The Idea
"Coulter and Broughton Inc" said the sign, "Stockbrokers and Capital Management Services"
In the back office of C & B twenty-eight year old Jason Cavanagh doodled absently with his pen on his desk-pad.
"Wake up Jase!"
It was his long-time friend and business partner Gary Foley, striding through from the front desk.
"We've got work to do mate. Big account coming our way. Client wants to place 500,000 BHP on the market."
"Well do it then."
"Nah! Not so easy. I offered to do it as a cross but he won't take it that way. Doesn't like taking the discount. Wants it placed at an exact time on a specific day."
"So what's the problem Gary? How does that involve us 'getting to work'?"
"The order has to be placed in various sized blocks, in a specific sequence on the day. Client will phone us when he is ready to sell."
Jason was wide awake now, and on his feet.
"And who is this client ... James Packer?" quipped Jason, straightening up his tousled red hair.
"Bigger than him. Jimmy Lee ... Singapore. But this is sooo confidential mate. Lee warned me to button my lip."
Coulter and Broughton had been in operation for 40 years and the pair had bought them out after working for them since end-of-school days.
Stock broking provided a waning income - due in not a small part to the electronic brokerages that sprang up after the October 1987 switch by ASX to the electronic SEATS system. Further, it seemed most traders wanted to take advantage of CFD trading in the bull market.
Now with the volatility accompanying the bear market, traders nearly withdrew from the markets altogether. Some having either missed the opportunity to sell near the top held on to their shares as prices collapsed, or chose to store them as "bottom drawer" collateral. Others dumped their stocks at a loss and steered clear of the share market. A few traded CFD's - relishing the turbulence and volatility that resulted from every flip-flop of Wall Street. Little of this trading activitity benefitted C & B Stockbrokers.
"You know what this means mate, don't you? $20 million BHP. $280,000 coming our way." Foley seemed ecstatic. "Long time since we had an order like this one."
" Yeah. Let's not blow it." Jason Cavanagh seemed to be hinting at something.
" Jason. What is there to blow? We simply follow instructions. Place the stock and it's payday! Simple. Nothing to blow."
"Gary, you seem to be overlooking something here. Jimmy Lee. Think man. Why would Lee use a two-bit firm like C & B to place a $20 mil order? Why not use AMRO? Why not Merrill?"
Foley couldn't answer that seriously. Cavanagh was right. Why indeed pick an unknown, struggling broker, run by a couple of semi-amateurs still cutting their teeth in the business?
"Opportunity comes in many ways Gary. I was sitting here thinking through the Nomura thing in the '90's. No one today would dare attempt anything like that again ... would they? I mean, not under the noses of ASIC ... would they?"
"If you're thinking what I think you are ... forget it man." Foley was suddenly strangely excited, but at the same time extremely wary of falling foul of the ASX and ASIC.
There was silence for about thirty seconds, then it was Foley who spoke:
"What exactly WERE you suggesting Jase?" Gary Foley could hardly believe he was giving an opening for anything less than transparency in his stock dealings, particularly to his friend Jason Cavanagh, who like to dance at the fringes of the regulatory music.
"Google 'Nomura' for yourself mate. Here ... have a look at this site after you do that. I was dreaming about a sting when you walked up and shattered my thoughts. But far from shattering them, your good news has actually given us the fuel to propel us to early retirement."
"Do some homework, mate. I'm knocking off for the day and going home to a nice cold beer. You coming?"
His words fell on deaf ears, Foley was already reading through the Nomura story. His mind churning one way with excitement and anticipation, but his gut was churning the other.
"Look mate - you coming or not - email the link to yourself and check it at home."
"Yeah. Coming."
Gary Foley would drink more than one beer that night, and sleep would be hard to find. His mind was in overdrive.
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To be continued ...
; "The Idea")
