Microeconomics Pindyck 8th Edition Solutions Manual

Microeconomics Pindyck 8th Edition

Solutions Manual
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 PART ONE

Introduction:
Markets and Prices
Chapter 1
Preliminaries

 Teaching Notes
Chapter 1 covers basic concepts students first saw in their introductory course but could bear some
repeating. Since most students will not have read this chapter before the first class, it is a good time to get
them talking about some of the concepts presented. You might start by asking for a definition of economics.
Make sure to emphasize scarcity and trade-offs. Remind students that the objective of economics is to
explain observed phenomena and predict behavior of consumers and firms as economic conditions change.
Ask about the differences (and similarities) between microeconomics and macroeconomics and the
difference between positive and normative analysis. Review the concept of a market and the role prices
play in allocating resources. Discussions of economic theories and models may be a bit abstract at this
point in the course, but you can lay the groundwork for a deeper discussion that might take place when
you cover consumer behavior in Chapter 3.

Section 1.3 considers real and nominal prices. Given the reliance on dollar prices in the economy, students
must understand the difference between real and nominal prices and how to compute real prices. Most
students know about the Consumer Price Index, so you might also mention other price indexes such as the
Producer Price Index and the Personal Consumption Expenditures (PCE) Price Index, which is the Fed’s
preferred inflation measure.1 It is very useful to go over some numerical examples using goods that are in
the news and/or that students often purchase such as gasoline, food, textbooks, and a college education.2

In general, the first class is a good time to pique student interest in the course. It is also a good time to tell
students that they need to work hard to learn how to do economic analysis, and that memorization alone
will not get them through the course. Students must learn to think like economists, so encourage them to
work lots of problems. Also encourage them to draw graphs neatly and large enough to make them easy to
interpret. It always amazes me to see the tiny, poorly drawn graphs some students produce. It is no wonder
their answers are often incorrect. You might even suggest they bring a small ruler and colored pencils to
class as they can draw good diagrams.

 Questions for Review

1. It is often said that a good theory is one that can be refuted by an empirical, data-oriented
study. Explain why a theory that cannot be evaluated empirically is not a good theory.
A theory is useful only if it succeeds in explaining and predicting the phenomena it was intended to
explain. If a theory cannot be evaluated or tested by comparing its predictions to known facts and
data, then we have no idea whether the theory is valid. If we cannot validate the theory, we cannot
have any confidence in its predictions, and it is of little use.

1
The CPI and PPI are reported by the Bureau of Labor Statistics (www.bls.gov). The PCE Price Index is compiled
by the Bureau of Economic Analysis in the Commerce Department (www.bea.gov).
2
The College Board collects data on college tuition (www.collegeboard.com).

Copyright © 2013 Pearson Education. Inc. Publishing as Prentice Hall.

4 Pindyck/Rubinfeld, Microeconomics, Eighth Edition

2. Which of the following two statements involves positive economic analysis and which normative?
How do the two kinds of analysis differ?
a. Gasoline rationing (allocating to each individual a maximum amount of gasoline that can be
purchased each year) is poor social policy because it interferes with the workings of the
competitive market system.
Positive economic analysis is concerned with explaining what is and predicting what will be.
Normative economic analysis describes what ought to be. Statement (a) is primarily normative
because it makes the normative assertion (i.e., a value judgment) that gasoline rationing is “poor
social policy.” There is also a positive element to statement (a), because it claims that gasoline
rationing “interferes with the workings of the competitive market system.” This is a prediction
that a constraint placed on demand will change the market equilibrium.
b. Gasoline rationing is a policy under which more people are made worse off than are made
better off.
Statement (b) is positive because it predicts how gasoline rationing affects people without
making a value judgment about the desirability of the rationing policy.

3. Suppose the price of regular-octane gasoline were 20 cents per gallon higher in New Jersey than
in Oklahoma. Do you think there would be an opportunity for arbitrage (i.e., that firms could
buy gas in Oklahoma and then sell it at a profit in New Jersey)? Why or why not?
Oklahoma and New Jersey represent separate geographic markets for gasoline because of high
transportation costs. There would be an opportunity for arbitrage if transportation costs were less
than 20 cents per gallon. Then arbitrageurs could make a profit by purchasing gasoline in Oklahoma,
paying to transport it to New Jersey and selling it in New Jersey. If the transportation costs were
20 cents or higher, however, no arbitrage would take place.

4. In Example 1.3, what economic forces explain why the real price of eggs has fallen while the
real price of a college education has increased? How have these changes affected consumer
choices?
The price and quantity of goods (e.g., eggs) and services (e.g., a college education) are determined by
the interaction of supply and demand. The real price of eggs fell from 1970 to 2010 because of either
a reduction in demand (e.g., consumers switched to lower-cholesterol food), an increase in supply due
perhaps to a reduction in production costs (e.g., improvements in egg production technology), or both.
In response, the price of eggs relative to other foods decreased. The real price of a college education
rose because of either an increase in demand (e.g., the perceived value of a college education increased,
population increased, etc.), a decrease in supply due to an increase in the cost of education (e.g.,
increase in faculty and staff salaries), or both.

5. Suppose that the Japanese yen rises against the U.S. dollar—that is, it will take more dollars to
buy a given amount of Japanese yen. Explain why this increase simultaneously increases the
real price of Japanese cars for U.S. consumers and lowers the real price of U.S. automobiles for
Japanese consumers.
As the value of the yen grows relative to the dollar, it takes more dollars to purchase a yen, and it
takes fewer yen to purchase a dollar. Assume that the costs of production for both Japanese and U.S.
automobiles remain unchanged. Then using the new exchange rate, the purchase of a Japanese
automobile priced in yen requires more dollars, so for U.S. consumers the real price of Japanese cars
in dollars increases. Similarly, the purchase of a U.S. automobile priced in dollars requires fewer yen,
and thus for Japanese consumers the real price of a U.S. automobile in yen decreases.

Copyright © 2013 Pearson Education. Inc. Publishing as Prentice Hall.

 Chapter 1 Preliminaries 5

6. The price of long-distance telephone service fell from 40 cents per minute in 1996 to 22 cents
per minute in 1999, a 45% (18 cents/40 cents) decrease. The Consumer Price Index increased
by 10% over this period. What happened to the real price of telephone service?
Let the CPI for 1996 equal 100 and the CPI for 1999 equal 110, which reflects a 10% increase in the
overall price level. Now let’s find the real price of telephone service (in 1996 dollars) in each year.
The real price in 1996 is 40 cents. To find the real price in 1999, divide CPI1996 by CPI1999 and
multiply the result by the nominal price in 1999. The result is (100/110)  22  20 cents. The real
price therefore fell from 40 to 20 cents, a 50% decline.

 Exercises
1. Decide whether each of the following statements is true or false and explain why:
a. Fast food chains like McDonald’s, Burger King, and Wendy’s operate all over the United
States. Therefore the market for fast food is a national market.
This statement is false. People generally buy fast food locally and do not travel large distances
across the United States just to buy a cheaper fast food meal. Because there is little potential for
arbitrage between fast food restaurants that are located some distance from each other, there are
likely to be multiple fast food markets across the country.
b. People generally buy clothing in the city in which they live. Therefore there is a clothing
market in, say, Atlanta that is distinct from the clothing market in Los Angeles.
This statement is false. Although consumers are unlikely to travel across the country to buy
clothing, they can purchase many items online. In this way, clothing retailers in different cities
compete with each other and with online stores such as L.L. Bean. Also, suppliers can easily
move clothing from one part of the country to another. Thus, if clothing is more expensive in
Atlanta than Los Angeles, clothing companies can shift supplies to Atlanta, which would reduce
the price in Atlanta. Occasionally, there may be a market for a specific clothing item in a faraway
market that results in a great opportunity for arbitrage, such as the market for blue jeans in the old
Soviet Union.
c. Some consumers strongly prefer Pepsi and some strongly prefer Coke. Therefore there is
no single market for colas.
This statement is false. Although some people have strong preferences for a particular brand of
cola, the different brands are similar enough that they constitute one market. There are consumers
who do not have strong preferences for one type of cola, and there are consumers who may have
a preference, but who will also be influenced by price. Given these possibilities, the price of cola
drinks will not tend to differ by very much, particularly for Coke and Pepsi.

2. The following table shows the average retail price of butter and the Consumer Price Index from
1980 to 2010, scaled so that the CPI  100 in 1980.

1980 1990 2000 2010

CPI 100 158.56 208.98 218.06
Retail price of butter
(salted, grade AA, per lb.) $1.88 $1.99 $2.52 $2.88

Copyright © 2013 Pearson Education. Inc. Publishing as Prentice Hall.

Another random document with
no related content on Scribd:
station, a porter roused himself from his afternoon nap and strolled
slowly down the platform calling "Whitsea! Change here for
Whitsea," in a melancholy sing-song. Guy picked up his stick and
alighted. Would Meriel come herself to meet him? He had asked the
question of himself a hundred times on the journey, and a hundred
times had told himself that he expected far too much.
But Meriel was there, and the delight in his heart showed in his
eyes as he went forward with outstretched hand to welcome her. Her
eyes dropped under his ardent glance, and the colour flushed her
cheek. Guy had seen no one but Meriel. Another voice recalled his
wandering faculties.
"I am just as delighted to welcome you to Whitsea, Mr. Hora, as
Meriel can be."
It was Guy's turn to flush, as he half turned to meet Mrs.
Marven's kindly glance.
"I only saw Miss Challys," he remarked simply.
"That was quite obvious," replied Mrs. Marven, as she took
Guy's hand, "and I am inclined to think that if I had been in your
place I shouldn't have seen anyone else, either. She is a pretty
picture, isn't she?" There was a tender inflection in her voice which
put Guy at his ease.
"There can be no two opinions about that," he answered
heartily.
"Auntie would make me vain, if I were not so already," said the
girl demurely, as she thrust her arm in Mrs. Marven's. "If you'll just
tell the porter which is your luggage, he will see that it is sent on. We
are not more than half a mile from the station, and we thought you
would like to walk to the Hall."
"Nothing could suit me better," declared Guy.
They strolled along the platform talking. Guy's kit bag and
dressing case were tossed out on the platform, and Jessel was
already mounting guard over them. Guy did not recognise his
servant until he was close to him. His surprise was apparent in the
tone of his voice.
"Hullo, Jessel!" he said. "What on earth are you doing here?"
The man touched his hat. "Beg your pardon, sir," he said. "Didn't
you intend me to come? You said nothing, so of course——"
Guy interrupted him. "I thought I had told you! But it doesn't
matter. Just see that the porter has my luggage all right. You can get
the next train back."
He turned away. Cornelius touched his hat. His face expressed
disappointment. Mrs. Marven observed his fallen countenance and
came to the rescue.
"I ought to have told you to bring your man with you," she
remarked to Guy, "and unless you have something you want him to
do for you, you had better let him come to the Hall. I know that the
Captain's man will be delighted that you have brought him, for I don't
mind telling you now, that he detests valeting anyone but his own
master."
With a word of thanks Guy dismissed the subject from his
thoughts. He was supremely indifferent to Jessel's presence. Meriel
was beside him. Nothing else mattered.
 CHAPTER XVII
STAR-DUST

Whitsea lies on the estuary of one of those Essex rivers which

flow into the North Sea through a wilderness of shallows. The visitor
who goes to it expecting to find any one of the ordinary attractions of
the average seaside watering-place may make up his mind to be
wofully disappointed. But the visitor with a delight in the
unconventional and the unhackneyed need not fear boredom. The
salt marshes which border the river for miles have a wild beauty
entirely their own. Flowers grow there as if the sea were no enemy to
them. Then the six miles of sheltered water which lie between
Whitsea and the sea give protection from wild weather, which the
yachtsman is not slow to appreciate. So when the days begin to
lengthen the Whitsea River begins to be alive with sailing craft, and
when the summer days really come, it has a population which lives
entirely upon the water.
At Whitsea the Hall was the most prominent residence, even as
Captain Marven was the most distinguished inhabitant. It was just a
simple, kindly English house, at one with its simple, kindly English
inhabitants. The life there was a revelation to Guy. Never before had
he known what it was to be an inmate of a pure unpretentious
English country home.
"You will find us dull, I am afraid," had been Mrs. Marven's
warning when she had invited him, "for excepting some sailing and
later in the year a little rough shooting Whitsea has no attractions."
Dull! Guy had never found a life so full. Every moment of the
day provided a new item of interest.
The house itself was a haven of peace. The long, low white
stone structure stood on a little knoll looking with all its many eyes in
the face of the southing sun. It was girt about with an old garden
where the scent of roses disputed with the perfume of carnations for
supremacy, a garden where tall white lilies stood sentinel over
serried ranks of sweet peas, and gazed down unmoved upon the riot
of colours that filled the borders. Beyond the garden a meadow
dropped down into the saltings, and beyond the saltings the sea wall
kept the tides at bay, and ever the sweet fresh breezes dinted the
surface of the water and lifted the petals of the roses and whispered
stories of the ocean in the ears of those who walked in the garden,
tempting them to venture forth in search of the places where they
were born.
Daily two of the inmates of the Hall responded to the temptation.
Meriel loved the sea. Guy was equally fervent in his adoration, and
there, ever before them, was the means of gratifying their desires in
the shape of the graceful ten-ton cutter Witch lying at her moorings
opposite the house, or the rightly christened little eighteen-footer
Dainty, which ever seemed to chafe at the chain which saved her
from going adrift. Oftentimes Captain Marven made one of the party,
more occasionally Mrs. Marven accompanied them, but there were
occasions when Meriel and Guy found themselves alone. Then when
the breeze sang in Guy's ears, and the spray tasted salt on his lips,
he felt a mad impulse to sail on and on with his precious cargo right
away out of the old life into a totally new one.
The two young people were drawn very close together in those
days. Meriel took no pains to conceal the pleasure she found in
Guy's companionship. Guy made no effort to disguise the fact that
life held only one hope for him. If there was a doubt at the back of his
mind that the hope was foredoomed to be disappointed, he put it
away. He would be happy while he might. Sorrow was for the sad
days of autumn. There was only one jarring note in the symphony. It
was a trifling one and did not affect Meriel. On the first day they went
for a sail they passed an excellently appointed steam yacht lying at
anchor in the fairway of the river. A figure immaculately clad in blue
jacket and white flannels raised a bridge-cap as they passed.
"Hildebrand Flurscheim, by all that's holy," remarked Guy.
 "Still searching for his missing pictures," said Meriel laughing.
The thought was an unpleasant one. But Guy was not allowed
to forget it. Flurscheim found out that the Marvens were at their
house and he called, and, undeterred by a cool reception, called
again. Guy could not help but realise that if his host and hostess had
been aware that he was the burglar who had raided the
connoisseur's treasure-house, the coolness accorded Flurscheim
would be nothing to the reception he might expect.
But Captain and Mrs. Marven would have both been horrified at
the mere suggestion that Guy could be guilty of such a deed. They
were fully cognisant of the love-story developing under their eyes,
acquiescing smilingly. They anticipated an idyll. They had watched
Guy carefully, and they had seen no fault in him. He had an
unblemished university career and was apparently sufficiently
endowed with this world's goods. He seemed chivalrous,
honourable, and, above all, deeply in love. Thinking of the days of
their own wooing, they anticipated a happy union.
A week passed, the second week was near its end, when a
shadow was cast on the sunlight of Guy's happiness, and again the
gloom was produced by a letter from Hora, forwarded to him from his
chambers.
"We shall be home on the Monday," wrote the Commandatore.
"Please come and see me on the Tuesday at latest, for I have now
completed my plans, and nothing remains but to put them into
execution. Again let me remind you to do your best to cultivate the
Marven people, if the opportunity arises. Any knowledge you may
acquire concerning them is likely to prove useful."
Guy took the letter with him into the open, where he tore it into
tiny fragments and scattered them to the breeze. Cornelius Jessel
from Guy's bedroom window watched the flying fragments longingly.
So also did another man who, seated on the sea wall some hundred
yards away, was just near enough to realise what Guy was doing.
But neither Cornelius nor the stranger made any efforts to recover
the fragments. Detective Inspector Kenly had no desire to call
attention in so pointed a fashion to the fact that he was visiting
Whitsea.
Guy was unaware of the dual observation, even as Jessel was
unaware that his late landlord was so near to him. His action was
merely prompted by an outbreak of anger at the despicable part he
was expected to play. He did not at first remember that he had not
told the Commandatore of his projected visit. His anger passed, for
he thought that the expectation was founded on a misapprehension.
But the reiteration of Hora's intention, his renewal of the belief that
he, Guy, would be as ready as heretofore to participate in the
carrying out of his plans warned Guy that he must no longer delay
coming to an explanation with the Commandatore. Hora had named
a date. That date would suit Guy as well as another. It would not be
fair to his father to delay any longer.
Guy was unusually silent that morning, and when Meriel joined
him she was surprised that he should be so preoccupied. She feared
to rally him on the subject, for she suspected a reason for his
preoccupation which she would not name to herself.
They went aboard the Witch about nine o'clock. There was a fair
wind from the north, the tide had just begun to ebb and there was
every promise of an ideal day. Gradually Guy's preoccupation melted
away. It was impossible to remain preoccupied on a brilliant summer
morning in Meriel's presence. By the time they had cast off their
moorings he was chattering away freely as ever. Hora was forgotten
for a while. He was remembered later.
"I must be going back to town on Tuesday," Guy said in reply to
a suggestion of some proposed trip for the ensuing week.
"Going back to town," remarked Meriel. There was more than
surprise, there was regret in her tone.
"I shall hate to do so," said Guy, "but I had a letter from my
father this morning and he particularly wishes to see me."
Guy's voice had unconsciously hardened as he spoke. His brow
was knitted and his lips were compressed. He looked up and he
caught sight of a something in her eyes which chased away the
frown.
"Of course, you must go then," said Meriel.
Guy responded to the regretful note in the girl's voice.
"You will be sorry to lose me?" he asked eagerly.
The ghost of a blush fluttered for a moment on her cheeks.
"We shall all be very sorry," she answered equivocally. Guy was
about to press the personal question home, but the sails shivered.
Meriel glanced upward. "Give me the tiller," she said. "You are
steering awfully badly this morning. Why, you've let the Witch run
right up into the wind."
Guy laughed as he vacated his post at the helm. For the
moment he was satisfied. He had seen an answer in Meriel's eyes to
his unspoken question which set his mind at rest. Before the day
was out that question should be answered, but the time was not yet.
The Witch flew along, bending over to the breeze. The river
widened and the banks fell away. The cutter begun to curtsey to the
waves, and now and again a spatter of spray was tossed high in the
air. Guy took the tiller again and Meriel unpacked the luncheon
basket. With appetites sharpened by the breeze they picnicked on
deck. They still pressed onward until the houses on the white cliff
before them begun to be plainly visible. Meriel looked at her watch.
"We are very near Clacton, and it is two o'clock," she remarked.
"Isn't it time we thought about returning?" she added regretfully.
The summer breeze began to show a disposition to change,
veering to the east. Guy put the helm down and went about. The
wind veered still more, though it still held. Guy gave the mainsail
more sheet, and the Witch ran merrily before the breeze over the
slackening tide. An hour passed and the wind became perceptibly
lighter. The afternoon sun shone down from a cloudless sky, while a
purple heat haze gathered on the horizon.
"Luckily we turned back when we did," said Meriel. "We shall
hardly get home on the tide even now. Hadn't we better set the
spinnaker?"
Guy acceded to the request. The breeze freshened again, and
for another hour the water rippled musically under their bows. Then
the breeze died away completely.
Guy shrugged his shoulders. "There's nothing for it but a policy
of masterly inaction," he said. "Don't you think it is time for a cup of
tea?"
He relinquished the tiller to his companion and dived below to
light the stove, and place the kettle upon it. By the time the kettle
boiled an absolute calm had fallen, the sea might have served as a
mirror, the sails hung straight and still, the heat had become almost
oppressive.
Neither Meriel nor Guy were troubled. They were together, and
although the boat seemed motionless they were drifting homewards.
Guy especially was in no anxiety to return. Tea drunk and the cups
washed and put away, Guy brought cushions from the cabin and
made a comfortable couch on deck for Meriel, while he sat by the
helm looking down upon her.
Their talk became personal. Meriel's confidences were those of
a pure-hearted girl, and Guy, listening, longed to repay confidence
with confidence. If he only dared! But his risks were too great. How
could this pure girl be brought to comprehend his point of view? Yet
he knew that some day he must make the effort. Perhaps if she
cared enough for him she might strive to understand. If she cared
enough! Yes, that was the whole question. Her views were so totally
opposed to those which he had imbibed from his earliest youth,
those which he knew now to be hopelessly wrong—not through any
intellectual conviction, but merely by his intuition of what would be
his companion's attitude towards them. He would make her
understand how he came to have held such views and where they
had led him. But not if she did not care. He could not win her under
false pretences. She must know all about him, exactly what he was,
the hidden life which none save Lynton Hora and Myra knew. Yet first
he must know if she did care for him, otherwise such confidence
would be treachery to Hora. His thoughts constrained him to silence.
When his replies became monosyllabic Meriel looking up saw that
his countenance had become overcast. She, too, became silent.
The boat drifted.
Meriel lay back on the cushions. Her eyes half-closed. She
wondered what thought could be troubling her companion. She
glanced up again and met his eyes.
"Something is troubling you," she demanded suddenly.
"Yes, something is troubling me," answered Guy moodily. With
an impulsive gesture the girl held out her hand. Guy grasped it. The
little sunbrowned hand was not withdrawn.
"Can I help?" she asked quietly.
"I cannot tell," he replied. "Until——" The moment had arrived
when he felt that he must give utterance to his thoughts or remain
forever silent. He braced himself to the effort. His voice was almost
harsh.
"Meriel," he said. She started at the sound of her name on his
lips. "Meriel——" He paused.
There was no coquetry in her nature. She understood the
unspoken thought as clearly as if it had been vocalised in a flood of
eloquence.
"Guy," she answered shyly.
The one musical syllable was sufficient. Their glances met.
Each read in the other's eyes the words they longed to hear. Lips
closed on lips.
The sun shone down fiercely. The boat drifted.
"Then you do care for me?" Guy asked presently.
"Do I care?" Meriel looked happily into his face. "If anyone were
to tell you that the sea had become dry you might sooner believe the
tale than that I should have ceased to care for you."
"That is love," said Guy. "I know, for my love for you is also
greater than the ocean."
 She was seated beside him. One hand was on the tiller, the
other encircled her waist and she leaned her head on his shoulder
with a sigh of content. The westering sun was dropping to the
horizon, and on the path of gold it painted on the waters the boat still
drifted. Was this to be the omen of their future lot? In his rapture Guy
thrust away all disturbing memories. He loved and he was beloved.
Nothing could alter that one fact. The whole world was transformed
for him. The sun dropped lower still. A rosy flush crept into the sky.
The sea, unflecked by a single ripple, glowed with opal fires. Nothing
broke the stillness. Meriel, too, lived her brief hour in love's fairyland.
The boat still drifted. The mouth of the Whitsea River was
narrowing in upon them. The sea wall stood up blackly against the
pellucid sky. The sun went down behind the purple bank of mist. The
colours faded. The sweet grey calm of summer twilight spread its
mantle over the water. From somewhere on the shore a sandpiper
called to his mate.
Meriel awoke to reality with a start.
"We shall never make our moorings to-night, Guy," she cried. "It
must be eight o'clock, and we are quite four miles from home."
"I should be quite content, dear," he answered, "to drift along
forever."
"You would tell another tale when you came to examine our
store of provisions," she answered merrily.
Guy looked at his watch. "The tide will run for another half hour,"
he said. "No, unless a breeze should spring up the Witch will never
make Whitsea to-night."
"We shall have to leave her," answered Meriel promptly.
"Why not wait for the next tide?" urged Guy.
"No, Auntie will be so anxious," the girl replied. "If we drop
anchor here and stow away comfortably we can easily row home in
the dingey."
Guy stood up and glanced around the horizon. The air was
perfectly still. There was not a movement in the sails.
 "We'll let her drift so long as the tide makes, and meanwhile I'll
make things snug," said Guy. The blocks creaked musically as he
gathered in foresail and jib. The topsail fluttered to the deck. It was
warmer work getting in the mainsail and darkness was gathering
rapidly. But the canvas was stowed away at last, the halliards made
fast, every rope coiled away in its place.
"The tide is on the turn," said Meriel. "If we can edge in a little
nearer the south shore the Witch will lie as safely as she would on
her moorings."
Guy hauled up the chain and cast the anchor loose. "When you
are ready, dear," he said.
"You may let go," she cried a minute later. The anchor dropped
with a heavy splash and the rattle of the chain as Guy paid it out
seemed almost a desecration of the silence. When the anchor held,
Guy once more went below to trim and light the riding lamp. By the
time his job was finished and the lamp was swung, the sky had
gained a deeper tint of blue and the stars had begun to sparkle. He
drew the dingey alongside and held out his hand to Meriel.
"You must let me take one oar," she said as she stepped into the
boat. "It will be a stiff pull against the tide."
"When I am tired I'll tell you," he answered. He looked regretfully
at the cutter as he dipped his oars.
"It seems ungracious to leave her," he said, "since the happiest
moments of my life have been passed aboard her."
"Good old Witch," replied Meriel softly.
Night's mantle of darkness and silence enwrapped them. The
stars studded the moonless sky, the plunk of the oars in the rowlocks
and the drip of the water from the blades alone disturbed the perfect
stillness. The boat drove onwards, leaving a trail of light in its wake.
The darkness had made yet another of nature's marvels manifest.
The water was full of phosphorescent light. Guy rested on his oars.
Meriel lifted a handful of water and poured it back into the sea. It was
as if she had poured out a handful of gems. She threw a handful of
the diamonds in the air, and every gem as it fell again into the water
struck gleams of light from the surface. They leaned over the side of
the boat, and here and there in the blackness the lights sparkled for
a moment and were hidden again.
"The water is full of star-dust," said Meriel. "See!" she added
eagerly. Guy followed the direction of her outstretched finger.
A phantom form lighting its way beneath the surface sailed by, a
myriad of the sparkling points accompanying it.
"Even the sea has its spirits," she remarked.
"On a night like this it is possible to idealise even a jelly fish," he
answered whimsically.
He took again to the oars. Few words were spoken between
them.
They came at last to their landing place. Guy made the boat fast
and joined Meriel on the bank. He clasped her lightly in his arms.
"Tell me you love me, Meriel," he demanded almost fiercely.
Her assurance was whispered only, but Guy recognised an
intensity as great as his own. He held her closely to him.
"I have something to—say," he told her. "I cannot ask you to
marry me,"—the words were wrung from him—"until I have told you
something about myself which you do not suspect."
She did not move in his embrace. He could see her eyes shining
in the darkness.
"Nothing you could tell me would make any difference, Guy,"
she answered.
A sharp pain stabbed his heart. "I am not worthy, Meriel," he
said. "And I fear that to-morrow you will tell me so."
"As if it were possible," she answered.
"I have been very happy to-day," he continued. "Such happiness
cannot last. When you know what I am in reality you will be glad to
forget me."
 This was more than the detraction of the ardent lover. Meriel
realised that there was the note of real suffering in his voice. She
waited almost with dread for him to continue. And Guy was upon the
point of pouring out his whole story. But the chance passed. A voice
hailed them from the lawn of the Hall.
"Is that you, Meriel?"
"Auntie is watching for our return," she said shyly. "Come."
Guy followed her along the path to the house.
"To-morrow," he said and she understood.
 CHAPTER XVIII
CORNELIUS JESSEL DREAMS OF A FORTUNE

The morning was heavy with an almost unnatural calm. By nine

o'clock the sun's rays glowed with the intensity of noon. The flowers
drooped their heads and the leaves hung listlessly. Cornelius Jessel,
passing out of the back way from the Hall, on his way to the
postoffice, had not covered a dozen yards before he paused to mop
his brow with his handkerchief. He bore with him the letter in which
Guy announced to Hora his intention of returning to town. It was the
briefest of notes, disclosing nothing of the intention of the writer. But
it was not the only letter which Jessel carried. In the other envelope
was the report which the shadow man had penned to the Master.
The envelope was stamped and sealed, but Cornelius took it from
his pocket and looked at it and frowned. He replaced it in his pocket
and proceeded on his way. He did not know whether to post it or not.
For the first time since he had undertaken the part of spy upon Guy's
actions he had wilfully suppressed an item of information which had
come into his possession concerning Guy. It was such an important
item of information, too. So important that he had gasped for breath
when he realised what the discovery he had made really meant.
On the previous afternoon and evening he had taken advantage
of Guy's absence to make a careful examination of his master's
property. He had frequently done so before, but without discovering
anything of any interest. But on this occasion he was more fortunate.
He had long been curious concerning the contents of a little silver-
bound box which reposed in a corner of Guy's dressing case. He
had oftentimes made discreet attempts to pick the lock but without
success, and he dared not venture on forcing it lest by damaging the
box he should excite suspicion. He guessed that sooner or later he
would get the opportunity he desired for examining the contents of
the little casket, and the occasion had arrived at last. Guy had left his
keys on the dressing table and one of the bunch fitted the lock.
When the lid was opened, Cornelius, at first sight of its contents,
gave a sniff indicative of disgust. He saw a little lace handkerchief, a
glove, an opera programme, a few withered rose leaves, and an
infinite contempt for the young man he served swept over him. There
was no trace of sentiment hidden away in the heart of Cornelius. But
when he tossed the trumpery aside he drew a long breath of
surprise. Beneath the valueless trifles was concealed an article of
price—a little golden frame enclosing an exquisite miniature on ivory
of a girl with a wealth of fair hair, the painting surrounded with a
circlet of brilliants. At first he did not grasp the significance of the
discovery. The likeness of the miniature to Meriel Challys seemed to
him a full explanation as to why it should be in his employer's
possession. But as he turned the frame over in his hand, counting
the stones in the setting, weighing the trinket delicately on two
fingers to estimate the weight of the gold, he remembered that
somewhere he had seen a description of some such article. Where?
He had not to rack his brain very long before he was able to recall
where he had seen the miniature described. Like many another
person who longs for the prize without incurring the attendant risks,
Cornelius had assimilated every detail which had been made public
concerning the Flurscheim robbery. His mouth had watered at the
published descriptions of the stolen articles and now here—if he was
not greatly mistaken—was one of them in his own hand.
At the heels of this thought came another which almost made
his heart cease beating. Five thousand pounds reward! Five
thousand pounds had been offered for such information as would
lead to the conviction of the thief and to the recovery of the stolen
property. Five—thousand—pounds! Five thousand pounds was lying
waiting for him, Cornelius Jessel. Yet, dazzled as he was by the
prospect of the acquisition of such wealth, he hesitated a long while
before he could persuade himself to make use of the information
which had come into his possession. It was the thought of the Master
which gave him pause. In view of the discovery which he had made
he began to be timorous. He could no longer believe that the
Master's interest in Guy Hora was the interest of the hawk in the
pigeon. Dimly he began to comprehend that unknowingly he was
being used as pawn in a game which he did not comprehend.
Supposing then that any effort of his own to secure that five
thousand pounds should run counter to any plan of the Master's? He
shivered at the thought, for he had a very real fear of the Master's
capacity for mischief. He had locked the miniature and the glove and
the rose leaves away again and set his wits to work to discover a
plan by which he might obtain the five thousand pounds without the
fact that he was the informer being disclosed to anybody. The more
he pondered upon the subject the more convinced he became that
fortune was within his grasp. He could not have made the discovery
at a more opportune moment. He was in the country surrounded by
a lot of simple country folk, and within reach was the victim of the
burglary, who had offered the reward. What better plan could be
conceived than that of taking his information straight to the fountain
head? He would then be able to make his own terms. But he saw
that it would be necessary to have some proof of the correctness of
his statements. He paid another visit to Guy's dressing case after
providing himself with a pencil and oiled paper. With these he made
a series of tracings of the miniature, and, clumsy as they were, yet
he trusted that they might be clear enough for identification. Thus
provided, he determined to take the first opportunity afforded him of
communicating with Mr. Hildebrand Flurscheim.
The determination carried with it as a necessary corollary the
decision to keep his discovery concealed from everybody,
particularly from the Master. He would have felt quite easy in his
mind if he could have assured himself that the Master was not
already acquainted with the fact that Guy possessed the miniature.
On the other hand, Cornelius argued that it was quite possible that
the man who was paying him to keep a watch upon Guy might be
actuated by dread of a confederate playing him false. That was a
strong reason why he should not postpone communicating with
Flurscheim. The reward would go to the first in the field with the
information. Then if the Master were implicated, and if he should be
captured, Cornelius saw safety for himself. Therefore when he wrote
his daily report to the Master of Guy's movements he entirely omitted
to mention the momentous discovery he had made, and yet so
terrified was he that he should bring his employer's vengeance upon
himself by his failure to report it, that a dozen times on the way to the
postoffice he drew the letter from his pocket and looked at it and
considered whether he should not reopen the envelope and add the
information which he had suppressed.
Even when he had dropped the letter into the box he nearly
entered the postoffice to ask for it back again, and only prevented
himself from doing so by declaring to himself that it would be easy to
give the information thereafter if circumstances pointed to the
desirability of his doing so. But once the letter was posted Cornelius
became bolder. The posting of the letter was in the nature of a
definite act committing him to a definite policy. It was no use looking
back, especially with the prospect of five thousand pounds to be
earned by merely speaking a few words. He forgot the heat. He
walked briskly away from the postoffice towards the little
embankment which Whitsea village proudly designated "The Front."
It seemed hotter than ever there. The tide was low and the air
shimmered in the heat reflected from the silvery banks of mud. He
placed his hand on the stone parapet of the low wall and drew it
back hastily. The stone was nearly hot enough to have blistered his
hand. He looked out on the river. Almost opposite him was Mr.
Hildebrand Flurscheim's yacht, and if Cornelius's eyes were to be
trusted Mr. Hildebrand Flurscheim himself was reclining beneath an
awning on the deck. The opportunity was too good to be missed.
Cornelius looked around for a boatman to put him aboard. There
was none visible, and he could not muster up courage to hail the
yacht. The Whitsea hotel showed an inviting open door just handy.
Cornelius felt suddenly thirsty. He accepted the invitation of the open
door, and while he quenched his thirst with a bottle of iced ginger
beer with something in it, he made known his desire to be put aboard
Mr. Flurscheim's yacht to the barmaid.
Before the words were well out of his mouth a man who had
followed Cornelius into the hotel remarked, "I'll put you aboard the
boat with pleasure, Mr. Jessel."
 Jessel's first impulse was to fly. To be suddenly accosted by
name when so far as he knew there was no one in Whitsea except
the servants at the Hall who could be aware of his identity, was
disconcerting to say the least. He stifled the impulse as best he
could, and, turning on his heel, faced the speaker. He saw a
pleasant, open-faced man of fifty or thereabouts holding out his
hand.
"Didn't expect to see me here, eh, any more than I expected to
have the pleasure of meeting you? But the world's a little place, and
this sort of weather, if one is likely to knock up against old
acquaintances, there's no spot more likely than where you find a
pretty girl mixing long drinks with a lot of ice in 'em. That's right, isn't
it, miss?"
The barmaid giggled.
"A slice of lemon, a bottle of Schweppe, a lump of ice, and a
suspicion of white satin, if you please," he said before turning again
to Jessel and continuing volubly. "You don't recognise me, eh? Well,
I'm not surprised, for now I come to think of it we haven't exchanged
more than a dozen words in our lives. My name's Kenly."
"Oh!" Cornelius remembered and immediately felt easy in his
mind. He had no reason for dreading his late landlord. He took the
proffered hand.
"This is a surprise," he said. "Who would ever have expected to
meet you here?"
"The same to you," said Kenly. He pointed to Jessel's glass.
"Drink up and have another and tell how you are getting on," he said.
"The missis will be pleased to hear, for she's always telling me that
she's never likely to have such a nice gent in the house to do for,
and she's always cracking on about your being obliged to leave, and
how certain she is never to get another like you."
Cornelius smiled and emptied his glass. "Well, as you insist
——" he said.
"Another of the same," said Kenly affably.
 "And what brings you down here?" asked Cornelius.
"Taking my holiday," remarked Kenly expansively. "This is just
the sort of a place that suits me. No sand, no niggers. Plenty of fresh
air and sunshine, a boat to potter about in, and some of the real sort
to drink when you're thirsty, that's the place that suits me down to the
ground, so I'm here. I suppose you're down for a change, too?"
"Not exactly," replied Cornelius. "I have to combine business
and pleasure, too." He took a long draught of the fresh brew which
the barmaid handed to him, and, assuming his most important air, he
changed the topic.
"I suppose Mrs. Kenly is with you?"
"Not much," answered the detective with a broad wink. "I know a
bit too much to bring the missis on a holiday, and, if you are married,
you'd understand."
Cornelius laughed and glanced at the barmaid. "You can't tell
me anything," he said.
"No," answered Kenly. "Half the bachelors to-day know more
than the married people, and that's a fact, ain't it, miss?"
The barmaid giggled again. "You're a caution," she said. The
conversation progressed swimmingly, and ten minutes later
Cornelius embarked on a dingey, having graciously allowed Kenly to
put him aboard Mr. Flurscheim's yacht. He lounged in the stern,
assuming his most important air, while Kenly pulled away at the oars.
He was fully alive to the fact that he would create a much better
impression going aboard thus than if he had been compelled to
borrow a boat and pull himself out to the yacht.
Kenly ran him up alongside, steadied the boat by the side of the
ladder, and then let his dingey drop astern to a sufficient distance to
allow him to observe Cornelius introduce himself to Flurscheim. He
saw that the two men were strangers, and he gathered that the
connoisseur was annoyed at Jessel's invasion of his privacy. He saw
the connoisseur jump up suddenly at something which was said and
begin to pace the deck in manifest agitation. He saw Jessel standing
unmoved, and then after a brief conference both men went down the
companion into the saloon.
The detective immediately realised that there was a chance of
his learning what errand had taken Jessel to the yacht. Half a dozen
strokes took him alongside again, and, making his painter fast to the
yacht's anchor chain, he stood up in the dingey as it drifted level with
an open port. As he had suspected the porthole gave upon the
saloon, and as the dingey came opposite he could hear two voices in
excited colloquy. One was easily recognised as Jessel's, and the
other Kenly had just as little difficulty in recognising as Flurscheim's.
"Is that anything like the face on one of your miniatures?" said
Jessel.
"I could swear to it," said Flurscheim.
"And the portrait—is it like anyone you know?" asked the valet.
"You've seen it," cried the Jew eagerly. "You must have done, for
the miniature is so like Miss Challys that she might have sat for the
portrait."
"I have seen it and I can tell you where it is at the present
moment," answered the valet.
"Where? Where?" cried the Jew eagerly.
"You don't expect me to tell you straight away, do you?" asked
Jessel in an injured tone.
The Jew took no notice. "And the other boxes and the pictures
—can you tell me where my Greuze is?"
"No, I can't, at least not at present," said the valet coolly, "but I
reckon that if once I put you on the track of one of the things that has
been stolen it won't be my fault if you don't find out where the rest of
'em are."
"Well, well," said Flurscheim, impatiently, "tell me where the
miniature is?"
There was silence and the detective listened impatiently.
 "Have you lost your tongue?" demanded Flurscheim angrily.
"What about the reward you offered?" said Jessel. "Five
thousand pounds, wasn't it, for such information as shall lead to the
conviction of the thieves or the recovery of the stolen property?"
"You shall have the reward, all right," said Flurscheim
impatiently.
"I'm not misdoubting your word," said Jessel, "but in cases like
this it's better to 'ave everything in black and white. 'Ave it in black
and white, that's my motto."
Kenly heard the connoisseur give a grunt of disgust, and he
smiled. He could even hear the scratching of a pen on paper. Then
Flurscheim's voice remarked sharply:
"Mind, I'll give nothing to any confederate in the robbery. If you
have had anything to do with it and will make a clean breast of the
matter, I'll do my best for you, but I'm not going to be blackmailed by
any d——d thief."
The detective smiled again at the injured tone of Jessel's reply.
"I'm a respectable man, Mr. Flurscheim, though I am a poor one, an'
the hinformation 'as come to me quite unexpected like. If I was rich
I'd be 'appy to tell you all I know for the cause of justice, but being
only poor, I've my old age to think of."
"Well, I only warned you, that's all," grumbled Flurscheim.
"Which there was no need," answered Cornelius with dignity.
"And there's another matter," he added, and now the detective could
detect a note of anxiety in his voice. "There's them as is connected
with this job that won't stick at nothing to get even with them as gives
'em away, if they has so much as a hint as to who done it. You'll have
to give me your word of honour as a gentleman as you'll not so much
as mention my name, or my life'll not be worth two pennorth of gin."
This time Flurscheim was silent a while before he replied.
"If I don't know your name it is not possible for me to mention it."
 "You can easy find out," answered Jessel, "when I tell you what I
have to tell you."
"I promise," replied Flurscheim shortly.
Jessel dropped his voice, but, low as it was, the detective's keen
ears overheard every word of the information which was imparted.
He was thunderstruck at the intelligence that a part of the stolen
property was in the possession of Guy Hora. He could not conceive
the motive which had prompted Jessel to disclose the fact, even if it
were true. He wanted time to arrange his ideas on the subject. But
he listened eagerly to every word that passed. He missed not a word
of the long conversation that ensued when Jessel had imparted the
information he possessed. He drank in all Flurscheim's questions
and all the valet's answers, and was so anxious to lose nothing of
what passed that he had barely time to cast the boat loose and drift
astern when he heard them rise to leave the saloon. Still he
presented a picture of perspiring innocence when he pulled up
alongside to take his late lodger back to the quay.
Cornelius was obviously elated. "Sorry to 'ave kept you so long,
Kenly," he remarked. "But I 'ad to wait for an answer to something.
We must have another drink."
They had it and the detective learned that Cornelius was
expecting to return to town the following day.
 CHAPTER XIX
INSPECTOR KENLY REPORTS

Although Cornelius had been entirely unaware of the fact, his

late landlord had arrived at Whitsea by the same train as himself,
and had been keeping a sharp eye on him, and if it were possible, a
still sharper eye on Guy Hora. But Kenly's observation had been
unproductive until the time when he obeyed the impulse to make
himself known to Jessel. He had been impelled to do so by sheer
desperation at having passed, from a professional point of view, one
of the most unprofitable fortnights of his life. He had not anticipated
any remarkable revelations when he had followed Cornelius into the
hotel bar, and when he finally bade his old tenant good-bye, he had
no need to force a spice of heartiness into the greeting.
Directly after Jessel left him he felt the necessity for rearranging
all his theories, but at the same time he was equally alive to the
desirability of getting to work upon the new clue which was in his
possession. There was now nothing to keep him in Whitsea. He had
learned of Guy's intention to return to London the following day, and
he determined to be in town before him. There would be plenty of
time to decide upon the best course to pursue during the journey.
He went into the hotel, packed his bag, and paid his bill in a
desperate hurry, for the hotel omnibus was at the door.
He caught his train and was thankful to find so few people
travelling that he could get a compartment to himself. He could
marshal his ideas better in solitude. Still, arrange them and
rearrange them as he might, he could get no nearer a reasonable
explanation of the relationship of the various parties who had
become objects of his suspicion. The only theory which seemed at
all tenable was that the Horas, father and son, Cornelius Jessel and
Captain Marven were all members of a gang of criminals who
operated in perfect safety by reason of the social position of the
principals. But in such case Kenly could not understand the motive of
the elaborate plot by means of which Cornelius had secured for
himself his place in Guy's service. Nor could he comprehend why
Captain Marven's name should have been used in regard to the
stock exchange operations which had followed upon the acquisition
of the knowledge contained in the despatches. To Kenly, that
seemed such a gratuitous piece of folly, as to be entirely unworthy of
the audacious person who had planned and carried out the
Flurscheim coup.
Like a wise man, he ceased after a while to trouble himself with
inventing explanations to fit theories. He knew very well that once all
the facts were in his hands an explanation would be easy to find, and
he was anxious to get some additional facts. Was not that the motive
which had made him decide to leave Whitsea in such a hurry? He
knew very well that Guy was not carrying the stolen picture about
with him, and he had learned quite enough about Whitsea Hall to be
quite assured in his own mind that the picture was not likely to be
reposing there. He had, however, become sufficiently acquainted
with Lynton Hora's mode of life from his friend the hall porter of
Westminster Mansions, to warrant the assumption that the Greuze
was hidden somewhere in Lynton Hora's flat. If he could only get an
opportunity to verify his suspicion before any of the persons he
suspected were alarmed, he saw an opportunity of bringing off a
coup which would provide a startling denouement to the sensational
Flurscheim burglary. The thought ran away with him to such an
extent that he allowed himself to taste the sweets of success. He
imagined himself reading the references in the newspapers to "the
smart work of that able officer, Detective Inspector Kenly." He
imagined himself listening to the commendations of the Judge when
the prisoners at the bar had been sentenced to various terms of
penal servitude, and—— He awoke to the bustle of Liverpool Street
railway station, limp with perspiration, still undecided as to the best
manner of setting about getting the evidence he needed, and
perforce compelled to leave circumstances to guide his course of
action.
 He permitted himself the luxury of a cab to Scotland Yard, where
he proposed to deposit his bag and report himself. He had another
reason for calling at headquarters. He foresaw that very shortly the
moment might arrive when he would not be able to deal with the
situation single-handed. If all the parties whom he expected to be
implicated in the two affairs were to be kept under surveillance, he
would need assistance, and he was not quite certain whether that
moment had not already arrived when some such steps were
necessary. Then Mr. Hildebrand Flurscheim might at any moment
communicate with the Yard, and Inspector Kenly did not want
anyone else to be put on the job without his knowledge. He knew
that as he had previously had the investigation in hand, if he
reported himself back in town he would be communicated with in the
event of any fresh information coming to hand, even though he was
detailed for special service on the Foreign Office affair, and thereby
relieved of the obligation to render daily reports of his work to his
own department.
He was glad that he had determined to report himself, for he
found awaiting him a pressing message from the Permanent
Secretary, asking him to call at the Foreign Office, as the Great Man
was anxious to know the result of his investigations.
Inspector Kenly looked at his watch. The afternoon was young.
The Permanent Secretary could be kept waiting for an hour or two
longer. The detective, leaving his bag behind him, strolled out into
the sun-scorched streets. He had even forgotten that he had eaten
no lunch, so eager was he on his quest. He walked briskly towards
Westminster Mansions, and could have shouted with delight when
he observed his old comrade standing at the open door. "Hello,
looking for a breeze," he remarked.
The porter chuckled.
"If you've been locking any up lately, the sooner you let 'em
loose again the better I shall be pleased," he remarked.
"It looks cooler inside than out here," said Kenly, with meaning.
 The porter winked and led the way inside. Two lift attendants
were seated languidly interesting themselves in the cricket
intelligence of the latest evening papers.
Kenly glanced at them while he asked in a low tone: "Is there
any chance of a private chat?"
His old comrade nodded, and after talking for a few moments on
the burning topic of the weather, managed to send both the youths
on an errand. Kenly grunted his relief. Directly he was alone with the
porter he went straight to the point.
"I want to go over Mr. Lynton Hora's flat," he announced
abruptly.
The porter gazed at him in silent astonishment.
"Yes, I mean exactly what I say," he continued, "and the sooner I
can do so the better I shall be pleased. I suppose some of your
people have a key?"
The hall porter regained his power of speech. "It can't possibly
be managed, Kenly," he spluttered. "There's nothing I wouldn't do for
you in reason, but——"
Kenly cut him short. "It's got to be done," he remarked
decisively. "I've come to you, because I know I can trust you to say
nothing, and the fewer people who know what I am doing the better I
shall be pleased."
"It can't be done," remarked the hall porter. "It would be as much
as my place is worth."
"Pooh!" said the detective. "It is easy enough to make some
excuse. You can say I'm the electric light man or that I have orders to
clean out the cisterns."
"There ain't no cisterns that want cleaning," objected the hall
porter. "Now if you had come and asked me two days ago there
wouldn't have been any difficulty, but to-day——"
"Why is it impossible to-day?" demanded the detective.
 "Well, Mr. Hora and Miss Myra have been away at Scarborough
for the past fortnight, and I could have let you in to their place, but
I'm expecting them to return at any minute now."
"Then we mustn't lose any time talking about it," said Kenly
briskly. "I suppose you have some means of communicating with the
flat from here."
"There's the telephone," said the porter.
"Take me straight up," said Kenly, "and if Mr. Hora should arrive
before I come down again just give two rings at the telephone bell. I
shall have plenty of time to let myself out before Mr. Hora returns."
He caught hold of the porter's arm and hurried him away in the
direction of the lift. Protesting all the while that it would be impossible
and entreating Kenly to postpone his visit to a more convenient
occasion, he yet allowed himself to be carried away by the
detective's impetuosity. He protested while the lift went steadily
upward, he protested even while he inserted a key in the lock, and
Kenly left him outside the door still protesting.
Fortune seemed to be favouring the detective. From previous
conversations he had gained a fairly accurate knowledge of the
geography of the interior of Hora's residence, and he wasted no time
in searching the residential portion of the flat. He went directly to the
door where Hora kept his pictures and his books. But here he
experienced a rebuff. The door was locked, and the lock was a
patent one. Kenly had with him a bunch of skeleton keys, but a very
slight trial proved that the lock was unpickable.
He began to cast around for some other means of gaining
access, but he saw none within the flat. He passed through all the
rooms, glancing round each. He was impressed by the luxury of the
furnishing, but there was nothing which could cause anyone to
suspect the occupant of anything but highly refined tastes. Kenly had
just completed his hasty survey when the telephone bell rang twice.
"D——n!" said the Inspector. He opened the outer door and
walked out into the passage outside. He knew that he must not be
seen, and he hastily descended the flight of stairs to the floor below,
and as he did so the lift passed him ascending upwards. He caught a
glimpse of Hora's face.
Kenly waited until the lift descended. The hall porter himself was
in charge. He stopped the lift. Kenly entered in silence.
"Find what you wanted?" asked the porter curiously.
"No time," grunted the detective. "I must have a look round
another time. If I had only known yesterday what I learned to-day
——" He groaned at the thought of what might be hidden beyond
that locked door. Still he was not disheartened. He had noted the
number of the lock and the name of the maker, and he knew that the
next time he called the locked door would prove no barrier to his
investigations. Still, days might pass before the opportunity he
desired would recur, and it was annoying to feel that opportunity had
been lost by so narrow a margin. He bade his friend good-bye and
went away at once to the Foreign Office.
The sky had become overcast and the atmosphere was hotter
than ever. Visions of a long drink, with cool translucent lumps of ice
tinkling against the steamy glass, sorely tempted the detective, but
he banished them, and, perspiring himself, he was at last ushered by
a perspiring attendant into the presence of a perspiring Permanent
Secretary who had wheeled his chair on to a line between the open
door and the open window, and sat there in his shirt sleeves in the
pathetic belief that a draught of cool air might be tempted to pass
that way.
"What is it? What is it?" he snapped at the attendant who
entered to announce Inspector Kenly. Then looking up he recognised
his visitor standing at the open door.
"Oh, it's you, Kenly. Come in." The attendant withdrew. "And,
yes, you had better shut the door." He sighed as if he had thereby
ordered the door to be shut on his own salvation.
"Sit down, Inspector, and tell me what you have found out," he
added.
He looked round for his cigar case, and not finding it
immediately made confusion of the pile of papers which covered his
table.
"I think, Sir Everard, you will find your cigar case in your coat
pocket," observed the detective blandly.
The Permanent Secretary smiled as he thrust his hand into the
breast pocket of his discarded coat.
"The heat always makes me irritable," he apologised. "No man
ought to work when the thermometer reaches the eighties." He
selected a cigar. "By the way," he remarked, "by what process of
reasoning did you arrive at the deduction that my cigar case was in
my pocket?"
"I saw the corner of it sticking out," remarked the detective
equably.
"H—m," said the Permanent Secretary, laughing, "the proper
use of the eyes may on occasion be more valuable than any amount
of deduction."
He lit his cigar and stretched himself lazily in his chair.
"Now fire away, Kenly. I can see that you have something to tell
me about those stolen despatches."
Without unnecessary beating about the bush Kenly began the
result of his investigations. The narration did not take long, for,
though he had already spent a month on the investigation, the facts
he had discovered could be described in a very few words. But few
as those facts were they were sufficiently startling to make the
Permanent Secretary forget the heat.
"By Jove!" he remarked, when Kenly had finished. "And I would
have pledged my life on Captain Marven's absolute honour. Yet, from
what you have told me, he appears to be hand-in-glove with a gang
of thieves, one of them living in his own house and likely at any
moment to become engaged to his daughter."
"Certainly appearances are very much against him," remarked
Kenly cautiously, "but I never trust to appearances myself. I have
seen too many cases, where perfectly innocent persons have been
on the most intimate terms with scoundrels, to allow that one fact to
weigh with me. If it was only a question of the burglary, I should
expect Captain Marven to be the next victim of the gang, and it is
only the fact that it seems impossible for the contents of the
despatches to have become known to the Horas without Marven's
assistance which leads me to suspect him with the rest of the
crowd."
The Permanent Secretary puffed meditatively at his cigar.
"Things look very black against Marven," he said. "Very black
indeed," he repeated, after a lengthy pause; then he asked, "Who
are these Horas?" Kenly shook his head.
"I should like to know their history myself," he answered. "All I
have heard hitherto is that the elder man has occupied a first-class
flat in Westminster for the past ten years at a rent of three hundred
and fifty pounds a year, and passes as a very retired gentleman
indeed. He spends only about six months of the year in London, and
they say he has estates in Italy. That may or may not be the case,
but, anyhow, he calls himself the Commandatore, which I'm told is
an Italian title given him by the King of Italy for something or other
he's done over there. The young one was at Oxbridge and made
quite a name amongst his set, and lived at home till a few weeks
ago, when he took some chambers in the Albany. Then there's a girl
named Myra, who passes as the old man's daughter, though there's
reason to think that she's only an adopted child."
"What are you proposing to do?" asked the Permanent
Secretary, after another pause.
Inspector Kenly coughed. "That depends——" he remarked, and
paused. "That depends on circumstances. You see, Sir Everard, my
hand may be forced before I shall have obtained all the evidence I
want. That communication which has been made to Mr. Flurscheim
may lead at any moment to the younger Hora's arrest, and then
good-bye to the hope of obtaining any more evidence. What I was
going to suggest was that you should allow me to continue to
investigate your affair. It will leave me more free to look after things
than if I have to turn in a report to headquarters. I'm so afraid," he
added in a burst of confidence, "that they might put some man on to