played the role of someone who "loves fame" in front of Kennedy, and now he needed to seize the opportunity to further develop that persona.

“This is what I think—sir!” Larry said, feigning deep thought and regret, “—since we have no choice but to give in, then we might as well concede to them—but we can’t give up all our reputation to the banks. I think that since I’ve been in charge of all this, or rather, their credit comes from me, then I should negotiate with them more—at least leave the good reputation for myself, oh, and for you and the governor.”

Kennedy nodded slowly, continuing to think. After a moment, he suddenly looked directly at Larry and said, "You're right—but not by leaving the reputation to me and the governor. We must remain hidden—I think what you're saying, using this opportunity to negotiate with him, is a good idea!"

Larry nodded and continued to ponder.

After a moment, Larry seemed to have made up his mind. He looked up at Kennedy and said, "If that's the case—I'll have to play it by ear and negotiate with him. However, our money might not be able to be distributed quickly, after all, we have nearly $2000 million in principal and profits, which is a significant bargaining chip!"

Kennedy made his decision almost instantly: "You're right! My brother, there's no rush to split the money."

But we can use our $2000 million capital to negotiate with him. Just go ahead and talk to him boldly—”

"What should we say to the governor?"

"Don't worry!" Kennedy said, patting his chest. "I'll convince him! This is the time to maximize our profits. Just go ahead and do your thing; we trust your judgment."

Larry nodded, his face resolute. "I swear to God—I will faithfully protect our shared future."

"Shared interests!"

Kennedy looked at Larry with approval in his eyes.

After the matter was settled, he visibly relaxed. He casually tossed aside his half-smoked cigar and lit another one.

"Larry! My brother, how much money did we make this time?"

"With a net gain of over $16 million, including principal and profit, you and the Governor will receive approximately $3,761,500 proportionally!"

Larry was referring to the allocation ratio that the three of them had agreed upon beforehand, which was based on the composition of the institution's funds.

The governor and Kennedy each contributed $50, accounting for 19.06% of the total, so the distribution was based on that!

$376 million!!

Kennedy swallowed hard.

Despite being mentally prepared and having weathered many storms, at this moment, faced with such enormous profits, even Kennedy felt his throat dry, his chest tight, and his eyes glaze over.

He had to exert himself to the utmost to suppress his emotions so as not to show his surprise.

After a long pause, Kennedy finally spoke, "—That's a remarkable profit, my brother—"

'

After a while, he smiled at Larry and said, "Larry, do you know what? The governor asked me to pass on some good news to you—he wants to give you a gift!"

"What gift?" Larry raised an eyebrow.

"A subsidy!" Kennedy grinned smugly, continuing, "The governor will be in office in four months. The first thing he'll do is subsidize your and Cargill's high-priced acquisition—that's a huge sum of money!"

"—Oh? There's a subsidy? How much is it?"

"At 10 cents per bushel, how much wheat did you purchase in total?"

"Um... about 1300 million bushels."

"That's a subsidy of $130 million. How about that? Pretty big gift, huh?" Kennedy said smugly.

"This, this is too precious, I can't believe I've received such a reward!!" Larry exclaimed, looking utterly astonished.

Kennedy smiled and waved his hand. "It's only right. You've helped us make so much money—this is how you deserve it. Besides, it's taxpayers' money, not the governor's. Subsidies are targeted at honest, kind, and patriotic businessmen—it's perfectly legal and reasonable! You can put the money in your pocket without worry; there's no risk involved."

Larry pretended to refuse for a while before nodding and "reluctantly" agreeing.

After saying this, Kennedy glanced at Larry and said leisurely, "My brother, the governor has offered his reward, and I will offer mine!"

"No, no! Your Excellency, I owe my success to your and the Democratic Party's help. How could I ask anything of you? To be honest, without your and the Governor's protection, how could I have escaped unscathed from this cornering incident? I appreciate your kindness, but I cannot accept this repayment!"

Larry stood up excitedly.

Kennedy stared into Larry's eyes, a smile spreading across his face, and casually waved his hand, gesturing for Larry to sit down.

After Larry reluctantly sat down, Kennedy smiled and said, "Larry, I know you're a fair person. But business is business, and your efforts must be rewarded accordingly—I can't be at ease if I can't give you a return—oh no! Sit down first!"

After pressing Larry to his feet again, Kennedy continued, "I told you! Once Mr. Cleveland is elected, we'll be richly rewarded, and I'll be too. One of those rewards is promising you Massachusetts liquidation status, but you've made me so much money—well, I have to do something—God above! This isn't just to satisfy my sense of indebtedness, but also for fairness and justice!"

Holy crap! This old politician really knows how to use words! When he said that, in a Western context, I couldn't really refute him. Larry's mind was full of complaints, but he still showed hesitation on his face.

Kennedy continued, "The governor and I discussed this beforehand, and we can't let you operate for free. So, we'll each give you 20% of the net profit; that's your commission. And—"

I personally intend to relinquish all my shares in Ford Motor Company and all my stake in the Southport Industrial Fund; it belongs to you—my brother.

"No, no! Mr. Kennedy, you've invested $20, and besides—you know the automotive industry has a bright future!!" Larry hurriedly said.

"I know—" Kennedy continued waving his hand to indicate that he knew what Larry was going to say, "But Larry, you have to know, this is all I can give you—after all, Ford is an important asset, as you said, and..."

I'm giving it to you because it has a bright future. Brother, please accept it.

As he spoke, Kennedy took out a document from a briefcase he had brought earlier and placed it in front of Larry. It was a contract promising to relinquish all his shares in Ford Motor Company and all his fund shares.

Kennedy's name was also signed at the end of the contract.

Kennedy's plan was quite good. He had long harbored deep resentment towards Henry Ford, and now, under the guise of "repayment," he was handing over all his shares. This was not only a way to dispose of his "bad assets," but also a way to offset Larry's compensation.

After all, disregarding costs, he and the governor each profited $326 million, and their 20% commission would be $65 each.

$10,000, totaling $1.3 million for the two of them!

The governor used his power to give Larry a $130 million grant, so he should at least give something in return.

After careful consideration, Ford Motor Company's equity stake is the best bargaining chip.

Kennedy was even proud of his "brilliant idea"!

But Larry was absolutely ecstatic!

He knew that these shares belonging to Kennedy were far more valuable than the $130 million dividend! Far more valuable!

In this way, I can truly get Henry Ford to mass-produce cars properly!

Besides, he had already "declined and offered his shares three times," putting on quite a show, so acquiring Ford's shares now would be a natural progression without any hidden risks.

After much feigned reluctance, Larry finally accepted Congressman Kennedy's "gift contract."

This matter that had troubled Larry for almost a year has finally come to an end!

As they were parting, Larry asked about the progress of Democratic presidential candidate Mr. Cleveland's campaign.

"The election is going very well! You know what? President Harrison has always adhered to the principle of 'campaigning in the corridor' and doesn't go to various states to campaign for votes. Now, his wife has just passed away, and he is in deep grief, so he has no heart for campaigning!" Kennedy said with a beaming smile as he talked about the current election situation.

"At present, it seems almost certain that our party will become the ruling party. Once Mr. Cleveland becomes president and enters Washington, Larry, you'll be one of our heroes!"

Larry quickly stated, "This is what I should do! The Democratic Party is my root, and the big tree behind me."

'

Kennedy was very satisfied with his statement, because a person without a base of influence would have to rely on powerful figures; and the Democratic Party was Larry's ideal and best backer!

That's great, because this way I can control this "little genius"!

Although he is talented and capable in trading and market manipulation, he also has his shortcomings, such as youthful arrogance.

Idealism, a love of empty fame — and a need for the protection of power!

Kennedy was confident he could control Larry Livingston.

Kennedy left the Palmerhouse Hotel with a satisfied smile on his face.

After Kennedy left, Larry rushed to the hotel’s telegraph room to send an urgent telegram to Baruch, the manager of Harding Company and his stockbroker in New York: Cleveland’s victory was a foregone conclusion, and now he was going to double and double his short positions in silver stocks!