His speculations came to an abrupt end as Farrell made two changes to the contracts, initialed them, signed his name at the bottom, and slid the documents across his desk to Peter. "These are all right as amended. What's your problem with the deal?"

"There are a couple of them, Mr. Farrell," Peter replied, straightening in his chair and trying to recover his earlier assertive attitude. "In the first place, I have the feeling you're going ahead with this deal because I led you to believe that we could make a quick, easy profit by reselling the land to Bancroft & Company. Yesterday, I thought that was a virtual sure thing, but I've spent the last day and a half researching Bancroft's operation, going over their financial statements, and I've also made some phone calls to some friends of mine on Wall Street. Last I talked to someone who knows Philip and Meredith Bancroft personally—"

"And?" Farrell demanded impassively.

"And now I'm not completely confident Bancroft & Company will be financially able to buy the Houston land. Based on everything I found out, I think they're heading for big trouble."

"What sort of trouble?"

"It's rather a long explanation, and I can only speculate, based on the facts and on a hunch I have."

Instead of berating him for not getting directly to the point, which Peter half expected, Farrell said, "Go on."

The two small words of encouragement banished Peter's nervous uncertainty, and he became the confident, capable investment brain they'd written up in the business magazines when he was still at Harvard. "All right, here's the overall picture: Until a few years ago, Bancroft's had a couple of stores in the Chicago area, and the company was virtually stagnant. Their marketing techniques were antiquated, their management team relied too much on the 'prestige' of their name, and they, like the dinosaur, were on the road to extinction. Philip Bancroft, who's still president, ran the stores as his father had run them—like a family dynasty that didn't need to respond to economic trends. Then along came his daughter, Meredith. Instead of going to some finishing school and devoting herself to showing off for the society pages, she decides that she wants to take her rightful place in Bancroft's hierarchy. She goes to college, majors in retailing, graduates summa cum laude, and gets her master's degree—none of which thrills her father, who tries to turn her off on the idea of working for Bancroft's by making her start at the store as a clerk in the lingerie department."

Pausing for a moment, Peter explained, "I'm giving you all this background so that you'll have a handle on who's running the store—literally."

"Go on," Farrell said, but he sounded bored, and he picked up a report on his desk and began reading it.

"During the next few years," Peter continued doggedly, "Miss Bancroft works her way up through the ranks and along the way she acquires a hell of a good firsthand grasp of everything involved in retailing. When she's promoted into merchandising, she starts pushing for Bancroft's to market its own private-label brands—a highly profitable move which they should have made long before. When that idea yields big profits, Papa shifts her into furniture merchandising which had been a losing proposition for the store. Instead of failing there, she pushes for a special 'museum antique' section, which pets written up in all the newspapers and brings shoppers into the store to ogle the antiques, which are on loan from museums. While they're there, the shoppers naturally wander over to the regular furniture department, and suddenly they're spending their furniture money at Bancroft's instead of at the suburban furniture stores.

"Papa then makes her manager of public relations, which had been a meaningless position that involved little more than approving an occasional donation to some charity and supervising the annual Christmas pageant in the auditorium. Miss Bancroft promptly set about conceiving more annual special events to bring shoppers into the store—but not just the ordinary ones like fashion shows. She also used the family's social connections with the symphony, the opera, the art museum, etc. For example, she got the ChicagoArt Museum to move an exhibit to the store, and she talked the ballet into performing the Nutcracker during the Christmas season in the store's auditorium. Naturally, all that caused an explosion of media coverage, which, in turn, created an escalated awareness of Bancroft & Company with Chicagoans and gave the store an even more elite image. Shoppers began coming to the store in record numbers, and her father switched her over to fashion merchandising, which was the next place she excelled. There, her success probably owed itself as much to her appearance as to any particular fashion talent. I've seen newspaper clippings of her and she's not only classy, she's stunning. Some of the European designers evidently thought so, too, when she went over there to talk to them about letting Bancroft's handle their lines. One of them who'd let only Bergdorf Goodman handle his line evidently cut a deal with her—he agreed to let Bancroft's have it exclusively, on the condition that Miss Bancroft herself appear in his gowns. He then designed an entire collection for her to wear, which she was naturally photographed in at various society functions. The media and the public went wild when they saw her wearing his stuff, and women began to arrive in droves in Bancroft's designer departments. The European designer's profits soared, Bancroft's profits soared, and several other designers jumped on the bandwagon and pulled their lines from other stores to give them to Bancroft's."

Farrell sent him an impatient look over the top of the report he'd been reading. "Is there a point to all this?"

"I was coming to it right now: Miss Bancroft is a merchant, like her forebears, but her special talent is actually in expansion and forward planning, and that's what she heads now. Somehow, she managed to convince her father and Bancroft's board of directors, who are anything but progressive, to embark on an expansion program and open stores in other cities. To finance the opening of those stores, they needed to raise hundreds of millions of dollars, which they did in the usual way— they borrowed what they could from their bank, then they took the company public and sold shares on the New York Stock Exchange."

"What difference does all this make?" Farrell demanded shortly.

"It wouldn't make any difference were it not for two things, Mr. Farrell: They've expanded so quickly that they're in hock up to their ears, and they've been using most of their profits to open more stores. As a result, they don't have a lot of cash lying around to weather any major economic reversals. Frankly, I don't know how they intend to pay for the Houston land, or if they can. Secondly, there's been a rash of hostile takeovers lately with one department store chain swallowing up another. If somebody wanted to take over Bancroft's, they couldn't afford to put up a fight and win it. They're ripe for a takeover attempt. And," Peter stated, deepening his voice to emphasize the importance of what he was about to say, "I think somebody else has noticed that."