The shocking West Asian war unleashed by the USA and Israel is a source of relief to Donald Trump because it has temporarily taken media attention away from his greatest domestic scandal, his long and sordid ties with the deceased sex trafficker, Jeffrey Epstein. But the Epstein story will return to haunt Trump forever.It is now evident that Jeffrey Epstein was both a financial conman and a depraved sex trafficker. These were his twin paths to cross breeding the most disparate elites on both sides of the Atlantic, and well beyond. He was the patriarch of what is now often called The Epstein Class. The connection between the sexual and financial elements of his career merit a closer look, which involves two keywords in modern finance: leverage and derivatives.The data swampFew of us can avoid being drawn in to the digital outpourings of the Epstein Files, disgorged by the Vesuvius that is the US Department of Justice, even as we hiss, cluck and weep about the extraordinary depravities in the emails recorded there. The heavily redacted emails are messages, not opinions, advertisements, reports or infotainment, even if they have elements of all of these. They are oddly personal, detailed and often casual, a steady stream of chit-chat, with the quaintly old-fashioned ring of candour, trivia and small talk, often about tuna melts and airplane timings, the loose packaging for requests, promises, dates, times and places.This material has even less intrinsic appeal than any TV feature about the Kardashians, assorted Mafia housewives, Sean Combs’ parties, or any comparably glimpse of the Rich and Awful. But it has something which sets it apart. It is the richest, most privileged, most ethically challenged network ever seen in human history. It crosses many demographics: between genders, generations and geographies, as well as between industries, professions and occupations. It is a borderless elite, visible in its banality and its depravity, sometimes two sides of the same coin. Even the most intelligent readers and interpreters of these files have not been able to decode what serve to glue this network together. Jeffrey Epstein is flagged as a charismatic con man, as the ultimate connector, as the Rosetta Stone of intra-elite bonding, as the wizard of finance for those unbound by normal rules, and as the emcee of the Masked Billionaires Ball. These and other similar insights still leave us unsatisfied. In our various histories and memories, we have seen power, greed, depravity, indifference to the law, contempt for commoners and the commons. We have also seen racism, eugenic fantasies, open social Darwinism and rampant corruption too many times to be as shocked as we now are. We know that there has never been an elite in history that wanted the great unwashed to breach their gates. We know from the great social scientists that modern elites are motivated by the wish to perpetuate themselves, that they think they are truly different, that they are constantly replacing one another, and that once the barn or the lifeboat is secure, the door is shut, the rest of us are thrown overboard. Most of us hold one or more of these meme-sized beliefs which add up to a collective sense of deja vu. Still, there is no clarity among the many opinion-makers around us about what holds this class together, a class which is an elite, a network, a cult, a web, with a giant Spider at its heart. The logic that holds this elite together remains unclear. I offer here another thread to pull at, one which offers us a different through line on the Epstein story.Derivatives and leverageThe history of the financial markets was massively changed in the early 1970’s, when a group of academics and financial traders discovered how to make money out of risk. They invented models for quantifying financial risks so that these risks could themselves be traded for profit. In the decades since then, the principal form of such wealth-making was the trade in derivatives, assets whose value was based on some other underlying asset, and whose future value could be guessed at but never precisely predicted. The trade in derivatives was an infinite pyramid of asset forms resting on other forms, creating a chain of bets between traders about the future value of such derivatives. The most conservative estimate of the global derivatives market in 2025 is US $ 600 trillion. This form of trading was the main factor behind the mortgage crisis of 2007-2008 which led the global financial markets, especially on both sides of the Atlantic, to virtual collapse in 2008. They were rescued by Obama and his Wall Street allies, who agreed that the major banks were “too big to fail”. In simple terms, this meant that their exposure to the mountain of derivatives whose trade produced windfall profits for them could drag down many other smaller banks, investors, debtors and businesses. Among the banks that failed spectacularly was a venerable one called Bear Stearns which was an intimate part of the process by which an obscure Brooklyn hustler called Jeffrey Epstein became a Wall Street billionaire in a matter of decades. A meticulous New York Times investigation, published on December 16, 2025, gives us a detailed picture of how Epstein amassed his millions. In March 2008, Bear Stearns collapsed under a massive, unsustainable leverage ratio of approximately 33-to-1 to 38-to-1, supported by just over $11 billion in equity against nearly $400 billion in assets. This extreme borrowing, coupled with heavy investment in mortgage-backed securities, made the firm instantly insolvent when asset values dropped and liquidity evaporated. The key word here is leverage, the capacity to take risks worth huge sums with little real money in hand. Bear Stearns, Epstein’s financial school house and later his own investment bank of choice for his ill-gotten millions, was not only dangerously leveraged, it was also massively involved in the derivatives market. Epstein was certainly embroiled in Bear Stearns’ primary financial strategies (leverage and derivatives) as his bosses and mentors in the company certainly were. Whether or not Epstein was truly an expert in the technically convoluted market in mortgage-derived securities, what he did master were the less demanding tools of financial fraud: tax evasion, shell companies, offshore accounts, contract violation, and flagrant abuse of all fiduciary norms. The millionaires and billionaires he serviced with this garden variety of fraud made their own money through more or less legitimate successes in real estate, retail, media, digital technology and law. Epstein was the the pilot fish for these sharks (and whales). In a 2008 video recording about his jail period in Palm Beach (before the notorious deal that freed him), he pretended genuine shock about the breaking news of the market collapse, as if he had no idea of the financial strategies that had led to it.Epstein consummately did what true entrepreneurs do. He translated what surrounded him at Bear Stearns (leverage and derivatives) from finance into the realm that suited him best, the social realm of connections, status, networks and celebrity. He created a vast and open network for an elite which allowed its members to take social risks in order to expand their networks. The risks themselves can be seen as a series of derivative rings, with gradually increasing proximity to the heart of Epstein’s trafficking in underage females. Those in the outer circles could smell the heat emanating from the inner circle, and had the choice to walk away, to sniff the relative proximity of abuse, or to take the plunge and enter the core circle of depravity. Networks like this have a life of their own, and expand and contract without any central authority, auto-regulated by the relative appetite for social risk of their members. With few exceptions, recruits to the Epstein class were at the top of their respective games, masters of their respective universes, but eager to peek over the fence at the neighbouring hierarchies of exclusivity, impunity and power. Their eagerness was indexed by their degree of appetite for the risk of derivative depravity, with Epstein as the gold standard.This entire class (or network, or cult, or web) was a leveraged system for networking and financial benefit as two sides of the same coin. One acquaintance acquired by Epstein was the leverage for an introduction to another in this growing class. The millions of emails unleashed like sewage by the Department of Justice show that the Epstein class had no worries about using a medium as vulnerable as email to make their dates, arrange their lunches, giggle about their conquests and coyly allude to Epstein’s known proclivities. These emails show that those who sent and received them were blinded by a sense of their impunity and turned on by their derivative closeness to Epstein’s core depravity. The chain of derivative risks runs from Epstein’s sexual appetites outwards to the edges of his network. And in the reverse direction, Epstein became the dream financier for any variety of financial appetites, from tax fraud and academic funding to shell companies and offshore assets. Leverage in both sex and finance supports reckless risk-taking.Epstein’s victims were turned into quiescent vehicles of derivative depravity, whose coerced silence, mutual isolation and social marginality made them equally ideal as exploitable bodies and as shields against public scrutiny. This layer of insulation began to erode in the years between 2010 and 2016, when the combination of brave and now mature victims, unforgiving media, crusading lawyers and external factors like the MeToo movement shifted the weight of public opinion from the Epstein class to the victims. Zero tolerance for derivative depravity appears to have arrived. But not quite. Trump himself, and the likes of Pam Bondi, Kash Patel, Alan Dershowitz, Les Wexner and Alex Acosta, continue to run free in the United States, hoping for reprieves provided by the MAGA lobby, or the Supreme Court or some other deus ex machina.Whatever happens, Epstein has added a new and grotesque dimension to our understanding of elites, and their unlicensed licentiousness. His world, his class, his network, built and sustained for almost three decades, marks a new economy of derivative depravity. In both financial and sexual markets, risk seems to guarantee reward, until its impunity is withdrawn. Arjun Appadurai teaches in New York and Berlin.