Chapter 87

"Dear Second Son, why did you fail this time?" In the same Wall Street office, Old Edward sat behind his desk, looking at his son with curiosity.

"It's normal to have losses and gains," Li Xu shrugged.

"Aren't you the one who boasts about seeing through the fog of the future?" Old Edward raised an eyebrow.

"Should I believe the boasts of a young man?" Li Xu countered calmly, "Dad, you didn't call me from Boston just to talk about this, did you? It's the weekend."

"Are you so eager to get back to San Francisco to be with your lovers?" Old Edward asked again.

"Yes, why not?" Li Xu shrugged again.

"But your betrothed is sitting outside waiting for you, and you haven't completely won her over yet. Is it appropriate to take her to meet your lovers now?" Old Edward pointed outside.

Li Xu fell silent, crossing his arms and looking at his father with dissatisfaction.

"Alright, take a look at this." Seeing this, his father stopped beating around the bush and handed him a document.

Li Xu flipped through it. The document was quite thick, with dozens of pages, and it took him over twenty minutes to finish reading it, and it was quite a struggle. But he finally understood it, after all, it was all about things he had mentioned before.

"Do you have to make these document clauses so complicated?" he complained after finishing.

"How else would we make money?" Old Edward was not at all evasive.

"Since it's for me to read, couldn't you make it a bit simpler?" Li Xu huffed.

This document contained the finalized terms of the CDO and the synthetic CDO. Clearly, Morgan Stanley's internal team had already set the formal conditions—though it might just be the adjustments made by his father's group, which made things interesting.

"If you can't understand it, it means the people below you have done a good job," Old Edward shrugged.

"Is that a compliment or an insult?" Li Xu's lips twitched.

"Anyway," Old Edward ignored him, "what do you think can be improved?"

"Keep changing it until I can't understand it," Li Xu huffed again, but quickly changed the subject, "So, you guys have already decided internally?"

"I didn't say that," Old Edward shrugged again.

"Alright, I get it." Li Xu smiled, knowing from his father's attitude that it wouldn't be long before Morgan Stanley's CEO changed.

So, he had to be tight-lipped.

But this didn't seem to fit Morgan Stanley's style. They had been talking about junk bonds for so long without taking action, and now they were presenting such detailed CDO terms... Wait!

"I remember, a week ago, The Wall Street Journal reported that Lehman Brothers was expanding into new business, and there was a mention of mortgage securitization..." Li Xu narrowed his eyes.

He had been reading newspapers since he was a teenager, and even now at Harvard, he hadn't stopped, despite his dislike of English newspapers. There was no internet in this world—CNN had just been founded—so he could only gather information through newspapers and television.

Of course, even if the information was vague, the key points were hidden between the lines, but by comparing it with his father's intelligence, he could guess some things.

"Oh, that," Old Edward looked relaxed, "We were discussing CDOs, so some information leaked out. CDOs aren't complicated; the key is the inspiration. Once you have the inspiration, it's easy to complete. So it's normal for them to play with it."

Actually, you wanted them to take the lead, right? Li Xu felt like facepalming. In another timeline, Salomon Brothers was the first to venture into CDOs, but they failed spectacularly, leading to intense internal conflicts.

Several key traders who contributed significantly to Salomon Brothers, like Howie Rubin and Steve Baer, eventually left to join other firms.

Lewis Ranieri stayed, but he had a famous quote: "If I couldn't do whatever I wanted here, I would have quit long ago!"

This shows how twisted the internal environment was, leading to a decline after a few years of success. They were hit by the SEC multiple times, and no one came to their aid. They eventually faltered due to the illegal bid for Treasury bonds in 1991 and were acquired by Citigroup a few years later.

Then, the market was divided among the major investment banks.

Although Li Xu didn't know if Morgan Stanley had secretly pushed Salomon Brothers to their demise in another timeline, he knew another piece of gossip. Michael Milken's Drexel Burnham Lambert was initially a subsidiary of Morgan Stanley but separated in the 1950s. It seemed they had no connection, but who knows?

When Henry Paulson was Treasury Secretary, he sold all his Goldman Sachs shares, but who would believe he wasn't still a Goldman man?

After Milken went to prison, guess who became the largest junk bond underwriter? Morgan Stanley.

So Li Xu was quite annoyed. Logically, bankers should make money quietly, but being too visible makes them easy targets. But isn't it cool to know that decades later, some people rumored that Morgan Stanley was Goldman's dog?

Of course, no matter how annoyed he was, he couldn't change the fact, and... what if Lehman Brothers was killed and acquired in 1990, but Salomon Brothers survived until 2008? That would be interesting.

With this thought, Li Xu didn't say more, shrugged, and stood up: "If there's nothing else, I'll go. I still need to take Diana shopping on Fifth Avenue."

"Oh, and this, take a look at it too." Old Edward handed him another document.

This one was much thinner, only four or five pages. Li Xu read it in a few minutes and was somewhat surprised: "You've already taken care of it?"

"Not completely, but the negative effects of their investment will take some time to fully manifest. It will be easier then," Old Edward said without concern.

Li Xu wanted to say something, but his father was definitely smarter than him and must have considered it, so he just asked: "You plan to give this to Murdoch as a gift?"

"Just a gesture, it's not a big deal," Old Edward said casually.

Alright, dealing with News Corp is your job. Li Xu didn't say more, nodded, and was about to leave.

"Second Son." His father suddenly called him back.

"Hmm?" Li Xu turned around.

"You know, I've always supported you," Old Edward placed his elbows on the desk, crossed his hands in front of him, and looked at him steadily without any expression.

"Of course, I know." Li Xu raised an eyebrow.

"..." After a long silence, his father said, "As your father, I hope that whatever you do, you achieve something."

"Understood." Li Xu smiled, about to leave, but stopped.

"Frankly, if you're going to talk like that in the future, remember to grow a beard and wear glasses that reflect light." He said, his tone slightly playful.

Old Edward didn't respond, just looked at him, waiting.

"Then, I might remember it longer." Li Xu said finally, waved, and left.

Old Edward still didn't speak. After the door slammed shut, he took a cigar from the drawer, cut off the cap, and burned the tip for a moment before putting it in his mouth and lighting it.

After enjoying it for a while, he sighed, "The child has grown up, and it's no longer easy to keep him in check."

---

Li Xu didn't know what his father was thinking, but even if he did, he wouldn't care. His family was like that; his grandfather, father, mother, and himself all expressed their feelings awkwardly. Eleanor was probably the only normal one.

Anyway, as long as he moved forward step by step, the idea of CDS hadn't been used yet, and many companies hadn't been born yet. If the butterfly effect prevented them from being born... well, he'd deal with it when the time came.

"Sorry to keep you waiting, Diana." In the lounge, Li Xu greeted Diana, who was wearing a beige suit and reading a magazine.

"It's fine," Diana stood up happily, "Everything is settled."

"Of course," Li Xu bent his arm, "Let's go."

Shopping with women isn't an easy task, even for Li Xu, who had more stamina than the average person. Women transform into a different being when shopping, and it's not just a saying.

But he persisted. After all, Diana had come from Britain just because of his invitation. He should show some appreciation, right?

Besides, to win over a woman, you need to put in effort. Pan, donkey, small, and idle—missing one isn't a big deal, but missing two is troublesome, especially since he had a harem.

They shopped for the whole afternoon, buying only a few bags—three or four, with four pieces of clothing, two skirts, and three pairs of shoes. If Diana hadn't realized that Li Xu was paying, the bags would have been many more.

"You're my girlfriend, what's wrong with buying things for you?" At a table in Jean-Georges in Manhattan, Li Xu swirled his wine glass and smiled.

"There's nothing wrong, it's just..." Diana pouted, "A bit embarrassing."

Although she said this, the joy in her eyes was evident, making her look very playful.

"Next time, when you're done picking, I'll tell the boss to wrap everything up. Then you won't be able to refuse," Li Xu said with a grin.

"Ed!" Diana rolled her eyes.

"Just kidding." Li Xu raised his hands.

"Wrapping everything up" might work for some women at some times, but it wasn't suitable for the still innocent Diana. Otherwise, he would have done it long ago.

Soon, the appetizers were served. They clinked glasses and started talking about other topics, then moved to Diana's work.

After she shared some amusing stories about the naughty kids at her kindergarten, Li Xu asked, "Diana, have you ever thought about changing jobs?"