Over the Edge (41 page)

'I can't tell you, Lou.'

'I don't believe this! You call me at home in order to pump me and then refuse to tell me why. Alex, you and I-'

'Lou, this has nothing to do with finance. I haven't heard anything even hinting the bond's in trouble. Fact is, I don't know a damn thing about it. It's the people behind it that I'm interested in.'

'Which people?'

'Ivar Digby Chancellor, Beverly Hills Trust. The Cadmus family. Any connections between them.'

'Oh. That case.'

'That case.'

'What's your connection with it?'

'Defence consultant.'

'Not guilty by reason of insanity?'

'Something like that.'

'From what I hear you've got your work cut out for you. Kid's supposed to be really crazy.'

' You get that from the Wall Street Journal?'

'The financial whiz grapevine. Anytime a major corporation's involved in something nasty, we money types make it our business to assess the impact.'

•And?'

'And the general consensus is that the impact is zilch. If the kid had control of the corporation and planned to turn the lake into a giant Jacuzzi, there might be something to worry about. But in his condition that's hardly likely, is it?'

'Hardly.'

'Something the matter, Alex?'

'No. About Chancellor - '

'Gay as a blade but a smart fellow and a hell of an arm twister - the right combination of creativity, caution, and cojones. Beverly Hills Trust is one of the strongest small banks on the West Coast. Chancellor took good care of his depositors. Put through enough smart deals to beat the big boys on interest rates without overextending himself. Made money the old-fashioned way: by inheriting it and watering it until it grew nice and tall. If you're rich enough, you can get away with liking young boys and wearing eye shadow. What else do you want to know?'

'Was he involved in setting up the Bitter Canyon deal?'

'Most probably. As a skid greaser. He'd been dealing with the Cadmuses for years and had plenty of clout with the Water and Power boys, so his influence could only be salutary. But his major involvement was when it came to buying. BHT was a major purchaser of the initial short-term serials. I remember that because by the time the offering came out, all the serials had been snapped up. I was curious who got them and did a little research. He also bought into the long terms. Let me move to the phone by the computer, and I'll punch in the data.'

He put me on hold and returned in a moment.

'Okay. I'm calling it up right now Bitter Canyon Consolidated System Power Revenue Bonds, Series of 1987 - here we are. It's a state bond, not a muni, because there's no municipality of Bitter Canyon yet. We're talking seventy-five million dollars in revenue - fifteen thousand lots of five-thousand dollar bonds at par. Eighteen million were in serials maturing from 1988 through 2000, staggered toward the end; the rest, in long terms: one-third twenty-year maturities; one-third, twenty-fives; and one, thirties. Nineteen million each.'

'What was Chancellor's buy-in?'

'Wait a sec. I've got that on another file. Okay, here it is. Now, this isn't rock solid precise 'cause there may have been some under-the-table trading, but it's pretty damn close. According to my data, BHT snapped up ten million of the serials - including the shortest terms, which were the most desirable - and another ten in long terms. That's through the bank. Chancellor may have bought more for himself personally, but it'd be difficult to trace that.'

I calculated mentally.

'Over a quarter of the total. Isn't that a big purchase for a small bank?'

'Sure is. It's also atypical for any bank to get that heavily involved in long terms, especially considering the downward trend of the bond market over the last few decades. But Chancellor was known as someone who bought aggressively when he believed in something. No doubt he figured to sell at a premium in the secondary market.'

'How'd he get such a large share?'

'The Cadmuses and the government gave him the inside track because a big buy by BHT was mutually beneficial. When a savvy investor demonstrates that kind of confidence in an issue, it raises the general level of enthusiasm.'

'Where did the rest go?'

'The serials were evenly distributed among several major financial institutions: other banks; savings and loans; brokerage houses; insurance companies. As were a healthy chunk of the long terms, with a little left over for a few eagle-eyed independents such as yours truly.'

'Sounds like a hot issue.'

'Red-hot. By the end of order-taking period all of it was gone. What does that have to do with defending the Cadmus kid?'

'Probably nothing. Let me ask you one more thing: Could a prior agreement by Chancellor to buy large numbers of bonds influence approval of the issue itself?'

'As a guarantee? Sure. If there'd been initial feasibility issues regarding the project, it couldn't hurt to have a major supplier of project revenues lined up a priori. But that wasn't the case with Bitter Canyon, Alex. The reason it was a hot issue was that the setup was a sweet deal all around. The Cadmus family's owned the land since the war. They bought it dirt cheap from the army and could afford to sell it back at a very substantial discount and still make a whopping profit. That profit, in turn, enabled them to put in a highly competitive bid to build the plant. And I do mean highly. That allowed the bond's interest to come out at half a point to a point over market. These days that's a hell of a lot, and since everyone's projecting lower rates in the foreseeable future, the premium could be juicy.'

'One hand washing the other.'

'Exactly. It makes the world go 'round.'

'I've heard there was some opposition. Conflict-of-interest questions.'

'Nothing substantial. Some of the other construction companies tried to raise a fuss, but it died in the back rooms. Most of them weren't big enough to put together a project of that size. The two companies that were couldn't come close to competitive bids. Pushing the objection would have raised the risk of a public outcry over expense padding - which they're all guilty of - and major delays. The surrounding municipalities and DWP wanted the project to be approved quickly and were exerting pressure to speed things up. Being seen as obstructionist would have been a major liability, politically speaking.' Make waves and forget future contracts.'

'A little more subtle than that, but you've got the general idea. Politically speaking, this was easy street, Alex - no Sierra Club types screaming about sacred cactus, high rates of local unemployment. Going to be lots of smiling faces when they break ground.'

'When's that supposed to happen?'

'Early next year. Right on schedule.'

'And Chancellor's death has had no effect?'

'Why should it? Sure, people are going to be looking at who takes over the bank. If it's a moron, you're going to see a slow, steady trickle of withdrawals - nothing sudden, because everyone gets hurt in a run. But that's an internal issue that has nothing to do with Bitter Canyon. Or the bonds.'

'What could affect the project?'

'Nothing smaller than your basic act of God - always nice to blame Him when things go wrong isn't it? The lake evaporates overnight; Cadmus Construction turns socialist and converts to a macramé factory - I don't like the tone of this conversation. What the hell are you getting at, Alex?'

'I don't know, Lou. I really don't.'

'Listen, I don't want to come across hysterical, but let me explain my position. In general, I stay away from bonds. Both for myself and in managing portfolios. Historically they haven't performed well, and at best you're protecting your flanks. But I have some clients who insist on them: conservative types like you and fools who are so rich they've deluded themselves that they have enough money. So I keep my eye out for good issues and buy in quickly. It doesn't happen often, but Bitter Canyon was one of those times, and I got in heavily. So far I've made a lot of people happy with it. But if it slides, those same people are going to be very unhappy. Murderously so. No matter that last year I was Midas. One mistake and I'm as popular as Arafat at the B'nai B'rith. All those years of charisma building down the proverbial crapper.'

'Like I said, Lou, I haven't heard anything. If I do, I'll call you.'

'You do that,' he said fiercely. 'Collect. Twenty-four hours a day.'

I GOT to campus at seven the next morning. Although the psych building was locked, a side door was open, as Jennifer had promised.

The lab was two floors below ground level, at the end of a murky hall, just past an animal dormitory that smelled of rat chow and dung. She was waiting in the windowless room when I got there, seated at a grey metal table, flanked by stacks of books, photocopied journal articles, and a pad of yellow legal paper. An Edward Gorey poster graced the rear wall. To the left was a black-topped lab table, its gloss dulled by years of scalpel nicks; to the right, a barracks of cages. Atop the table was an open dissection kit and a spool of electrode filament. The cages percussed with activity -dark, oblong blurs banded with white, scurrying from side to side: hooded rats. They seemed especially restless, interrupting their exercise only to scratch, chirp, suck the spouts of their water bottles, or gnaw the bars in protest of man's inhumanity to rat. Some of them had sacrificed for science, their heads topped by pink caps of paraffin. Underneath

the wax, I knew, was exposed brain tissue, strategically lesioned. Extending from the centre of each cap was an inch of filament - electrode lead wire - that quivered with each movement of the skull that housed it.

'Alex.' She rose quickly, as if startled. A rat squeaked in response to the movement.

She'd dressed completely in black: bulky sweater; skintight denims; high-heeled knee boots. Her tawny hair was shower-damp; her face, freshly scrubbed. Black plastic triangles hung from her ears. Her fingers jitterbugged on the table top. A dramatic-looking and very attractive young lady. Less than half my age.

'Good morning, Jennifer.'

'Thanks for coming down. I know I wasn't too forthcoming last night. I didn't want to get into it over the phone because it's so complex.'

'If you know something that can help Jamey, I'm all ears.'

She looked away nervously.

'I'm not - I may have overstated myself. It's all conceptual at this point.'

I sat down, and she followed suit.

'What's on your mind?' I asked.

'You remember I said his mental deterioration had intrigued me for a while? Well, the points you raised crystallised that intrigue: the lack of psychopathy; the contradiction between his supposed mental state and a serial murder profile; the visual hallucinations; the questions about drug use. I thought about it for a long time and kept going in circles. It was maddening.'

After picking up a pen from the table, she used it as a conductor's baton, punctuating the rhythm of her speech.

'Then I realised that I'd been proceeding bass-ackwards, trying to adapt the facts - the givens - to an unverified hypothesis that he was both psychotic and a serial murderer. The key was to throw all that out and start from scratch. Conceptually To establish alternative hypotheses and test them.'

'What kinds of alternatives?

'All the permutations. Let's start with murderer but not psychotic. Jamey's a sadistic, homicidal psychopath who's been faking schizophrenia in order to escape responsibility for his crimes. It's a tactic that's been used before by serial killers - the Hillside Strangler, Son of Sam - totally in character with a psychopath's manipulative nature. But from what I've read, it doesn't work very well, does it?'

'No, it doesn't,' I said. 'Juries are suspicious of psychiatric testimony. But a defendant facing overwhelming evidence might still chance it.'

'But Jamey could have avoided capture in the first place, Alex. There's no reason someone that bright - given the assumption that he's not psychotic - would allow himself to be caught red-handed and then rely on a low-return strategy. Besides, the psychosis wasn't something he just tossed on like a sweater. He was deteriorating long before he was arrested. You don't think he was faking, do you?'

'No,' I said. 'He's been suffering too much for too long, and it's got worse. The day I talked to you guys he threw himself against the walls of his cell and ended up with a concussion. It was bloody. Even a prison guard who'd been sure he was malingering had second thoughts when he saw it.'

She turned her head toward the cages, watched a rat wiggle its snout through the bars, and winced.

'That's horrible. I read about it in the paper, but there were no details. How is he?'

'I don't know. I've been removed from the case and haven't seen him since.'

That surprised her. Before she put the surprise into words, I said:

'In any event, you don't have to convince me he's not a psychopath. What's your next hypothesis?'

'Psychotic but not a murderer. The problem of the visual hallucinations remains, as does the general drug abuse issue. But both could be explained by the possibility that he was schizophrenic and a drug user.'

' Simultaneously?'

'Why not? I know drug abuse doesn't cause schizophrenia, but hasn't it been known to put some people -borderline types - over the edge? Jamey's never been well adjusted - at least since I've known him. So, couldn't he have dropped acid or PCP and had a bum trip that loosened his ego boundaries and caused a psychotic break, then continued to take dope afterward?'

'Jen, according to almost everyone, he was antidrug. Nobody's even seen him take anything.'

'What about Gary? Did you find him?'

'Yes, and he did say Jamey was a user. But he'd inferred it from Jamey's behaviour and admitted he'd never actually seen him trip out.'

'So at least it's still an open issue,
 
she insisted.

'The big problem with hypothesis number two,' I said, 'has nothing to do with drug use or psychosis. If he's not a murderer, how did he end up with a knife in his hand?'

She hesitated.