“I’ll say good night for you, then. Bye, Russell,” Alice blurted, and withdrew, closing the door behind her.

The interlude cut short Edmund’s tirade. He poured himself another drink and then one for Russell, closed his eyes for a second, and took a deep breath. Why did it have to be Gloria Croft? “You’d better tell me everything.”

Russell sat down on a low padded stool by the fire. Edmund stayed standing.

“I made some calls. It only took two, actually. I called the guy who told Teddy Hill he heard about the shorting and the guy gave up his source. It was someone I’d met before, at some mortgage convention in Vegas. He runs this bullshit financial newsletter. He got it from the horse’s mouth.”

“The horse’s ass, more like. Did he say why she’s doing it?”

“Didn’t say much. I think once he’d told me he thought better of it and got off the phone pretty quick. He got nervous. She’s a big player. BigSkies has a lot of money.”

Edmund was experiencing a less-than-pleasant sense of déjà vu. Through her hedge fund, BigSkies, Gloria Croft had taken huge positions betting on the failure of the CDOs issued by, among others, Edmund and Russell’s desk. She’d taken the positions early, in 2006, when no one else was doing it and when it was cheap to do. Hundreds of thousands of dollars could turn into tens of millions. What she was indicating was that she thought the AAA-rated mortgage-backed bonds would fail and jeopardize the futures of Wall Street giants like Bear Stearns and Lehman Brothers. Almost no one agreed at the time: There was no chance their stock could go so low. But it did, and it went lower.

Russell and Edmund were quiet, Russell staring into the bottom of his glass, Edmund at the fire hissing and spitting in the grate. He held back the fire guard and popped another log into the flames.

“She’s got some balls,” Russell said finally.

“She does.”

“This is different, though.”

“You’re right about that.”

Russell and Edmund’s thinking was following the same track. Subprime mortgages were a disaster; as assets, they were just terrible. In their “Life Settlement” paradigm, the debtors were the nation’s largest insurance companies, some of the richest institutions in the country. The bottom line was solid, encapsulated in one of Edmund’s favorite sayings of recent months: What are the insurance policy holders going to do, not die?

“So what is she doing?” Edmund said after another long pause. “It doesn’t make sense. We know the numbers, right? We’re solid all round. Actuarially, we did the worst case—people living a little longer for God knows what reason—and we’ve taken those tolerances into account. Unless she’s shorting you and me personally. But she’s too smart for that. Way too smart. There’s gotta be something she sees in the numbers.”

“If there was anything in the numbers, I’d have seen it,” Russell said a little testily.

“I know that, Russell. She’s seeing something that isn’t there. It really doesn’t matter why she’s doing it, she’s doing it and we might be left standing in the rain with our dicks in our hands. God damn it.”