Free EBook Samples: Free ebook sample of "Coffee" by Gren Blackall

- Chapter One -

Two men leaned on the teak railing, looking out to the surf. A young messenger approached, in crisp khaki pants and blue military shirt. Sweat on his black face glistened. Winded and stiff, he cut in, “Please excuse this interruption.”

John Clorice paused to fold his hands, not turning his head.

“One of the coffee seed dryers has failed, Meneer Clorice. The other two are already running at capacity.”

“Where is the foreman?” Clorice demanded.

“He is at the facility ...”

“Then I see no reason for your intrusion. The foreman has full authority to resolve this.”

“But, Sir, you gave explicit instructions to contact you if anything threatened our shipment to Spain.”

Clorice faced the messenger, eyes glaring. “Threatened? I’m sure the foreman would not risk his career over a simple machine problem.”

Regret for asking showed on the young man’s face. “Yes Meneer.” In a flash, he was gone. Rapid footsteps resounded through the adjacent courtyard.

After an exquisite dinner, John Clorice and his guest had come to enjoy night air from the balcony. Low voices of plantation workers rose from the banana trees and coconut palms. Cooking smells from fried plantain, simmering soups, and fire-cooked fish mixed with the ocean breeze. The sunset behind them left a ruby cast above the gray water. Dark shapes of cargo ships marched along the horizon.

“John, your ancestors would be proud,” announced Marcello de Barros, President of Brazil, John Clorice’s honored guest. “You have fulfilled their dreams.”

Clorice heaved an airy laugh, shaking his head. “No Mr. President, not yet.” He smiled, knowing that after tonight, all that would change.

Clorice owned the 2,000 acre plantation, along with 14 other facilities spread throughout Brazil. This magnificent island property, just north of Recife, served as headquarters for Clorice Coffee Company. The compound included his palatial mansion, numerous guest houses, a coffee processing facility, and a few older storage buildings.

“You are kind to invite me here for my vacation. I will return fresh to Brasilia.” The President’s words wallowed in a deep Portuguese accent. “Since only the most trusted know where I am, I will have peace.”

The President towered a full head over Clorice. His bloodline back to the earliest Portuguese settlers, and a family history of high ranking soldiers, helped win the last two elections. As always, Barros wore his conspicuous, medal covered uniform.

Clorice gingerly pulled a cigar from a pocket. He rolled it between his fingers, eyeing the outer leaf and judging its freshness. “The finest in the world, General. Hand rolled by my own people.” He found a second one for his companion, and offered a light.

Although John Clorice barely stood five feet, any impressions of frailty quickly faded. His eloquent speech and firm hold on the world’s largest coffee company earned him great respect. At seventy years old, his smooth complexion and highly toned figure compared to much younger men. A small mustache and goatee adorned his thin angular face.

Soon the two men puffed together, sending blue smoke billowing into the darkness. “So smooth, so full of taste. You should sell them around the world, and become even richer, John Clorice.”

“I couldn’t charge enough to recoup the cost of labor. No, I keep these for myself and distinguished guests.”

“I’m honored,” he replied, admiring his impressive host.

After a contemplative pause, John Clorice began his planned speech. “No, General, I’m far from fulfilling my ancestors’ dreams - those that were brutally dashed by the Portuguese.” The President flinched at the surprising change of tone.

“350 years ago, my direct ancestor, also named John Clorice, landed on this beach. The naturally protected port, in such beautiful surroundings, convinced him to stay. The natives’ desire to build a fruitful life, away from the crushing rule of the Portuguese, made them a good source of labor.”

The President protested. “Portuguese leadership has been good to all of us. You should be grateful. You are living proof.”

The President’s personal guard noticed the harsher voices. He purposely stepped out of the shadows, and noisily lit a cigarette.

“Within a few years, a plantation was born. Coffee, sugar, and cocoa harvests doubled each season. Dutch traders passing south to Rio began including Recife on their trade routes. Other Dutch emigrated here. Families grew, local populations prospered.”

In the darkness on the beach below, Milpeau’s large frame appeared. Clorice expected him, but did not acknowledge the shifting shadows. Milpeau headed Plantation security - a physically dramatic, former field worker of African decent. Milpeau focused on Clorice’s face from around the trunk of a palm, watching through the subdued light for a sign.

The President and his guard exchanged puzzled glances. “Yes John, I know. We still enjoy fruit from the seeds sewn by your ancestors.”

Although Clorice spoke calmly, the words grew in clarity. “But the Portuguese did not appreciate John Clorice’s success. They became jealous of his power. Having once spurned these regions, they were willing to kill and destroy to own them. John Clorice did not come prepared to fight with guns. He came to grow business and cultivate prosperity. His vision was clear and far. But the Portuguese saw only the bulbous noses in front of their faces.”

The President slapped his hand on the rail. “The Dutch invaded our country and occupied our land! Your very existence shows the foresight and tolerance of our founding fathers!” The guard stepped to the President’s side and crossed his arms. With a subtle twitch of his hand, Clorice signaled to Milpeau below.

Clorice finished his practiced tirade. “My ancestors were nearly doomed. The Portuguese captured, humiliated, and murdered most of them. To prevent a full scale war with the Dutch, John Clorice was spared, but only in body. The man who could have made Brazil an equal to the United States, died a poor, broken man.”

Barros had heard enough. He faced Clorice, clenching a scarred fist. His accent thickened with rage. “I did not come to hear you desecrate my ancestors!” He pushed himself away from the rail and stomped toward the beach stairs. The verandah wrapped around the immense residence, with an overhanging roof supported by Romanesque columns cloaked in flowering vines. The President’s guard hustled to keep up, and Clorice followed behind.

The guard asked, puffing, “Your Presidency, Sir, would you like me to arrange for your return to Brasilia?”

Milpeau and a stunningly attractive young lady reached the top of the stairs just as they arrived. A short skirt slit to her waist hardly covered her light brown thighs. A halter top loosely tied over her shoulders left a wide path of exposed skin down to her navel.

The girl’s seductive eyes closed coyly while looking at the President. Clorice spoke from behind, “General, I have arranged some entertainment for the long evening ahead.”

Milpeau released her arm. Her steps toward the President flowed like a dancer’s. The wind played with her top, giving fleeting views of her young naked breasts.

“Well, John, I do appreciate the finer arts,” he said, not removing his eyes from her.

“General Barros ... Estella,” introduced Clorice.

She spoke while gliding her hands around his waist. “General, may I have your company tonight?” She lightly kissed his neck.

Milpeau turned to the President’s guard. “Come, my friend. Let us leave the President to escort his guest.” His bright white teeth formed a smile in the dimness. The guard looked to the President, who nodded a quick approval.

Clorice and Milpeau strolled back along the balcony with the guard between them. Clorice surfaced another cigar for the young soldier, and offered a light in cupped hands.

The beach activity had slowed. Only a few voices were audible above the surf. A last fire flickered.

“What is your name, son?” Clorice asked sincerely.

“Ernesto, Mr. Clorice. The President did not appreciate your condescending tone tonight. You should take more care. He is a powerful man.”

They stopped to lean on a section of rail. “But I know a young girl who has him doing anything she wants. What power is there in that?” Clorice and Milpeau laughed together.

Ernesto objected. “Your lack of respect is repulsive.” He puffed hard on the glowing cigar. Clorice returned a mocking smile to Ernesto’s taut frown.

Milpeau stepped back from the railing and moved behind the guard. He reached into his side pocket to grip a tobacco aerator, a foot long thin metal shaft with a handle at one end and a pin-sharp point at the other. While the guard looked down to tap the ash from his cigar, Milpeau felt the debilitating force of Clorice’s stare and knew what he must do.

With a single thrust, Milpeau pushed the point of the aerator through the base of the guard’s neck, piercing the brain stem, and lodging into the inside surface of his skull. Clorice reached his arm around to steady the spastic shaking. The guard’s eyes shivered and wandered out of sync. A drop of spittle dripped off the lower lip of his gaping mouth. The cigar fell from his hands, turning as it tumbled down, bursting in a small shower of sparks as it hit the sand.

Once the guard’s arms fell limp, Clorice leaned him on the railing to reflect. “Good. The President will be dead from pneumonia by daybreak. Then we begin.”

Milpeau stared at the handle sticking out from the man’s neck. He whispered without looking up, “I wish there was another way.”

Clorice puffed in silence before speaking. “You are my best man, Milpeau, with a lovely wife and children. Tonight you have proven yourself again. Your stature here will only grow.”

“Yes, Meneer.”

“You are unwise to question these things.” While the words came softly, they chilled the humid air.

Clorice took a final drag on his cigar and flicked the stub over the edge. “Have Ernesto brought out with the fishermen. Leave the aerator in place or you will have a fountain of blood. The President’s body must be delivered to the freezer as soon as he expires so his death announcement can be delayed according to plan.” Clorice relished a last deep breath of night air. “We start the Presidential communiqués tomorrow morning. By the end of the month, Brazilians will hate Barros so much, they won’t shed a tear on hearing of his untimely death.”

Milpeau easily draped the guard’s body over his massive shoulder, and disappeared down the beach steps.

- Chapter Two -

Harriet Bishop squeezed in next to Knut Olafson’s elaborate computer equipment. “Here they are, Knut, there’s something strange. Look at these repeating blips.” She pointed her slender finger at the particularly brilliant screen, in front of a mounted binocular-like viewing device the operator was looking through. “Tell me I am crazy, or is someone manipulating the market?”

Most called her ‘Etty’. She had spent all but the earliest of her thirty years in some form of academic setting. But now she was one trimester shy of her ‘All But Dissertation’ in Dartmouth College’s PhD program in Finance. The Finance Department considered her their top student. Some of her course papers had been archived for permanent reference.

To help gather information for her dissertation on “Efficiency in the Commodities Market”, she had collected years of price history on a number of traded commodities. She spent most of her time reviewing data from CSCE, the Coffee, Sugar, and Cocoa Exchange, a trading “pit” in New York City that establishes world prices for these foods. Market behavior and efficiency, or lack of efficiency, attracted her - but also the thought of tropical goods, the warm beaches, the sugar cane waving in the balmy air, helped her through the cold New Hampshire winter.

A few days earlier, working in her secluded hilltop apartment outside of Hanover, she noticed some odd behavior in the price of Coffee. She found three years in a row with a sudden price increase during one of the peak production months of November through February. The jumps lasted less than a day, sometimes only hours. Efficient markets move for a reason, and she could not imagine what would cause these short lived spikes.

She called in a heavy weight for some advice and access to more data. Knut practically lived in this specially constructed laboratory. Dartmouth’s reputation for progressive use of computer technology was known around in the world, and Knut was the top professor/researcher. His near total blindness caused by diabetes barely affected his productivity. The College allowed him a reduced teaching schedule, but Knut earned his keep many times over with his high quality research. Knut was actually a year younger than Etty, having earned his professorship at a surprisingly early age.

Etty knew that the man behind the special computer display worked around the clock, but when Knut scheduled her appointment at 12:30am, she had to laugh.

“I don’t see anything strange, there are blips all over the place.” Knut enjoyed playing boyishly confused in front of Etty. Knut was known to receive calls from all over the College system and from top Government researchers who wanted to share in his uncanny analytical abilities. No less than twenty published papers on Statistics and Game Theory showed him as the principal author. Knut had his run of the place, and he knew it.

“Bring up prices by the minute for this day here,” Etty demanded as she pointed at one of the price peaks.

Within seconds, the screen changed, revealing a ragged line etched across, peaking distinctly between 10:30 and 11am. “Look at that. That’s one hell of a run up in price.”

“Yea. Let’s see, that’s about a 3% rise in fifteen minutes. Let me run a quick query to see how many times that’s happened in the last decade.” Knut typed faster than anyone Etty knew. And these weren’t long comfortable sentences. The database commands spilled out on the video display as if the computer were printing them itself.

“If you ever need a few extra bucks, you could type circles around the secretarial pool.” Beyond the small talk, Etty was anxious. She needed a breakthrough on her dissertation - something that would really grab attention, maybe even be accepted by the Trustees for publication. Market manipulation! If this were true, she might uncover a plot to defraud the markets. Three percent changes were huge, and especially lucrative to anyone who could anticipate them in advance. Buy just before - sell just after. What a profit for fifteen minutes! The coffee exchange moved billions of dollars of goods a day. Three percent of billions is many millions. To the discoverer would come world recognition. No fantasy pleased her more.

Knut’s voice shook her back. “Well well, Miss Bishop, lookee here.” Knut’s binocular viewer had to be pivoted to the side for Etty to get a full view of the screen. “It’s happened once a year for the last three. They stand out like beacons. It does look rather organized for such an efficient market.”

“Check out Sugar and Cocoa. They have similar peak production cycles.” Again, the sound of astoundingly rapid key tapping filled the cramped computer room.

“Nope. Not the same way. There are some opening bids with three percent changes from the prior close, but they stuck for days, weeks. These ‘Etty bumps’ fade fast. See here - back to nearly the opening price in what, an hour?”

“Can you pull up the actual trades? Can you see the names of the people behind them?”

“No, ‘fraid not. The Exchange itself may be able to give us that, but the University databases and Internet only go so far.”

“I need some confidence limits. Can you generate some stats on the probability of this happening randomly?”

“Sure, easy. The chance it is random will be pretty small. But, that doesn’t mean someone caused it on purpose. Could be some agricultural thing, or something to do with information releases,” Knut mused.

“I need those limits by tomorrow morning. I’ll present an abstract to the Department head and see if he’ll let me spend some money on more research.”

“Whoa girl. Tomorrow morning? That’ll cost you.”

“Sure, Knut. You know damn well you’ll be finished with it by the time I hit the stairwell.”

“Expertise doesn’t come cheap. It’s not how fast, but how well.”

“O.K. then, what do you propose, Mr. Olafson?”

Knut’s eyesight allowed him to see only the brightest lights, and even they appeared as weak spots. The binoculars brought ten characters at a time to his eyes, filling his field of vision with large bright block letters. But the handicap heightened his ability to imagine. He could see perfectly Etty’s coy smile in his mind view.

He had asked a co-worker what she looked like, after Etty’s first visit. Knut hung on every word, painting a clear picture. Not tall, shapely hips and medium chest, and a face to die for with slightly plump lips, gorgeous dark eyes, and skin as smooth as vanilla pudding. Her jet black hair hung straight and long down her back. He had to fill in some of the gaps, but there she stood before him in every detail.

“A drink. You must join me in a drink. I’ll mix them right here.”

“Here?”

Knut pointed over his head. Etty noticed the upper cabinet with a combination lock dial under the latch. “Oh, I get it, the important personal file.” She could use a little relaxer to end her outrageous day. “Oh hell - sure. What’s the combination - I’ll open it.”

“Sorry. No can tell. We really do have important papers in there. In fact, given the potential volatility of your little research work, that’s where I’ll store yours.”

Knut stood, feeling his way to the cabinet. Even if Etty had tried to record the code as he turned the raised-numbered combination knob, his nimble fingers would have made it impossible. “Ah, here. My file on attitude adjustment.” Knut pulled down a bottle of Schmirnoff Vodka, placed it behind him on the desk, and found two simple water glasses.

“What do you mean, potentially volatile?” Etty asked, while wondering how he planned to serve the vodka.

“You wouldn’t want anyone stealing your dissertation, would you?” Actually, Knut had bigger concerns. He agreed the price behavior was odd. But, there could be any number of legitimate explanations. This was, after all, a world market with growers and producers from every corner of the globe. If Etty jumped too quickly on a market manipulation theory, industry experts might make kids play of it. She, the College, and even he could suffer. On the other hand, if she happened to be right, then she could be dealing with some nasty players. He decided to do a little research on his own. Besides, he liked her, and helping her might give him a chance to get to know her better.

Knut filled the glasses to a healthy half full mark. “There. Skol.”

“That’s it? Just straight Vodka, no ice? Whiskey maybe, Scotch, Brandy, but Vodka?”

“Try it. You’ll be surprised.” Knut drained his glass. “Ahhhh.” He refilled, took one small sip, and laid the glass on the Formica shelf.

Etty sipped and scowled, but then held the glass close to her face while the flavor struck. After a tiny nod, she quickly tipped back her head to swallow the full amount.

“Interesting. Can’t say I’ll give away my Glenlevit, but it’s not bad.”

They rearranged themselves in the cramped space among the monitors and computers to get comfortable with their drinks.

“So, Etty, what’s with the two middle initials? V.E.?”

“Why, have you been looking through my files? I don’t use the middle initials except in formal documents.”

“Guilty. You were born in Nashua, New Hampshire. You’re thirty, you hold a BS from Amherst College, and a Masters from Middlebury - am I right?”

“Wonderful. I suppose you saw my application, too with all that bullshit about running a multi-national corporation.”

“Multi-national? No, they don’t type applications into the student databases, just some key facts. I’m sorry, I suppose I should be more tactful. But, you’d be amazed what information I can get from my little pulpit.”

“If you figure out how to change grades, let me know.” Etty poured another half glass, and began taking larger sips.

“Even if I could, there’s no place to go with you. This is your 6th trimester, and you have all 4.0’s - that’s A Pluses. And the courses! We’re not talking cake-walk classes either.”

Etty blushed a little, but let herself smile knowing Knut could not see her expression. “Well, thanks.” Another sip. Knut refilled his.

Knut continued, “So tell me about your application. Are you interested in world domination, or just a little multi-billion dollar a year company?”

“I wrote about ten pages on it, actually. I did it partly to stand out in the crowd. I heard they like to accept people with specific, not general goals at Dartmouth. Although I think that is a bit naive, I gave them what they wanted. President of a multi-national corporation, specializing in trade of goods around the world, headquartered in Europe.”

“Partly to stand out, but partly because you really want it?”

“I suppose. Sure. Why not?” She tipped back the glass for another large swallow. “You know, Mr. Database, your facts are a little wrong. I was not born in Nashua, if you care. I was born in Germany with the last name Von Enes. My mother tried to bring me here as a baby, but died of influenza or something during the voyage across the ocean. I gather she didn’t have much money.”

“That’s the V.E., then, Von Enes?”

“Yup. I was put up for adoption through New York Immigration, and taken by a family in Nashua. Thirty years ago, they kept almost no information on adopted emigrants. I know my birth date, former last name, and Essen, Germany as birthplace. My new parents named me Harriet Bishop after a family member, but as a small tribute, they kept the initials.”

“So you know nothing about your real family?”

“Nothing. I’ve tried finding out, too. A lone baby arrives with dead mother at Ellis Island. There are no records.”

“That’s a sad story.” Knut poured for both glasses.

“I can’t complain, I’ve had a good life with good parents.” Etty noticed that he did not look when he poured, but filled each to the brim without spilling. “How do you do that? Pour the vodka so well?”

“I heard you put it down. That told me where it was, and I knew by sound that it was empty.”

Etty felt flushed from the alcohol. “The only thing I have from my mother is this watch.” She reached out her hand, and then remembered he couldn’t see. “Here.” She touched his hand and pulled it to her wrist.

“Big! Feels more like your father’s. This the original leather band?”

“I doubt it, but the watch itself is Dutch, from the thirties. I love it. If this watch ever stopped, something would stop in me too.”

“Must be big on your wrist.”

The binoculars from Knut’s special viewing equipment faced her like two huge eyes at the end of a stalk neck. Etty fluidly changed the subject. “How’s this stuff work, anyway?”

“I call it ‘Mantis’, ‘cause it looks like a Praying Mantis head.”

“That’s the bug that eats her date after sex. Great.” Etty kicked herself for bringing up sex, hoping Knut would not pick up the cue. She could tell Knut liked her, and noticed a slight change in his breathing when he touched her wrist.

Knut let it slide. “It’s actually two things, a monitor and a microscope. Let me show you.” He twisted it around as far as possible so the eye pieces were a little closer to her, but she still had to get up and lean toward Knut to press her eyes against it. Knut shuddered as he picked up a subtle scent from Etty, a soap and skin smell. He could hear the air passing over her lips and teeth as she breathed only a few inches away.

Knut flicked the mode button to Monitor, and large bright letters appeared across the high contrast field of vision. “Wow. Bright. I’ll bet that gives you a headache.”

“It’s not bright at all to me, in fact it’s rather dim.”

“What’s the microscope part?”

Knut opened his mouth in front of the view side so it pointed down his throat, and switched to Microscope. “Christ!” She backed her head away, laughing. “Microscope. I get it.”

Knut rarely dated. His consuming work kept him from the social circuits. But his excruciating schedule also veiled an insecurity. Most considered him mildly handsome, with his soft features and tender yet witty style. He could tell women liked him, but he feared rejection more than he desired intimacy. But recently, he vowed to change all that. A full professor at a top Ivy League college, it was time to be more bold with women. ‘What’s she going to do, push me down the stairs?’ Knut chuckled to himself.

He slugged down a mouthful, and after a short pause, “Etty. How about a favor?”

Etty looked around the apparatus into his glazed eyes. “What?”

“Can I look at your face?”

She smiled again, getting increasingly giddy from the Vodka. “With this thing? Why, so you can see my blackheads?”

“No, really.” By his calm expression, Etty realized he was quite serious. Knut was a nice man, a very intelligent and interesting man, whom Etty found rather attractive. But she had no interest in any kind of relationship - her work was far more important. Still, there was something oddly appealing to her about this, a blind man pouring over her face with a large machine to see every crevice.

“Well, O.K., but I’m telling you right now, we’re stopping above the neck.” Knut pivoted the binoculars back the other way, and Etty positioned herself in front of them. “Do I move around, or do you?”

“Just relax, stay put,” he said with his eyes pressed firmly into place, and his voice slightly distorted by the bulky gear.

He started with her eyes. The light made her squint at first, but she willed them open wide, having resigned herself to give him a full show. The tight quarters forced her knees up against his. Knut felt the touch with keen sensitivity.

He moved up to her hairline, over the top to see wisps of straight black hair. Then along the top of her forehead to a widow’s peak point, around to the other side to her smallish delicate ears. Across the middle of her face, over the high reddened cheeks, perked up mostly because she could not wipe the wide smile off her face. Then her nose. “Ugly nose,” she had to interject, giggling. Knut said nothing. Then her mouth. For a second, she opened her mouth wide as he had done, producing a grunt laugh from Knut, but then she returned to smiling.

Knut stayed on the mouth. Her lips were so close, he wanted to kiss them. He caressed with his eyes as he slowly passed each area - the two little peaks in the center of the upper lip, the tiny crevasses crisscrossing the swollen pink skin, and the precious creases in each corner. Through the slight opening of her smile, he saw bright white teeth. Not perfectly aligned, but strong and clean. And deeper still, the tip of her wet tongue.

“Knut, the tour is almost over. I want another drink.”

Knut moved to her chin, not broad but protruding and forceful. He followed along her jaw line to her attached ear lobe, common in northwest European descendants.

Etty finally sat down. “Hot. Pheu.” She wiped the dampness from her forehead, and picked up the vodka for another shot.

Knut sat down, not smiling but peaceful, his arms hanging down at his side.

He finally spoke. “Thank you, Etty.” He paused again before continuing. “You know, and I mean this in the sincerest sense, you are the most beautiful woman I have ever seen.”

“You don’t get out much, do you Knut.”

Knut stopped talking, and Etty started feeling a little uneasy. She looked at her watch. “2:30am! Knut, I have classes tomorrow morning. And it’s Monday. I have to drive all the way home.”

“You can stay here!”

“What, and sleep under the desk? No thank you.”

“No, I have a cot in the back. I sleep here all the time, really. It’s pretty comfortable.”

Etty stood up and straightened her crumpled blouse and skirt, not feeling self-conscious about quietly realigning her undergarments in front of him. She collected a few papers that were on the desk and packed them into her leather satchel. “No, Knut, it’s been great, but I have to go. I get cranky unless I have at least twenty minutes in a real bed.”

Knut pushed his chair back and stood up so she could slip by him. Her whole front brushed across him. He sensed every point where they touched. Once out from the tangle of equipment, she headed for the door.

Etty easily returned to business. “Don’t forget I need those statistics tomorrow. I’ll come by around noon.”

“Etty?”

Etty stopped with her hand on the door handle. “Yea?”

“Will you go out with me?”

Etty heaved an audible sigh. “Knut? Listen. I like you, really. I just don’t date, okay? Let’s leave this on a friendship level.”

“I mean out to dinner. I don’t expect anything more, I promise. We both have to eat, let’s just do it at the same time in the same place.”

Etty sighed again and drooped her head to think. Looking up she said, “Dinner. That would be fine. Maybe next week.” She started pulling open the door.

“Next week? Why next week? What about, tonight? What are you doing after classes today?”

Etty pulled open the door fully, somewhat impatiently, and started walking through. “How about Friday night. This Friday,” she called back.

“Sure!” he said, not effectively showing his disappointment. “Friday’s fine.”

The door began to close, and her footsteps started on the top of the stairs.

“Etty!” Knut yelled. More steps. The door opened a few inches. Etty yelled back annoyed, “What!”

“You don’t have an ugly nose.”

“Oh God!” She huffed and trotted off.

- Chapter Three -

Etty lurched awake with the ringing phone. She switched on the light, squinted, and clumsily pulled the receiver to her face. She checked her watch while listening. “Etty, it’s Knut.”

“This better be good, it’s 6:30, I’ve had 3 hours of sleep.”

“I did some analysis. I wanted you to know that we have to move on this.”

“What did you find?” Etty pulled herself up with her back against the bed board. She found a half empty cup of cold coffee on the bedside table from the prior morning and drank it down, followed by a gagging expression. She found a note pad and pencil.

Feeling more awake, she asked, “Did you find statistical significance?” If true, this would mean that Knut had found that the price changes were unlikely caused by random fluctuations. If the spikes could not be traced to a legitimate source - it would give her the key to an exciting dissertation.

“That’s nothing. I have names. Listen to this.” Knut was obviously excited, and probably buzzing from his mixture of no sleep and vodka.

“Both buyer and seller are the same each time there’s a bump. A guy representing the Clorice Coffee Company has a seat on the CSCE...”

“Slow down,” she said while writing.

“That’s the Coffee, Sugar and Cocoa Exchange in New York City where Clorice Coffee must have a representative.”

“I know what CSCE is. I was getting the company name, I’m still half asleep, remember.”

Knut continued. “Clorice Coffee is a grower in eastern Brazil, and based on how much he has sold over the last twenty years, he is a major world player. Maybe the largest.

“You have an address?”

“Yea, Recife, a port town, north eastern coast. The buyer is Global Growers, a major distributor for the big coffee manufacturers in the U.S. - Maxwell House, Chase and Sandborn, Folgers, people like that.”

“Interesting. I thought you said you couldn’t get names?”

“I forgot I set up a special link to the Chicago Mercantile Exchange database for Warren Sherman. Chicago does most of the commodities in the world, and they keep statistics on all the exchanges, even CSCE.”

“Who’s Warren Sherman?”

“You don’t know? A woman in Finance at Dartmouth doesn’t know our big honcho bond trader Warren Sherman?”

“No. He must not teach anything.”

“No teaching. He manages, among other things, the College endowment and pension funds, and an alumni investment fund, something like 700 million dollars.” Knut was privately pleased she did not know him, as Warren’s good looks were legendary.

“I didn’t know we had that much money! And all that hassle they put me through for my scholarship,” she grumbled.

“Actually, 700 million for Warren Sherman is rabbit food. He came from Goldman Sachs where he managed a 52 billion dollar Money Market fund.”

“Why would someone move to a private college from that?”

“He hated the rat race, and he loves to ski. He’s a tremendous athlete, and they say he’s built like a race horse. But anyway, Global Growers and Clorice Coffee are the two players in your little price game. Every time, Global buys and Clorice sells.”

“Not bad for a drunken blind guy,” Etty joked.

Knut smiled on the other end. He liked to be kidded about his handicap, because only people who were really comfortable with him could manage it.

“The part I don’t get,” Knut mused, “is how Global gets anything out of it. Here this Clorice guy walks into a world exchange and sells his spring harvest at a huge premium over market, while Global takes it in the shorts. Seems to me Global could have just bought like everyone else at the normal price.”

“Good point,” Etty said, still having trouble organizing her thoughts. “There must be something else going on between them.”

Knut rattled on, referencing statistical figures, ratios, confidence limits, trends, but Etty phased out to think. How would Global get compensated for spending too much money? Clorice Coffee is the obvious gainer, but he can’t force Global’s price up. A seller can’t push up prices up by selling - it defies market logic. No, Global must be doing it on purpose, but how do they get paid?

“Etty?”

“Oh, yes, Knut, that’s great,” she said, rejoining the call. “Just give me the print out tomorrow, I mean today.”

“Wait, Etty, there’s something more. Do you think I’d wake you up for just that?” Etty shrugged her shoulders, thinking she’d already learned plenty. “It’s going to happen tomorrow.”

“Tomorrow!”

“It always happens on Tuesdays, on the first Tuesday of the month. And it happens in the month after Brazil’s harvest. Two years ago, it was delayed until January, but I checked and that year had some serious rain problems in November and December. But this year’s on course - Brazil’s storage facilities are brimming. That’s tomorrow!”

“Today’s Monday. December 2nd. Right, first Tuesday. Way to go! But let me think, what should we do...?”

“I figure we have two options, we watch one go by to confirm your theory, or we call the heat now, the Securities and Exchange Commission, and blow the whistle.”

“That’s it!” An idea struck Etty. “Options!”

“Wha?”

Etty sprang into action. “Listen, Knut. This is important. Go to your database and print off all you can on Coffee Options for the last three years, right around each one of the price spikes. Bring the print out to Warren Sherman’s office by 8am this morning. Bring the other print outs too. I’ll go in right away and leave a note for him so he’s expecting us.”

“Whoa nelly! Coffee Options?”

“Yes, trust me. They’re a special kind of investment that relate to stocks or commodities. I’ll tell you about them when we meet. I think I just found how Global Growers is getting paid for their services to Clorice Coffee.”

“I know what they are, but I don’t get how they relate. And what are you going to do with Warren?”

“You said we can do one of two things, watch or tell. I’ve got a third ... we buy Options.”



Etty quickly showered, and bundled up for the arctic ride into Hanover. November had been particularly harsh, with temps in the 10’s, and December looked bad already. Snow started falling at dawn, leaving a slippery first layer. Etty lived on Trescott Ridge Road, a thin winding route appropriately named for occasional steep slopes on one side. She lived in a room above the garage of an elderly couple. Their house sat nearly alone on a small plateau facing north, with a view of the Connecticut River valley and peaks of the White Mountains.

Her old rear wheel drive Ford sedan did poorly in slippery weather. From years of abuse, the doors and windows left large cracks for wind to whip through, making for an ugly drive in falling snow.

Warren Sherman had already removed his jacket and loosened his tie by 8am when Etty returned to his office for their meeting. He wore a fine charcoal black suit, leather suspenders, and an arty silk tie. Despite his thinning hair, he had all the attributes of a male model - broad shoulders, “V” chest leading to a tight waist, powerful thighs, gorgeous blue eyes with a seductive twinkle, and an adorable dimple on his left cheek. Etty boldly walked in, hand outstretched. “Hi, Harriet Bishop. I left you a note earlier this morning.” Warren’s grip almost hurt.

“Hi Etty, great to meet you finally.”

“Oh, so you’ve heard of me?”

“Knut’s a good friend - told me all about you. He also called this morning to warn me.”

“Warn you?”

“He said you are a powerhouse, best in the PhD program in Finance, not to be taken lightly. He also told me to watch my step and not get too friendly.”

Etty subdued a blush. “I’m afraid he’s a little ... “

“And here is comes now.”

Knut’s tapping cane entered the room. He carried a stack of uneven computer printouts under one arm. Shirt tails stuck out of one side of his pants. Tangled hair and bloodshot eyes confirmed his lack of sleep.

“Morning Knut! You look terrible as usual. Etty beat you here. Have a seat just to your right.” Knut folded up his cane in a fluid motion and sat down.

“Hi Knut. You slept yet?” Etty asked.

“Nope. I have to see what you’ve got brewing. Believe me, after a string of population demographic studies for the Anthropology Department, this is so exciting it’s almost criminal.”

“Let’s hope not,” cautioned Warren. Knut had told him enough to make him wonder. “Etty, you don’t look so wide awake either, your left eye is red as cayenne.”

“I had a few hours sleep. The red eye’s an allergy. There used to be a cat in my apartment - still gets me sometimes.”

Warren sat back with his hands behind his head. “So, what’s this big idea you’ve dreamed up.”

“Thanks for seeing us so suddenly, Warren. Knut tells me you are quite the Investment expert, and we need some advice,” Etty began.

“Sure.”

“We’re interested in purchasing some options on one of the commodity exchanges - Coffee. And...”

“Now there’s something you don’t get into unless you know what you’re doing,” Warren interjected.

Etty was well aware of the risks in all the publicly traded investment instruments, especially options. She took every course possible in option theory, and knew the mathematical models inside and out. She didn’t come to receive advice on risk - she wanted to know whether Warren had any buying power.

Ignoring his interruption, she continued. “First of all, tell me Warren, do you have complete say in the investments in the school’s portfolio?”

“Not even close. We have strict guidelines, right down to the types of investments. I can make proposals to the Trustees, and sometimes they accept, but not after an incredibly convincing story. They never go for the odd stuff, especially derivatives like options.”

“Oh, I see,” she said lightly, showing disappointment.

Warren wasn’t accustomed to students waltzing into his office with investment ideas, or if they did, the suggestions were often too academic to have merit in the real world. There was something intriguing about Etty though. “Well, I do have a speculation fund.”

“Oh?”

“It’s not uncommon in the investment houses. I helped Dartmouth design it. But I thought you were the one with the story to tell.”

“How’s it work? How much money can you play with?”

Warren huffed, “A chunk of the portfolio is left aside for the manager to have full say - to take some calculated risks. If you beat some target rate of return, the manager gets to keep some of it. In the big firms, if you play your cards right, you can make millions, some even billions.”

Knut jumped in. “But Dartmouth had better cafeteria food, right?”

“Right. Chile con carne from a can, same reason you don’t walk out and get a six figure salary someplace, Knut. You know damn well it would take you about ten minutes to find one.”

“Actually, for me it’s the baked beans and ketchup.”

Etty recovered the topic. “Boys, this is my show. Continue, Warren.”

“So I have a speculation fund, some dollars I can do what I want with, with only a few exceptions. Then, as my incentive I get a quarter of any earnings over 10%. It’s not great, but it can add up.”

“What if you go under?”

“If the return is 10% or under, I get nothing. Of course, if the return goes negative, I get fired and probably never work again.”

“How much money is in the fund?”

Warren rolled his eyes at Knut, even though he couldn’t have seen. “Harriet, where are you going with this? The speculation fund is fifty million.”

Knut jerked and had to scramble to catch the papers in his lap from falling. “Fifty million dollars? This is your little ‘spec fund’?” Etty reached over and took the papers from Knut. She scanned them quickly, pulled one report to the top, and turned back to the discussion.

“Yea. It’s not that much, really. Remember the total portfolio is 800 million,” Warren said with sincere surprise at Knut’s reaction. “I had many times that in New York.”

“What’s the money in now?” Etty continued.

“Listen, I have a lot to do. If you have a proposal, I’ll hear it. Otherwise ... ”

“All right, all right. Sorry if I’ve been rude, but we’re in a tight time frame. I’m looking for someone who wants to make a sizable investment, and if you didn’t have the capability, I didn’t want to waste your time.” She straightened in the chair. “Let me explain.”

Etty described in detail the price abnormalities in the coffee market. Knut helped by reciting his analysis. Warren watched with growing interest. In his fifteen year career, he had never seen such dramatic proof of market manipulation before it was discovered by the authorities. He had read of the Hunt Brothers cornering the silver market and a few others, but this was still fresh.

“Hell of a thesis. The chances are good there’s someone behind it. You’ve got it made - just write the paper, sit back, and watch the University Presses fight to print it.”

“But Warren, this is happening tomorrow! If we’re right, there’ll be another one of these price spikes in less than thirty hours. Do you know what you could do with this knowledge?”

While Warren wondered how to answer, Knut interjected, “Why on the first Tuesday of the month?”

“That’s easy,” Warren said, happy to change the subject. “The agriculture report comes out of the World Food Federation on the first Wednesday. Their numbers can make markets crazy. They track things like world crop conditions. If a weather or disease problem is discovered which might lower supply, prices jump up.”

“So why the Tuesday before?” Knut persisted.

“This Global Growers guy wants to force up the price of Coffee for some reason. He has a lot of money and coffee to work with, but still, it’s only a fraction of the total coffee market. He wants a lot of bang for the buck, so he works in a skittish market. What better time than just before the ‘Ag’ report comes out - when anxiety is high.”

“Makes sense to me.” Etty nodded.

Warren elaborated. “Since the numbers on Wednesday are so important, everyone gets their underwear in a bunch on Tuesday, scared to death that someone might get an early peek at the report. If some big buyer comes into the market and starts buying like mad, bidding up the price, the rest of the guys out there start thinking the buyer knows something they don’t. They get nervous. Some can’t stand it and start buying themselves. The price goes up and up.”

“Global Grower’s been at this a while, you’d think the market would learn,” Etty realized.

“Good point. Probably won’t work too many more times. Others will figure it out eventually. But you’d be surprised how many things defy logic in our supposedly ‘efficient market’. For one, the buyers and sellers change all the time in the pit where they trade. It’s a burn out job - most don’t last a few months. Each time Global pulls this, there may be a whole new group of unsuspecting traders.”

Knut burst in. “Come on, Etty, let’s get to the juicy part.”

She paused while she planned her words, agreeing it was time for specifics. “Warren.”

“Yes Harriet?” he mocked. “If you think I am going to buy coffee for the Dartmouth Endowment Fund, you’re demented.”

“What if you just wanted to get the benefit of the price increase without buying the actual investment?”

“I’m supposed to say, ‘I’d buy Coffee Options,’ right?”

Knut loved this game. “Bingo!” he yelled. “Now, Etty, explain the Option dynamics. How does Global get paid with them. I’m all ears.”

After smiling at the irony in Knut’s comment, Warren sat back, a little impatient, and started bending paper clips into little loops. He also knew options extremely well from years of using them as a component in his stock funds. But, he decided to let Etty explain to Knut, interested on how she might present a topic that many people have difficulty ever understanding.

Etty turned to Knut. “Let’s say coffee sells for $100 per unit...”

Warren interrupted, “Coffee sells in 2,000 pound lots.”

Etty flicked a vexing expression at Warren, then continued. “Let’s say a hundred pounds of coffee is selling for a hundred dollars. You look at price history, and you see that the price is almost always between $98 and $102, with rarely any big jumps.”

Knut listened intently. “I’m with you.”

“How much would you pay for the right to buy coffee at $110, some time over the next 3 months? An ‘option’ to buy coffee at $110?”

Knut thought for a second. “Not much. If the price never goes over 102, then the option to buy it at 110 would be silly, and therefore worthless, right?”

“Well, not worthless, because in markets you never know. There is always a little chance that prices will go crazy, but in my example you’re close. You wouldn’t pay much, like maybe a buck.”

“Sure. I’ll play. I pay a buck, and that gives me the option over the next 3 months to buy coffee at 110 even though now coffee sells at 100. If it happens to go to 120, I use my option to buy it at 110, and immediately sell it, and make 10 bucks.”

“Now, all of a sudden, the price of coffee jumps to $103 in one hour, courtesy of our friends at Global Growers. What do you think would happen to the value of your option?”

“I think you’re going to tell me.”

“It would go up. If coffee can go to 103 in 1 hour, then it might more easily get to 110 in 3 months, right?”

Knut started seeing the finale. “Yea, I see.”

“Even though the price of coffee is still way below 110 at 103, the chance that coffee could hit 110 goes up. Therefore, the value of the option to buy at 110 goes up too. Make sense?”

Knut let it sink in for a minute. “Yes it does.”

“It might go to, say two bucks, which means the value doubled, right?”

“But if you held onto it through the end of the 3 months, it would still be worthless, because the price never went over 110.”

“Right, that’s why you have to immediately sell it when the price is up.”

Etty sat back to enjoy Knut’s thoughtful expression, then added, “Think what this means for tomorrow’s Coffee Options. If you buy a million dollars of them at 9am, you could conceivably have two million by lunch.”

Warren cut in. “Thanks for the lesson, Etty. What about some facts. Let me guess, you have option price history on that report in your lap.”

“Correct. These reports verify it. Coffee options behaved just like my example right after the Tuesday price spikes.“ Looking down at the printout, “Here’s one last year that went from $1.20 to $2.42, here’s one that went from $0.90 to $1.75. Both doubled or nearly doubled.”

Now Etty returned to face Warren. “Listen to me guys. I have stumbled on to a market manipulation scheme of monumental scale. Thanks to your interesting addition about the agriculture report, here’s how I think it works.”

She guided her thick black hair away from her face with both hands. “Clorice Coffee Company and Global Growers must have worked this out as partners. Clorice’s seller goes to the trading pit with lots of coffee to sell, the day before the ag report. The Global guy suddenly starts buying, pushing the price higher and higher over a short burst. Others join in, there’s a feeding frenzy. Everyone thinks Global knows something from the report, like maybe that world coffee supplies are about to crater. Clorice makes out like a bandit, selling his goods at well above the market price. He’s happy. Meanwhile, Global owns a huge pile of options on coffee. The value of the options jump. They sell at a huge percentage profit, like doubling their investment. Net of the loss they took on buying the actual coffee beans at above market rates, they still make out big time. They’re happy. The price starts to drop again, and eventually returns to where it started. Win - Win.”

Warren reached toward Etty. “Let me see the printouts.”

Etty stood and leaned over his desk to show the option price jumps on the same days as the price spikes, then sat back, feeling victorious, while he studied them.

Before Warren spoke again, she continued. “Warren. Even if these guys are scum of the earth, deserving to die a slow death, there is nothing illegal about making an investment based on a hunch about a change in value. People do it every day, every minute. You, more than any of us, must know that.”

Knut again interrupted, still back on the scheme. “You know, the more I think about it, this is an incredibly smart game. The guy who is creating the ruse, Global, does so by pushing up the price, a deal where he loses money on the trading floor. He pays too much! I bet the Securities and Exchange Commission looks for people who make money, not for people who lose. Unless they look further into the Options market, they might over look the bad guys. Clorice is safe too - who’d blame a seller for selling at the highest price? Pretty good plan - pure genius.”

Etty persisted. “Warren. You could potentially double every dollar you invest in these things - in one day. The down side is minor - if nothing happens, you’d only lose the commission on buying the options - nothing for a big spender like you. You’ve got little to lose, and with your incentive plan, you could keep a piece of the gains yourself.”

Warren had been way ahead of Etty on the commission math. His spec fund, ironically, was heavily invested in Reais, the currency of Brazil. Warren had been watching a steady increase in the strength of the Brazilian economy. As Brazil improved, so did the value of their currency relative to the U.S. dollar. He was already up 6% from 3 months ago. But this! Currency was easy to sell. He could convert any amount of it in minutes to whatever investment he wanted.

Although he kept it to himself, his main reservation concerned legality. Could you get in trouble for profiting in someone else’s market manipulation scheme? He would call the regulatory agencies before considering it further.

“What do you hope to gain from this, Etty, if I did make an investment?” he finally asked.

“Gain? One big party, that’s what! But otherwise, material for the best PhD dissertation ever written. ‘How I earned millions in one day getting my degree’. Can you imagine the look on the faces of the Trustees when they read it? Besides that though, nothing, Warren. I certainly wouldn’t expect to share in any of the profits.”

Knut summarized, now convinced. “So what are you waiting for? Sounds crazy to pass up.”

“I’ll have to think about it.” He arranged some papers on his desk, avoiding their glances. “This isn’t something you just do. I’m not even sure how big the market for Coffee Options is - if you invest too big a percent, you’ll change the price with your own buying.”

“But you’re interested. I know that tone of voice,” Knut said.

Etty studied Warren’s face. She sensed uneasiness, an emotion he appeared unaccustomed to. The big New York high flying investment guru steps way down to run a relatively small portfolio in a quiet New England town, and suddenly gets stumped by a student - a pure academic. Behind the macho build and newly pressed fashionable clothes, she saw a window into the person beneath. Normally able to command any meeting with the ease of a billionaire, here he sat, not sure how to end their simple encounter. But his eyes glimmered. Even with such a short interview, she perceived a kind, gentle man, someone to trust. A wave of excitement prickled through her. This was her idea, her discovery. Her blood felt hot.

Etty didn’t want to push the decision any further, so she walked to Knut, touched his elbow, and offered to lead him out of the office. Knut accepted, leaving his cane where it lay in his pocket. They passed the line of clerk desks. Etty took one look back while waiting for the elevator. Warren had not moved from his desk. He was staring directly back at her, spinning one of the paper clip creations between his fingers.

- Chapter Four -

Knut had his computer room office much cleaner when Etty arrived at 8:15am the next morning. Although a bit fitfully from excitement, he had slept enough to regain some color in his cheeks and whiten his eyes. He had showered, changed, and even combed his long thick hair. Etty brought doughnuts and a thermos of coffee.

Knut pointed proudly toward the computers he had set up and explained. “The markets open at 8:30. I’m hooked up through the Internet to a price service on these two PC’s so you can watch both. This monitor here will show Coffee prices, this one here the Option prices. I have Mantis set up for both prices too, for me. I am also saving the results to a disk so you can keep them for posterity. If the prices spike, we’ll be right there.”

“Have you heard from Warren?”

“Nope. Thought I’d let you call. If he chickens out, at least he might want to join us while we watch the numbers.”

“I have a feeling he’s going to do it, but let’s give him some space.”

She spread out the doughnuts, poured the coffee into paper cups, and removed a computer diskette from her pocket. She pulled off her parka, and settled in to a word processor on a PC in the corner of the room. “I want to get a full description of this whole event on paper and in the hands of administration before the shooting starts, if it starts, just in case something goes wrong and Warren gets in trouble. I want everyone to know it was my idea, not his.”

“How heroic. Of course, if it goes the other way and he makes millions for Dartmouth, then this will make sure you get all the credit.”

Etty grinned. “Well, yes, I guess that too.”

Continue reading this ebook at Smashwords.
Purchase this book or download sample versions for your ebook reader.
(Pages 1-34 show above.)