While a sudden cold snap had frozen all of New York solid, the penthouse suite of the Plaza Hotel radiated a gentle warmth.
Dressed in comfortable loungewear, Seok-won stood by the large living room window, slowly tilting a mug filled with rich, aromatic coffee.
He gazed out over Central Park, now blanketed in snow from the night before.
The city was so quiet—perhaps because of the cold—that the serene winter scenery within the bustling metropolis gave him a rare sense of calm.
Just then, the familiar sound of footsteps came from behind, followed by a familiar voice.
"Good morning, Boss."
Turning around, Seok-won saw Landon approaching with a gentle smile, dressed neatly in a gray cashmere coat.
"Come on in," Seok-won said, gesturing casually as he took the head seat on the sofa. Landon sat to his left.
Placing his mug on the coffee table, Seok-won began the conversation.
"Roads must be a mess because of the snow. Did you run into much traffic?"
"That's why I took a helicopter."
Shrugging as he spoke, Landon's tone was light, and Seok-won replied just as casually.
"Smart move. Better than wasting time stuck in traffic."
In a city of super-rich elites like New York, it was quite common to see helicopters shuttling across Manhattan.
The traffic in New York was notoriously nightmarish—even calling it "murderous" didn't do it justice.
For the ultra-wealthy or Wall Street traders, whose time was literally money, paying several times more to travel by helicopter was the far better choice.
Landon had recently purchased a mansion in East Hampton, one of Long Island's most affluent areas, and had even built a private helipad in the yard.
Thanks to that, what would have been a two-hour drive through choking traffic was reduced to a mere 10 to 15 minutes.
Just then, Han Ji-sung, Seok-won's executive assistant, arrived with a steaming cup of coffee and placed it in front of Landon, who nodded slightly in gratitude.
He picked up the cup, took a sip, and then turned to Seok-won, who was lounging comfortably
with one leg crossed.
"Charles Kirk has officially resigned from Intel."
Seok-won recalled the man he had met a few days ago in San Diego.
"When can he start?"
"He plans to move to San Diego next week and begin commuting to Qualcomm HQ. His family will join him later."
"I figured it'd take at least two weeks for him to wrap things up—this is unexpected."
"Well, it's his first time serving as a CEO, and he seems very eager. He's highly motivated to turn Qualcomm into the world's leading semiconductor company."
Since it was good news, Seok-won gave a small nod.
"If the new captain in charge of leading Qualcomm is that passionate, it's certainly not a bad thing."
"Exactly."
Seok-won took a sip of his coffee and then set it down before asking,
"By the way, how's the recruitment of Lisa Su going?"
"We made an offer through a top headhunting firm, and the response has been quite positive."
"Give her whatever she wants—just make sure we bring her in."
"I'll follow your instructions," Landon replied, still cupping his warm coffee mug. Then he added,
"Oh, and do you remember I told you last time that LTCM informed their investors they would return all invested funds?"
"Yes, I remember."
"Well, that's caused quite a stir among the investors."
Seok-won tilted his head slightly, puzzled.
"They're not withholding money, and they're even adding profits on top of it. So what's the problem?"
"The investors are begging to stay in the fund—even offering to accept higher management fees than originally agreed."
"So LTCM wants to return the money… and the investors are refusing to take it back?"
"That's right. Honestly, if a fund consistently delivers 30 to 40 percent annual returns, I wouldn't want to pull my money out either."
Landon glanced over at Seok-won and grinned, showing his teeth.
"Of course, even the famously high returns of LTCM pale in comparison to what we've achieved."
Landon gave a confident shrug, the relaxed look of a victor on his face.
"If we ever announced that we were accepting new investments, people would come running with bags of money."
"Well," Seok-won replied calmly, "that's never going to happen."
Seok-won let out a brief chuckle.
Since their fund was already managing tens of billions of dollars, there was no reason to go through the hassle of accepting new investments. Landon nodded in agreement without hesitation.
"They say some investors were furious, accusing LTCM of begging for money before, only to now wipe their hands clean. But LTCM ignored the backlash and went ahead with returning all the invested capital."
Landon leaned in slightly as he spoke.
"According to some sources, there was quite a bit of internal debate at LTCM over this. But CEO Wiseman and chief investment officer Engoron strongly pushed for it and eventually got their way."
"They're greedy types," Seok-won said coolly. "They've accumulated enough capital and now don't want to share profits with outside investors anymore."
"They claim it's to increase their operational autonomy, but I think you're right."
"Failure always comes when arrogance sets in," Seok-won added, his voice cold.
LTCM was overflowing with confidence, believing they would continue to ride a wave of success. But they didn't realize they were already at the peak—and that a horrifying plunge was right ahead.
'A few months from now, they'll realize that returning their investors' money was a stroke of divine luck.'
Had they let their greed get the better of them and kept the funds, they might have been dragged into a complete disaster.
"And now LTCM is aggressively shorting options on the S&P 500 and the major European indices."
"Options?" Seok-won asked, narrowing his brow slightly.
Landon nodded.
"Yes. They're shorting 5-year index options reflecting an annual market volatility of 19% in both directions—up and down—and they're doing it on a massive scale."
"How large are we talking?"
"I can't say for certain, but it's definitely in the hundreds of millions of dollars."
Seok-won frowned.
"Selling options in both directions means they're not reading the market trend—they're just trying to collect premiums. But that amount… it's too risky."
"Volatility trading has always been part of LTCM's strategy going back to their bond days, but even so, I agree—it looks risky to me too."
Seok-won hummed in thought, crossing his arms.
"It seems they're placing too much faith in the option pricing formula developed by last year's Nobel Prize winners, Shaun Payne and Johnny Callas."
The core idea behind the formula was that, by trading the underlying assets in exact proportions, one could completely hedge the risk of a particular option.
And Shaun Payne and Johnny Callas weren't just any academics—they were founding members of LTCM.
"LTCM has generated astonishing returns so far using the formula devised by mathematicians, so it's only natural they've come to blindly trust it. Seeing that, many Wall Street investment banks and hedge funds are now hiring PhDs in mathematics and trying to mimic LTCM's strategies."
But Seok-won responded with a dispassionate expression.
"The market isn't moved by complex formulas written on a chalkboard. It's influenced by countless unseen variables. Mathematical formulas can serve as a reference, but they can't be the answer."
"True," Landon agreed. "If the market worked like a math problem, where everything fit together perfectly, no one would ever lose money in stocks."
"They've been lucky so far, but the moment an unexpected variable arises, they'll suffer a serious loss."
And that black swan was approaching fast: Russia's default.
Everyone knew Russia's economy was in trouble.
But at that time, no one had imagined that a nuclear-armed superpower like Russia would suddenly declare a sovereign default.
'That's what made the shock even greater.'
It was hard to imagine LTCM, which was still riding high, collapsing. But since it was Seok-won saying it, Landon took it seriously.
"An unexpected variable... yes, I suppose anything can happen at any time."
Seok-won let go of that line of thought—it was bound to happen soon anyway—and shifted the topic.
"Now then, there's a stock we need to start buying."
Landon straightened up in his seat.
"Which one?"
"Citicorp and Travelers. Both."
Landon tilted his head, looking puzzled.
"As far as I know, there's no particular good news that would push their stock up. Why are we buying them?"
"There's going to be a merger announcement soon."
"...!"
Caught off guard, Landon's eyes widened.
"M-Merger? Did you say merger?"
"That's right."
Unlike the composed Seok-won, Landon couldn't hide his surprise.
"If a merger announcement comes out, the stock prices will surge. So let's make sure to buy them in advance."
Landon calmed his startled heart and cautiously responded with a skeptical tone.
"But... isn't that difficult because of the Glass-Steagall Act?"
The Glass-Steagall Act was a law that strictly separated commercial and investment banking, also restricting the types of financial products they could handle.
It had been enacted in 1933 following criticism that unregulated banks' reckless practices had contributed to the 1929 stock market crash and the ensuing Great Depression.
Under this law, commercial banks were prohibited from using customer deposits to invest in stocks, and affiliations between banks and securities firms were banned.
Citicorp was the holding company of Citibank, a major commercial bank, while Travelers Group owned Salomon Smith Barney, one of Wall Street's top five investment banks.
In short, a merger between the two would be a direct violation of the Glass-Steagall Act.
"Everyone thinks that way, which is why no one can even imagine a merger between them. But Landon, you also know that for years now, there's been growing debate over the effectiveness of the Glass-Steagall Act."
"That's true, but it's still a valid law."
"Right. But it's also the biggest obstacle to the White House's push to boost the financial industry centered around Wall Street."
Landon swallowed dryly, now fully focused on the conversation.
"If these two firms merge, it'll be the largest M&A deal in history—worth $140 billion. There's no way they'd recklessly push forward with something that big without thinking it through."
A sudden thought struck Landon, and he leaned forward.
"Are you suggesting... they've already received the White House's approval?"
A subtle, meaningful smile played on Seok-won's lips.
"Once the merger is announced, it'll spark debate that the Glass-Steagall Act is outdated. That'll naturally lead to Congress formally discussing its repeal."
Landon was convinced—his hunch had been right.
As he imagined all the ripple effects of such a merger, his face flushed with excitement.
"If they really do merge, it'll be a massive event, just like you said."
"Which is why I'm telling you—we need to buy the stock beforehand."
"I understand."
With renewed determination on his face, Landon nodded.
Seok-won picked up the mug on the table and sipped the last of his coffee, thinking to himself:
"The repeal of the Glass-Steagall Act will eventually lead to the global financial crisis a few years down the road... but that's a problem for later."
It was a textbook case of how human greed and foolishness cause history to repeat itself.