For a man confident of a coming economic catastrophe, Mark J. Grant certainly seems to be enjoying himself.
Smoking a morning cigar poolside at his waterfront Fort Lauderdale home, a top executive at a Wall Street bond operation recalls how he predicted the Greek debt crisis two years ago. That foresight is getting noticed. The Wall Street Journal this year called him “The Wizard” in a column devoted to his forecasts, borrowing a nickname Grant uses for himself in the investment newsletters he sends to clients. A wizard also graces the burgee of the 83-foot yacht docked behind his home. Name: Wishes Granted.
“Besides making money, which is good, I’m also having a wonderful time,’’ said Grant, 61. “That’s as good as it gets in this life.”
Life has certainly been good to Grant, who has owned five yachts named “Wishes Granted.” But now he’s enjoying a new windfall: fame. Thanks to an early hunch that Europe might swamp the U.S. recovery, Grant is quickly becoming perhaps the most prominent financial commentator in South Florida.
“Soon, everybody could know Mr. Grant,’’ New York Times columnist Andrew Ross Sorkin wrote last week, dubbing Grant the “Dr. Doom” of the Greek crisis.
Grant’s ultra-bearish instincts came out Friday amid Wall Street euphoria over news that European leaders were readying a new bailout for beleagured banks in Italy and Spain. Grant wasn’t buying it, and urged his clients not to buy into it. “I advise against investing on hopes, prayers and grand schemes that have too often gone astray in Europe,’’ he wrote in an email note 21 minutes after the markets began surging Friday morning. “I think the rally fades as people look past the headlines.”
The coming weeks will show whether Grant’s latest bet against a brighter day will prove correct. He still sees his early predictions of a Greece meltdown largely coming true, the first step in what he sees as a much broader crisis. With Spain following Greece into insolvency and Italy on the brink, Grant predicts a broad European banking meltdown. That will push the United States into a recession as early as this fall. With the downturn, Grant also sees South Florida’s real estate rebound ending and prices dropping again.
“I thought it was going to get bad, and it got bad,’’ Grant said in an interview. “It’s a big mess.”
Grant was on a yacht in the Bahamas when the Lehman Brothers investment bank collapsed in 2008, sparking a financial crisis that put the United States at risk of a depression. Grant turned the yacht around and raced back to Fort Lauderdale.
To prevent a national bank run, Washington began buying preferred stock in insolvent financial institutions. Grant saw an opportunity in the rescue: buy the banks’ own debt, since bondholders would be paid back ahead of stock holders in the event of a bankruptcy.
“Many of you are staring at the table and haven’t yet noticed the present that is sitting there,” he wrote in a Nov. 12, 2008 note to clients. “Smell the roses, wake up to the glorious dawning of a new day...’’
The downturn was apparently good for Grant. In 2009, Grant paid $3.2 million for his 6,000-square-foot house, including a three-car garage that now houses a Bentley, Ferrari and a Rolls Royce. In 2009, he also bought his latest Wishes Granted. In 2010, he set sail for a three-month working vacation aboard the yacht, joined by his private captain, chef and stewardess.