In early September, a Gulfstream GV private jet flew from Milan to Boston, traversing the stratosphere over the Atlantic Ocean.
Inside the cabin, David Cohen, chief trader at Lin Qi Capital, appeared somewhat agitated. Several internal research reports from Goldman Sachs and Morgan Stanley, along with thick account statements, were scattered on the table in front of him.
"Boss, that $4 billion has been sitting in Treasury bonds and money market funds for months." David rubbed his temples, trying to perk himself up with black coffee. "The big investment banks on Wall Street have been calling me non-stop. The macroeconomic data is terrible right now, and the aftershocks of the dot-com bubble are still lingering. Should we position ourselves in advance? Use leverage to buy some put options and short the Nasdaq or certain weak sectors?"
Lin Qi leaned back in his leather seat, a glass of whiskey in his hand, his gaze calmly fixed on the sea of clouds outside the window.
He knew perfectly well that in a few days, a catastrophe that would reshape the world would strike. Shorting the airline and insurance industries now would yield astronomical profits. But he also knew that betting on a "black swan" event of that magnitude was tantamount to dancing in a minefield for the SEC ( United States Securities and Exchange Commission ) and the FBI.
"No." Lin Qi's answer was without the slightest hesitation, extinguishing David's hopes.
David paused for a moment. "Why? The current trend isn't optimistic, and shorting is logically supported."
"Throw those investment bank reports in the trash. Tell them not to touch a single penny without my permission." Lin Qi gently swirled his glass, the ice clinking softly. He didn't explain anything to David, simply issuing the order with the authority of a boss, "Maintain absolute flexibility and wait for the best opportunity."
"But boss, such a huge amount of funds are idle..."
"Wait," Lin Qi interrupted him, his tone casual yet carrying an undeniable authority, "The market right now is stagnant. We'll only act when the market experiences extreme panic and liquidity completely dries up. And when that moment arrives, we won't just refrain from shorting; we'll go long."
David took a deep breath. Although he was full of doubts, his professional ethics kept him silent. He really couldn't understand what kind of panic his boss was waiting for, and why he would go long at that time.
Lin Qi's orders were tragically proven true just a few days later.
On September 11, 2001, the world was shocked by the "9/11" attacks. Airline flights across the United States were grounded, and Wall Street was forced to close for several days.
When the stock market reopened on September 17, a panic sell-off swept in like a tsunami, with the Dow Jones Index plummeting more than 14% in a single week, and market liquidity drying up instantly. Moreover, the SEC and the FBI immediately targeted accounts that had "foreseen" the attack and purchased large amounts of airline and insurance put options, launching an unprecedented insider trading investigation.
David Cohen watched the news on TV and broke out in a cold sweat. If Lin Qi had agreed to his short-selling proposal on the plane two weeks ago, Lin Qi Capital would definitely be targeted by the SEC like a mad dog and skinned alive.
On September 21, when the market had plummeted to its lowest point and everyone was in despair, Lin Qi's instructions arrived.
David faithfully carried out the instructions. He used four times intraday and short-term leverage to pour the $4 billion into S&P 500 and Dow Jones Index ETFs and options in batches, frantically absorbing the panic selling in the market. At the time, Wall Street viewed Lin Qi Capital as a model of contrarian investing, stepping forward with real money to "provide liquidity" when the market needed it most.
As panic gradually subsided, a retaliatory V-shaped rebound arrived as expected.
By October 11, the market had fully recovered the losses incurred before the 9/11 attacks.
In the Lin Qi Capital office in Boston.
David placed a final liquidation report on Lin Qi's desk. The index long strategy, amplified by 4x leverage, had yielded extremely high profits in less than a month, all under the guise of "market rescue," which regulators considered absolutely righteous.
"Boss, all positions have been liquidated." David's tone carried undisguised awe. "The fund's total profit is close to $3 billion."
Lin Qi looked at the report and nodded in satisfaction.
"Under the '2/20' partnership agreement, your personal performance bonus will be nearly $600 million," David added.
Lin Qi picked up his pen and signed his name on the liquidation document.
Nearly $600 million. Because it was held for only a little over a month, this money was strictly classified as short-term capital gains for tax purposes. According to the highest federal personal income tax rate of 39.1% in 2001, this money would have been subject to a huge tax bill of over $200 million.
Lin Qi did not engage in any tax avoidance activities and readily had his finance department pay the taxes.
Once all the tax procedures were completed, $360 million in pure cash lay cleanly and legally in Lin Qi's personal United States. bank account.
This money was paid in full to the United States. federal government as "protection money," and without any offshore structure to conceal it, it is completely private wealth that can be freely used in the open.
That afternoon, Lin Qi called his private lawyer, Richard, a top Wall Street M&A expert.
" Richard, prepare an acquisition contract. I need to formally submit the team ownership change application to the league." Lin Qi stood in front of the floor-to-ceiling window of his office, overlooking the early winter street scene of Boston, his tone calm.
Richard on the other end of the phone paused for a moment. "Boss, Celtics's parent company is an offshore shell company registered in the Virgin Islands, isn't that your business? You want to acquire... your own team?"
"That's right, from left hand to right hand."
A shrewd glint flashed in Lin Qi's eyes. "I'm going to put up $300 million in cash and 'buy' the Boston Celtics outright from that offshore company. That will completely eliminate the hidden problems behind the team."
Richard gasped. This maneuver was brilliant: funds flowed from Lin Qi's left pocket (his personal account that had just been taxed) to his right pocket (an offshore shell company). His actual wealth barely decreased, except for the transaction costs, and the issue of opaque team ownership was resolved.
"Understood, boss. A valuation of $300 million is perfectly in line with the current market value of NBA teams. This deal is flawless, David Stern will probably be relieved." Richard immediately agreed.
"There's one more thing, Richard," Lin Qi interrupted him, his voice still steady, "Once the $300 million acquisition payment is deposited into the Virgin Islands ' account, don't let it sit there."
What do you mean?
"Transfer it out. First, Cayman Islands, then transfer it to a holding company in Luxembourg under the name of a venture capital fund. Finally... inject funds in batches into EBA's operating account in Zurich."
Richard fell into a brief silence on the other end, then his mind went blank as he suddenly realized what was going on.
This is the real "two ways to eat a fish", or even "three ways to eat a fish"!
This $300 million not only laundered Celtics's ownership, but after passing through several offshore accounts, it ultimately became the "astronomical start-up capital" that the EBA president promised to Europe club owners in the Milan box... for the EBA League to upgrade its infrastructure.
The money ultimately came from Wall Street!
Not only did Lin Qi acquire a clean-cut NBA franchise without spending a single penny, but he also used the panic selling in the United States financial markets to fund his ambitious Europe expansion.
"Get it done quickly, complete the process as soon as possible. The new season is about to start."
Lin Qi hung up the phone.