Believe me when I say that within the confines of a sensible set of economic or trading policies this is insane:
FTX evidently lent large amounts–$16 billion!–of customer assets to Alameda Research. Apparently to prop it up after huge losses in the first blizzards of Crypto Winter. (In retrospect, SBF’s buying binge earlier this year looks like gambling for resurrection.)
SBF described this as “a poor judgment call.”
No, it’s insane.
You don’t say! I hear that’s what Napoleon said while trudging back from Russia in November 1812.
Also probably an illegal judgment call.
Could well be.
(I further note that SBF is a huge Democrat donor. Like Corzine, his political connections may save him from the pokey, though by all appearances he should spend a very long stretch there.)
Is this actually illegal, any of this, or just a huge balls-up ?
SBF keeps saying “But I didn’t know!”. Those more informed are saying, well, if you were trying to defraud this is what would be done. So, perhaps the didn;t know is true after all….
Mind you. The DoJ is good at hanging nebulous “racketeering” charges on people . Isnt that what they did to Conrad Black ?
I hear that’s what Napoleon said while trudging back from Russia in November 1812
At least the theme tune was good.
Clearly Black didn’t drop enough in the Democrat donation pot.
Out of interest, says above “FTX evidently lent large amounts–$16 billion!–of customer assets to Alameda Research.” Are we talking $US or crypto here? If the assets are crypto the value’s undetermined. Probably zero. Problem’s in how people talk about two words
Value = Every & all times total fantasy.
Derived from:
Price = A figure for the last historic transaction. Now meaningless. That buyer & seller were satisfied by the transaction. It is, by definition, not a figure for the next transaction.
Also derived:
Bid & offer = Size? The bottom bound of size is 1
Like all asset values, they’re nothing better than an aspiration. Dreamworld. Meaningless. To liquidate, the seller needs a buyer. So in small amounts, maybe. Anything larger & the action of offering to the market will change the bid. It’s entirely possible there will be no bid. At any figure.
We got into this territory with unrealised capital gains taxes. What’s the gain? In small numbers of units it can be based on market price. But in large numbers? What’s the value of a company if you want to sell it? Or a large proportion of it? Is there a buyer? At what price? You’re off with the birds.
“At least the theme tune was good.”
Je ne regrette rien?
I worked for a company but bailed out because… Well I thought that their product didnt work and the customers hated them.
They sold out to IBM for a billionish dollars. The company wasnt worth that much, but its patents were.
SBF went to MIT, they tend not to let morons in, so ‘I didn’t know’ is a bit unlikely.
No idea how reliable the source is, but it seems plausible:
“Shocking” is a word that aptly describes the rapid fall of Sam Bankman-Fried’s cryptocurrency empire. To a surprising degree, it’s a sentiment that pours out from people who worked for him, people who you’d think would’ve had a clue.
https://www.coindesk.com/business/2022/11/10/bankman-frieds-cabal-of-roommates-in-the-bahamas-ran-his-crypto-empire-and-dated-other-employees-have-lots-of-questions/
“SBF went to MIT, they tend not to let morons in,”
Half of the UK governing class went to Oxford. What university a person attended is no guide to their useful intelligence
Who remembers Archegos? Are you mad because this is bigger? Is SBF mad that he couldn’t reach Too Big To Fail status and get a Fed bailout? But will the Fed come around in the future?
“Half of the UK governing class went to Oxford. What university a person attended is no guide to their useful intelligence”
I think it was Nassim Taleb who coined the phrase ‘Intellectual Yet Idiot’, which pretty much sums up the class of people who run the West these days. I genuinely think that the decline of the West can be traced to the total removal of people with ordinary life experience from the political class (the Left ironically was a decent source of such people in government – men (and it was mostly men) who had been dockers, miners, train drivers, steelworkers etc etc). And all political parties up to the 1980s had plenty of people who had fought in a war, which is perhaps the ultimate source of ‘real life’ experience.
Now we are governed by ‘clever’ people who can write an essay on some obscure legal doctrine, or translate Latin, or write a ‘policy document’ in the usual wokespeak BS, and are quite capable of writing speeches arguing both sides of the same debate (and not really caring which they plump for), but who couldn’t build a brick wall, service their car, or do some simple plumbing.
IMO there’s two parts to intelligence, there’s the intellectual, involving ideas and data, and the manipulation thereof, and there’s how one uses that intellect to interact successfully with the physical world. If you can do the former but not the latter, then you are not truly intelligent. You are no more suited for high office than someone who is a highly skilled carpenter but can’t string a 2 ideas together to make a coherent argument. Both have just half the tool kit required to be considered part of the elite suitable to govern.
Hence my distain for universities. They select entirely for the intellect, and never for the practical. But we chose our leaders from the ranks of the university educated. And we get people entirely unsuited for leadership as a result.
@Jim
I think there’s something one could call “smarts”. Maybe it’s learned, maybe it’s innate, maybe a combination of the two. One sees it in people who can make correct decisions on patchy information. Correctly extrapolate what’s likely to happen from the now depending on what courses of action are taken.
Whatever it is, there’s certainly little sign of it in your governing classes.
Amusing take on the affair by Patrick Boyle: https://www.youtube.com/watch?v=zTFhnpf-IE0
My answer to the fool/crook conundrum with regard to Bankman-Fried is that he – and many in his line – are like Elizabeth Holmes at Theranos. They start off honest, but a combination of the inability to run a business and to live up to their BS, coupled with massive egos and reams of people blowing smoke up their arses means they abandon morality very quickly and end up being prepared to do anything to maintain their status.
Crypto is awash with people like this and most of the rest are simply crooks. That’s partly the reason why crypto presents zero threat to fiat currencies. Never mind the principles, look at the principals involved.
The coindesk articl Jonathan links to gives some idea of the ‘workings’ of FTX/Alameida. – a million miles from a properly run business. But run by people who espouse “effective altruism:, so that’s OK….
“The louder he talked of his honour, the faster we counted our spoons”
BiS:
Half of the UK governing class went to Oxford.
Oh yes you are right, but it depends on the degree – if he did a STEM degree, then he’ll be in the top 1-2%. If he did PoliSci, or Gender and Ethnic Studies, then he’s not…
Jonathan
Unfortunately a 1st class STEM degree doesn’t in itself stop a poli from going down the route of becoming arse-licking Govt fodder, that depends more on what motivates the particular scrote.
@Jim – November 11, 2022 at 10:16 pm
Hence my distain for universities. They select entirely for the intellect, and never for the practical. But we chose our leaders from the ranks of the university educated.
I remember when (many years ago) when I was reading for my LLB, I was doing some running-repairs on my old banger of a car and one of my mates wandered over, looked at what I was doing and said “if you’ve got another of those spanners I’ll give you a hand..”. Nice of him, but I was using a screwdriver at the time!
He’s recently retired from the High Court bench.. 🙂
@Jonathan
it depends on the degree – if he did a STEM degree, then he’ll be in the top 1-2%. If he did PoliSci, or Gender and Ethnic Studies, then he’s not…
All the evidence (and there’s reams of it) strongly suggests that there’s nobody in government (whether politics or civil service) with a STEM GCSE, let alone a degree.