Creating America: My campaign manager was Roosevelt

Chapter 185 Snowball

The constant ringing of telephones in the office suddenly stopped without warning.

Immediately afterwards, the telephone in the center of the desk rang.

There is only this one.

The monotonous, urgent ringing echoed through the office, sounding particularly jarring.

Ethan glanced at the caller ID, then looked up at Leo.

"It's Yili."

Leo was not surprised at all.

Ron Smith, the old man who dared to strip and display his scars in front of City Hall, has clearly united all the panicked mayors. This old man now holds the entire "Industrial Revitalization Alliance's" bargaining chips.

Leo took a deep breath and picked up the receiver.

Good morning, Ron.

Leo's voice was calm, without a trace of panic.

"Good my ass."

Smith's voice was harsh, and his anger almost burst out of the receiver.

"Leo, I don't want to hear your diplomatic rhetoric. Tell me, why did Saint-Cloud withdraw?"

"St. Cloud Capital issued a statement saying it was for risk control, but I ask you, whose risk is it? Yours, or ours?" Smith cut to the chase.

"Everyone's saying that Pittsburgh's funding chain has broken down. Are you planning to default on your debts? If so, I'll take people to Pittsburgh right now. Even if I have to tear down the city hall and sell the bricks, I'll get back the money that belongs to Erie."

Leo leaned back in his chair, and even from hundreds of miles away, he could feel the fugitive aura emanating from Smith.

"Ron, calm down."

Leo's tone was serious; he hesitated, unsure whether to reveal the truth to his ally.

If Smith were told that the pool of funds they depended on for survival had actually been targeted by a greedy woman, this already fragile alliance might collapse instantly.

But if you don't tell the truth, can those clumsy excuses fool him?

"Ron."

Leo took a deep breath and made his decision.

"I don't want to lie to you."

"This is indeed risk control, but it's because of St. Cloud Capital."

Leo's voice lowered.

"Evelyn St. Cloud, she wants to swallow you all up."

There was silence on the other end of the phone, followed by Smith's suppressed breathing.

"Ron, go look at the balance of those notes lying in the Erie municipal account right now. You know very well how huge that number is." "What have you done in the past quarter to grasp at this lifeline, to get the shut-down factories running again?" "You restarted the blast furnaces, put workers on three shifts, and ran the machines 24/7. You loaded all the steel piling up in the warehouses, every single piece of rebar that had just been produced, onto trains and sent them to Pittsburgh, to any city in the Union that needed them." "You got dollars, but you also got a huge amount of notes."

"Ron, we're both smart men. We both know that this bill system is essentially a carefully designed financial game." "When these bills simply circulate between cities, used to exchange for cement, glass, or services, everything seems perfect. That's the magic of fiat money."

"Once you want to cash it out, once everyone is crowding into that narrow exit trying to exchange these numbers for real dollars, that's a liquidity crisis."

"It's like a musical chairs game; there are only a few chairs, but more and more people want to sit down."

"Saint-Cloud won't just sit back and wait for you to cash all the tickets."

"She's waiting for that critical point."

"When the bills you have accumulated are enough to overwhelm your finances, when you not only want to cash in the profits, but even need to cash in the principal to keep operating."

"She would turn off the music and remove the chair."

"At that time, you will be completely destroyed by this game. You will be forced to use your most valuable assets to fill this black hole made of numbers."

"I just didn't expect this day to come so soon."

"I originally planned to strike first and suspend payments through an executive order to stop her harvesting plan."

"But I didn't expect her to be faster than me."

"She beat me to the punch by releasing that announcement, throwing this dirty water on my head while simultaneously putting a knife to your throats," Leo readily admitted.

"The current situation is that if we continue to allow redemptions, the fund pool will be drained instantly, and then you will have no choice but to beg her to sell the city to her."

"Only by suspending payments and locking the money in the system can we have a chance to survive."

"Ron, I know this is hard for you to accept."

"The difficulty in making redemptions lies not in the lack of funds in the system, but in the collapse of trust. Once panic begins to spread, no single fund pool can withstand a run on the system."

"Even if I were to give up all of Pittsburgh's wealth right now, it wouldn't be enough to fill this black hole that's expanding infinitely because of fear." "We can only stop the bleeding, even if it's done in the most brutal way."

"Next, I will formally sign an executive order declaring a financial emergency in Pittsburgh and suspending all intercity bill payment in US dollars."

There was a few seconds of silence on the other end of the phone.

Smith understood.

"Leo, I don't care what reasons you made up, or what that woman is trying to do." Smith's attitude was very firm. "I only know one thing: these receipts I have in my hands have become worthless because of your struggle."

"So, to prevent her from swallowing us up, you preemptively withheld our money?"

"What's the difference?"

Smith let out a cold laugh.

"You're suspending the exchange, you're killing me."

"We need to see money. Immediately."

Leo's fingers tightened slightly as he gripped the receiver.

He knew the crucial moment had arrived.

For a seasoned veteran like Smith, who has been navigating the quagmire of local politics for decades, empty words are useless; he must offer real financial incentives.

"Ron, I know your difficulties."

Leo gripped the receiver tightly.

"So I prepared a compensation plan."

"From this moment forward, all suspended bills will retain their legal tender status, and, as a token of our gratitude to our allies for their trust during this extraordinary time..."

"City accounts that hold notes but do not cash them will receive an additional 5% holding bonus after six months."

"Five percent?" Smith's voice changed. "You mean interest?"

"You can call it interest, or you can call it a bonus," Leo said. "This money will be drawn directly from Pittsburgh's fiscal surplus; it's my compensation to everyone."

"Five percent..."

Smith was quickly calculating in his mind.

For local finances, this is an almost unbelievably high rate of return.

The current federal funds rate is pitifully low, and the figure given by Rio is an attempt to attract deposits with high interest rates.

"Where are you getting the money to pay this interest?" Smith keenly sensed something was wrong. "If your financial chain is sound, why are you offering such high interest rates to prevent us from making payments? Leo, are you running a Ponzi scheme?"

"This isn't a scam; it's a matter of timing."

Leo replied, "Ron, you need to understand the situation. If you rush to cash out now, you'll be playing right into her hands. She'll buy your notes at a very low price and then take control of your city."

"I am suspending the exchange now to protect you from being eaten by the crocodiles of Wall Street."

Leo turned his attention back to the greedy woman.

"As for where the money comes from?"

"Don't forget John Murphy."

"He's already leading in the state polls. If he wins the election and gets a Senate seat, he'll push forward the new Regional Economic Recovery Act in Washington."

"At that time, federal funding will come in like a flood."

"That's a multi-billion dollar scale."

"The interest I pay you is just a drop in the ocean."

"The current difficulties are only temporary. If we can get through this month and Murphy wins, we will all be rich." "But if the alliance falls apart now, if you panic and trample each other."

"Then Murphy will lose, I'll go bankrupt, and you..."

"Leo said coldly."

"You will be eaten alive by Evelyn St. Cloud, leaving not even a bone fragment."

"They're here to weather the storm with me, earn five percent interest, and wait to share in the federal pie in the future."

"Or should we jump ship now and drown, or get eaten by sharks?"

"Ron, you're a smart man, you know what to choose."

The sound of a lighter lighting a cigarette came from the other end of the phone.

Smith is smoking.

This is his habit before making important decisions.

Leo didn't urge him, but just waited quietly.

He's using future money to buy his present life.

He was using a larger bubble to envelop the bubble that was about to burst.

But he had no other choice.

Only by binding everyone to this chariot can it not overturn.

After a long while, Smith exhaled a puff of smoke.

"Leo, you're a real bastard."

The tense, aggressive tone in Smith's voice had disappeared.

"You've kidnapped us all."

"Likewise," Leo replied casually. "We're in the same boat."

"Five percent is not enough."

Smith suddenly said.

"I want seven percent."

"Furthermore, I need you to sign a memorandum. If federal funding doesn't arrive within six months of Murphy's election, Pittsburgh must use the second phase of the Inland Port equity as collateral to repay our notes."

That's Smith's cunning.

He accepted Leo's logic, but he wanted to raise the price and provide a guarantee.

Leo made a mental calculation.

Seven percent, which will significantly increase Pittsburgh's financial pressure.

His core asset is the equity in the inland port.

But now, survival is the top priority.

As long as we can lock up the liquidity of this bill, as long as we can stall for time, everything can turn around.

"Six percent."

Leo bargained.

"I can agree to equity pledges, but only if federal funding completely fails."

"make a deal."

Smith agreed readily.

He didn't actually want to force Leo to his death.

He needs to give an explanation to the cities below him, and he also needs to find a way to save face for himself.

The 6% interest rate, coupled with the guarantee of the port equity, would be enough for him to go back and appease the panicked mayors.

"I will tell them that this is to fight against the conspiracy of Wall Street and Philadelphia, and that we must unite."

Smith changed roles and reverted to being a staunch ally.

"But Leo, you'd better pray Murphy wins. If you dare lie to me, I'll personally drive a truck into your city hall and smash it down." "Don't worry, Ron," Leo said, "we won't lose."

The phone hangs up.

Leo felt a dampness on his back.

He put down the receiver and looked at Sarah and Ethan standing to the side.

Both of them had nervousness written all over their faces.

"Let's issue a notice."

Leo closed his eyes briefly, then opened them again, his gaze clear.

"An emergency notice regarding maintaining regional financial security and implementing a liquidity incentive program was jointly issued in the name of the Mayor's Office and the Pennsylvania Industrial Alliance Trust."

"Put the 6% holding bonus in the most prominent position."

"Use phrases like combating malicious short selling and protecting local assets."

"We want everyone to feel that this is a great financial defense, not a bankruptcy crisis."

Sarah nodded vigorously, her fingers flying across the tablet as she scribbled notes, then turned and ran out.

Ethan looked at Leo, seemingly wanting to say something but then stopping himself.

"Say whatever you want to say." Leo tidied the documents on the table.

"Boss, you're drinking poison to quench your thirst," Ethan said in a low voice. "Six percent interest, plus the principal, will snowball very quickly. If something goes wrong with Murphy..."

"Then let the snowball grow bigger."

Leo interrupted him.

"Once the snowball gets big enough, anyone who dares to stand in its way will be crushed."

"Now, we've survived."

"As long as you're alive, there's a chance to turn things around."

Leo glanced at his watch.

"Alright, Ethan, go outside and see if the girl is still there."

Ethan paused, then asked, "Who? You mean Elena?"

"right."

Leo nodded.

"Let her in."

"Now that the external fire is under control for the time being, it's time to address our internal problems."

"I'm going to start keeping my promise to her."

Ethan was stunned when he heard Leo's words.

He found himself increasingly unable to understand Leo.

Just minutes before, he was on the phone with Smith discussing the bank run crisis, and now he can effortlessly concern himself with the most mundane issues raised by a community student, such as rising rents and the rights of dishwashers.

He seemed to live in two worlds simultaneously, and was equally adept in both.

This elusive complexity filled Ethan with both awe and bewilderment.

He is not a simple politician; he is a freak who can manipulate everything from the clouds in the sky to the mud on the ground.

"Yes, Mayor." Ethan put his mind at ease and left.

Philadelphia, Chestnut Hill.

The computer screen in front of Evelyn St. Cloud displayed the newly released Pittsburgh City Hall notice.

Her long, slender, fair fingers tapped lightly on the table.

"A 6% holding bonus..."

Evelyn looked at the line of text.

"It even included a forward mortgage commitment on the port equity."

She had expected Leo to break down or crawl back to her like a dog, begging for mercy.

She accurately predicted Leo's financial chain and the panic of those mayors.

But she hadn't accurately predicted Leo's courage.

This young man actually dared to use a method that was almost a Ponzi scheme to forcibly lock up liquidity.

He did not deny the crisis, but rather packaged it as an opportunity.

He used higher profits to weld those who originally wanted to jump ship to the ship.

"So this is what you mean by 'if I don't sell, you can't buy it'?"

Evelyn stroked her chin.

"interesting."

"They'd rather take on high-interest loans than bow down to me."

"He'd rather mortgage his future to those country bumpkins than let me touch his power."

Evelyn felt neither anger nor much disappointment.

"Okay, Leo."

Evelyn murmured to herself.

"You win this round."

"You preserved your alliance, and you locked up your power."

"But now your debt is heavier."

"I'd like to see how you're going to fill this ever-growing hole."