[[Harvard University]] (MBA)"}},"i":0}}]}" id="mwCQ">.mw-parser-output .infobox-subbox{padding:0;border:none;margin:-3px;width:auto;min-width:100%;font-size:100%;clear:none;float:none;background-color:transparent}.mw-parser-output .infobox-3cols-child{margin:auto}.mw-parser-output .infobox .navbar{font-size:100%}@media screen{html.skin-theme-clientpref-night .mw-parser-output .infobox-full-data:not(.notheme)>div:not(.notheme)[style]{background:#1f1f23!important;color:#f8f9fa}}@media screen and (prefers-color-scheme:dark){html.skin-theme-clientpref-os .mw-parser-output .infobox-full-data:not(.notheme) div:not(.notheme){background:#1f1f23!important;color:#f8f9fa}}@media(min-width:640px){body.skin--responsive .mw-parser-output .infobox-table{display:table!important}body.skin--responsive .mw-parser-output .infobox-table>caption{display:table-caption!important}body.skin--responsive .mw-parser-output .infobox-table>tbody{display:table-row-group}body.skin--responsive .mw-parser-output .infobox-table tr{display:table-row!important}body.skin--responsive .mw-parser-output .infobox-table th,body.skin--responsive .mw-parser-output .infobox-table td{padding-left:inherit;padding-right:inherit}}
John Paulson | |
---|---|
Born | John Alfred Paulson December 14, 1955 New York City, U.S. |
Education | New York University (BA) Harvard University (MBA) |
Known for | Founder of Paulson & Co. |
Political party | Republican |
Spouse | Jenny Zaharia (m. 2000;sep. 2021) |
Children | 2 daughters |
John Alfred Paulson (born December 14, 1955) is an American billionaire hedge fund manager. He leads Paulson & Co., a New York–based investment management firm he founded in 1994. [1] He has been called "one of the most prominent names in high finance". [2]
He acquired much of his fortune in 2007 when he earned almost $4 billion and was transformed "from an obscure money manager into a financial legend" [3] by using credit default swaps to effectively bet against the U.S. subprime mortgage lending market. In 2010, Paulson earned $4.9 billion. [4] The Forbes real-time tracker estimated his net worth at $3 billion as of January 2023. [1]
A Donald Trump supporter, Paulson was a major donor to Trump's 2016, 2020, and 2024 presidential campaigns. Trump has publicly floated Paulson as a potential Secretary of the Treasury following his victory in the 2024 election. [5]
Paulson was born on December 14, 1955, in Queens, New York City, the third of four children of Alfred G. Paulson [6] [7] [8] (1924–2002) and Jacqueline (née Boklan, 1926–2018). [9]
His father was born Alfredo Guillermo Paulsen in Ecuador to a father of half French and half Norwegian descent and an Ecuadorian mother. Alfredo was orphaned at fifteen, and at age sixteen moved to Los Angeles with his younger brother, Alberto. Alfredo enlisted in the U.S. Army, where he served and was wounded in Italy during World War II. He later changed his surname from Paulsen to Paulson. [7] [9]
John's mother, Jacqueline, was the daughter of Jewish immigrants from Lithuania and Romania who had moved to New York City. She met Alfredo while they both attended UCLA. They wed and moved to New York City, where Alfredo worked at Arthur Andersen [9] and later as the CFO at public-relations firm Ruder Finn. [10] [11]
After dropping out of college then realizing that his previously chosen career path in sales would not provide a steady and secure cash flow, John Paulson returned to NYU in 1976, where he began to excel in business studies. [9] In 1978, he graduated valedictorian of his class summa cum laude in finance from New York University's College of Business and Public Administration. [12] He went on to Harvard Business School, on a Sidney J. Weinberg/Goldman Sachs scholarship, earning an MBA as a George F. Baker Scholar (top 5 percent of his class) in 1980. [12]
Paulson began his career at Boston Consulting Group in 1980 where he did research, providing advice to companies. Ambitious to work in investment on Wall Street, he left to join Odyssey Partners where he worked with Leon Levy. He moved on to Bear Stearns working in the mergers and acquisitions department, and then to Gruss Partners LP, where he was a general partner. [13]
In 1994, he founded his own hedge fund, Paulson & Co., with $2 million and one employee, [14] located in office space rented from Bear Stearns on the 26th floor of 277 Park Avenue. The firm moved to 57th and Madison in 2001. By 2003, his fund had grown to $300 million in assets. [3]
Paulson and his company specialize in "event-driven" investments—i.e. in mergers, acquisitions, spin-offs, proxy contests, etc.—and he has made hundreds of such investments throughout his career. Many of the events involved merger arbitrage—which has been described as waiting "until one company announces that it's buying another, rushing to purchase the target company's shares, shorting the acquirer's stock (unless it's a cash deal), and then earn the differential between the two share prices when the merger closes." [3] An example of a proxy event investment Paulson made was during Yahoo's proxy contest in May 2008, when Carl Icahn launched a proxy fight to try to replace Yahoo's board. [15]
In 2010, he set another hedge fund record by making nearly $5 billion in a single year, [1] primarily investing in the gold sector. [16] However, in 2011, he made losing investments in Bank of America, [1] Citigroup [1] and the fraud-suspected China-based Canadian-listed company, Sino-Forest Corporation. [1] His flagship fund, Paulson Advantage Fund, fell sharply in 2011. Paulson has also become a major investor in gold. [1]
Paulson became world-famous in 2007 by shorting the US housing market, as he foresaw the subprime mortgage crisis and bet against mortgage-backed securities by investing in credit default swaps. Sometimes referred to as the greatest trade in history, Paulson's firm made a fortune and he earned over $4 billion personally on this trade alone. [17]
Paulson worked with Goldman Sachs to provide liquidity for low-performing home loans in Arizona, California, Florida and Nevada. Together, Paulson and Goldman created the Abacus 2007-AC1 investment vehicle and kept Paulson's bet against the underlying assets hidden from people who purchased it. Paulson escaped indictment because his firm maintained that it was always transparent about its view of the mortgages that had been securitized and that the assets were not without risk. Goldman was sued by the Securities and Exchange Commission and had to reach a settlement for Abacus. [18] [19] On July 15, 2010, Goldman settled out of court, agreeing to pay the SEC and investors US$550 million, including $300 million to the U.S. government and $250 million to investors, one of the largest penalties ever paid by a Wall Street firm. [20]
Paulson contributed $140,000 to political candidates and parties between 2000 and 2010, 45% of which went to Republicans, 16% to Democrats, and 36% to special interests, [21] including former House Speaker John Boehner. [3]
In 2008, Paulson co-wrote a Wall Street Journal op-ed piece suggesting an alternative to the Treasury Secretary's plan for stabilizing the markets. The alternative plan included recapitalizing the troubled financial institutions by spending the $700 billion Troubled Asset Relief Program funds to buy their senior preferred stock rather than their "worst assets". [22]
In 2008 while testifying before US House Committee on Oversight and Government Reform Paulson was asked about the low tax rate on long-term capital gains and carried interest earnings and Paulson replied "I believe our tax situation is fair." [3] In a 2012 interview with Bloomberg Businessweek magazine he expressed displeasure over the Occupy Wall Street movement, saying, "We pay a lot of taxes, especially living in New York—there's an almost 13 percent city and state tax rate. ... Most jurisdictions would want to have successful companies like ours located there. I'm sure if we wanted to go to Singapore, they'd roll out the red carpet to attract us." [3]
In 2011, Paulson donated $1 million to Mitt Romney's Super PAC Restore Our Future. [23] On April 26, 2012, Paulson hosted a fund-raiser at his New York townhouse for Romney's presidential candidacy. [3]
At the 2014 Puerto Rico Investment Summit in San Juan, Paulson stated: "Puerto Rico will become the Singapore of the Caribbean." Paulson was reportedly investing in the territory's municipal debt and real estate developments, and was building a home at a resort. [24]
Paulson received media attention when he immediately backed Donald Trump after Trump secured the Republican nomination in 2016. [25] Paulson served as one of the top economic advisers to Donald Trump's 2016 presidential campaign. [26] [27] Paulson had established a relationship with Trump prior to the campaign, with Paulson and other investors having sold the Doral Golf Resort & Spa in Trump in 2012. [28] Together with his spouse, Paulson contributed $831,370 to Donald Trump's 2020 presidential campaign. [29]
Paulson has been a major fundraiser for Donald Trump's 2024 campaign. [30] [31] On April 6, 2024, the Trump campaign self-reported a $50.5 million fundraising haul at John Paulson's Palm Beach house. [32] In March 2024, it was reported that Trump floated Paulson as a potential Secretary of the Treasury if he wins the 2024 election. [33]
Between 2009 and 2011 Paulson made several charitable donations, including $15 million to the Center for Responsible Lending, $20 million to New York University Stern School of Business (auditorium now named after Paulson), $5 million to the Southampton Hospital on Long Island, $15 million to build a children's hospital in Guayaquil, Ecuador, and £2.5 million to the London School of Economics for the John A. Paulson Chair in European Political Economy. [34] [35] [36]
In October 2012, Paulson donated $100 million to the Central Park Conservancy, the nonprofit organization that maintains New York City's Central Park. At the time of the donation, the gift represented the largest monetary donation in the history of New York City's park system. [37] In June 2015, Paulson donated $400 million to Harvard University's School of Engineering and Applied Sciences (SEAS), the largest gift received in the university's history. Following the donation, the engineering school was renamed the Harvard John A. Paulson School of Engineering and Applied Sciences. [38] [39] The next month, he gifted $8.5 million to New York City's largest charter school organization, Success Academy, to change public education and open up middle schools in the Bedford-Stuyvesant area of Brooklyn and in the Hell's Kitchen area of Manhattan. [40]
In 2022, New York University announced that Paulson had donated $100 million towards the cost of a new building in its Washington Square Campus. The building was named the John A. Paulson Center in recognition of the gift. [41]
In 2024, the Hebrew University of Jerusalem awarded Paulson an honorary doctorate in recognition of his extensive philanthropic contributions to Israeli cultural and educational institutions. His support for Israeli initiatives includes a $27 million commitment to establish the Paulson Bar-El Building for Computer Science and Engineering at Hebrew University. Paulson also contributed significantly to the Tel Aviv Museum of Art in 2021 to celebrate the museum's 90th anniversary and has supported the Jerusalem Campus for the Arts. [42]
In 2000, Paulson married Jenny Zaharia in an Episcopalian ceremony in Southampton, New York; [43] Jenny was a Romanian immigrant who came to the United States after her brother George, a track star in Romania, defected and moved to Queens. [9] The couple had two daughters [44] and lived most of the year in a 28,500-square-foot Upper East Side townhouse on East 86th Street, bought in 2004 for $14.7 million. [3] Paulson also owned a home in Aspen, Colorado, purchased for $24.5 million in 2010 and an estate in Southampton that he bought for $41 million in 2008. [45] [3] [46]
In 2017, Paulson and his wife wrote a letter to the elite Manhattan Spence School, threatening to withdraw aid if the school continued its "alarming pattern" of "anti-white indoctrination". In the letter, they stated: "In fact for children of all races, we strongly believe that schools should value and define success in terms of hard work, earned accomplishment, merit, a commitment to academic rigor, and personal integrity." [47]
Paulson filed for divorce in September 2021, but later withdrew his divorce action so that both sides could negotiate out of court and away from the media. [48] In 2022, Zaharia sued Paulson for $1 billion in damages. [49]
In 2024, Paulson was reportedly engaged to be married to 35-year-old clinical dietitian Alina de Almeida. [50] [51]
John Paulson has an older sister named Theodora Bar-El, an Israeli biologist.
The Goldman Sachs Group, Inc. is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered in Lower Manhattan in New York City, with regional headquarters in many international financial centers. Goldman Sachs is the second-largest investment bank in the world by revenue and is ranked 55th on the Fortune 500 list of the largest United States corporations by total revenue. In the Forbes Global 2000 of 2024, Goldman Sachs ranked 23rd. It is considered a systemically important financial institution by the Financial Stability Board.
Julian Hart Robertson Jr. was an American hedge fund manager, and philanthropist.
Henry "Hank" Merritt Paulson Jr. is an American investment banker and financier who served as the 74th United States Secretary of the Treasury from 2006 to 2009. Prior to his role in the Department of the Treasury, Paulson was the chairman and chief executive officer (CEO) of major investment bank Goldman Sachs.
Kenneth Cordele Griffin is an American hedge fund manager, entrepreneur and investor. He is the founder, chief executive officer, co-chief investment officer, and 80% owner of Citadel LLC, a multinational hedge fund. He also owns Citadel Securities, one of the largest market makers in the United States.
David Alan Tepper is an American billionaire hedge fund manager. He is the owner of the Carolina Panthers of the National Football League (NFL) and Charlotte FC in Major League Soccer (MLS). Tepper is the founder and president of Appaloosa Management, a global hedge fund based in Miami Beach, Florida.
Marc Lasry is a Moroccan American billionaire businessman and private equity manager. He is the co-founder and chief executive officer (CEO) of Avenue Capital Group. He was a co-owner of the NBA's Milwaukee Bucks basketball team from 2014 to 2023.
Rajakumaran Rajaratnam is a Sri Lankan-American former hedge fund manager and founder of the Galleon Group, a New York-based hedge fund management firm. He is also the author of his memoir, Uneven Justice: The Plot to Sink Galleon.
Daniel Och is an American billionaire hedge fund manager, and philanthropist. He is the founder, chairman and former CEO of Och-Ziff Capital Management, a global hedge fund and alternative asset management firm. According to Forbes he has a net worth of US$3.6 billion, as of August 2021.
Barry Stuart Sternlicht is an American billionaire and the co-founder, chairman, and CEO of Starwood Capital Group, an investment fund with over $100 billion in assets under management. He is also chairman of Starwood Property Trust. He is the founder of Starwood Hotels and Resorts Worldwide and served as its Chairman and CEO from 1995 to 2005. As of May 2023, his net worth was estimated at $4.6 billion.
Paulson & Co., Inc. is a family office based in New York City. Previously, it was a hedge fund established by John Paulson in 1994. Specializing in "global mergers, event arbitrage, and credit strategies", the firm had a relatively low profile on Wall Street until its hugely successful bet against the subprime mortgage market in 2007. At one time the company had offices in London and Dublin.
Stephen Frank Mandel Jr. is an American hedge fund manager, investor, and philanthropist. He founded Lone Pine Capital in 1997, after working as the managing director at Tiger Management. According to Forbes, Mandel has an estimated net worth of US$3.9 billion as of August 2022.
Clifford Scott Asness is an American hedge fund manager and the co-founder of AQR Capital Management. As of July 2024, Forbes estimated his net worth at US$2.0 billion.
Leon G. Cooperman is an American billionaire investor and hedge fund manager. He is the chairman and CEO of Omega Advisors, a New York-based investment advisory firm managing over $3.3 billion in assets under management, the majority consisting of his personal wealth.
Michael Edward Novogratz is an American investor, formerly of the investment firm Fortress Investment Group. He is currently CEO of Galaxy Investment Partners which focuses on investments in cryptocurrency.
Robert Leroy Mercer is an American hedge fund manager, computer scientist, and political donor. Mercer was an early artificial intelligence researcher and developer and is the former co-CEO of the hedge fund company Renaissance Technologies.
The Greatest Trade Ever: The Behind-the-Scenes Story of How John Paulson Defied Wall Street and Made Financial History is a debut non-fiction book by American journalist Gregory Zuckerman. The book was released on November 3, 2009, by Crown Business. The book investigates the reasons and consequences of the subprime mortgage crisis and the role that hedge fund manager John Paulson played in those events.
Charles W. Murphy was an American investor and hedge fund manager and has been referred to in media reports as a "financial guru".
Goldman Sachs, an investment bank, has been the subject of controversies. The company has been criticized for lack of ethical standards, working with dictatorial regimes, close relationships with the U.S. federal government via a "revolving door" of former employees, and driving up prices of commodities through futures speculation. It has also been criticized by its employees for 100-hour work weeks, high levels of employee dissatisfaction among first-year analysts, abusive treatment by superiors, a lack of mental health resources, and extremely high levels of stress in the workplace leading to physical discomfort.
SEC v. Goldman Sachs & Co, civ 3229 was a civil court case in front of the United States District Court for the Southern District of New York brought by the U.S. Securities and Exchange Commission against Goldman Sachs (GS&Co) and Fabrice Tourre an employee of GS&Co relating to the ABACUS 2007-AC1 CDO. The court found against the defendant which resulted in the largest fine in the SEC history at the time of $550m.