Crash Read online

  After threading through rush hour traffic exiting the Holland Tunnel, Chip clipped the rear end of a Yellow Cab on Varick, sending it crashing into the side of a garbage truck, and a half block later a police car, its lights flashing, and siren on, came from behind them.

  “We can’t be stopped,” Ben said.

  “I know, I know,” Chip said.

  He hauled the Chevy down Varick and managed to put a little distance between them and the cop car, switching down side streets whenever the lights and traffic permitted it, and reached Broadway. At City Hall they were completely bogged down.

  The cop car was less than a half block behind them now.

  “Get the hell out, this is the best I can do,” Chip shouted.

  Ben and Cassy jumped out and sprinted the few blocks to Nassau as fast as they could run. A dozen police cars, unmarked sedans, and SUVs were blocking the street before the next corner in front of the Burnham Pike tower.

  “Is there a back way?” Ben asked, not breaking stride.

  “A side door on John Street,” Cassy said. “Follow me.”

  * * *

  They slowed their pace so as to go unnoticed as they passed by the police cordon. Around the corner, the side door was locked but unmanned, so Cassy used her pass card to get inside. It was a bit of luck they badly needed.

  Instead of taking the elevator down to DCSS, they took the stairs.

  The cybersecurity room was filled with the usual people, except for Butch Hardy’s watchdogs. Masters jumped up from behind his desk when they came through the door. Everyone else stopped what they were doing.

  “What the hell is going on?” he demanded.

  “Not now, Francis,” Cassy said, racing across to her workstation. It was just nine.

  Masters came around from behind his desk, but Ben blocked him.

  “Who do you think you are?”

  “Let it be,” Ben said.

  Cassy powered up Chip’s laptop, plugged it into her center console, and once the connection was recognized and the antidote program came up on both screens, she hit Enter on the laptop, and the program began to run.

  Ben came over. “Are we on time?”

  “I think so,” Cassy said, looking up at him. “I don’t know.”

  “In twenty minutes, at opening bell, we’ll all know,” Ben said.

  115

  The white Mercedes transit van pulled over in front of the World Wide Destinations Travel Agency in Union City, New Jersey, a minute or two before nine-thirty. Viktor had gotten lucky with a parking spot, but didn’t look over as Alexei, behind the wheel of the Mercedes C300, passed them and got lucky with another parking spot just half a block down the street.

  “The gods are with us this morning,” Alexei said.

  Bykov, in the passenger seat, nodded, but something didn’t feel right to him. He didn’t know what it was, maybe a sixth sense, but his gut said get out now.

  Traffic through the Lincoln Tunnel had been heavy, which they’d expected at that hour. But right here, Union City seemed almost deserted.

  Only one car cruised past, the woman driver looking straight ahead. But there were no pedestrians on the sidewalks. No one waiting at the corner for the light to change so they could cross. Even the travel agency, the beauty salon, and the liquor store across the street from where they were parked seemed deserted.

  “What’s the matter?” Alexei, sensing something of Bykov’s mood, asked.

  “I don’t know.”

  “It’s quiet.”

  “Hold fast,” Bykov said. He got out of the car and walked across the street to the liquor store.

  The door was open and a clerk, an older man, came from the back. He looked bored.

  “Good morning,” Bykov said. “Stoli?”

  “End of the aisle.”

  Bykov went down the aisle, found a liter bottle of Stolichnaya vodka, and back at the counter he paid cash for it.

  The clerk made change and bagged the bottle. “Have a nice day.”

  “You too.”

  Taking the bottle, Bykov walked back across the street and got in the car. “We’re leaving now.”

  Alexei looked up in the rearview mirror. “Something wrong?”

  “Da,” Bykov said, “But I don’t know what.” He got on the phone and tried Butch Hardy’s number. He let it ring ten times, but Hardy didn’t answer.

  “Okay, what the hell is going on, Yuri?”

  “It is a setup, and I think Hardy has turned us in.”

  “Pizdec.”

  Bykov phoned Viktor, who answered on the first ring. “Arkadi is just finishing. Stand by.”

  “Drop it and get up here right now, we’re leaving.”

  “Wait, wait.”

  “Nyet!” Bykov said.

  Viktor shouted something Bykov couldn’t quite catch, and Arkadi’s reply was equally as garbled.

  Everything was wrong.

  Bykov opened his door and was about to run back to the van, when he heard the sounds of a lot of sirens maybe a couple of blocks away, closing in.

  He closed the door.

  “What’s the matter?” Alexei demanded.

  “We’re leaving right now.”

  “What about Viktor and Arkadi?” Alexei shouted.

  “Drive to the airport.”

  Alexei pulled away from the curb. Turned left and sped back the way they had come.

  “Slow down,” Bykov said. “We can’t be stopped for speeding.”

  * * *

  Viktor couldn’t believe his eyes watching Alexi and Yuri driving off. “Yeb vas,” he said. Fuck off.

  “We need to get out of here now,” Arkadi shouted, climbing over the seat.

  “Shut the bomb off! Something’s wrong.”

  Viktor opened his door and started to get out.

  * * *

  Around the corner a block and a half away, a tremendous explosion behind them split the air with an unbelievable roar. Seconds later, the concussion from the blast blew out windows on the left side of the street.

  “Mother of God,” Alexei said, crossing himself.

  THIRTEEN

  OPENING BELL DAY TWO

  116

  It was nearly a half hour after the opening bell when Cassy and Ben were cleared through security outside the New York Stock Exchange and got to the visitors waiting area.

  In the middle of everything Betty Ladd had called down to Cassy’s station in the DCSS to find out what progress was being made.

  “My program has loaded,” Cassy had told her.

  “And my fingers are crossed,” Betty had said. “If the cops will let you come over, we can watch what happens together.”

  “May I bring Ben and his friend along?”

  “Absolutely. Love to meet them.”

  But Chip had begged off. “I have to talk to Huggard and let him know we ran into another delay,” he’d said.

  “Like helping save the world’s free enterprise system,” Cassy had told him. She stood up on tiptoes and gave him a kiss on the cheek.

  “You know I do outrank Ben. And I’m making a lot more money than he does.”

  “I make it a rule never to date married men, especially happily married ones,” Cassy had said and they all laughed.

  A pretty young woman appeared with a smile. “I’m Jennifer, Ms. Ladd’s assistant. Follow me, please.”

  Down the hall and around the corner they come to the trading floor, which was fairly calm, though there was some commotion at the post where BP’s stock was traded.

  Betty came over and gave Cassy a big hug. The older woman looked tired and worried, but she smiled. “Thank God you’re okay,” she said, and she turned to Ben and held out her hand. “The savior of the day.”

  They shook hands.

  “She’s worth it,” Ben said. “But I thought there’d be more action here.”

  “It’ll come if Cassy’s program doesn’t work, because on top of that I just learned that there was an explosion in Union Cit
y across the river that took out our backup computer and killed as many as a half dozen people.”

  “The Russians?” Ben asked.

  Betty shrugged. “Unknown.” She glanced at a monitor showing the numbers. The Dow was down only a few points, as were some of the other indicators. But it was nothing catastrophic. “We’re about where I expected we would be,” she said. “But we should have a better idea in the next half hour or so, because if Abacus does kick in, there’ll be an all-out free fall that our automatic systems won’t be able to stop.”

  A bearded man in a gray suit and knitted red tie walked up. “Sorry to interrupt, Betty. We’re putting together a follow-up to our news story about Reid Treadwell. Any comment?”

  “Reid was a giant of Wall Street,” Betty said. “No one was smarter, more charismatic, or more visionary than he.” She smiled faintly. “Considering everything else that’s been happening this morning it’s all I have for now, Tony. We’ll talk later.”

  He returned her smile and walked away.

  “Tony Langley of The Wall Street Journal,” Betty said. “I’ll give him the truth about Reid’s suicide later.”

  “And the explosion?” Ben asked.

  “I knew nothing about it until I heard it on the news this morning.”

  They glanced at the monitors again. The Dow and S&P were still falling but not dramatically.

  “So far so good,” Betty said. “But is there any chance your program didn’t completely wipe out Abacus?”

  “From my diagnostics in DCSS it looked as if we neutralized it,” Cassy said.

  “But the chance still exists?”

  Cassy nodded uncomfortably. “There’s always a chance. Whoever designed the thing knew what they were doing,” she said. “But if it were going to kick in, it would have started by now.”

  “Good enough,” Betty said, and she hugged Cassy again. “If you’re looking for a job, say the word, and you can come here and work for the exchange as my director of cybersecurity.”

  A man in a blue trader’s jacket who Cassy recognized as Seymour Schneider, Burnham Pike’s legendary and always prescient floor trader, came over. He nodded to Ben and Cassy, but then turned to Betty. “A word with you?”

  “Sure,” she said. “Be right back,” she told Ben and Cassy and went with Schneider off to the side of the floor.

  “What’s on your mind, Seymour?”

  “I heard something of what went on overnight, but not everything. With Reid gone, what’s going to happen on fifty-four?”

  “That’s up to your board.”

  “I meant, what’s the exchange’s next step?”

  “We’re not started with the inquiry yet, and even if we were you know I couldn’t discuss it, except to say that the firm has been doing some seriously bad things.”

  “My question is, what about our leadership team? Reid is gone. Spence was arrested just an hour ago, and Julia was taken into FBI custody until whatever happened is unraveled.”

  “As I said, that’ll be up to your board. And as much as I don’t like the man, you still have Dammerman if his hands are clean.”

  “I heard that he’s all lawyered up. Says he had no real idea what Reid was up to, and that he needs to take over at least as interim CEO.”

  “I’ll tell you this much, Seymour. Whatever my personal opinion is of the man, I think he was up to his neck in the scheme to cause a crash. I suspect that Julia might be able to provide some links.”

  “I wouldn’t count him out,” Schneider said. “Reid was a sneaky bastard, and Dammerman is three times worse. But he knows how to run the firm.” He glanced over at a monitor. “Maybe we’ll get through today better than yesterday, but the threat is still there.”

  “And what threat is that?” Betty asked, though she knew the answer, and it wasn’t Abacus.

  “The worldwide debt. We’re on the rim of the abyss.”

  * * *

  Cassy was sad. “I’m going to miss Donni. He was a bright kid and a really good friend. If it wasn’t for me, he’d still be alive.”

  “If it wasn’t for you giving him the flash drive, the Russians who took you would have gotten it, and this place would be a shambles right now. And if you’re right, so would the entire world economy.”

  She nodded. “He did it.”

  “You and he did it,” Ben said

  Cassy smiled wistfully. “Maybe it’s finally over,” she said. “But you mentioned something about going to Paris. Is that still on?”

  “You bet,” Ben said.

  “Then let’s go.”

  “The admiral is going to have a fit, but what the hell.”

  “And wasn’t there something you were going to ask me when we got there?” Cassy said.

  “Why wait,” Ben said, “Cassy Levin, I’m in love with you. Will you marry me?”

  AFTERWORD

  THE DEBT BOMB

  Lawrence Light

  How serious is the problem of too much debt in our world, an ever-growing burden that will crush us? Very serious. In Crash, our character Spencer Nast, the chief White House economist, aptly dubs the situation the “debt bomb.” As a financial journalist who has covered the economy and Wall Street for many years, I know that forecasting holds perils. As the great Yankees player and all-around sage Yogi Berra put it: “I never make predictions, especially about the future.” But odds are strong that a debt bomb is set to go off in the U.S. in just a few years.

  It’s built of a combustible mixture of obligations owed by the federal government, corporate America, public pension plans, and households. When will it go off? A good bet is when the next recession arrives. A downturn is inevitable: The economy moves in cycles. Then watch the whole cursed concoction go kerblooey, as the revenue to pay interest and principal dwindles.

  Economics is like physics. Nothing can last forever. Like debt. A limit exists on how much public and private borrowers can go into hock. At some point, for instance, fixed-income buyers will grow leery of Treasury paper, even though now federally backed bonds are in great demand. But once Washington’s debts reach an unsustainable level, that sentiment likely will change, and with a vengeance.

  People don’t want to face this, and Congress’s attempts to cap federal spending always end in abject failure. Think of the Road Runner cartoon where the clever bird maneuvers Wile E. Coyote’s shack onto railroad tracks. Coyote, busy inside fussing with dynamite to blow up the Road Runner, looks up and sees outside his window the locomotive bearing down on him. His response: Draw the blinds. This doesn’t end well for the hapless canine.

  FEDERAL DEBT. Right now the national debt is slightly higher than the gross domestic product, thanks to escalating federal spending to fight two wars and two recessions, and large tax cuts enacted under the Trump administration.

  When Social Security was enacted in the 1930s, the system had forty-two workers for every recipient, hence a lot of taxpayers funded benefits for the elderly. Now the ratio is 3 to 1, and in another ten years that will be almost 2 to 1. A similar scary math governs Medicare. People are living longer, which means they will need more medical care. And health-care prices are burgeoning with no end in sight.

  CORPORATE DEBT. This has exploded, as nonfinancial companies took advantage of low interest rates to expand their bond debt to a record $6.4 trillion, by the St. Louis Fed’s count, a 75 percent increase. When it comes due, a reckoning will occur. The companies will have to dig deep to pay off the debt or attempt to refinance at much higher rates than today’s. While corporations in general have ample cash, some $2.6 trillion, to service that debt, the problem is that the cash is concentrated among a few behemoths, like Apple.

  There also has been a surge of speculative bonds, issued by companies carrying an abundance of debt. These securities, known as junk bonds, are 20 percent of the corporate bond market. Those on the brink of junk, rated BBB, are twice that size, meaning they are at risk of being downgraded.

  Time and again, recessions have amped
up defaults among junk issues. While today only 3 percent of junk bonds default, that figure typically more than triples in an economic downtown. At the same time, investors eager for a yield in a low-interest-rate time—junk pays higher interest than investment-grade bonds due to its elevated risk—have fewer protections. Bonds normally carry covenants, restrictions that prevent issuing companies from doing investor-unfriendly things like adding yet more debt. Not anymore; in the land of junk, “covenant-light” bonds are the rule.

  PENSION OBLIGATIONS. Years ago, states and municipalities pleased their workforces by promising nice retirement benefits. This is, in effect, debt these governments owe to their workers. The upshot is that a lot of them can’t meet their obligations.

  The average funding ratio, the amount in their investment portfolios compared to what they must give to pensioners, is around a third. Put another way, using unfunded liabilities as a percent of state revenues, the picture is even more frightening. The worst off is Illinois, whose unfunded liability is seven times the state government’s annual revenue.

  HOUSEHOLD DEBT. Consumer debt is back. After the financial crisis of ’08, household borrowing declined sharply, especially for mortgages as home buying ebbed. But lately it has rebounded, and then some. By 2018, loans—for credit cards, homes, autos, college, etc.—had exceeded even the bloated total of 2008, now standing at $13.7 trillion.

  Student loans, for example, have doubled over the past ten years to stand at $1.5 trillion, with an average at just under $40,000. Many young people, who start out in low-paying jobs, can’t afford to pay them, and the ninety-day-plus delinquency rate is at 11 percent.

  Making matters worse, after a brief postrecession spate of thrift, Americans are back to their precrisis habit of saving very little, in favor of running up debt. The personal savings rate (savings as a percent of disposable personal income) is back to near precrisis levels at 2.4 percent. A big reason for all the borrowing is not a heedless orgy of spendthrift purchasing; rather it’s that wages have been stagnant for years when adjusted for inflation. A growing economy has disproportionately shoveled its bounty to the upper tenth of the population.