From legendary short seller to god of American capital

Chapter 392 Wheat Flows Back to the City, Wheat Prices Plunge Again

This fleet belongs to Mr. Klein's Continental Express shipping company.

At 10 p.m. the previous night, the fleet had just passed through the Mackinac Channel between Lake Michigan and Lake Huron, and was about 160 nautical miles from its anchorage in Chicago.

But at 11 p.m., they received instructions from New York at the dock at the waterway exit to turn around and return to Chicago at full speed. They were required to dock and register for delivery before noon on Tuesday, or they would be fired.

Time was of the essence, and the fleet leader ordered the fleet to turn back overnight. However, the speed could only reach a maximum of 12 knots, and there was still a headwind, so the timing had to be extremely tight.

The crew members were forced to take no rest and complained bitterly, but the European Express also conveyed the instructions of their boss, Mr. Klein: as long as the grain ship was successfully delivered, they would receive three days of leave and a week's salary bonus.

So when the crew saw the hazy Illinois landscape on the shores of Lake Michigan, smiles appeared on their faces.

Throughout the Great Lakes waterway, there are still three similar fleets on their way back to Chicago.

Meanwhile, Larry Livingston, still asleep, was roughly woken up.

Larry opened his eyes, still groggy, and saw McMillan looking at him anxiously. "Something's wrong!"

Larry was startled and quickly asked, "What's wrong?"

"Someone is submitting a pre-registration delivery application to the Chicago Mercantile Exchange," McMillan explained, fearing Larry might not have understood the meaning. "That means new warehouse receipts are being registered. With more deliverable wheat, the current wheat futures price will be driven down to around 60 cents."

"Oh? So where does the wheat come from? I've already secured all the wheat along the railway line!" Larry asked, his face showing curiosity.

"From the docks! My information is that someone has bribed the port dispatchers and silo managers, and some wheat that had already been sold to Europe is being returned!" McMillan said urgently.

"Oh! I see—" Larry nodded, wiped his face with his hands, and turned to grope around on the pillow.

"What are you looking for?"

"Cigars! By the way, your office is so cold. I don't feel warm enough if I don't have a puff in the morning."

McMillan frowned. "Hey! Livingston, are you even hearing what I'm saying?"

Larry had already pulled out his cigar case and gestured for him to have one. After McMillan refused, he lit a cigar, took a puff, and nodded, saying, "What you're talking about is very important. Wait for me to get up—we'll go to the docks together."

Emerging from Larry's room, McMillan was somewhat bewildered. He was certain Larry had understood him, but he wasn't sure if Larry grasped the terrifying implications of what had happened.

Larry and Cargill risked everything in this stock manipulation—millions of dollars, their reputation, and their future—in order to force a short squeeze.

But now the bears have actually launched their counterattack!

They actually brought back wheat that had already been shipped abroad and registered warehouse receipts for it.

The most important aspect of a short squeeze is ensuring that short sellers don't have real wheat to pay for. If, by the delivery date, the short sellers have no wheat to deliver, then they have to bear the price, no matter how high or absurd.

But now the fundamental conditions have changed, and the short sellers have an unknown amount of power, managing to get wheat that had already been sold and belonged to Europeans back to Chicago overnight.

How much energy is that?

Similarly, if the short sellers have enough wheat to deliver, then the attempt to squeeze the shorts will not succeed!

This would mean a crushing defeat for our side!

Upon hearing such terrible news, he immediately rushed to tell Larry Livingston—but what was Livingston's reaction?

They actually started by enjoying a cigar!

What a damn guy!

McMillan's expression was unpredictable. He waited a full five minutes before Larry finally came out. Surprisingly, he even had time to wash his face and brush his teeth!

"Let's go! Let's go check out the docks!" Larry said briefly.

"Where's Mr. Browning? Isn't he coming with us to take a look?" McMillan didn't see Matthew.

"Oh—I'll have him run some errands!" Larry replied with a smile.

The South Wharf of Chicago and the Lake Shore Port were seven miles apart, and the carriage carrying the two men did not arrive until 8:30 in the morning.

As the sun rose, the fog in the port area gradually dissipated, but a thin layer of fog remained between the crane's boom and mast.

Larry Livingston's carriage stopped outside Pier 3. He didn't get out, but opened the window a crack and squinted at the row of cargo ships that looked like a steel mountain.

Twelve Great Lakes-class steamships, their waterlines extremely deep, silently proclaimed their full load.

The dock was bustling with people, and supervisors from the export company were already waving their arms and urging the workers on in sharp voices.

The massive grain suction machine, like a dying beast, emitted intermittent, weak roars as it sucked wheat from the grain ship's hold onto the grain trucks on the shore.

McMillan glanced at the dock, then at Larry, and noticed that the latter's eyes showed absolutely no sign of panic.

But McMillan was panicking! This was a matter of life and death for him! Why wasn't he reacting at all!

Is Livingston still half asleep?

"Hey! What do you think we should do?! Should we switch docks and head to the stock exchange now?" McMillan asked urgently.

"Wait—let me check again!"

Larry's face was expressionless, but his fingertips tapped very lightly on his knees, as if he were calculating some kind of rhythm.

Five minutes later, McMillan hurriedly glanced at his pocket watch—it was already 8:47!

"I think you should go to the exchange; you have to do something. If the short sellers really start pushing the price down, there will be a big drop this morning," McMillan urged.

"Wait a little longer—" Larry's face still held that indescribable calmness.

McMillan was speechless.

Another ten minutes or so passed, and McMillan took out his pocket watch several times. He even deliberately made a "clink" sound as he took it out, as if to remind Larry that time was ticking away.

But an eerie silence remained inside the carriage until Macmillan's assistant arrived—

A carriage came speeding by, and the people inside jumped off before the carriage had even come to a complete stop. The assistant stared at McMillan's carriage and rushed over, his face showing obvious anxiety.

"Mr. McMillan! Mr. Livingston! The exchange is going crazy! The price—the price is plummeting! Should we—"

Larry raised his hand to stop him from saying anything more, his gaze still fixed on the dock, watching the writhing army of loaders and unloaders, watching the busy workers—

McMillan and his assistant stared at each other, their faces filled with confusion and their hearts with anxiety.

After a few seconds of deathly silence, Larry's lips suddenly curled up slightly, forming a clear arc.

It wasn't a bitter smile, nor was it a forced composure; rather, it was a genuine smile, tinged with cold mockery and absolute control, as if one had witnessed a long-awaited and perfectly anticipated scene.

McMillan and his assistant were stunned.

"Good! Very good!" Larry said softly, rolling up the car window and turning to McMillan, "Back to the exchange!"

9:30 a.m., Chicago Board of Trade.

The air here is completely different from the damp cold of the dock. It is hot and viscous, steamed by the body heat, sweat, cigar smoke, and an emotion called "panic".

Inside the trading room, it was like a pot of boiling porridge. Futures brokers and people crowded together like madmen, and the noise almost lifted the arched dome.

"62 and a half cents, 200 lots sold!"

"62 and 1/4 lots, 150 lots sold!"

"I'm closing out 100 long positions at market price! Who's going to buy them? Damn it!"

The numbers on the price chart plummeted like beads from a broken string. The news of the arrival of the European fast grain transport ship was like a bomb thrown into the market by the bears, instantly destroying the fragile confidence that the bulls had painstakingly built up on Monday.

Those short sellers who were unwilling to close their positions yesterday swarmed in like sharks smelling blood! Meanwhile, those long sellers who were lucky enough not to close their positions faced the desperate situation of running out of margin and possibly being liquidated again.

Old Stone stood by the trading pool, his face pale. He glanced several times at Larry on the second floor, where he usually stood, his palms sweaty.

Unexpectedly, the short sellers used this tactic to bring back the grain that had already been transported away—thus suddenly increasing the amount of deliverable wheat—

The market was triggered by this news, which caused it to fall continuously! Because the rumor is that the delivery price of this newly arrived grain is expected to be only 60 cents!

But the market isn't so rational; a sharp rise inevitably leads to overcorrection! Wheat prices could fall below the low of 58 cents, breaking through all long positions' stop-loss levels.

In that case, all those who went long would die, while their closing orders would allow the short sellers to close their positions and realize huge profits!

That could be an excess profit of 15 cents per bushel!

Why wasn't Mr. Livingston there at such a crucial moment?

Just then, a man in a brown coat squeezed into the wheat trading pool. Old Stone recognized him; he was the big broker who represented major clients in New York.

"500 lots at market price! No matter the price!! I want them now!" the man shouted.

After a brief moment of shock, panic began to spread among those in the trading pool. This 500-lot short order instantly drove the price below the 60-cent mark.

The key issue is that in current market trading, such large-scale sell-offs take an exceptionally long time—watching as massive sell orders relentlessly crash down, many traders holding long positions feel as if they are being slowly tortured, gritting their teeth and anxiously considering whether they should close their positions and cut their losses as each second ticks by.

Meanwhile, the unfamiliar traders who had driven up wheat prices yesterday were now watching the market decline in bewilderment. They hadn't received any trading orders, but seeing the market fall, they looked at each other, completely lost and helpless.

"Your client's finished!" Agent Green squeezed next to old Stone, his face radiating undisguised smugness and cruelty. "His tricks have been exposed! Wasn't that guy Livingston? His agricultural revival plan—the European fast transport fleet—it's all a joke when it comes to those boastful manifests! We're going to make sure his ships are emptied today!"

The brokers and traders in the room weren't stupid; they had long understood that the "mastermind" was Livingston, who had previously been a client of Stone & Co.

Livingston did teach the market a lesson, but what good did it do?

Livingston, a young man who was once rumored to be a god, is now seen by most people as prey who has fallen into a trap and is about to be devoured!

The one in charge must be a large investor!

This sentiment permeated the entire exchange.

The price has dropped to 58 and a half! This was yesterday's floor price for market support.

Old Stone subconsciously looked up at the pillars on the second floor, only to suddenly see Larry already there!

Not only was he there, but there was also a tall young man next to him—Old Stone recognized him as McMillan, the current executive at Cargill.

Larry glanced at the bid board and the trading pool, then turned to McMillan and said something—

McMillan's expression went from astonishment to seriousness, and finally—a look of sudden realization!

Old Stone couldn't hear what they were saying, but he could see Larry's expression—more like... than McMillan, who was much older than him.

It's like a revelation—

Old Stone frowned. He couldn't imagine why Mr. Livingston looked so calm in such a terrible, breakout position in the futures market.

Larry watched as McMillan hurriedly left, then turned and looked down at the trading floor once more.

He should have a way, right? It should be like this—

Old Stone looked anxious, but that was all he could tell himself.

When Larry arrived at the exchange, he didn't act immediately. He watched quietly for ten minutes, observing how wheat prices were trampled by panic and how the short sellers celebrated wildly.

Watching the 58-cent mark be breached for the first time, and watching the market briefly struggle and catch its breath around 57.5 cents.

This position is just one step away from a bull market collapse! It's easy to imagine that as soon as Wall Street's big money sees the price drop to this level, they will inevitably launch another massive short order, crashing the market!

Finally, Larry made his decision. He turned and greeted the old trader who had been waiting in the shadows of the pillar behind him, "Sir!"

The veteran trader rushed to his side.

"Now, let's begin! Use all our anonymous accounts, unlimited amounts, to buy!"

Larry's voice was calm and even.

The veteran trader almost thought he'd misheard. "But—Mr. Livingston, at this level—the market has completely collapsed!"

"Do as I say." Larry's eyes returned to the trading pool. "Remember, there's no limit, but it's slow and spread out. Like water dripping on a stone—but don't let the price drop below 55 cents."

The veteran trader took a deep breath, suppressing the turmoil in his heart, turned around, and quickly walked down the stairs, squeezing into the trading hall on the first floor.

When the anonymous brokers saw the veteran trader return, their expressions turned serious, and they hurriedly gathered around him.

The veteran trader relayed Mr. Livingston's instructions. Although everyone was quite surprised, they immediately returned to the trading floor and began to do their own thing.

「58美分，买入50手————什幺你说现在价格才57又1/4？我的报价就是58美分，没有成交完的话就向上扫卖单！」

"57 3/4 lots, buy 30 lots!"

"57 1/2 lots, buy 80 lots!"

These buy orders are still small compared to the huge sell orders, but they appear in extremely tricky positions, always when prices hit new lows and selling pressure eases slightly.

Like an invisible hand, it quietly lays a thin layer of support in the bottom area.

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