New York & London, August 1914
On July 31st, 1914, for the first time in its history, the New York Stock Exchange closed its doors indefinitely. The avalanche of European selling had become an existential threat to the American financial system. For the titans of Wall Street, it was a cataclysm. Their world had ceased to function. Men like Jack Morgan Jr. and the partners at Kuhn, Loeb were trapped, their vast holdings of securities now illiquid and unpriceable. They paced their silent offices like caged lions, their fortunes held hostage by a war an ocean away.
Alan Mikaelson, by contrast, had never been more active. The closure of the exchange was an irrelevant sideshow to him. His assets were not in stocks; they were in cash, gold, and the unshakeable structure of his bank. While his competitors were paralyzed, he and Annelise were executing the most important transaction of their lives.
The final agreement from the British Treasury came via a multi-part encrypted cable that took Annelise two hours to decipher in their secure communications room. The Germans were sweeping through Belgium. Paris was threatened. The British Expeditionary Force was in retreat. Desperation had forced London's hand.
"They accept," Annelise said, looking up from her notes, her face a mask of calm concentration. "They have agreed to the 'escalating collateral' model. For the first one hundred million pounds sterling, they will transfer twenty million pounds worth of bullion from the Bank of England to our New York vault."
"And the deed?" Alan asked.
"Contingent," she replied. "If the bullion transfers become impossible due to naval losses, or if their financing needs exceed five hundred million pounds, the sovereign deed to the Witwatersrand Goldfields will be signed over to a neutral Swiss holding company controlled by the consortium. They have accepted the devil's bargain."
The news sent a jolt of cold energy through the room. They had done it. They had leveraged a world war to put a lien on the crown jewel of the British Empire.
Their next move was a masterstroke of financial engineering. The head of the Starbank Property & Casualty Division, a shrewd and discreet man named Alistair Finch, was summoned.
"Alistair," Alan began, "the British government requires insurance for a high-value shipment from Southampton to New York. Cargo is designated 'industrial machinery parts'. Value is twenty million pounds."
Finch's eyebrows shot up. It was the largest single policy he had ever heard of. "The risk is astronomical, Alan. The German navy is on the prowl. The premiums would have to be... unprecedented."
"I am aware," Alan said. "Annelise's associates in Paris and our own sources in Amsterdam have provided intelligence on U-boat patrol routes. We believe there is a seventy-two-hour window next week where the primary threat will be concentrated in the English Channel, leaving the northern transatlantic route relatively clear. Calculate a premium based on that risk profile. We will be the sole underwriter."
Finch did the math. The policy, priced to look legitimate to any outside observer at the Treasury, came to an eye-watering five percent of the cargo's value: one million pounds sterling. It was a fee Starbank would pay to itself for insuring its own inbound assets, a perfect, closed loop of profit generated entirely by risk analysis that no competitor could possibly replicate. The Morgan syndicate, had they secured the deal, would have paid that premium to an outside firm like Lloyd's of London, losing the capital. The Mikaelson-Rothschild consortium became Lloyd's for the transaction.
Two weeks later, in the dead of a moonless night, a convoy of ten heavily armored trucks, their markings painted over, rumbled through the deserted streets of lower Manhattan. They weren't heading for the Federal Reserve or the Assay Office. They descended a specially constructed ramp into the sub-basement of the Starbank building.
Down in the "Bedrock Vault," under the harsh glare of bare electric bulbs, Alan and Annelise watched as a team of bonded security men unloaded crate after heavy crate. Using a crowbar, Alan pried open the lid of the first one. It was filled not with machine parts, but with tightly packed gold bars, each stamped with the sovereign crest of the Royal Mint.
The air was cool and dry, but the sight was incandescent. It was the physical manifestation of their strategy: the wealth of an empire, fleeing a burning continent, coming to rest in their private treasury.
Far uptown, at the Union Club, Jack Morgan Jr. swirled the brandy in his glass, his face thunderous. A contact at the Treasury had leaked a single, infuriating detail: the British had secured an "unlimited" line of credit from a private, unnamed American source.
"Who?" Morgan snarled to a partner. "Who has that kind of capital? Rockefeller is in oil. The Vanderbilts are a fading memory. Who in God's name has the liquidity to outbid my entire syndicate?"
He had no answer. The name Mikaelson was still just a whisper, a minor player who had gotten lucky on a few transactions. He could not conceive that the quiet, serious young man was at that very moment presiding over the largest private transfer of sovereign gold in modern history. The game had changed, and Jack Morgan didn't even know the new rules yet.
End of Chapter Summary
Period: Q3 1914
Mikaelson Family Estimated Net Worth: ~$62,500,000
(Note: Net worth has surged dramatically. The £20M in gold (~$97M at 1914 rates) is consortium property held as collateral. Alan's 25% stake is ~$24.25M. The £1M insurance premium (~$4.85M) is direct profit, split 50/50. The value of the active, high-certainty war financing contract adds significant book value to Starbank itself.)
I. Financial Holdings (Starbank)
Total Assets: ~$17,000,000
Book Value of War Contract: The exclusive financing rights are now a performing asset valued at an estimated ~$15,000,000.
Insurance (P&C) Profit: Direct Revenue: +$2,425,000 (Mikaelson share of the insurance premium).
II. Gold Holdings (Mikaelson Gold Consolidated)
Fields: 2 (Domestic production ongoing)
Vaulted Bullion (Mikaelson Share): +$24,250,000 (Alan's 25% stake of the £20M British gold transfer held as collateral).
Total Mikaelson Gold Assets: ~$34,750,000
III. Luxury Goods (Elysian Holdings)
Operations: Stagnant due to the war. Value remains nominal.
IV. Gaming (Pixel Palace)
Operations: Stable domestic sales. Value remains nominal.
Acquisitions This Chapter:
Company Name: None.
Mentioned Families & Alliances:
Rothschild Family (Finance): Est. Net Worth: [Classified]. Status: Successfully executed the first stage of the war financing deal. Their 75% share of the gold collateral and profits has massively increased their liquid assets.
Morgan Family (Finance): Est. Net Worth: ~$105 Million (Decreased due to market closure and illiquid assets). Status: Outmaneuvered and frustrated. Aware they have been beaten by a powerful, unknown competitor.
Kuhn, Loeb & Co. (Finance): Status: Paralyzed by the NYSE closure. Sidelined from the major war financing operations, highlighting their vulnerability to market shocks.