Ugly Americans, the timing

I've written before in this blog about Ben Mezrich's 2004 book, UGLY AMERICANS. In fact, I see from sitemeter that I get a lot of hits as a result of those posts.

So here is another one in that line. To review, Mezrich's story concerns two Americans in Japan. One, known in the pages of this book as "Dean Carney" (probably based on Richard Tavoso) became a mentor for the other, "John Malcolm" (probably Michael Lerch).

The focus of Mezrich's story, though he takes some time getting around to it, is "index arbitrage," the trading tactic of playing the value of the underlying stocks against the movements of an index composed thereof -- like the Nikkei or the Hang Seng.

But what I've only just noticed is a discrepancy in Mezrich's story, before he gets us to that point. In early 1995, Malcolm/Lerch is working for Barings in Osaka, and he chief duty is to take orders from Nick Leeson in Singapore. Nick Leeson, now infamous as the "Rogue Trader," was laying the groundwork for that infamy at the time. His scams unravelled largely due to a big bet on the Nikkei on the one hand and the Kobe earthquake on the other.

What bothers me is this. Mezrich gives us a detailed account of "Malcolm's" day on January 17, 1995, because Osaka was part of the area devastated by the Kobe earthquake. He has Malcolm and a friend wandering through the glass-strewn streets to get to the business district only to find that the phones were dead, and so forth.

When the phones are working again, later that day, Malcolm talks to Leeson about the danger that Leeson's, and presumably Barings', mysterious client, Mr. X, was going to take a huge loss on that Nikkei position.

Then, THE NEXT SENTENCE after the description of that conversation, we get the following: "It wasn't until a week later that Malcolm found out the truth." The truth is that there was no Mr. X, that Leeson had been making those bets with Barings' own money -- and making them at a level that Barings could not cover.

My problem? It actually wasn't until more than FIVE weeks later that they could have learned the truth. Mezrich is here condensing into a single week the whole period from Jan. 17 (the earthquake) to Feb. 25 (discovery of Leeson's losses.)

I accept the introduction of a certain amount of literary technique into non-fiction narratives. But if the result itself is fiction, that's how the book should be labelled, by whatever real-world events it may have been inspired. Changing names -- apparently at the request of one's sources -- is one thing. Changing the dates of well-documented events? Lame.