The morning of December 25th, 1895, dawned bright and crisp over the Kingston household. A thin layer of snow dusted the ground outside, adding a touch of magic to the already festive air. Inside, the scent of pine needles filled the small house, emanating from the carefully chosen Christmas tree that stood proudly in the parlor. It wasn't as lavishly decorated as trees would be in the future, but it twinkled with the soft glow of candles carefully placed in holders, interspersed with a few precious glass ornaments and strings of popcorn and cranberries, lovingly crafted by Mary and Elizabeth. Small, wrapped packages, tied with ribbons, lay scattered beneath its branches.
Michael was the first one awake, his eyes wide with anticipation. He crept down the stairs in his nightshirt, his small feet padding softly on the wooden floor. The sight of the tree, bathed in the gentle light, made his breath catch in his throat. He had helped decorate it just a few evenings prior, carefully hanging a hand-painted wooden star right at the very top.
Soon, the rest of the family joined him. George, his face still a little tired but beaming with warmth, ruffled Michael's hair. "Merry Christmas, champ!" he boomed, his voice full of cheer. Elizabeth followed, her usual stern gaze softened into a loving smile as she embraced her son. Even John, usually reserved, had a smile on his face as he wished Michael a Merry Christmas. Mary, ever the nurturing presence, had already started preparing a special breakfast of hotcakes with maple syrup, a rare and delightful treat.
After a hearty breakfast, dressed in their finest clothes, the Kingstons made their way to the local church. The small building was filled with parishioners, their voices raised in joyous hymns celebrating the birth of Christ. The air was filled with the scent of beeswax candles and the solemn beauty of the service. As John sat in the pew beside his family, his gaze drifted across the congregation. He recognized several faces – men who had once been his peers in the bustling world of finance, individuals with whom he had shared lunches, business deals, and camaraderie. Men who, in the prosperous days before the Panic, had considered him an equal. Today, however, when their eyes briefly met his, there was a flicker of something akin to dismissal, a subtle turning away as if they hadn't truly seen him. A faint shadow of disappointment crossed John's face. He understood. The sting of recent financial troubles still clung to him in their eyes. But the feeling was fleeting. He glanced down at Michael, his bright eyes shining with innocent joy, and then at Elizabeth, George and Mary, their familiar presence a comforting anchor. A quiet resolve settled within him. These were the people who truly mattered.
Back home, Michael was the center of attention. He was showered with small gifts: a new wooden train set from his parents, "The Adventures of Tom Sawyer," the very book Michael had been asking about for weeks, from John, and a hand-knitted woolen scarf from Mary to keep him warm during the winter months. Each gift was received with wide-eyed wonder and a heartfelt "Thank you!"
After the gift opening, the family gathered around the piano. Mary played familiar Christmas carols, and everyone sang along, their voices blending in a joyous harmony. Michael, though not always hitting the right notes, sang with gusto, his heart filled with the warmth of family and the magic of the holiday.
Later in the day, the aroma of a grand Christmas dinner filled the house. A plump roasted chicken, glistening golden brown, sat at the center of the table, surrounded by bowls of mashed potatoes, buttered peas, and cranberry sauce. There was also a rich plum pudding, its sweet scent promising a delightful end to the meal. Michael enjoyed the special dishes, savoring each bite.
Throughout the day, Michael was pampered endlessly. He was allowed to stay up a little later than usual, his every wish seemed to be anticipated, and he was regaled with stories and laughter. Even John, who often maintained a more serious demeanor, indulged Michael with tales of his own childhood Christmases.
As the evening drew to a close, and the soft glow of the fire in the hearth cast dancing shadows on the walls, the family gathered in the parlor once more. John looked around at his brother, his sister-in-law, and his bright young nephew, a warmth spreading through his chest that had little to do with the fire. He thought of the past year, the financial anxieties that had weighed heavily on them, and then he looked at Michael, whose innocent joy filled the room.
"You know," John said quietly, a hopeful tone in his voice, "this has been a truly wonderful Christmas." He paused, his smile lingering as he looked at Michael. "Let's hope that by this time next year, our fortunes will have turned, and we'll have even more to celebrate." George and Elizabeth exchanged a hopeful glance, a shared sentiment echoing in their hearts. As the snow continued to fall gently outside, a quiet sense of optimism filled the Kingston home, a belief that the coming year held the promise of brighter days, perhaps even brighter than they could have imagined, thanks to the extraordinary young boy nestled amongst them.
********
The day after Christmas, a sense of eager anticipation filled the Kingston home as John carefully unfolded the financial pages of the newspaper. George and Elizabeth peered over his shoulders, while Michael watched with innocent curiosity. Their eyes scanned the stock listings, comparing them to the names Michael had confidently declared as "winners" and "losers" just days before at the Exchange. A collective gasp of astonishment rippled through the room. Michael's week-long predictions had proven to be remarkably accurate, with the designated "winners" showing notable gains and the "losers" indeed experiencing a dip in their stock prices. The young boy's unusual gift was becoming increasingly undeniable.
The family gathered in the parlor, the newspaper spread across the table, Michael's list of stocks from their last visit to the Exchange lying beside it. The remarkable accuracy of his predictions for that single day had shifted their initial doubts into a cautious but growing belief.
"We need to be smart about this," John said, tapping a finger on the newspaper. "Michael has a gift, that much seems clear. But the stock market can be unpredictable. We shouldn't risk everything."
"Agreed," George replied. "We have around $6,500 in savings. Perhaps we could allocate a portion of that to test Michael's ability. Say... $5,000?"
"It feels like a lot," Mary said, her brow furrowed with a hint of concern, "but if Michael's predictions continue to be accurate, it could be a real turning point for us." Elizabeth nodded in agreement.
"We also need a strategy for how we invest," John continued, looking at the list Michael had provided for the coming week and month. "Michael simply pointed out certain stocks. But looking at the financial pages over the last week, I've noticed a pattern. The stocks he identified as potential winners and losers for today all experienced a price change of more than ten percent. Then there are other stocks on the board that didn't make his list. These seem to have had much smaller fluctuations, some up, some down, but all below that ten percent threshold. Based on this, it seems Michael's ability is most effective in identifying stocks with more significant potential for change."
"So, how do we proceed, Brother?" George asked, leaning forward.
John picked up his pen. "Well, for the stocks Michael picked as 'Winners', based on my analysis, have the potential for significant increase, we should look at buying shares directly. That seems the most straightforward way to benefit from his insight there."
"And for the stocks he picked as 'Losers'?" Elizabeth inquired.
"That's where we could consider 'shorting' the stock," John explained. "Shorting is essentially betting that a stock price will go down. Here's how it works: we would borrow shares of that company from a broker and then sell them on the market. Our hope is that the price will drop. If it does, we can then buy those shares back at the lower price and return them to the broker, making a profit on the difference."
John then took a moment to explain the concept of shorting with an example. "Imagine a share of a company is currently worth $100. If Michael picks this stock as a potential loser, we could short it. We borrow one share and sell it for $100. If the stock price then falls to $90, we can buy that share back for $90 and return it to the broker. We would have made a profit of $10 (minus any fees or interest for borrowing the share)."
"That sounds a bit risky," Mary commented, her concern evident. "What if the stock price goes up instead?"
"That's the risk with shorting, Mary," John acknowledged. "If the price goes up, we would have to buy it back at a higher price, resulting in a loss. That's why, for now, we should focus on the stocks Michael has indicated with a clear potential for significant movement, either up or down, based on my analysis of past performance aligning with his picks."
"So," George summarized, "for the stocks Michael picked as potential winners, we buy shares. For the ones he picked as potential losers, we consider shorting them."
"And the other stocks, the ones Michael didn't pick?" Elizabeth asked.
"Given that Michael's ability seems geared towards spotting larger fluctuations, and my observation of the past week supports this, it's best we avoid those for now," John replied. "Let's focus our resources where Michael's insight gives us the clearest indication of a significant price change."
With this strategy clarified, John began to refine their investment plan, carefully noting the stocks Michael had identified for the week and month ahead, ready to allocate their $5,000 and embark on this new, uncertain, but potentially rewarding venture.