To read through Jeffrey Epstein’s emails is to glimpse something of what Hannah Arendt saw when she attended the trial of Adolf Eichmann in 1963. In the Epstein files so far released, there are hints of the monster’s crimes – when a lackey discusses building a “playroom” for him in a hotel, when he emails a contact: “I loved the torture video” – but the overall impression is one of horrifying normality. They are mostly emails about meetings. Where conversation takes place in the files, it is usually men talking about money.
The most important thing about the files is that they form part of the evidence against a group of people who subjected more than 1,000 victims, many of them children, to sexual violence, rape and trafficking. But the way these people talk about money is also relevant, because it shows financial elites’ awareness of how money changed in the post-2008 era, their celebration of the policy that made them even richer and their plans for a world in which this situation became permanent.
The day after the 2016 Brexit referendum, Epstein emailed the venture capitalist and investor in PayPal, Facebook and Palantir, Peter Thiel, to tell him that Britain’s vote to leave the EU was “just the beginning” of a new age of a “return to tribalism”, and that for those with wealth, it would be easy to buy “things on their way to collapse” and to make “amazing new alliances”. These sound like dramatic, world-changing ideas, but the really important part of the email is this: “you and I both agree… zero interest rates were too high”. This is an acknowledgement of something that had given such men power, which paid (at least in part) for the private jets and private islands.
In the late 1970s the investment bank Bear Stearns had produced two things: the mortgage-backed security and Jeffrey Epstein’s career. Epstein, having been sacked from a teaching job at a private school in Manhattan, was given a job on the bank’s trading floor in 1976. A year later another Bear Stearns trader would develop the mortgage-backed security, which would become the collateralised loan obligation, which would become the subprime lending boom, which would precipitate the global financial crisis that began in 2008.
Zero (or near-zero) interest rates were a major part of the response by central banks, such as the US Federal Reserve and the Bank of England, to the recession caused by that 2008 crash. Paired with the printing of new money to buy government bonds (quantitative easing), this extreme approach to monetary policy made it effectively profitable to borrow money. It also made assets that investors might have held for their safety value (such as government bonds) much less profitable to hold, which meant money flowed towards other assets, such as property and company shares. The “real economy” in many countries stagnated, wages fell against inflation, but house prices and stock markets boomed as a wave of risk-seeking capital spread around the world.
Epstein and his friends recognised this and celebrated it. In 2014 Epstein wrote to a Qatari business contact that “zero interest rates provide once in a lifetime opportunities. all fun”. In another 2015 email to Thiel, he wrote: “zero interest rates are still churning out money”.
In 2016 he again corresponded with Thiel on the subject of zero interest rates (“still too high”). He would later discuss with Larry Summers, the former US Treasury Secretary, the idea of Thiel running the US economy, although behind his friend’s back he considered him “too autistic” for the job. A piece written for (but never published by) New York magazine by the journalist Michael Wolff on Epstein’s life portrays “Epstein and Summers trying to unravel the conundrum of zero interest rates”, although to these men it was not really a conundrum. It was a massive inflation of the value of their assets. Since 2008 the wealth of the world’s billionaires (as a share of GDP) has roughly doubled.
The zero-rate world was not just one of financial opportunity to Epstein but a chance to increase his political influence. In 2015 he wrote to the former prime minister of Israel, Ehud Barak, that he had been speaking to “sergey” (apparently Sergey Lavrov, the Russian foreign minister) and that he was keen to set up a meeting with Putin to discuss “the new world of zero interest rates”. Epstein and many of his associates foresaw a world in which the money of ordinary people would lose its meaning; the emails are full of cryptocurrency discussion. Epstein claimed to have been asked to develop a digital currency for Mongolia, and proposed one for Dubai to the Emirati businessman and CEO of DP World, Sultan bin Sulayem.
In December 2018, Steve Bannon emailed Epstein a link to an article that reported Donald Trump had discussed firing the chair of the Federal Reserve, Jerome Powell, who had just raised interest rates in the US. Epstein derided Powell’s career, saying he “didnt understand the markets 25 years ago”, and told Bannon that “getting rid of powell” was of primary importance. America’s central bank, he wrote, was “a weapon to be used with sophistication.”
This is still very much the view of the current Trump administration. After the 2024 election Elon Musk called for the Federal Reserve, which he considered to be “absurdly overstaffed”, to be audited, and the DoJ has recently launched an investigation into the Fed’s spending on its buildings, which Jerome Powell has stated is motivated entirely by Trump’s desire to reduce interest rates, to inflate assets still further – to return to the zero-rate world in which the financial elite’s money simply cannot lose.
[Further reading: How has Donald Trump escaped the Epstein files?]
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