I am Hollywood

Chapter 367: Chapter 368: A Certain Moment



[Chapter 368: A Certain Moment]

Due to a massive influx of capital and Eric's 'whimsical' demands, the trading team ramped up their purchases of crude oil futures in the following days, increasing their daily investment by over $30 million.

By mid-July, Eric had poured a staggering $250 million into the futures market. Since crude oil prices fluctuated during those two weeks, this amount had not appreciated. Chris grew even more anxious.

...

On July 16, a report published early that morning in The New York Times quickly spread across the globe.

At local time on July 16, and in the early hours of July 16 in Eastern Time, a fully equipped elite armored tank division of Iraq's Republican Guard suddenly gathered at the Iraq-Kuwait border. Simultaneously, stunning news emerged about Iraqi-Kuwaiti negotiations, where Iraqi President Saddam Hussein presented new conditions. He not only demanded the forgiveness of Kuwait's previous $14 billion loan but also sought $2.4 billion in compensation for 'stealing Iraqi oil.'

The Western nations, keeping a close eye on the Middle Eastern situation, had yet to respond, but the financial markets, highly sensitive to any news, began to show significant volatility. That same week on July 16, as the world's major futures exchanges opened, crude oil prices, which had been hovering between $18 and $20 per barrel, swiftly broke the $20 mark. In under two hours, prices shot up to $21. Throughout the day, oil prices did not dip again, closing at a high of $21.40, with a 7% increase.

...

That evening, Chris and his father Jefferey did not return to Chris's apartment; instead, they gathered in Eric's hotel suite. Despite the surge in crude oil prices, which had generated a profit of $175 million for Eric in just one day, Chris felt even more troubled.

The fax machine in the suite buzzed incessantly, continuously churning out documents.

Jeffrey, Chris, and Eric silently scanned the faxes, while Drew lounged on the couch, absorbed in the television.

"All I could gather is this, Eric," Chris said after circulating the documents. "As you've seen, almost all military experts believe this is just Iraq trying to put on a show of force. The likelihood of war breaking out is minimal. This armored division, equipped with Soviet T-72 tanks, is more than enough to flatten Kuwait. If Iraq planned to invade, they wouldn't need to deploy the Republican Guard; a standard infantry division could easily take Kuwait City. Saddam is likely just trying to extort more concessions."

"I still stand by my initial guess."

"Eric, this news will break in the papers tomorrow, and the crude oil prices will likely fall again. To avoid losing the profits we made today, I suggest we start selling tomorrow morning. That way, we might secure around $100 million in profit."

"No, keep buying, Chris. I feel like the time is getting closer."

Chris glanced at Jeffrey, who didn't really grasp the conversation, and said, "In that case, we can expect even more violent fluctuations in oil prices in the coming period, so I need enough margin in the account."

Eric knew Chris spoke the truth. Compared to the relatively stable prices of early July, the volatility of oil prices in late July would be even greater, given the involvement of the Middle East and Western nations. "No problem; you can operate as necessary."

Seeing Eric not adhering to his opinion this time, Chris breathed a sigh of relief.

...

On July 17, the analysis articles Eric and the others had seen the night before appeared in major newspapers worldwide. Even a high-ranking official from the U.S. Department of Defense publicly asserted on a television interview that Iraq would not take military action against Kuwait. Due to this perspective, crude oil future prices fell to $20.70, a 3% drop.

However, in the following week, oil prices began to slowly rise again. After deploying an elite armored division at the Iraq-Kuwait border, Iraq didn't stop but instead continued to bolster its troops. Within a week, 100,000 Iraqi troops amassed at the border.

Kuwait's head of state, Emir, could no longer remain passive and began pleading with other Arab nations for intercession.

...

On July 22, Egyptian President Mubarak visited Baghdad to negotiate on behalf of the Kuwaiti Emir but left empty-handed with no promises from Saddam. Soon after, Yasser Arafat, the chairman of the Palestine Liberation Organization, visited Baghdad where Saddam warmly welcomed him. When Arafat left, he could only relay a single message to the Emir: "Show me the money."

...

While most Western nations still maintained that Saddam would not take military action against Kuwait, in the face of Iraq's aggression, on July 24, the U.S. aircraft carrier fleet in the Gulf conducted joint military exercises with the UAE.

By this time, international oil prices had risen to $23, a 15% increase from the previous week. Eric's investment in the futures market grew to $400 million, with a staggering weekly profit of $500 million. The profits were unbelievable, yet Chris repeatedly urged Eric to pull back. He pointed out that any significant shift in the Middle Eastern situation could lead to losing everything.

The military exercises seemed to deter Iraq somewhat, as the next day Saddam urgently summoned U.S. Ambassador April Glaspie. In front of the Arab-American ambassador, Saddam solemnly assured her that Iraq would not take military action against Kuwait.

When this news broke, it appeared to mark a turning point. In the following days, oil prices began to slowly decline as most investment firms grew pessimistic about oil prices. As this unfolded, an increasing number of speculators aggressively shorted the market; whatever contracts they bought would quickly be absorbed.

...

In the last week of July, Eric spent all of his remaining $700 million on crude oil futures. Due to the drop in oil prices, the previous profit of $500 million dwindled to nearly nothing. Despite Chris's exhaustion and despair over Eric's insistence on making one last purchase of a hefty $20 million crude oil futures contract, he had little choice. The $700 million gamble, with a tenfold leverage and hardly any surplus margin, meant that if oil prices fell by just $2, those seven hundred million would vanish in an instant. Moreover, if oil prices dropped by more than $2, Eric's account would face a margin call, resulting in not only a total loss but leaving him deeply in debt to the futures company, possibly leading to bankruptcy.

At this point, many pressing concerns were becoming impossible to hide from Jeffrey. The old man was stunned by the figure of $700 million, left in a daze for a moment before sighing deeply.

...

In Los Angeles, Hollywood was closely monitoring Eric's every move. Thus, news that Ghost had surpassed $100 million at the box office in three weeks became less significant. After the release of Basic Instinct, which sparked intense controversy, few media outlets took this opportunity to criticize Eric's work as a screenwriter.

It seemed everyone was waiting, anticipating some sort of final reckoning.

Finally, time, that indifferent mistress, wiggled her waist and stepped into the grid of August

1990.

*****

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