(MONEY Magazine) – The intersection of Western Avenue and Martin Luther King Jr. Boulevard in South-Central Los Angeles looked like hundreds of others in the sprawl of Southern California -- a public school, a Unocal station, a gigantic Boys Market grocery and, on the northwest corner, a Popeye's fried-chicken outlet backed up by a mini-mall: more than a dozen small shopkeepers in search of a dream. The American dream. You could feel the crackle of work and hope in the air. They had come to this corner from South Korea, Mexico and the Philippines, from Nigeria, El Salvador, Trinidad and Jamaica -- and from just around the block, the streets of Watts and South-Central. They had staked their claims, and their lives, here. And they were making it -- or at least hanging on. The two owners, the Shokrian brothers, who themselves had emigrated from Iran in the 1960s, named the place the King-Western Shopping Center when they bought it in 1988. Neighborhood people just called it The Mall. To the merchants there it was life itself, the prospects of their families and children. But it was also a laboratory, an experiment in free enterprise, where shopkeepers weighed the risks of 12-hour days in a poor and violent neighborhood against the rewards of sometimes surprising profits. Then one spring day, the mix of hope and despair, energy and frustration, went a little wrong. There was a spark, and The Mall blew up. The spark, as all the world knows now, was the acquittal of four white Los Angeles policemen charged in the videotaped beating of a black man named Rodney G. King. The fires of April were not contained here, of course; they spread to other areas where poor people lived or shopped. Two days of wild looting and 733 blazes destroyed 3,500 small businesses and did an estimated $1 billion in damage. The King-Western mall was a window on this madness: The first looters appeared there within an hour of the verdict Wednesday afternoon, April 29. The fires started the next day and, by Friday morning, the first dawn of May, The Mall was debris, and the shopkeepers' dreams were smoke. The Mall's merchants always knew they were the front line of commerce. These parts of Los Angeles are like islands, where most businessmen and, sometimes, police and fire fighters too fear to tread. But there is money to be made. Costs are low -- rentals at King-Western ran as cheap as $1 per square foot, less than half the going rate only a few miles away. And except for the largest legal business -- liquor stores -- competition decreases as the danger of doing business goes up. So if an entrepreneur can get anything useful onto the island, it will sell. The danger meant there were always vacancies at The Mall though. The Simanis got the space for their $1 Bargain Center when the previous tenant, a Korean selling sports clothes, was robbed one too many times. The new manager of Chief Auto Parts, Robert Etheridge, who is black and grew up three miles from The Mall, says that one of his predecessors took a bullet in the chest while sipping a Coke at Popeye's after hours last year. No one knows who shot him, or why (luckily, he survived). Drive-by shootings are both a recreation and a gang initiation rite in South-Central. The merchants had only a nodding acquaintance with one another before the riot. There was no time for more than that. Only chance -- the main chance for most of them -- brought them together in that single-story L-shaped building. It was not until after the fire that they talked, as they sifted through the ashes, and found out how alike they were. ''It feels like a death in the family,'' said Chris Demuth, standing in front of what had been the People's Choice Thrift Shop. Demuth, 38, was the only Anglo business owner who worked at The Mall.

''We need live together,'' added the proprietor of Harmony Fashion, Sandra Chong-White, 44, who came from Korea as a G.I. bride 20 years ago. Her thinking is better than her English. She patted her face as she said: ''If flower only yellow, it ugly. Please, I am a citizen, I am an American. We all equal. We all one nation.'' ''We ran away from a revolution to this,'' said David Simani, 35, who, with his 31-year-old brother Bahram, got out of Teheran just before Ayatollah Ruhollah Khomeini took over in 1979. ''In Iran, everyone hated the government. Here everyone is against each other. I am ashamed to say it, but everyone in this city should have a gun.''

The Simanis, in fact, did have a .38-caliber pistol but soon realized that it would be insane to use it. Some of the looters were armed and more than willing to shoot. ''I kept closing my eyes, thinking that when I opened them everything would , be back the way it had been,'' said Onuoha Nwanyanwu, 47, called Tony since his days as an exchange student from Nigeria at the University of Wisconsin. He and his 41-year-old wife Adanma, a school nurse, had paid $75,000 for their 2 For 1 Pizza franchise in 1988, using savings and 16.5% home-equity loans. ''I see now this was my real home,'' he said. ''All my work, my life is gone.'' ''We are losers too, since we lose the rent,'' observed Nassir Shokrian, 54. He and his brother Elias, 46, came to this country as students and stayed to invest for their family -- Iranian Jews -- under America's great umbrella of political and currency stability. ''But we have insurance; we will rebuild. The tenants are the big losers. They are good people, very good. I have great admiration for them. But they are on the edge, living day to day.'' Although their place of business was called a mall, in other lands it would be a mercado, bazaar or souk. Chris Demuth, along with his 24-year-old Mexican-American wife Norberta, began by selling odds and ends at swap meets before saving enough to move into King-Western. They used to drive to West Los Angeles and Beverly Hills, collecting trash -- anything salvageable -- at the end of the long residential driveways. The $1 Bargain Center was also typical: The Simanis bought whatever they found cheap in the warehouses of Southern California and sold it cheap too. On the day before the King verdict, David Simani came up with four-packs of flashlight batteries for 75 cents. He priced them at 99 cents. At that price, they were hardly worth stealing. They were still there the next morning -- black with smoke inside a grotesque cage of mangled shelves, part of a loss the Simanis estimate at $180,000. ''At least we had fire insurance,'' said Bahram Simani. Most did not. The Simanis were not popular neighbors. They kept their door locked to prevent more than three teenagers from getting inside at a time -- in self- defense, they said. Down the way, where the days were gay, record store owners Bob James from Trinidad and David Brown from Jamaica were sure it was the Simanis who used to call the police when kids would dance in the parking lot to the reggae on their store's outdoor speakers, though the Simanis deny it. James and Brown, both 32, opened Digital International Records with earnings from their work as private-party disk jockeys and lost everything: $50,000 in merchandise and equipment. Their black owned sign only postponed the looting, and the fire proved to be an equal-opportunity destroyer. But James wasn't angry: ''My life savings are gone, but a statement had to be made,'' he said. ''I'm sorry this happened to us, but it's fine if the statement gets heard.'' The best known of the victims were African Americans Alfred Ligon and his wife Bernice, who owned the 51-year-old Aquarian Book Shop -- the oldest black literature bookstore in L.A. The Ligons lost $175,000, including 5,000 volumes of black literature and history -- some of them irreplaceable. But the Ligons too were philosophical: ''If we waste time being upset, we're no better than the looters,'' said Bernice, 78. Two years ago, when the Los Angeles Times profiled the Ligons, the piece ended with a quote from a customer, a black lawyer: ''It's good to see a thriving black business in a black area when so many are boarded up.'' In the fire this time, there was not enough of a business left to put boards around. Possibly the most lucrative of The Mall's enterprises was CLS Check Cashing, though you could not tell it from the outside -- or the inside either. George Co's 1,500-square-foot shop cashed $150,000 in checks each week, keeping 1% for the trouble. But the big money came from the $200,000-a-month perfume business he ran out of the back. A Filipino of Chinese descent, Co's story reveals a great deal about the new Los Angeles -- and perhaps about a new world order that goes beyond political rhetoric. He was just another immigrant doing work rejected by Americans: cashing government and payroll checks for the thousands and thousands of people who have no connection with local banks that, at least until now, seemed to have no use for them. There were, before the riot, only 19 bank branch offices serving the 660,000 people of South-Central, compared with 30 branches for the 32,000 in Beverly Hills. Co, 49, arrived from Manila in 1984 with $2 million of family money ''because America is better than anyplace else,'' he said. ''As long as you work hard, you get your money and it keeps its value.'' The riot claimed two of his three stores, he says, and about two-thirds of his wealth -- $210,000 in cash, $140,000 in fixtures and $525,000 of perfume. He had no insurance, though he could afford it. ''What Americans pay in insurance is what I take in profit,'' he said. To Co, fires and riots are reasonable business risks. He's more worried about political hazards; he says his family lost an even bigger share of its wealth -- three-quarters -- to the rapid devaluation of the Philippine peso that occurred during the unrest following the assassination of former Senator Benigno Aquino in 1983.

Co, Etheridge and Chong-White all found out about the looting the same way. Their alarm companies told them Wednesday night that security microphones were picking up voices. People were in the stores. ''We called the police,'' the security dispatchers said, ''but they said the same thing is happening everywhere.'' Then the security people added a warning: ''Don't go near there till morning. You could get killed.'' The mob of mostly young black men hit Korean-owned shops first, beginning with ET Video at the King Boulevard tip of The Mall's L. They honored black owned signs initially -- both Pop's and Popeye's served breakfast Thursday morning. But that restraint broke down as the day wore on and more Latinos joined what, by then, resembled a crazed block party. (There was also a pattern to the way the King-Western merchants described the looters. In early interviews they said the thieves were blacks they knew from the neighborhood. ''Our customers,'' said one shop owner. A few days later, though, in a variation of political correctness, they called the crowds a mixture of blacks and Latinos and said they did not recognize any of them.) Once looted, the video shop was also the first to be torched, at about 1:30 Thursday afternoon. (Its owners were rarely seen before the riots and could not be located by the Shokrians or MONEY afterward.) Soon a second plume of smoke erupted from the black-run Chief's at the opposite end of the L. The flames moved in from both sides, consuming one store after another. Fire trucks arrived but stayed only minutes, aiming most of their spray at the walls of the school complex behind The Mall. ''When my wife saw that,'' says Joe Wilson, co-owner with wife Joyce of Pop's (see their story on the opposite page), ''she said, 'Joe, kiss Pop's good-bye.' '' Adds Joyce, ''In the end, 'black owned' didn't matter.'' By nine o'clock Thursday night, freestanding Popeye's was the only shop left; it was just far enough away to escape the flames. The restaurant's $350- a-week manager, Angel del Cid, an El Salvadoran and graduate of nearby Jefferson High School who crossed the border at Tijuana in '84 by posing as the son of a Mexican woman with a U.S. passport, watched the devastation in amazement. ''This is the greatest country in the world because there is so much opportunity here,'' he said later. ''But there's also too much liberty. This should not be allowed to happen.'' All the King-Western owners agreed with that last point. Walking among the smoking ruins after order was restored Friday, they cursed the police, the fire department and Los Angeles politicians. ''They watching them steal and burn,'' said Chong-White. ''I blame police for making it race. They more badder than in any country.'' Bob Etheridge echoed that thought. The 37-year-old, $35,000-a-year Chief's manager is an American success story. The son of a minister and a teacher, he served in the Air Force during Vietnam and worked his way to a business degree at California State University, Los Angeles. He had been an auto sales manager and a bank loan officer before joining Chief's in January. Sales at his store were up 30% since then -- and pilferage was down 90%. But after a couple of hours of conversation, some of it about his upcoming second marriage, Etheridge suddenly told his own story about being young and black in L.A. Seventeen years ago, on Christmas Eve, he was stopped on the Hollywood Freeway for tailgating a car driven by his first wife (then his fiancee) after an argument. According to Etheridge, two white California Highway Patrolmen hauled him from his Volkswagen Beetle, shouting racial slurs he refuses to repeat even now, and beat the hell out of him. The patrolmen, he adds, claimed he charged them like a fullback and accidently ran into a heavy five-cell flashlight. (Court records of misdemeanor cases are destroyed after 10 years, but a CHP spokesman said she doubted Etheridge's account ''because of the high standards to which we hold our officers.'') Whatever happened, Etheridge ended up in jail with three broken ribs, three stitches and a charge of resisting arrest. He was convicted, sentenced to two years probation and fined $600. As Etheridge recalls it, the prosecutor, who was also black, took him aside after the verdict and told him: ''Don't blame me personally. This is just the way it is. Everyone in that courtroom knew you didn't do anything bad enough to warrant a beating. But you have to forget that and go on with your life.'' The Mall merchants too must get on with their lives -- something that's easier if you work for a big operation like Chief's, which moved Etheridge to a new store before his old one had even cooled. But those left behind were still cursing weeks later -- aiming at the President, Small Business % Administration agents and other federal officials who came to Los Angeles talking of low-interest loans to rebuild. The forms took hours to get and days to fill out, and they asked the same sticky questions about collateral that had blocked many of these entrepreneurs from getting credit for years. True, the interest rates were lower: as little as 4%, compared with the 8.25% SBA- guaranteed loans available before L.A. became a disaster area. ''But these are the people who can't get loans because they don't have collateral,'' said Nassir Shokrian. ''They are beginning to think this talk of assistance is just a way to keep them quiet until they quit in frustration.'' Will they quit? On the government, maybe. But something inside each of them led them to the intersection of King and Western during that terrible week in April. Rebuilding The Mall will take 10 months, Nassir Shokrian says -- practically a lifetime to people living day to day. But the men and women who put their lives on the line there will show up someplace else. They may be losers, but they are not quitters. They're a brave bunch, the people of The Mall. Their dreams are now just a little farther away.