The episode begins and the coroner has changed the cause of death on Jimmy's death certificate to "accidental drowning". Nucky is making plans to head to New York for the day, but it's neither to meet with Rothstein or Billie. He asks Slater about a pony for Emily. Slater is in charge of figuring out the details. Eddie comes in with news, "James Darmody is dead". Nucky, Slater and Eli, who's also in the room, know the truth about Jimmy, but Nucky tells Eddie, "That is pure speculation". Eddie hands Nucky the newspaper reporting Jimmy's "drowning". They're all confused and surprised. Johnny Torio is back in Chicago from a long visit to Italy and Al Capone welcomes him warmly.
Back at the house, Leander reminds Gillian that there's still the issue of Tommy's guardianship. Nucky arrives. Gillian notes that in her business, "Sooner or later, everyone comes through your door". Nucky raises his glass and toasts, "To James," and Gillian throws her drink in Nucky's face. "Shall we stop now, with all this nonsense?" Gillian says. Nucky agrees it is nonsense and adds, "We should really be drinking to the sap who died in your tub". Gillian tells Nucky he killed her son and that she can't stand seeing Nucky standing there and lying to her face. Nucky tells Gillian to always remember that she exists in this town because he allows her to. Later, Nucky's meeting in New York is with Esther Randolph.
He asks what she does for fun and she says she runs "naked through the pages of the United States Criminal Code". Gaston Means walks and says "the arrangements are in place." He says Secretary Mellon is in Manhattan attending to private matters. He'll be having lunch at the Union Club. Nucky wants to get in, but can't. "Charles Rickson" of Missouri can, though, and that's Nucky's cover. Randolph briefs Nucky on Mellon, one of the richest men in the world. He's the head of the Treasury Department, in charge of enforcing prohibition and collecting the income tax. He doesn't like either task, and he hates Harry Daugherty. Nucky wants to know if that's enough to get him to arrest George Remus, and Means points out that among Mellon's personal holdings is the old Overholt Distillery.
Randolph is surprised by this. She decides she doesn't really want to hear all the details of this conversation, and leaves. Al and Jake wait for Torio's arrival, and O'Banion shows up moments later. O'Banion brings Van Alden and says he's his "muscle". Slater is checking out a pony while Margaret watches. He and Margaret talk about ponies they had back in Ireland. Billie is at a movie audition and the director quizzes her a bit about why she wants to be in movies. She's given a scene to rehearse and she kills it. The crew and the director love it. Nucky sits in the quiet, swanky Union Club and spots Secretary Mellon. He tells Mellon they "have an enemy in common".
Nucky introduces himself and says his "dealings" with Harry Daugherty. Asked by Mellon for clarification on these dealings, Nucky says they were "circumvention of the Volstead Act." Mellon wants to hear more and Nucky says "something is very wrong" when someone in Daugherty's position is involved in such things. Mellon says Daugherty is a small part of the problem, and Mellon goes on to rail against the income tax, which he calls sanctioned robbery. Nucky tells Mellon about the chance to arrest Remus and "force Daugherty to show his hand" because they're in cahoots. He tells Mellon that he'll have something on Daugherty to use when he needs it.
Nucky says his bargain is that he would run the old Overton Distillery without any communication. Mellon would only see the money. Mellon tells Nucky that he's brought "a little color" into his day, and then tells the club's guards to make sure Nucky leaves. Margaret tells Slater that getting a pony for Emily doesn't make sense. He tries to talk her into it, but she tells him he shouldn't talk about what's good and isn't, because those are "just words." She then asks him to teach her how to drive. "Now?" he asks. "No," she says. "After". And they start to make out in the car, which is parked in a downpour. At the iron company, Van Alden is asked to do a role-playing exercise and the guy he's working with keeps teasing him while the rest of the office laughs.
The rage builds in Van Alden's face until he takes the hot iron and presses it to the guy's face. The whole office clears out while Van Alden, now looking completely insane, starts slamming office equipment to the floor while the man cries in pain. Billie is dancing with another actress when the actor from the audition shows up. Nucky pays a surprise visit and finds the actor guy flirting with Billie. She says they're all celebrating. She introduces the guy, Gil, to Nucky. Nucky plays along with the jokes and Gil offers him a drink, calling Nucky "sir." Nucky is annoyed and they fight. Nucky punches Gil in the face repeatedly, calling him an "interloper” a clear reference to what Mellon called him at the club.
Billie's friends leave and Nucky tells her he doesn't like constantly looking the other way. He tells Billie he can take care of her, and then he implies that she can't count on a career in show business. She tells him she has a father, and that's what he's starting to sound like. She tells him he's "no fun this way" and when Nucky asks her what she wants from him she says, "I just want you to be my gangster". That night, Van Alden starts packing things and tells Sigrid they need to leave immediately because of incident at work. She shows him she's been making whiskey all day. She's even made an extra few bottles to sell to Norwegians. She says they can make and sell more to make up for the job Van Alden lost.
Lucky is at the house and Gillian doesn't know why. He says he has business with Rothstein and Nucky. She tells him she wants him out of the business and hands him a check for $4,500. He tosses it aside. Margaret finds Dr. Mason outside the hospital to discuss the "delicate" situation. She asks him to help her obtain a diaphragm. He asks if that's what Mrs. Shearer was asking about, and she confirms it. Then she asks for two, one for Mrs. Shearer and another for her. Gillian is telling stories at the brothel and Gyp Rosetti is there, not looking impressed. She asks him if he has any children and he says he has two daughters who are just like their mother. Harrow walks in and Gillian introduces him to Rosetti and his right-hand man.
After Harrow leaves, she tips Gyp off that Nucky will be dining with Arnold Rothstein at Babbette's that night in case he's "like to surprise them". Nucky he has a phone call. It's Andrew Mellon. He says that Treasury agents in Cincinnati will soon arrest George Remus. In exchange, he says, he wants the Overholt Distillery to be up and running within a month and profitable in another month. He says he doesn't want to hear from Nucky again. Nucky finds Billie looking for the hummingbird earrings he gave her. She has a blonde wig on and tells Nucky she just felt like being someone different for a little while. They go through some fake introductions and he hands her an annuity that will pay her a regular salary on the first of the month for the rest of her life.
She asks him what's the gag, and he tells her to "call it a mystery". She doesn't want it, but he tells her he appreciates that and assures her that what she does with the money and who she does it with is her own business. At the Norwegian festival, Van Alden is selling the specially flavored liquor Sigrid made. He notices that, unlike steam irons, it "sells itself". Al brings Torio some payments and asks him if he needs anything else. "Sounds like you've got it all under control" Torio says. He leans back and tells Al to send his love to his wife and son. Al pauses a moment and realizes the mantle has been passed.
Nucky, Rothstein, Lucky and Billie walk the boardwalk when they run into George Baxter. Nucky sends Billie along so she doesn't have to wait through Baxter's pitch for the radios he's selling. She walks toward Babette's and stands in the doorway where Nucky can still see her. Suddenly, the place explodes. A massive fireball knocks everyone over. Nucky opens his eye and hears only ringing in his ears. Nucky sees Lucky and Rothstein trying to gain their footing, and he looks toward the doorway where Billie was standing but doesn't see her. Nucky collapses. The episode ends at this point.