Fooled by Foreshortening

In some of my earlier posts, I've discussed the plot of a Ben Mezrich book, UGLY AMERICANS.

I got some important chronological points wrong, and I'd like to correct that now. Indeed, I've corrected it in my plot summary thus.

I've had a lot of trouble cross-referencing the events in the book with real-world events, and to some extent I at last understand why. Bear with me.

Mezrich tells the "true story of the Ivy League Cowboys who raided the Asian Markets for Millions." The central "cowboy" is the fellow he calls John Malcolm, who went to Japan to take a job with Kidder Peabody, apparently in 1993, then lost that job when the Joseph Jett scandal hit, the following year.

Then Malcolm got a job placing orders for Nick Leeson, which ended in February 1995.

Thereafter, Malcom called his former boss at Kidder Peabody, who was now the head of a hedge fund. The main story of the book starts there. Until now, I had believed that these central plotting events, involving the Hong Kong stock exchange's tracking fund, took place in 1995, soon after Malcolm had settled into his new job. That is the impression the book conveys. But the tracking fund at issue didn't exist then! It came into existence as a result of the East Asia currency crises of 1997-98.

But on a closer reading, I see that the story can be reconciled to that fact, and Mezrich can't be said to have simply gotten it wrong, foreshortened though his account is. At least part of the blame is mine.

There is a time clue on page 196 of his book, where Mezrich writes: "The brainchild of Richard Li, at thirty-five one of China's richest and most infamous characters, Pacific Century Cyberworks has started off...."

When was Li thirty five?

The answer is that he would have turned that age in November of 2001. This means that the Christmas party described in chapter 21 of the book, when the main characters discuss Richard Li, must have taken place in December 2001. That, in turn, makes the foollowing trades consistent with the actual existence of this fund, and with a merger in which Pacific Century Cyberworks was involved at the turn of the millennium.

"Understanding comes step by step, grasshopper."

"Thank you, Master."

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.

Mezrich's latest

Rigged, the latest book by Ben Mezrich, describes the world of oil-futures trading.

It may not sound like the most natural subject for book by a general-interest publisher like William Morrow -- given the bald statement of the setting above, one might have expected Wiley & Sons to publish this.

But Mezrich became famous with a book about card counting in casinos. For him, the oil futures exchange, especially the New York Mercantile Exchange, or NYMEX, where much of this book is set, is as exciting as any casino in Vegas, and his goal is to make us feel the same.

I've written about Ben Mezrich in this blog before, in particular about his book about American arbitrageurs in east Asia, The Ugly Americans. As I said at the time, the claims of the book to be non-fiction are a bit unsettling. Mezrich changes more than merely the names of his characters, and at some point "protecting one's sources" and such becomes, simply, fictionalization.

I have the same difficulty with this one. Consider the subtitle of Rigged. It's "The True Story of an Ivy League Kid who Changed the World of Oil, from Wall Street to Dubai." The insistence upon the "true story" part is my hang-up here.

Consider, now, the following passage, the opening paragraph of chapter 3.

"There was something uniquely soothing about the whir of helicopter blades. The rhythmic, circular disruption of air, each and every turn apply calculable lift, allowing a thing that should not fly instead to float, like a magic carpet in a child's coloring book -- a carpet made of steel and Plaxiglas and in this case solid gold. Even as the rhythm slowed and the floating, five-ton, bug-eyed carpet came to a gentle rest on the jutting ivory-white helipad, the whirring blades continued their soulful cadence, the long steel appendages cutting slower and slower arcs until all that was left was the beat of the thing itself, the soothing rhythm of a thing that should not be -- but, indeed, was."

Clearly, the author is taking us inside the mind of one of his characters here. The character in question isn't the "ivy league kid" the book is written about. Rather, its another young man, a Cambridge University schooled heir to Arabic nobility, Khaled Abdul-Aziz. Khaled's desire to do something grand for the future of Dubai makes him in time an important ally to the central character's desire to modernize and expand NYMEX. And it's Khaled who is supposedly thinking these thoughts about helicopters and their soothing blades.

As a piece of descriptive prose in a novel, I'd consider the above over-wrought. And the "carpet made of steel" bit makes the helicopter sound like a train they call the City of New Orleans. Still, since we're reading a work of non-fiction, we can infer that at some point Khaled confided in Mezrich about his feelings regarding helicopters, right?

Wrong. At this point, we have to flip back to the author's note, where we find the following lovely disclaimer. "Characters such as Gallo and Khaled are composites and are not meant to portray particular people."

I'll ignore Gallo for this post. Khaled is a composite? Non-fiction is, I think, consistent with the use of composites to simplify an overly complex narrative when the author is (as here) upfront about that. But ... composites in that sense don't have a "stream of consciousness." If we portray a composite as thinking of the "slower and slower arcs" of a helicopter on the landing pad as "soothing" then we've crossed the line and created a fictional character.

The South Park character "Towlie" did this sort of "non-fiction" writing once. He had an excuse. He was smoking pot at the time.

Richard Tavoso

This is a bit of meta-blogging. Props to Cicily for explaining to me how sitemeter works.

Due to that wonderful data stream, I've noticed that I now and then get readers who arrive by googling phrases like "Dean Carney," or "Richard Tavoso" or "index arbitrage." They're looking for two entries I wrote about two months ago (May 14 and May 17, to be precise) which describe a book by Ben Mezrich, "Ugly Americans."

I believe Mezrich is probably getting extra attention now because an earlier book of his, "Bringing Down the House," has been made into a movie -- under a different title -- starring Kevin Spacey.

http://cicilycorbett.blogspot.com/search?q=21

So Mezrich is getting attention, his book on arbitrage trading in East Asia by Americans, largely Ivy Leaguers, is getting attention, and as the last link in the chain reaction, my humble blog is getting some hits. I blush for my unworthiness, but if you google the names [Carney Tavoso], this blog is second on the resultant list.

So let's try to make some use of that. I'll address Mr. Tavoso, in the event that he is or becomes among those who do that search. Sir, Do you agree that you are likely the real-world basis of the partially fictionalized Dean Carney? If so, do you think the portrayal is fair or unfair? Not only am I personally curious, but if the plot corresponds to reality, even somewhat, it sounds like an important piece of the financial history of the region, so it would be worthwhile getting it straight without the fictional veneer.

I hope to hear from you. Thanks.