A $50 million margin call? I'll short Wall Street.

Obama had a fundraising event in Chicago on his itinerary that day, and before the event, he had a break, so he habitually went to Goolsby's office to sit for a while.

This is an understanding they've maintained since 2004. Outside of the formal campaign schedule and working meetings, they maintain a stable, private communication.

"Staff" and "presidential candidate" are not enough to describe their relationship.

When Obama walked in, Goolsby was at his desk. Several printed CDS spread charts and summary pages of the 10-Q report were spread out on the desk.

"Ostan."

Obama sat down on the sofa and casually picked up a copy of The Economist lying on the coffee table and flipped through it.

"How was your weekend?"

"I drove for ten hours."

Is Greenwich worth the trip?

Obama knew that Goolsby had gone to Greenwich over the weekend. After learning about Lu Ze's deeds, Goolsby showed curiosity about the young man. Obama didn't have much of an understanding of economics, so Goolsby thought it was worthwhile to meet him.

Goolsby thought for a moment about how to start the conversation.

He's a fast talker. But when he's with Obama, he deliberately slows down.

Obama has an aura that makes you want to use every word precisely. Rather than being oppressive, it's more like an implicit demand: "I'll listen carefully to what you say, so you'd better speak accurately."

"That young man,"

"It's more interesting than I expected," Goolsby began.

"Interesting" is a word with a specific meaning in Goolsby's vocabulary.

He used it to describe those who had intellectually impressed him. In his more than ten years of teaching, he used the word to describe no more than ten students.

Obama put down The Economist and then raised an eyebrow.

"This kind of comment is rare for you. How interesting is it?"

"His understanding of the micro-level of the financial system is unlike anything I've heard in school, in the economic advisors of my campaign team, or in policy circles in Washington."

It's not a difference in perspective, it's a difference in perspective. We've been looking at data on the surface—GDP, employment, inflation. He's looking at pressure gauges in underground pipes.

Goolsby paused, carefully choosing his words.

"My previous assessment was that the impact of the subprime crisis on the real economy was manageable. The recession might last two or three quarters, but its depth would be limited. This assessment was based on macroeconomic data, and it's also the assessment of the vast majority of people at present."

"And now?"

"The macroeconomic data hasn't changed. What has changed is my understanding of the financial transmission mechanism."

Goolsby picked up a CDS spread comparison chart that he had printed the night before from his desk, walked over to Obama, and unfolded it on the coffee table.

"I won't pretend I fully understand these things. But Walker explained a mechanism to me, and after I came back and checked the data, I found that the mechanism is real."

He pointed to several locations on the map with his finger.

"Simply put: Wall Street's big banks borrowed money from each other to keep up with daily operations. They borrowed and repaid daily. If one day a bank's creditworthiness was compromised—it didn't need to actually go bankrupt, just that other banks thought it might—their lending channels would freeze within days. That's how Bear Stearns died. From the onset of problems to its acquisition, it took five days."

Obama stared at the chart without saying a word. His expression was the kind of "processing information" look that Goolsby was familiar with: his brows furrowed slightly, his lips pressed together, and his gaze slowly moving across the chart.

"If the same thing happened to an institution larger than Bear Stearns,"

Goolsby continued, "Whether the government can provide timely assistance? Walker isn't sure. I'm not sure either. But he pointed to a political constraint I hadn't seriously considered before—"

"It's an election year," Obama said.

Goolsby glanced at him. Obama was extremely politically astute.

"Yes. Paulson needs to ask Congress for money to bail people out. Congress is unlikely to readily approve a multi-billion dollar Wall Street bailout plan in an election year. The Bear Stearns precedent has already drawn months of criticism from voters against lawmakers."

"Even his own party criticizes him, calling him a socialist and such."

Obama paused.

"So what's your suggestion?"

Goolsby leaned back on the sofa.

"My suggestion is very specific. Have the team spend two or three days developing an internal contingency plan."

"What scenarios does the contingency plan address?"

"Paulson was forced to take over both homes this summer."

Obama raised an eyebrow slightly, somewhat surprised.

"Paulson just told Congress that the rocket launchers are just a deterrent and won't actually be used."

"Yes. But Walker believes the CDS spreads between Fannie Mae and Freddie Mac indicate the market won't give Paulson much time. He may have to take action very soon after the Senate passes the bill."

Goolsby paused, then used a word that left room for interpretation.

"This is just a possibility, not a certainty. Walker himself said so. But the cost of making this contingency plan is almost zero—if nothing happens, we'll just have wasted two days of work from several staff members."

But if it does happen, we'll be in the game at least one to two weeks earlier than McCain's team.

Obama didn't respond immediately; the prediction had quite an impact on him. He glanced again at the CDS spread chart on the coffee table, then looked up.

What is your overall assessment of Walker?

Goolsby mentally organized his thoughts. He wanted to be precise.

"He was incredibly intelligent. And in a way that differed from the intellectual intelligence found in academia. He wasn't the type to construct elaborate models in papers; he was the type to smell the gunpowder still burning in the ruins."

Do you trust his judgment?

"I trust his understanding of micro-financial mechanisms. As for his predictions of macroeconomic trends—"

Goolsby chose honesty, or a cautious approach that left room for maneuver.

"I think he may have exaggerated the urgency of systemic risk. He's a short seller, and panic works for him; this bias must be taken into account."

"But he proved himself in Bear Stearns and in oil."

Obama said. This wasn't a rebuttal, but rather a supplement to a missing piece in Goolsby's own assessment.

"right."

Goolsby admitted.

"That's why I suggested taking his judgment seriously, rather than ignoring it outright. Even if we discount it by 30%, the remaining amount is enough for us to prepare in advance."

Obama stood up, picked up the CDS spread chart from the coffee table, folded it, and handed it back to Goolsby.

"Make contingency plans. Scenario of Fannie Mae and Freddie Mac being taken over. I want to see how our economic policy rhetoric will adjust and how our campaign narrative will shift in that situation."

He walked to the door, paused, and looked back at Goolsby.

"Maintain contact with Walker. But Ostan—"

"I know."

Goolsby nodded. "No written record. Just say I saw an old friend's garden in Greenwich."

Obama nodded and walked out.

Goolsby sat alone in his office.

Outside the window, it's a summer afternoon in Hyde Park. A few students are reading in the shade on the University of Chicago lawn. In the distance, I can hear the sound of some kind of sport—perhaps a frisbee, or maybe a dog running.

He unfolded the CDS spread chart again and looked at it for a while.

Actually, he still had some questions he wanted to discuss with Lu Ze, new questions that arose during the thinking process.

But he still put down his phone.

Then I started drafting the framework of the plan on the computer.