Michael Lewis

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What happened next was that CNBC—which Jonathan now rose at five each morning to watch—announced its stock-picking contest for children. Jonathan had wanted to join the contest on his own but was told that he needed to be on a team, so he went and asked two friends to join him. Several thousand student teams from schools across the country, each consisting of at least three children, set out to speculate their way to victory. Each afternoon CNBC announced the top five teams of the day. To get your name read out loud on television you obviously opted for highly volatile stocks that stood a chance of doing well in the short term. Jonathan's team—which dubbed itself "the Triple Threat"—had a portfolio that rose 51 percent the first day, which put them in second place. They remained in the top three for the next three months, until, in the last two weeks of the contest, they collapsed. "The problem was that in the last two weeks I listened to my teammates," said Jonathan. "I did it all until the end and then I let them talk me into buying Netscape and Western Union. So we finished fourth."

Even a fourth-place finish was good enough to fetch a camera crew from CNBC, which came and filmed the team in Cedar Grove. The Triple Threat was featured in the Verona-Cedar Grove Times and celebrated on television by the Cedar Grove Township Council. "From then everyone at work started asking me if Jonathan had any stock tips for them," said Greg. "They still ask me," said Connie. From that time also dated Jonathan's most distinctive attribute: his attaché case. In it he kept reams of stock market research; and he never went to school without it. Everywhere Jonathan went he found grown-ups asking for advice about the markets. A couple of them were professional stockbrokers. "He was taking a physics test," said Connie, "and the biology teacher knocked on the door and pulled him out of class to ask him if he had any stock ideas."

"No," said Jonathan, "that teacher already had his stocks. He had a list of five stocks that he thought had bottomed out, and he wanted to know what I thought." He said this in an indifferent tone, as if it happened every day, because it did. The effect on Cedar Grove public opinion of the SEC's call was to confirm the general suspicion that Jonathan knew something other people did not.

By the spring of 1998 Jonathan's ambitions were growing. He was now thirteen. He had glimpsed the essential truth of the market—that even people who called themselves professionals were often incapable of independent thought, and that most people, though obsessed with money, had little ability to make decisions about it—and realized he was special. He knew what he was doing, or thought he did. He'd learned how to find everything he wanted to know about a company on the Internet; what he couldn't find he ran down in the flesh. It became a routine in Connie Lebed's life to drive her son to various corporate headquarters to make sure they existed. Considering an investment in a bagel company, Jonathan made her drive him to taste the bagels on the other side of New Jersey. When he wanted to invest in a cigar company, he attempted to take the entire family seventy-five miles out of its way on a vacation to Florida so that he could inspect the company's newest retail outlet.

Jonathan entered the next CNBC competition, but soon became bored and abandoned it after a few weeks. "What's the point of doing it with fake money?" he said. Instead his mother opened an account with Ameritrade. "He done so well with the stock contest, I figured, Let's see what he can do." said Connie.

What he did was turn his $8,000 savings bond into $28,000, inside of a year. At around the same time, he created his own web site devoted to companies with small market capitalization—penny stocks. The web site was called Stock-Dogs.com. ("You know, like racing dogs.") Stock-Dogs.com plugged the stocks of companies Jonathan found interesting, or that people Jonathan met on the Internet found interesting. At its peak Stock-Dogs.com had maybe fifteen hundred visitors a day. Even so, the officers of what seemed to Jonathan to be serious companies wrote to him to sell him on their companies. Within a couple of months of becoming an amateur stock market analyst, he was in the middle of a web of people who spent every waking hour chatting about and trading stocks on the Internet.

The mere memory of this clearly upset Greg even more than usual. We were sitting around the dining room table, in the middle of dinner, when he was forced to retrieve it.

"He was just a little kid!" he exploded. "These people who got in touch with him could have been anybody."

"How do you know?" said Jonathan. "You've never even been on the Internet."

"I started to get scared shit," Greg said. "Suppose some hacker comes in and steals his money! Next day you type in and you got nuttin' left."

Jonathan snorted. "That can't happen." He turned to me. "Whenever he sees something on TV about the Internet he gets mad and disconnects my computer phone line."

"Oh yeah," said Connie, brightening as if realizing for the first time that she lived in the same house as the other two. "I used to hear the garage door opening at three in the morning. Then Jonathan's little feet running back up the stairs."

"Youse goddamn right I unplugged it," said Greg. He turned to me to explain. "The phone line was in the garage." It didn't seem to bother him in the slightest that every time after he'd unplugged it, his son waited until he'd gone to bed, then ran down and plugged it back in. It didn't seem to occur to him that he might be able to control his child's actions. The point was: at least he'd done something.

"He'd see something about credit card fraud and he'd start shouting," said Jonathan. "He believes it, like, happens very commonly, and it doesn't. Anyway, if someone steals your credit card on the Internet, it's not your responsibility. He doesn't even know that."

"I haven't ever even turned a computer on!" said Greg. "And I never will!"

"He just doesn't understand how a lot of this works," explained Jonathan, patiently. "And so he overreacts sometimes."

"I know, I know," said Greg, turning to me. "I'm supposed to know how it works. It's the future. But that's his future, not mine!"

Greg and Connie were both born in New Jersey, but from the moment the Internet struck, they might as well have just arrived from Taiwan. When the Internet landed on them it had redistributed the prestige and authority that goes with a general understanding of the ways of the world away from the grown-ups and to the child. The grown-ups now depended on the child to translate for them. Technology had turned them into a family of immigrants.

"Anyway," said Connie, drifting back in again. "That's when the SEC called us the first time."

The first time?