Although Cæsar did not distinguish himself especially in Congress, he
worked hard. His activities were devoted mainly to two points: the stock
exchange and Castro Duro.
Cæsar had found a partner to play the market for him, a Bilboan
capitalist, whom he had convinced of the correctness of his system.
Señor Salazar had deposited, in Cæsar’s name, thirty thousand dollars.
With this sum Cæsar played for millions and he was drawing an
extraordinary dividend from his stocks.
Their operations were made in the name of Alzugaray, whose job it was
to go every month to see the broker, and to sign and collect the
certificates. Cæsar gave his orders by telephone, and Alzugaray
communicated them to the broker.
Alzugaray often went to see Cæsar and said to him:
“The broker came to my house terrified, to tell me that what we are
going to do is an absurdity.”
“Let it alone,” Cæsar would say. “You know our agreement. You get
ten percent of the profits for giving the orders. Do not mix in any
further.”
Often, on seeing the positive result of Cæsar’s speculations, Alzugaray
would ask him:
“Do you find out at the Ministry what is going to happen?”
“Pshaw!” Cæsar would say; “the market is not a capricious thing, as you
think. There are signs. I pay attention to a lot of facts, which give
me indications: coupons, the amount shares advance, the calculation of
probabilities; and I compare all these scientific data with empirical
observations that are difficult to explain. In such a situation, events
are what make the least difference to me. Is there going to be a
revolution or a Carlist war?... I am careless about it.”
“But this is impossible,” Alzugaray used to say. “Excuse me for saying
so, but I don’t believe you. You have some secret, and that is what
helps you.”
“How fantastic you all are!”’ Cæsar would exclaim; “you refuse to
believe in the rational, and still you believe in the miraculous.”
“No, I do not believe in the miraculous; but I cannot explain your
methods.”
“That’s clear! Am I to explain them to you! When you don’t know the
mechanism of the market! I am certain that you have never considered the
mechanism of the rise produced by the reintegration of the coupon, or
the way that rise is limited to double its value. Tell me. Do you know
what that means?”
“No.”
“Well, then, how are you to understand anything?”
“All right, then; explain it to me.”
“There’s no difficulty. You know that the natural tendency of the market
is to rise.”
“To rise and to fall,” interrupted Alzugaray.
“No, only to rise.”
“I don’t see it.”
“The general tendency of the market is to rise, because having to fall
eighty _céntimos_, the value of the coupon, every quarter, if the market
didn’t rise to offset that loss, shares would reach zero....”
“I don’t understand,” said Alzugaray.
“Imagine a man on a stairway; if you oblige him to go down one step
every so often, in order to keep in the same place as before he will
necessarily have to go up again, because if he didn’t do so, he would be
constantly approaching the front door.”
“Yes, surely.” “Well, this man on the stairway is the quotation, and the
mechanical task of constantly making up for the quarterly loss is what
is called the reintegration of the coupon.”
“You do not convince me.”
Alzugaray didn’t like listening to these explanations. He had formed
an opinion that had not much foundation, but he would not admit that
Cæsar, by reasoning, could arrive at the glimmering of an inductive and
deductive method, where others saw no more than chance.