It was still dark when Brenden O’Neill drove his car through the tree-lined streets of suburban Houston, making the short commute from his home to the Koch Supply & Trading office. He usually arrived for work around seven in the morning. Or, to be specific, he arrived for work around seven a.m. in the Houston morning, as opposed to the London morning or the Singapore morning. There was no single morning for a commodities trader like O’Neill. Instead, there was a rolling series of mornings, each one representing a signal point at various places along the globe, marking the passage of global markets that circled the world and never slept. London, Singapore, Moscow, Geneva. Activity in these markets advanced with the horizon of dawn, passing one major trading hub after the next. O’Neill liked to be stationed at his desk when the markets hit the all-important New York morning, and trading began with a frenzy on Wall Street. By that time, O’Neill was ready to execute transactions worth several hundred million dollars.
O’Neill was thirty-one-years old. He seemed like an unlikely candidate to work in the world of high finance. He had never worked on Wall Street and didn’t have a degree in finance or economics. But O’Neill was exactly the kind of person whom Koch Industries hired to staff its trading floors. The company preferred engineers to financiers and preferred graduates of midwestern state schools to the Ivy Leagues. O’Neill had graduated from the University of Kansas with an engineering degree and spent most of his career working at Koch Industries’ oil refinery in Corpus Christi. He still dressed like a refinery worker. The standard uniform for a Koch derivatives trader wasn’t a pin-striped suit with cufflinks, but khaki pants with a short-sleeved golf shirt. He lived in a modest one-story home in the western suburbs of Houston with his wife, Heather. It was a snug fit for their family, but it worked well enough. The house was only a ten-minute drive from the Koch Supply & Trading office, a building with black windows that looked like an obsidian cube, tucked away in a quiet, commercial neighborhood near the Houston Zoo.
The headlights of O’Neill’s car cut across the garage entrance to the tower as he approached. It was early in the winter of 2000, and the temperature was in the lower fifties—a freezing spell by Houston’s standards. The morning temperature was a salient fact for a derivatives trader. The weather meant everything. The weather determined how the markets might buck and heave throughout the day as commodities traders tried to figure out how much heating gas, electricity, and crude oil might be consumed across the United States. Unexpected temperature changes could change these calculations in an instant. One of the first things O’Neill did every day was read through a series of proprietary secret weather reports produced by Koch analysts. He needed to gain an edge over the New York morning. He parked his car in the company garage, and headed toward his trading desk.
The interior lobby of 20 Greenway Plaza was colorful and visually dazzling, like a geode hidden inside a black stone. The spacious atrium rose up several stories, and the open space was crisscrossed by a series of silver escalators that slanted upward at interlocking angles, like something out of an M. C. Escher lithograph. The walls were covered with grids of lighted squares glowing yellow and with metallic circles that looked like jumbled points on a graph. A security guard was stationed at a circular wooden desk in the center of the space.
O’Neill rode the elevator up to Koch’s trading floor.
Koch’s trading floor was a cavernous room that sprawled for several thousand square feet, taking up an entire floor of the office building. O’Neill walked through a maze of trading desks as he made his way to his work station. The traders sat side by side in long rows, each trader facing one or more bulky computer screens. The desks were covered in piles of papers and files and telephones that were used at a punishing level of intensity throughout the day. By seven o’clock, many of the desks were already filled. Not too far from O’Neill’s desk, for example, Koch’s in-house meteorologist was hard at work developing reports that he would soon e-mail out to the teams of traders. Even though the office was crowded, the trading floor wasn’t a loud or unruly place. It wasn’t a commodities pit where red-faced men in loosened ties yelled orders across the room. It felt more like the headquarters of an insurance brokerage or an investment research firm. The day was filled by the ambient clatter of keyboard typing and the background murmur of salespeople working the phones.
O’Neill settled into his desk and turned on his computer. His face seemed weathered in a way that was particular to the place he grew up—Wichita. His features were drawn and narrow, his cheekbones high and sharp. He was lanky and had sky-blue eyes. Both of his parents were raised on small farms, and he never knew a life of wealth, let alone entitlement. Now, after joining Koch Supply & Trading, O’Neill had a chance to become something different. He had a chance to get rich. He spent his days working in the epicenter of an unprecedented wealth machine called the derivatives market. This was the supercharged engine of America’s economic growth during the 2000s. The profits from derivatives were larger, in fact, than the profits for the real, underlying economic activity that derivatives were based on—you could make more money from selling natural gas derivatives than selling natural gas. O’Neill managed to become one of the insiders who knew how things worked inside the black box, and this knowledge gave him a once-in-a-lifetime opportunity. He had the chance to make so much money, off a single giant trade, that he might be able to elevate himself out of the American middle class forever.
It was almost an accident of circumstance that O’Neill found himself in the position to make a fortune almost overnight. His path to Koch’s trading floor began in a humble working-class neighborhood in Wichita. O’Neill’s dad worked as an engineer at the Boeing aircraft factory, earning a decent middle-class living. O’Neill’s mom stayed home and took care of the kids, which entailed the workload of an executive-level position—O’Neill was the youngest of nine children. He shared his childhood bedroom with three of his brothers, all of them sleeping in a matching set of bunk beds. The family had enough money to get by; a typical family vacation was a weekend trip to Kansas City to watch a Royals baseball game. Ever since he was young, O’Neill wanted a richer life than his parents had. He wanted to be a doctor because doctors made a lot of money and lived in the big houses near the Wichita Country Club. He would take his kids on real vacations and maybe give each kid their own bedroom.
O’Neill never considered working for Koch Industries until he was well into college. He was attending KU when a recruiter from Koch came to campus and pitched O’Neill on the idea of taking a summer internship. O’Neill paid a visit to Koch headquarters. He couldn’t believe what he saw. The place was crawling with all these guys who were so young. O’Neill was interviewed by a former Exxon employee named Kyle Vann, a senior manager in the company’s oil group, who couldn’t have been any older than his midthirties. And these guys weren’t just young—they had money. They didn’t even have to brag about having money; it was obvious in the way they carried themselves. The guys at Koch had that same air of confidence as the members of a winning football team. O’Neill wanted to be part of this. He took the summer internship and was paid $3,000 a month, a staggering sum. It was more than many kids in Wichita made in a whole summer.