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

Friday, March 21, 2008, evening

Wall Street has never lacked myths, but most myths die in the second chapter.

On Friday evening, the name Farstar Capital swept through the entire Manhattan financial district like a sudden storm.

……

[5:17 PM, CNBC Studio]

"...Now we're going to talk about the most shocking trade of the week."

Host Becky Quick sat behind the studio, a stack of freshly delivered documents spread out in front of her. Her tone initially maintained the steady composure typical of a financial news anchor, but as she read the last line, her voice involuntarily rose slightly at the end.

"According to information we have cross-confirmed from multiple sources, a small hedge fund called Far Star Capital made a profit of over $700 million through a put option trade during the week of the Bear Stearns collapse."

She paused for a moment.

"Seven hundred million US dollars."

There was a brief moment of silence in the studio.

"And what's even more astonishing is..."

Becky glanced down at the documents.

"Just three weeks ago, this fund had less than ten million US dollars in assets under management. Its founder and fund manager is a 26-year-old Chinese American named Lance Walker."

The special guest sitting opposite her—an analyst who has long followed the hedge fund industry—adjusted his glasses and interjected:

"Beckie, I need to add a number. According to the version I have now, the actual principal they put into this deal is neither ten million nor eight million."

He paused.

"It's five million one hundred and twenty thousand US dollars."

Becky looked up: "All of them?"

"all."

The analyst nodded, "That's almost all the cash available in the entire fund's account."

If Bear Stearns had lasted just one more week, the company might not exist today.

Someone in the studio took a soft breath.

An older trader sitting on the far right, who had been silent until now, slowly began to speak:

This is not an investment in the standard sense.

Becky looked at him: "So what do you think this is?"

The veteran trader stared at the printed portfolio review on the table, remained silent for two seconds, and then said:

"It's like holding a gun to your temple and betting that the other person will die first."

"But he won the bet," Becky said.

"Yes."

The veteran trader nodded, his expression complex. "So from today onwards, Wall Street will no longer treat him as a joke."

Becky closed the document and looked at the camera.

"Far Star Capital. Lance Walker. If you haven't heard of this name before, you'd better remember it starting tonight."

The camera cuts away.

But the atmosphere in the studio didn't dissipate.

Because everyone knows that in a deal that makes $700 million, what's truly terrifying is never the profit itself.

Rather, this money will prompt countless people to reassess a name that wasn't originally on the list.

……

[6:42 PM, a high-end steakhouse on Wall Street]

This is a private club that only caters to people within the financial industry.

There is no signboard, only an unassuming black wooden door, behind which is a thick carpet, dim lighting, and the ever-perfect temperature of red wine.

Inside the private room, four men in custom-made suits were having dinner.

They came from Morgan Stanley, Citigroup, UBS, and Deutsche Bank, respectively. They were all around forty years old and, although not the highest-ranking, they were all in positions closest to the business.

"You all saw that name CNBC just mentioned?" The Morgan Stanley employee cut off a piece of steak and asked casually.

"Yuanxing Capital".

The Citibank representative nodded. "It's been circulating all afternoon."

"I had someone check their publicly available information."

The Deutsche Bank employee put down his knife and fork. "The fund was only officially registered in January of this year, and it's so small that almost no one would give it a second glance. It has no decent fundraising record, nor any impressive track record."

"In other words," the UBS representative wiped his mouth, "this person wasn't even on our radar three months ago."

"It's here now."

The Morgan Stanley man picked up his glass, swirled it gently, and said, "And not just any ordinary glass."

"Goldman Sachs has already made a move?" the Citibank representative asked, looking up.

"It started this afternoon."

The Morgan Stanley representative said calmly, "Their prime brokerage division has already put him on a priority list. I heard they've even made calls from above."

The Deutsche Bank employee chuckled: "These guys are always faster at smelling blood than anyone else."

"nonsense."

A Citibank employee said, "Five million a month, seven hundred million in the blink of an eye. If this kind of client is still just on the regular list, then the PB department shouldn't be paying out bonuses next year."

The UBS representative didn't laugh; instead, he said in a low voice, "I'm more concerned about something else."

"What?"

What will he do next?

The private room fell silent for a moment.

The Morgan Stanley employees put down their glasses, and only then did their expressions become truly serious.

"Yes. It's not about how much he's already made, but where he's planning to bet his next sum."

The Citibank representative picked up the conversation:

"If he just won a bet, that's it. People will just watch the show and forget about it in a few weeks."

"But what if it weren't for luck?" the UBS representative said.

No one responded to that sentence.

The Deutsche Bank representative paused for two seconds before calmly saying:

"That means that from today onwards, everyone has to open the door for him."

"Wrong." The Morgan Stanley man smiled. "It's not about opening the door."

He looked at the wine glass on the table and slowly said:

"It's about getting ahead of everyone else and locking the door in your own hands."

The group exchanged glances but remained silent.

But what they were thinking about was clearly not the same thing anymore.

Some are calculating credit limits, some are calculating brokerage channels, and some are calculating how to turn this newly emerging massive amount of cash into the most impressive figures for their business line over the next twelve months.

Wall Street does not worship myths.

It will only offer a quote for the myth as soon as possible.

……

[8:15 PM, Lehman Brothers Headquarters, 31st Floor]

Richard Fuld stood in front of the floor-to-ceiling window, his hands behind his back, gazing at the brightly lit Manhattan outside.

He is the CEO of Lehman Brothers, the fourth largest investment bank on Wall Street with a 158-year history and a market value of tens of billions of dollars.

The CFO behind him held a freshly completed internal briefing, his voice low:

"The research department reviewed the transaction with Farstar Capital. Their entry timing, exercise price selection, and exit strategy in the last two days were all too precise."

Fuld did not turn back.

"Your conclusion."

The CFO paused for a moment:

"I don't like this feeling."

"Because he made money?"

"Because this isn't like betting in the conventional sense," the CFO said.

"It's more like someone stood in the direction the wind was going to blow, waiting for the whole building to collapse."

Fuld then turned around, his gaze as cold as a knife.

"Bear Stearns collapsed because their own balance sheet and financing chain were broken. It wasn't because someone bought a few put options that the building collapsed."

"I know."

The CFO nodded.

"But the market doesn't think that way. Neither does the board. This afternoon, someone was already asking if Lehman Brothers would be the next target."

"Target?" Fuld repeated, as if he had heard something absurd.

He walked back to his desk, picked up a document, and slammed it onto the table.

"We are different from Bear Stearns. Our collateral structure, financing arrangements, and liquidity reserves are all different."

He gave a cold laugh.

"They're like rats in the gutter, trying every possible way to take a bite out of the elephant."

But the market is just panicking right now. Panic will pass. Starting next week, the financing plan will proceed as scheduled. I don't want to hear any nonsense like "Lehman Brothers is next." Anyone spreading that kind of rhetoric internally should get out.

The CFO remained silent.

"And another thing," Fuld added, "keep an eye on this Lance Walker."

"To what extent are you monitoring them?"

Fulder looked out the window, paused for a moment, and then said:

"Let's see if he only bets on corpses."

The CFO nodded and turned to leave.

After the door closed, the office became quiet again.

Fuld stood before the floor-to-ceiling window, gazing down at the sea of ​​lights belonging to the investment banks. It was the place he had ruled for many years; the lights were still bright, and the order still seemed secure.

"Oh."

He let out a low, mocking laugh. Perhaps he was laughing at the overestimation of some people's abilities.