Executive Times






2005 Book Reviews


Human Capital by Stephen Amidon


Rating: (Recommended)




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Stephen Amidon’s new novel, Human Capital, reveals the struggles of a parent in suburban Connecticut. No matter how hard he strives, Drew Hagel seems to botch up something in his life. Amidon presents Hagel as an unappealing protagonist, and it can be uncomfortable at times to turn the pages as Hagel makes choices that usually lead to failure instead of success. Having inherited his father’s real estate business, Hagel missed the opportunity to make the business stronger as more people moved to the area. When Hagel meets the head of a secretive hedge fund and gambles his future in the hands of a financial genius, it’s not much of a surprise that Hagel comes up a bit short.


Here’s an excerpt from pp. 63-71:


Drew leaned over the footbridge’s buffed railing, star­ing into the little river that twisted through Capital Park. He had fifteen minutes to kill before his meeting and didn’t want to cool his heels in reception. He had a tendency to talk too much in these situations, being friendly with the wrong people, getting in the way of the right ones. It had been worst during the period of his divorce, the terrible hours he’d sat out­side the mediator’s door at the Relation Shop while Anne told her side of the story, her aggrieved monotone an instrument of torture de­signed for his ears alone. And there was also twenty years of chatter to bored home buyers, filling up the void with words that he regretted the moment they came out of his mouth. He’d done it again just the other night with his unwise attempt at consolation after Jamie’s loss at the banquet. They’re just jealous. He could see the irritation on Quint’s face the moment he spoke. He had to be more careful. He still had to learn the language if he was going to be with these people.

The immaculate water, trapped in a series of effervescent eddies, slapped and gargled ten feet below. Sparkling fish darted among the smooth stones. Back when Quint bought the place the river was so polluted that the bleached bones of small mammals littered its cor­roded banks. These days Drew could baptize his impending newborns in the water if he were so inclined. A squadron of dragonflies pa­trolled its surface, their movements tightly choreographed as they hunted mosquitoes. The afternoon sun revealed startling colors in them, gossamer blues in the wings, electric greens on their bodies. They’d been imported from California to combat the West Nile virus; rumor had it they’d been genetically altered to be superpredators. Drew wondered what they would feed on once they’d rid the area of their prey.

He looked up, letting his gaze take in the entire park. Quint really had worked wonders on the place. The undulating grass was cut to a uniform height, coated with the fine dew that emerged periodically from programmed sprinklers. The dirt pathways were carefully raked; the firs and magnolias lining them were trimmed into neat geometric shapes. Newcomers would never suspect that the park covered the pestilential rubble of a tap and die factory that had gone so spectacu­larly to ruin that Drew and his friends had been banned from playing here as boys. It was one of the few prohibitions they actually obeyed, scared away by stories of flagrant rashes and rabid bites. Now a team of groundskeepers eradicated any outcropping of wilderness, and the brazen jays and fat squirrels that moved over the grass were perfectly harmless. Drew had learned during last summer’s tennis games that the pollution had been the complex’s prime selling point, allowing Quint to buy it for a song, then get the EPA to foot the cleanup bill. Nowhere was this transformation more apparent than in the former factory buildings. The largest, occupied by WMV Capital Manage­ment, was huffed perfection, old stone salvaged, gaps packed and sealed. The two outbuildings were occupied by a roster of lesser com­panies, a sports paraphernalia retailer and a reverse auction outfit that brokered energy contracts. The rest had impenetrable names that re­lied heavily on the latter consonants. Drew had considered relocating here, but rents were on a par with midtown Manhattan. Until things improved, he was stuck in his father’s place, with its cracked plaster and thirty-year lease.

He stifled a yawn and shook his head, trying to jump-start his mind. It had been a long, exhausting weekend, starting with Satur­day’s arduous shopping expedition to the mall for baby gear, a task they’d left this late because of Ronnie’s omnipresent fear of another miscarriage. They’d visited a dozen stores, loading his old Saab to bursting. Luckily, none of his weary credit cards was rejected. Ronnie had gone to bed soon after their return, the pregnancy finally starting to slow her down. Drew had recently suggested she stop working, but she wouldn’t hear of it. Leaving her clients before they’d been prop­erly referred to new therapists was unthinkable.

After she was soundly asleep, Drew established himself in front of the television for his regular fix of videotaped catastrophe: flashlit cops and overhead angles on car chases; sports riots and animals gone bad. The two beers he’d allocated himself in reward for the mall trip stretched into four, and he only vaguely remembered going to bed. But then there was a voice in the darkness. Ronnie was sitting up, clutching a pillow to her stomach, telling him that something was wrong, the terror in her voice stoked by two previous miscarriages. They had the ER to themselves; Saturday nights were downtime at Mercy The real action started just after dawn on weekdays, when weary hearts seized and brittle arteries burst, unable to handle an­other day, another ride into the city, another anthill of woe.

The news was good. As soon as the nurses and doctors got at his wife, Drew knew that it was a false alarm. There was none of the tight-lipped, whispering urgency that he had dreaded during their silent ride to the hospital. They wanted to keep her in for the night, anyway; twins occasionally baffled their gadgetry. Drew sat with up with her through the dawn, chasing those beers with bad coffee as he watched over her relieved slumber.

They were home by nine. He helped Ronnie into bed, then climbed in as well, spooning up behind her round hot body. They slept until noon, when the distant ringing of a phone woke him. He could hear it downstairs but not on the master bedroom’s phone, which confused him until he remembered that he’d turned off its ringer after they got home. Ronnie slept on, her flush face serene in a plane of bright midday light, her ginger hair lit like some hothouse flower. Shannon was awake in the kitchen, the Sunday paper spread on the kitchen table, a spoonful of yogurt hovering near her mouth.

“Since when do you outsleep me?” “We were at the hospital all night.” Her expression turned serious.

“Don’t worry,” he said. “False alarm.”

“She really should stop working, you know.”

“She feels responsible to her patients.”

Shannon returned to flipping indifferently through the paper.

“So what did you do last night?” he asked.

“Party. End-of-the-year festivities have begun.”

He still found it hard to imagine Shannon attending the series of rowdy house parties that accompanied graduation. It was a shame that she’d left it so late.

“Hey, who just called?” he asked. “I thought I heard the phone.”

“Oh, sorry. It was Quint.”

Quint? Really? What did he want?”

“To talk to you. He left his mobile number. Wait, it’s . . .“

She handed him a drugstore circular with a number penned in the margin.

“So what’s up, Dad?” she asked. “What are you doing with Quint?”

Drew hated to lie to Shannon, after all those years when the truth between them was just about the only thing he had. But there was no other choice.

“Probably just wants to get the tennis thing going again.”

He phoned from his study, wondering whether Quint wanted to give him the chance to up his investment now that the lockup was ending. It would be tricky; he’d probably have to bring Andy Starke in on what he was doing if he tried to borrow any more against the house. On the other hand, it would be embarrassing to turn down such an offer.

Quint sounded very far away, his voice layered with static.

“Drew, yes, I was wondering if we could get together tomorrow.”

“Sure. Absolutely”

Quint broke away for a moment to speak to someone in the room with him.


He came back on.

“Can you make it after lunch? About two?”

Drew had precisely nothing planned for the following day

“That shouldn’t be a problem.”

There was an impatient chorus of voices in the background.

“All right. I’ll see you then.”

“Is there anything I should know or—”

But the connection was already dead.

Time to go. Drew plucked his briefcase from the bridge and strode through WMV’s heavy, iron-framed doors. The receptionist invited him to take a seat. He would have to wait a few minutes after all; Quint was running a bit late. From where he sat he had a view of the entire open-plan office. The once-decrepit building was now perfectly clean and perfectly still, a place more appropriate for contemplation than high finance. There was nothing in the design to suggest the nail-chewing tension and split-second frenzy associated with Quint’s business. The intervening floor had been knocked out to turn the small factory’s two cramped stories into a single unbroken space; the stone walls had been uncovered and sanded. The light was natural, pouring through skylights and long vertical windows but mostly, at the far end of the building, through the sheer wall of glass that overlooked the park’s gently rolling acreage. The main-floor area was populated by secretarial staff and younger associates. Hammered iron walkways ran above them on either side, lined by the offices. Just beneath that wall of glass was a common area with sofas and lounge chairs and ta­bles. Above everything, Quint’s office hung like the car of some great elevator, a floating glass cube. Drew could see him in there now, lean­ing back against his desk, talking to three men gathered in a tight crescent of chairs. His arms were folded across his chest; occasion­ally, his right hand would free itself to make a frugal gesture.

It was the same scene that had confronted Drew during his first visit to WMV last May, a meeting he’d been angling for ever since he and Quint became tennis partners. Drew had almost wrecked his car racing across town once the call finally came. In his office Quint was very different from the reserved, slightly shy man Drew had come to know on the court and at school functions. The polite wariness had been replaced by a clipped, almost conspiratorial tone. He talked nonstop for nearly ten minutes, telling Drew about WMV, explaining why it was different from other hedge funds. Drew lost his way occa­sionally in the jargon, especially a short interlude about “stochastics.” But he’d grasped the basics: Quint traded in the world’s volatility, bet­ting that incorrectly priced markets would eventually stabilize. His fund was “global macro”; he’d invest anywhere, anytime. Bonds, stocks, currency, futures. Emerging markets, established ones, mar­kets that weren’t even made yet. What stuck in Drew’s mind was Quint’s insistence that all markets were ultimately rational and that the key to making big money was to move into the temporarily irra­tional ones before they stabilized. How exactly he did this was a mys­tery to Drew; Quint had offered him a glimpse of a computer screen that was stacked with a series of crowded, mutating line graphs that could have been describing the workings of a bumblebee’s nervous system. Quint also explained that a client’s money would not be actu­ally invested in the markets, but rather used as collateral for the very large amounts he borrowed.

“We’re leveraged. Big time. And we can afford to be because we’re right.”

As for the rest, it was pure Greek. But the details weren’t impor­tant. Drew had been to Quint’s house; he’d seen the cars and tennis rackets and wristwatches of his clients; he’d listened to their talk about Gulfstreams and houses in Aspen and fifty-thousand-dollar March Madness wagers. Not that Drew was interested in any of that. He knew they were out of his league. All he wanted was the stability that would come with just a fragment of such wealth, the sense that he was no longer being buffeted by life. All he wanted was enough. To live as his father had lived, effortless and calm. Although Quint re­fused to quote numbers, Drew knew from his Web searches and what he’d heard at their Saturday-morning tennis sessions that last year in­vestors in WMV had seen a return of 44 percent.

Forty-four percent.

“But we have to move on this,” Quint said. “Minimum participation is two-fifty. And there’s a one-year lockup.”

It took Drew several long seconds to understand that the sum of $250,000 had just been mooted. He’d arrived thinking he could just about manage thirty.

“Obviously that’s just the ante,” Quint added. “You can participate at a more robust level. Most come in at about a million. Rookies I cap at two. Unlike Steinbrenner. After your lockup we’ll talk about ac­cepting further capital.”

“Okay” Drew said. “Let me . . . can I let you know?”

“Let me know what?” Quint asked after a moment.

“My, you know, how much I want to put in.”

Quint relaxed.

“Sure. But I need to know something by the close of play tomorrow. I want to get you set up for a June dividend next year. Plus I have a ninety-nine-partner limit, and there’s a pretty hefty waiting list for this spot.”

Drew had left in a gloomy trance. For some reason he’d thought Quint would understand he didn’t have that kind of money to invest, that he was just after enough cash to pay for his daughter’s college and knock down his credit cards. A strange notion, since as part of his effort to impress the men at the tennis games, he’d been hinting that he’d just closed on some fairly large property deals and was swimming in cash. As he drove back to town, he went though the motions of try­ing to determine where he could get his hands on a quarter million dollars. A futile exercise. Five years earlier he could have siphoned it out of Hagel & Son, but that money was gone. He had eighteen thou­sand in various bank accounts, half of which he figured he could ded­icate to an investment. For the rest of the thirty he’d been planning to borrow against the big Northwestern life insurance account his father had set up for him when he was a boy. But that was it. Two hundred and fifty was an impossible number. By the time he got to his office he knew he had no choice but to beg off. He was clearly out of his league. His bluff had been called. Badgering Quint had been a foolish mistake, taking unfair advantage of their growing friendship. But he couldn’t make the call. He sat at his desk for nearly an hour, staring at the phone, unable to bring himself to admit that he would never be able to join Quint’s fund.

What amazed him was how easily the answer came to him. He’d borrow it from the equity credit line they’d opened a year earlier, when Ronnie was in her second pregnancy. Their plan was to use it to renovate the house once the baby was born. Although 33 Crescent had been heavily mortgaged to pay off Anne, the recent property boom had inflated its notional value far enough that they would be able to sap a couple of hundred thousand more dollars from its old wood. But then they’d lost the baby and the loan had remained dor­mant. Without ever saying so, Drew and Ronnie agreed that it would be spent only once a child was pinkly oxygenated and nestling on her chest.

Although he understood that there was no way he could use this money to invest in a private fund, the thought wouldn’t go away. Within a few hours it became inevitable. It would be simple. Ronnie would never know. He’d do everything through his office. Even if she got pregnant in the next few months—an event that of course came to pass—he’d have received his first dividend by the time they were ready to start renovating. He would have to hustle to make the repay­ments for that first locked-up year, but come the following June the weight of his debts would be lifted. And it wouldn’t be the ten or twenty thousand per year he’d anticipated when he first approached Quint, but a hundred thousand. More. He’d be able to pay down the credit line; Oberlin would be a snap; he could pay the builders. Five years down the road the credit line would be gone. Every penny he made from WMV from then on would be profit. Pure, weightless, frictionless money. He could help get Shannon going in life; Ronnie would be able to build her practice. And he’d never have to drag his tired bones out to show some lousy, crumbling, odoriferous pile that no one wanted to buy, never have to lose another listing to the barn­dans at Property Management. He’d be clear.

There would, he admitted to himself, be trouble if Ronnie found out. She was averse to all forms of risk. It led to stress, which was in her eyes a poison more deadly than leaked PCBs. Gambling with their house was something even she might never forgive. But she didn’t understand. She hadn’t spent those Saturday mornings with Quint and his partners. Nor did she know how desperate things were at Hagel & Son, what it was like to wake up at four in the morning and wonder how he was ever going to afford Shannon’s college, much less the new family they so badly wanted to start. What it was like to pay two hundred thousand dollars to a selfish damaged woman in ex­change for one scared and confused daughter to raise without an instruction manual and then, as an added bonus, to watch his father’s business waste away to nothing in the distraction that followed.

And so he had met with Andy Starke at Bill’s Tavern that evening, saying he wanted to increase the credit line by a hundred thousand to start the major overhaul of the house. Starke said it shouldn’t be a problem. He knew Drew. He knew the house. Only a fool would re­fuse to lend against 33 Crescent. The following morning Drew had called Quint and told him that yes, he wanted in.

“Fantastic,” he said. “I’ll have someone drop off an accredited in­vestor form and we’re all set.”

“Accredited investor form?”

“It’s an SEC requirement. It basically says you make two hundred grand a year or have clear assets over a mil. Get that back to me, and we’re good to go.”

Filling out the form proved easy. It felt good, actually, fabricating big numbers for the income and asset columns, erasing all that debt. He’d been worried when Quint had him give the form to Mahabal, but the sharp-eyed lawyer didn’t check closely. Why would he? Drew had spent the last few months as a regular guest on Orchard. His daughter was dating Quint’s son. He was one of them.


Human Capital will have some special appeal to readers who’ve been involved in hedge funds, or who are familiar with the approach used by Long Term Capital Management. Every reader will appreciate Amidon’s presentation of those aspects of parenting, belonging, and striving that can bring out the best and worst of human nature.


Steve Hopkins, January 25, 2005



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The recommendation rating for this book appeared

 in the February 2005 issue of Executive Times


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