The Genius of the Hohenzollerns
With a mighty cry, the baby opened his eyes.
In the midst of the chaotic atmosphere, he felt gazes fixed upon him. He tried to look around through a cloudy, unfocused haze, but he could not clearly distinguish a single face. People exchanged words in an incomprehensible tongue and burst into laughter again and again.
The baby tried to ask them what was happening, but his voice twisted into a wail. A young woman hurriedly scooped him up. Only then did the baby realize he had become very small.
I've turned into a baby?
The shock hit him hard. And there was more to come. The young, beautiful woman holding him was a white woman—someone he had barely glimpsed a few times even at university. He tried to speak again, but nothing came out except a tearful sound.
The woman smiled down at him and guided him naturally toward her breast.
I never asked for milk!
His protests went unheard. A moment later, a rosy nipple slipped into his mouth. Without meaning to, the baby began to suck vigorously.
I wasn't even hungry.
But reason could not overcome instinct. He soon focused entirely on easing the hunger. And so began a life of eating, sleeping, and soiling himself. At first it was humiliating and wounded his pride, but human beings grow used to anything.
During those mortifying days, the baby carefully memorized the conversations between the young woman who nursed him and her lady-in-waiting. Unlike the others, they spoke English, which made them relatively easier for him to understand.
Of course, even their English differed in vocabulary, phrasing, and grammar from the English he knew as "common sense," so grasping it still demanded considerable effort. Still, the information he pieced together could be summarized as follows:
This was the year 1868, in the Crown Prince's Palace in Berlin, Prussia. His full name was Joachim Friedrich Ernst Waldemar von Hohenzollern, the fourth son of Crown Prince Friedrich III and Crown Princess Victoria. The woman nursing him was his own mother, Princess Victoria.
She had lost custody of his eldest brother Wilhelm, his second brother Heinrich, and his eldest sister Princess Charlotte to the Empress, and his third brother, Prince Sigismund, had died young. As the only remaining male royal child left in her care, she clung to him with deep attachment.
For scraps of overheard conversation, it was enough to sketch the situation reasonably well.
Waldemar… the prince who was supposed to die of diphtheria in 1879.
Through the 1880s diphtheria was virtually untreatable, yet it was not something to panic over. If the time came, he could simply arrange a trip to his grandmother's house in England and avoid the disease that way. What truly concerned him was his eldest brother, the Crown Prince's heir, Wilhelm.
That one-armed disaster… ugh.
Having as monarch the very brother who would drag the empire into a world war was nothing short of a catastrophe. With a brother who was the strongest ally of the French Third Republic ascending the throne, the empire's ruin was guaranteed. One hundred percent certain.
Look on the bright side. Even if Wilhelm wrecks Germany, the family itself won't go under.
Even after Germany lost the world war, the royals had not been reduced to beggars. Wilhelm himself—the man who had ruined the country—had lived out his full span chopping firewood at Huis Doorn in contentment. What Waldemar truly regretted was the loss of royal status itself: a lifetime of enormous royal pensions guaranteed no matter what. A diamond spoon that let you live like a chaebol without lifting a finger.
He mourned the future he was about to lose, then shook the thought away.
There's plenty of time until the empire falls. In that time I'll accumulate enough wealth to buy the world. Then a few pension crumbs won't even register.
Nursing at his mother's breast, Waldemar laid out his own life plan. To set that plan in motion, he first had to become a genius the House of Hohenzollern had never seen before. Only then would he gain the justification to achieve economic independence from childhood.
Reaching the goal won't be hard.
He was confident. Whether it was a side effect of reincarnation or not, he could still recall even the contents of YouTube videos he had watched as idle entertainment in his previous life. Fully exploiting the knowledge in his head, packaging himself as a prodigy proficient in every field would be no trouble at all.
Time flowed swiftly. The Germans crushed France in the Franco-Prussian War and proclaimed their empire in the Palace of Versailles, the very symbol of French pride. By single-handedly defeating the nation that had once claimed to be Europe's strongest power and extracting a colossal indemnity, the empire's prestige seemed to have reached its zenith. The boy watched the shifting international situation with keen interest.
"Ah, if only I'd had money to invest, I would have bought French government bonds."
The London banker Junius Spencer Morgan had scooped up French bonds that had crashed because of the war. At the time France needed 250 million francs—equivalent to ten million pounds—for war reparations and postwar reconstruction, yet no bank in Europe would underwrite the loan.
Morgan boldly stepped in, purchasing the entire issue at an 85 percent discount. When the Paris Commune uprising later drove the bonds down to 55 percent of face value, he bought still more. As a result, when France redeemed them at par in 1873, Morgan walked away with a staggering profit of 1.5 million pounds.
In Waldemar's eyes it had been money for nothing. Given France's vast overseas assets and agricultural productivity, there had been no real risk in investing in French bonds.
"Ah, free money I simply let slip away."
His English tutors reported the boy's lingering regret over French bonds to the crown prince and princess. Crown Prince Friedrich III merely laughed at his son's attachment, but Crown Princess Victoria thought differently.
She was already considering giving an opportunity to a son who had displayed astonishing talent in music, mathematics, Latin, English, history, philosophy, medicine, economics, literature—almost every field. From the age of three he had kept his own household ledger and diary, and every time he did so he expressed a desire to manage money himself.
Baldi seems to have inherited the financial instincts of the English. Wouldn't it be good to nurture that talent from early on?
Victoria wrote to her mother, Queen Victoria, seeking her opinion and received a positive reply. Not long afterward, Waldemar received one hundred pounds from his mother—roughly two thousand marks at the time.
Considering that a German laborer's monthly wage was eighty marks, it was a substantial sum for a child to handle. Victoria told him to think carefully about how best to invest it, while also warning that the money had been advanced from his inheritance and must not be wasted.
A reaction already. Has Mother been that impressed by my genius?
Waldemar was satisfied at having extracted investment capital from her. Considering that royals normally achieved financial independence only upon reaching adulthood, this was truly special treatment.
So how should I invest this money?
This was 1873, the year the Long Depression would begin; it was not a good time for stocks or real estate. If one had to invest, safe assets such as gold or government bonds were secure, yet their returns were thin. After wringing his memory dry, Waldemar hit upon a way to make money.
Short selling.
The collapse of the Vienna stock exchange on 9 May 1873 would offer short sellers an enormous speculative opportunity. The American financial crash of 18 September 1873 would be another fine chance. The problem was that a small child could not carry out such operations himself. Buying and selling shares on an exchange required adult hands.
Waldemar organized his thoughts and went to his mother. Victoria was startled when he announced he intended to invest in stocks. She remembered the story of Sir Isaac Newton, the greatest genius the British Empire had ever produced, who had still been brought to his knees by the mania of the stock market. No matter how brilliant her son was, she believed he must not rashly plunge into equities.
"My dear, do you realize you are only five years old? At that age, merely having an agent invest in gold or government bonds would already be considered remarkable."
She was not wrong. Waldemar set about persuading his mother with cold logic.
"Mother, this year's stock market is already destined to collapse because of the poor performance of the railway companies. When they fall, the banks will fall; when the banks fall, the real economy will be ruined in turn. The crash of the stock market is an unavoidable fate."
Victoria quickly countered.
"If what you say is true, then investing in stocks is the last thing one should do, is it not?"
"What I intend is not ordinary stock investment. I mean to engage in short selling—profiting when share prices collapse."
Waldemar launched into an elaborate explanation of the possibilities of short selling, mixing technical terms with practiced fluency. Victoria felt a dizzying confusion under her son's dazzling rhetoric. She did not fully understand what he was saying, yet simply listening made her feel she too could make easy money! Now she was no longer even sure she should stop him.
She forced herself to recall the sad lesson of Sir Isaac Newton.
"Baldi, I can see you've thought this through in your own way, but you are not some Jew who has spent a lifetime in the stock market. Wouldn't it be safer simply to buy government bonds or gold?"
"Failure is the mother of success. Whether I fail or succeed this time, I want to experience financial investment at least once, Mother."
Victoria decided to yield a step before the stubbornness of the Hohenzollern genius. Compared with her own dowry it was pocket change; she could simply regard it as an educational expense for her son.
"Very well. Do as you wish."
The reincarnated soul smiled with quiet satisfaction at his mother's consent. The time had come for an economic predator who would strike terror into the world economy to make his debut.