New York City, July 1914
The floor of the New York Stock Exchange was a maelstrom. The assassination of Archduke Ferdinand had lit a fuse that ran directly to the heart of global finance. As Austria-Hungary delivered its ultimatum to Serbia, and the great powers of Europe began the grim calculus of mobilization, a tidal wave of fear washed over the markets. European investors, desperate for liquidity, were dumping their American securities at any price, trying to repatriate their capital before the borders slammed shut.
From a quiet visitor's gallery overlooking the chaos, Alan Mikaelson watched, his expression unreadable. Beside him, a partner from Kuhn, Loeb & Co. was sweating through his collar. "It's a bloodbath, Mikaelson! We're down twelve percent in a week. The Morgan house is trying to form a pool to support the market, but it's like trying to dam a tsunami."
"The Morgan house is sentimental," Alan replied, his voice barely audible above the roar. "They are trying to save the market. The market, however, does not wish to be saved. It wishes to be purged."
He wasn't selling. He wasn't buying. He was observing. Every panicked seller was a future opportunity. Every over-leveraged bank trying to meet its margin calls was a name he filed away for later. While J.P. "Jack" Morgan Jr. was huddling with the heads of other major banks, playing the role of Wall Street's patriot, Alan was in his office, connected by a private, encrypted cable line to Paris and London.
Annelise's dispatches were concise and invaluable. 'French government projecting a three-month war. Their gold reserves are adequate for six. They are delusional.'
A cable from the Rothschild's London branch was even more critical: 'Jack Morgan met with Ambassador Spring Rice. Offering a one hundred million dollar credit line to Britain and France. A syndicate of banks. Terms are standard war bonds, five percent interest.'
This was the competition. The establishment's move. Patriotic, public, and, in Alan's view, financially naive. It was a loan of paper backed by a promise from a nation about to bleed itself white.
"They are selling shovels to a man digging his own grave and accepting payment from his estate," Alan murmured to Annelise, who was now managing their European intelligence from New York. "We will sell him a ladder, but we will take ownership of the ground he stands on as payment."
The Mikaelson-Rothschild counter-offer was not made through ambassadors or public channels. While Jack Morgan courted politicians, Baron Édouard de Rothschild leveraged a century of influence to secure a private, off-the-record dinner in London with Sir John Bradbury, the Permanent Secretary to the British Treasury. The man who managed the books of the largest empire on Earth.
Lucien Dubois, acting as the consortium's envoy, laid out their proposition in the quiet of a private club.
"Sir John," Dubois began, "The Morgan offer is generous. It will fund the first few months of the war. But what happens when the casualty lists grow, and the public's appetite for war bonds evaporates? What happens when you have to choose between printing money and surrendering?"
Bradbury, a man of cold numbers, remained silent.
"My associates," Dubois continued, "believe this war will last years, not months. They believe it will cost billions, not millions. They are prepared to offer a revolving, inexhaustible line of credit to His Majesty's Government for the full duration of the conflict. One billion, two billion... the number is irrelevant. The funds will be available."
Bradbury's eyes narrowed. "In exchange for what? No one offers such a thing out of charity."
"Indeed," said Dubois. "The terms are simple and absolute. For every fifty million pounds sterling advanced, we require collateral. Not in bonds. Not in future tax receipts. In physical gold, delivered to our vaults in New York or Geneva. Or, to avoid the depletion of the nation's reserves and the risk of U-boats, there is an alternative."
Dubois slid a single, heavy sheet of paper across the table. It was a geological survey map of the Witwatersrand basin in South Africa.
"We will finance the entire war," Dubois said softly. "All of it. In exchange for the sovereign deed, in perpetuity, to the Crown's interest in the Rand Goldfields."
Bradbury felt a jolt, as if the floor had dropped away. What they were asking for was the heart of the Empire's mineral wealth. It was an act of breathtaking audacity. It was financial treason.
"That is... impossible," Bradbury breathed. "That is the single most valuable asset in the Empire."
"Which is precisely why it is the only collateral that can secure a loan of this magnitude," Dubois countered smoothly. "Sir John, the Morgan syndicate offers you a crutch. We are offering you a bottomless war chest. They are betting on your victory. We are merely ensuring it, and in exchange for our services, we require a fee that is immune to the inflation and political chaos that will follow this war, regardless of who wins. Your choice is simple: risk losing the war for lack of funds, or guarantee your victory and pay a steep, but finite, price."
Dubois stood to leave. "We do not require an immediate answer. We know you must speak with the Chancellor. But be assured, when the German army is marching on Paris, Mr. Morgan's paper bonds will feel very flimsy indeed."
The message was relayed to New York. Alan and Annelise waited. Two days later, a single-word cable arrived from their London office. It said: 'DISCUSSIONS.'
The hook was set. The great financial families were now in a silent, high-stakes war of their own. The Morgans, the Vanderbilts, and their allies were betting on America and the old systems. The Mikaelson-Rothschild axis was betting on something far older and more reliable: gold.
End of Chapter Summary
Period: Q3 1914 (The July Crisis)
Mikaelson Family Estimated Net Worth: ~$41,000,000
(Note: Net worth calculation now includes the estimated present value of the consortium's war financing contracts, which are considered a highly probable future asset. This reflects the immense leverage gained by their unique, hard-asset-based proposal during a period of extreme global uncertainty.)
I. Financial Holdings (Starbank)
Commercial & Retail Banking: Branches: 15
Total Assets: ~$16,500,000 (Increased deposits as investors flee the volatile stock market for the perceived safety of Starbank's conservative management.)
Insurance (P&C): Premiums for transatlantic shipping have skyrocketed. The division is generating significant cash flow, insuring non-military assets at exorbitant rates.
II. Gold Holdings (Mikaelson Gold Consolidated)
Fields: 2
Current Market Value (estimated): ~$10,500,000
Infrastructure: The "Bedrock Vault" is complete and operational.
III. Luxury Goods (Elysian Holdings)
Brands: 2
Strategy: All expansion plans are on hold. Current focus is securing supply lines for French materials.
IV. Gaming (Pixel Palace)
Strategy: Production is stable. The focus is on domestic markets.
Contracted Future Value:
Mikaelson-Rothschild War Financing Proposal: The probability of acceptance by the Allied powers has created an asset with an estimated present value of ~$14,000,000 to the Mikaelson family's stake.
Acquisitions This Chapter:
Company Name: None.
Mentioned Families & Alliances:
Rothschild Family (Finance): Est. Net Worth: [Classified]. Status: Consortium is actively negotiating the largest financial deal in history with the British Treasury.
Morgan Family (Finance): Est. Net Worth: ~$110 Million. Status: Primary competitor for Allied financing. Their syndicate is offering a traditional (and consortium-viewed as inferior) bond-based solution.
Kuhn, Loeb & Co. (Finance): Status: Positioned as a potential partner in the Morgan syndicate, but currently suffering losses from the market crash. They represent the "old guard" being caught off guard by the crisis.