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Jeffrey Epstein: International Moneyman of Mystery

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So how do termite grouping patterns fare as an investment strategy? Again, facts are hard to come by. A working day for Epstein starts at 5 a.m., when he gets up and scours the world markets on his Bloomberg screen -- each of his houses, in New York, St. Thomas, Palm Beach, and New Mexico, as well as the 727, is equipped with the necessary hardware for him to wake up, roll out of bed, and start trading. He will put some calls in to his private banker at JPMorgan to get a reading as to how wealthy investors -- the best gauge of market sentiment, he believes -- are reacting to the market's movements. Then he will call currency traders in Europe. On a given day, he will spend ten hours or so on the phone -- after all, he is running $15 billion essentially by himself.

Strangely enough, given his scientific obsessions, he is a computer-phobe and does not use e-mail. "I like to hear voices and see faces when I interact," he has said. Given the huge sums he has to invest, he focuses on assets with extremely high liquidity, like currencies -- though he dabbles in commodities and real estate as well. Those who know him say he is an impulsive, quick-to-change-his-mind trader, still governed by Ace Greenberg's trader's maxim: If the stock is down 10 percent, sell it. He has been on the short side of the Brazilian real, and those close to him say bets there have paid off in spades. He recently took a long position on the euro before its rebound on the basis that Europeans were too proud to see their currency sink any lower against the dollar. His next targets: an across-the-board short of the German stock exchange and a possible attack on the Hong Kong dollar peg in light of the recent disclosure of North Korea's nuclear-weapons program.

None of this is investment rocket science, but getting the direction and the timing right, no matter how conventional the investment idea, can spin large money for an investor. Before taking a big position, Epstein will usually fly to the country in question. He recently spent a week in Germany meeting with various government officials and financial types, and he has a trip to Brazil coming up in the next few weeks. On all of these trips, he flies alone in his commercial-jet-size 727. 


Friends of Epstein say he is horrified at the recent swell of media attention around him (Vanity Fair is preparing a megaprofile, and the Villard House office has had a barrage of calls from other media outlets). He has never granted a formal interview, and did not offer one to this magazine, nor has his picture appeared in any publication. Yet for one so obsessive about his privacy, one wonders -- didn't he realize that flying Clinton and Spacey around Africa was going to blow his cover? As he said to a friend: "If my ultimate goal was to stay private, traveling with Clinton was a bad move on the chessboard. I recognize that now. But you know what? Even Kasparov makes them. You move on."


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