Speaker 1: On February nineteen two, there was a mass shooting in Portland, Oregon.
Speaker 1: Right wing extremist opened fire at people doing traffic support
Speaker 1: for a weekly racial justice march. He killed one person,
Speaker 1: he injured several others. One of the people who was injured,
Speaker 1: a young woman, is currently paralyzed from the neck down.
Speaker 1: Her friends and family are raising money, um, not for
Speaker 1: immediate survival, stuff for for quality of life things, for
Speaker 1: things to you know, allow her to enjoy herself out
Speaker 1: in the world with people, given the fact that she's
Speaker 1: dealt with something and is dealing with something, uh, permanently
Speaker 1: life changing. So I wanted to highlight that they're already
Speaker 1: above their initial goal. But obviously, you know, any anything
Speaker 1: we can give will help her and her family have
Speaker 1: a higher quality of life, and I think they deserve it.
Speaker 1: So go to go fund me Portland mass shooting Paralyzed
Speaker 1: Survivor Fund. That's go fund me Portland mass shooting Paralyzed
Speaker 1: Survivor fund. If you've got some extra cash, you know,
Speaker 1: the season being what it is, I get that everybody's
Speaker 1: got a lot of expenses coming up. But if a
Speaker 1: few folks have some extra bucks, I know it'll be appreciated.
Speaker 1: It will help her have a warmer season this year,
Speaker 1: and she certainly deserves it. So again, go fund me
Speaker 1: Portland mass shooting paralyzed survivor fund Thank you. Oh God
Speaker 1: is dead and you, Jamie Loftus, have killed him. I
Speaker 1: did it, I did it, you did it. You did it.
Speaker 1: No God was a hymn and Jamie killed him, hammered
Speaker 1: at the back of the head. And and people are
Speaker 1: going to be critical of that, but you know, you
Speaker 1: don't know my story. And in my six part mini
Speaker 1: series in which I'm played by Amanda Sea Freed, You're
Speaker 1: going to start to see my side of the story.
Speaker 1: And she is definitely not going to jail for what
Speaker 1: I did. That's good. Unlike Founder of Their Enough Elizabeth Holmes,
Speaker 1: who we just found out has been sentenced to eleven
Speaker 1: point to five years in in prison. I'm kind of like, yeah,
Speaker 1: I have mixed I have mixed feelings because it's like
Speaker 1: people don't go First of all, the prison industrial complex
Speaker 1: in general, it doesn't make anyone better to the extent
Speaker 1: that there's value in the present day, and putting people
Speaker 1: in prison, it's people who are like a severe ongoing danger.
Speaker 1: And I don't see this making anything better. Like at
Speaker 1: the same time, I hate her, so I don't. I'm
Speaker 1: not gonna it's not it's not going to be the
Speaker 1: top injustice I write route today. I do kind of
Speaker 1: like that HERU after being exposed as an unrepentant criminal,
Speaker 1: She's like, Oh, I think I'm just going to kind
Speaker 1: of be like a norm e girl for a while
Speaker 1: and I'm gonna gon gomal kid. And You're like, Liz,
Speaker 1: it's too late. It's too late for that. Liz. You
Speaker 1: defrauded people with a fake medical device that led folks
Speaker 1: to to get treatment for things they didn't have and
Speaker 1: ignore all this as they did, which is bad. That
Speaker 1: before too many bodies at the floor, but that would
Speaker 1: have stopped you, but you didn't really care. You applied
Speaker 1: Steve Jobs logic to something that was not just a
Speaker 1: silly box to keep in your pocket. Lizzie, you know, Lizzie, uh,
Speaker 1: Lizzie again. Also putting her in prison for you know,
Speaker 1: probably nine years, when you consider all the other things,
Speaker 1: is like not gonna help anything. It'll just mean that
Speaker 1: that kid she has grows up without a mom for
Speaker 1: nine years, and that's not going to make that It's
Speaker 1: like it's a huge moment for many things can be
Speaker 1: true at once and having to hold all of those
Speaker 1: truths and um, still recording episode of Behind the Bastards,
Speaker 1: I can tell you about this. Actually, this actually will
Speaker 1: be relevant to the episode. But yes, please please really yes, Okay,
Speaker 1: this is definitely not going to be relevant. So let's
Speaker 1: let's okay. I was a legal case I was thinking
Speaker 1: about today. Um was the beanie baby is billionaire. Um.
Speaker 1: When he went was taken the court in for holding
Speaker 1: money in a Swiss bank account. Um. He it was
Speaker 1: like a tax a tasion, tax evasion charge. Um. So
Speaker 1: he was up for as many as five years in
Speaker 1: prison for tax evasion, and he got off with I mean,
Speaker 1: he's a billionaire, he's never going to suffer a consequence, right,
Speaker 1: But like, he ended up getting a two years of
Speaker 1: probation on the ground that it had been too publicly
Speaker 1: humiliating so he didn't have to get to go to
Speaker 1: jail because he was too and so farnest. It was
Speaker 1: so embarrassing that he didn't have to go to jail.
Speaker 1: What that's absolutely fucking weird. Anyways, I'm gonna I'm gonna
Speaker 1: see how far this goes by committing murder and then
Speaker 1: having my pants fall down and like, well, Judge, look,
Speaker 1: yes I did stab that man seven times underpants. Yeah
Speaker 1: pp myself so feel like that. Yeah we can we
Speaker 1: just zero this one out. Man. I love the Beanie
Speaker 1: Baby's story so much. I'm surrounded by my beans feeling safe. Wow,
Speaker 1: that's good. You do literally have one on your shoulder
Speaker 1: right now. Yeah, just just like I have this rifle
Speaker 1: next to me. I think that we both have our
Speaker 1: comfort objects at the ready. Um so, Jamie, speaking of
Speaker 1: Elizabeth Holmes, because the person we're talking about today is
Speaker 1: going to be the next story like that. By this
Speaker 1: time next year, they're probably is going to be an
Speaker 1: HBO documentary about this guy. God, maybe Taylor Taylor Kitch
Speaker 1: could probably play him. Um, actually, if he wanted to. Really,
Speaker 1: Taylor Kitch played hot David Koresh in The Waco Show,
Speaker 1: walked into that. Yeah, they'd have to give him like
Speaker 1: a belly suit or something. That's not anti fantom, just
Speaker 1: being accurate, but he could do it. Maybe that is
Speaker 1: I don't want to see this man ever again. No,
Speaker 1: I'm mad. You don't want to see Taylor kitchigain you
Speaker 1: don't want to see those cum gutters again. Unbelievable, goddamnit.
Speaker 1: Plenty in this town, Robert, there's a million cum gutters.
Speaker 1: I don't need those. Oh that that is true. But anyway,
Speaker 1: so through the street that that that is that is
Speaker 1: true of Los Angeles and no other city. Today we
Speaker 1: are talking about a guy who absolutely never comes Sam
Speaker 1: Bankman Freed. Why do you know this guy? Do you
Speaker 1: know this guy? I don't know this guy. You don't
Speaker 1: know this guy. You don't know this guy? Have you?
Speaker 1: Have you caught any news in the last week about
Speaker 1: how like a massive cryptocurrency exchange has collapsed Plummett? This
Speaker 1: is that guy. Oh, this is the guy with his
Speaker 1: like polyamorous sex ring that was running a big crypto
Speaker 1: bank in the Bahamas and it all fell apart. Now
Speaker 1: billions of dollars are gone. You've lost me again. Oh great, Okay, well,
Speaker 1: well I'll right. This is still breaking. Um we are
Speaker 1: because this is a Thanksgiving week episode. We only do
Speaker 1: one episode on Thanksgivings. I needed a single one, so
Speaker 1: I just want to give everyone background on this guy.
Speaker 1: We will we may come back to this story because
Speaker 1: there's a lot we don't fully understand about how he
Speaker 1: did what he did and the degree to which. But
Speaker 1: is that this guy, this guy ran a trading service
Speaker 1: called Alameda Research and a crypto exchange, and exchange is
Speaker 1: basically like a bank, right, It's a cross between a
Speaker 1: bank and like a trading platform called f t X,
Speaker 1: which was one of the largest cryptocurrency exchanges in the world,
Speaker 1: and was also considered by most people to be the
Speaker 1: most stable and like ethical and legitimate, right, people who
Speaker 1: are just kind of on the outside looking at when
Speaker 1: everything collapsed earlier this year, Right, you remember that we
Speaker 1: have that I was engaged in that. It's just that
Speaker 1: I get a lot of my news journalists on Twitter
Speaker 1: and they've been busy this week. Yes, So when when
Speaker 1: the when the when crypto like fell apart? When a
Speaker 1: lot of crypto fell apart earlier this year, and like
Speaker 1: a bunch of places went under. F t X was
Speaker 1: one of the ones that stayed stable. And actually we're
Speaker 1: buying up a bunch of like failing crypto companies to
Speaker 1: try to like prop up the industry. They just collapsed
Speaker 1: and like the value of all everything has been plummeting
Speaker 1: for for the last several days. It's a big disaster.
Speaker 1: It is very like yeah, in in and as in
Speaker 1: words that will annoy me as little as possible. Can
Speaker 1: you explain why fts remained solvent and others? It is
Speaker 1: not so why did it outlast? Because they lied? Um,
Speaker 1: so they were they were operating the short end of
Speaker 1: how to describe it, And we may there will be
Speaker 1: more details to come, but at present it seems fair
Speaker 1: to say that it was a giant Ponzi scheme where
Speaker 1: they were they were they were taking in money, promising
Speaker 1: unreasonable returns, using other investor money to gamble on stuff
Speaker 1: to try to provide anyway. And it was like all
Speaker 1: the other guys they were, they were dishonest. Yeah, it is.
Speaker 1: It is very likely. What what what differentiates this is
Speaker 1: the scale because this is very likely a financial crime
Speaker 1: on the level of what Bernie made off did. We
Speaker 1: are talking in the ten to twenty billion dollars stolen
Speaker 1: a lot of money. This is a serious financial crime.
Speaker 1: I'm in on this pretty cold. And so for the
Speaker 1: other the other kind of mass of um like touchstone
Speaker 1: of this is that it has led to a class
Speaker 1: action lawsuit against Larry David, Shaquille O'Neal, Tom Brady and
Speaker 1: a number of celebrities who were all in a Super
Speaker 1: Bowl ad for f t X. I remember that ad
Speaker 1: that was so embarrassing for my man Larry. The lawsuit
Speaker 1: is basically advertise. Basic was the high dollar Ponzi scheme,
Speaker 1: and you guys were using your name recognition to sell
Speaker 1: unregistered securities, which they were, which they were, which they
Speaker 1: definitely were. Sorry, I just want to circle back to Shaquille.
Speaker 1: Shaquille O'Neil will put his name on anything, to the
Speaker 1: point where to the point where I worked at a
Speaker 1: Haunted hay Ride this year, which we don't talk about
Speaker 1: because it was a bad idea, but the rival what idea?
Speaker 1: I guess what. I'm alive, bitch, bitch, I lived, I
Speaker 1: lived to tell the tale. It's very unclear who is
Speaker 1: right in the side of should I work at a
Speaker 1: Haunted hay Ride or not? I still haven't really landed
Speaker 1: on a name answer point being. Our closest rival Haunted
Speaker 1: Hayride wise was sh Octoberfest. It was Shack themed haunted
Speaker 1: attraction in which the only Shack related thing was a
Speaker 1: gigantic inflatable Frankenstein that looked like Shack, which did sound awesome.
Speaker 1: That sounds actually like the best time anyone's ever had
Speaker 1: Shack put his name on an anything, including crypto and Halloween.
Speaker 1: What a what a King? Um? Probably not. I'm sure
Speaker 1: there's horrible things about Shack that have come out that
Speaker 1: seems almost unavoidable. Anyway, Sam Bankman Freed is the guy
Speaker 1: behind this gigantic financial crime that is still unraveling as
Speaker 1: we do this episode. And I want to talk about
Speaker 1: less about what happened on the exchange, because none of
Speaker 1: us want to talk about how somebody carries out the
Speaker 1: nuts and bolts of a cryptocurrency scam. But I want
Speaker 1: to talk about I want to talk about the social
Speaker 1: elements of the scam. I want to talk about how
Speaker 1: he conned the media, how he conned celebrities, and how
Speaker 1: he conned regulators UM. And I just want to talk
Speaker 1: about also the way some of these people talked and
Speaker 1: wrote about him, because there's a lot about I don't know.
Speaker 1: A week or so ago, we did an episode on
Speaker 1: The Daily Show we do what could happen here about
Speaker 1: ethical altruism, which is in brief theory that like the
Speaker 1: instead of trying to help people just because they need help,
Speaker 1: you should only help people after you consider the way
Speaker 1: to help people that is like the absolute most beneficial
Speaker 1: way for like the least amount of you know, effort.
Speaker 1: The it's utilitarianism, right, what can I How can I
Speaker 1: do the greatest good with the least resources? And yeah,
Speaker 1: and it's it's the way a lot of these like
Speaker 1: and it's merged with this kind of thinking towards what
Speaker 1: billionaire types called long termism. And the gist of this
Speaker 1: is like, it's not worthwhile for me to do stuff
Speaker 1: like pay taxes to have a society or guarantee like
Speaker 1: universal health care. Instead, I should make Instead, the most
Speaker 1: ethical thing that I should do is make as much
Speaker 1: money as I personally can and then put that money
Speaker 1: into things that I believe will save the world, like
Speaker 1: research to stop aies from killing everyone and getting to
Speaker 1: Mars and ship It's a way for billionaires, trains, It's
Speaker 1: a way for billionaires and the other mega rich to
Speaker 1: justify like continuing to do exactly what they want and
Speaker 1: feel like they're saving in the world anyway, Sam, you
Speaker 1: guy from Beanie you know the beanie babies billionaire did
Speaker 1: to improve the world may a lot of beanie babies,
Speaker 1: and then he bought the four seasons hotel and kept
Speaker 1: making beanie babies. He didn't do ship. That's well, you know,
Speaker 1: that's I'm fine with that compared to these guys because
Speaker 1: they're where they're pretending anyway. Bank Sam Bankman Freed is
Speaker 1: one of these guys. We're gonna get into that. But
Speaker 1: we did this episode on It could Happen Here where
Speaker 1: he was kind of a tangentle character in this very
Speaker 1: unsettling and insidious movement that is behind guys like Elon
Speaker 1: Musk who are claiming to be saving the world will
Speaker 1: just sucking over people. And then like four days after
Speaker 1: it came out, his entire life unraveled and his fortune
Speaker 1: disappeared overnight because he was a giant con artist. What
Speaker 1: a treat. It's very funny. So that's why we're talking
Speaker 1: about him right now. He's like thirty years old and
Speaker 1: looks like Mark Zuckerberg and David Dobrick's love child. He's
Speaker 1: thirty years old, was a Mark Zuckerberg and David dobricks
Speaker 1: love child. Look. I shouldn't call anyone a schlub, but
Speaker 1: he looks like a schlub. I forget what David Dobrick
Speaker 1: looked like because my brain protects myself respectfully. Two villains,
Speaker 1: two villains, love child. Yeah. Um anyway, so I uh yeah.
Speaker 1: Sam Bankmnfried was born in nineteen ninety two on the
Speaker 1: campus of Stanford University, uh, continuing a long and proud
Speaker 1: tradition of absolutely nothing good ever coming from that hellhole.
Speaker 1: His parents are both extremely prominent Stanford professors. His mother, Barbara,
Speaker 1: is a lawyer her clothes who clerked for the Second
Speaker 1: Circuit Court and graduated from Harvard. She founded Mind the Gap,
Speaker 1: a somewhat shady and mysterious democratic fundraising group. I think
Speaker 1: it's shady and that people don't exactly know where all
Speaker 1: the money comes from or like what their goals are.
Speaker 1: She also yeah yeah. She also pinned an essay in
Speaker 1: two thousand thirteen that the right wing is going nuts
Speaker 1: about because she was basically arguing that like it's good
Speaker 1: and evil are less a factor in in what people
Speaker 1: do than environmental factors and and and all that stuff,
Speaker 1: Like when people do things that are bad, it's more
Speaker 1: and a product of their And it was kind of
Speaker 1: am oh god, what's that fucking psychologist. It was like
Speaker 1: a Skinner type argument where it's like, well, if people
Speaker 1: have bad inputs in their youth and that's going to
Speaker 1: determine anyway. Um, I think that's funny given what happens. Um,
Speaker 1: I'm gonna guess she sucks at what she's she's she sucks. Uh,
Speaker 1: And so does his dad, Joseph Bankman. Joseph is also
Speaker 1: a lawyer. He is a graduate from Yale. His big
Speaker 1: claim to fame was developing a proposal for an overhaul
Speaker 1: of the California tax return system that would have filled
Speaker 1: out citizens tax returns in advance. And I don't know,
Speaker 1: I just said he sucked, But actually that sounds like
Speaker 1: a good thing. Um, I think that that's actually a
Speaker 1: cool thing to advocate for. The measure failed by one
Speaker 1: vote after heavy lobbying from into It, a tax prep
Speaker 1: prep software company. Um yeah, it kind of is. It's
Speaker 1: it's total bullshit because stuff, it's the thing everybody agrees
Speaker 1: with on paper, but nobody will actually fight the tax
Speaker 1: prep companies, which is like, Hey, the I r S
Speaker 1: like knows more or less what I'm ache and like
Speaker 1: knows more or less what I owe. Why don't I
Speaker 1: just get a thing from them? Why do I have
Speaker 1: to go through this? Like anyway, there's no need but
Speaker 1: it's like that's the other countries do it that way.
Speaker 1: We don't, though, because there has to be a convoluted
Speaker 1: system that's expensive and where they can charge you if
Speaker 1: you make the tiniest mistake because you can't read size
Speaker 1: one font well. And more to the point, because I
Speaker 1: don't actually think the I R. S. Is advocating to
Speaker 1: keep it a pain in the ass. I think it's
Speaker 1: these tax prep companies because they have an entire industry
Speaker 1: based on charging people to do the thing that they
Speaker 1: have to do to avoid going to fucking prison. Um. Anyway,
Speaker 1: I said he's an asshole, and I'm sure he is,
Speaker 1: but he was right about this, and I don't know
Speaker 1: what to say about that. Like all of us. Joseph
Speaker 1: is also a podcaster. He is the host of the
Speaker 1: co host of the Stanford Legal podcast too, and he's
Speaker 1: a nerd. If it wasn't the holiday season and I
Speaker 1: wasn't like getting ready for friends and family and all
Speaker 1: that that good stuff, I would have listened to his
Speaker 1: podcast and we would probably be making fun of him.
Speaker 1: But you can do that on your own goodness, I believe,
Speaker 1: isn't it doesn't it feel so horrible when you think
Speaker 1: of how many people do what we do, but they're
Speaker 1: the worst person you've ever heard of. It's so sad,
Speaker 1: it's embarrassing. Yeah, it's it's like, I don't know, I
Speaker 1: avoid self identifying as a podcaster as it is, it's
Speaker 1: still not a stem. But then on top of that,
Speaker 1: they're like, oh, like what, like I mean, you know,
Speaker 1: you know, the only you know, the only thing that
Speaker 1: I can compare it to is like when I started
Speaker 1: making a living as a writer fifteen years ago, and
Speaker 1: I would say that at like a at like a
Speaker 1: party or something, someone asked like, well, what do you
Speaker 1: do And I'm like, well, I'm a writer, and like
Speaker 1: four other people would say yeah, me too. Uh and
Speaker 1: then you wind up listening to everybody's pitches for their
Speaker 1: novels that they're never going to finish. Um. So eventually
Speaker 1: I just started lying and saying that I still worked
Speaker 1: a special at well. I like, I mean, it's the
Speaker 1: same thing with like if you say you're a comedian
Speaker 1: in a party, you're god no, never never identify as
Speaker 1: a comedian And oh me too, do you? And I've
Speaker 1: done one whole open mic and Mike was very offensive
Speaker 1: and he's had a comedian's job to push boundaries and oh,
Speaker 1: tell me your job, you know how Lenny Bruce, Let
Speaker 1: read that. Let read that list of curse words. Will
Speaker 1: I just do that with slurs here? Let me show you. Yeah,
Speaker 1: you're like yeah, like slame. Bruce was not funny in
Speaker 1: that period of his career, even a little. Anyways, Anyways,
Speaker 1: our job, I mean, are embarrassing what I'm saying. Anyway,
Speaker 1: our jobs are indeed embarrassing. So, as you might guess
Speaker 1: from all of that, Sam was born into what amounts
Speaker 1: to America's like liberal aristocracy. He is a fucking coastal elite, right.
Speaker 1: This kid grows up on the Stanford campus to Stanford professors.
Speaker 1: One of his aunt's teaches at Columbia University is like
Speaker 1: a professor there. So seems like he has close family
Speaker 1: connections to employees at Yale and at Harvard UH as
Speaker 1: well as Stanford, like his parents both go to Harvard.
Speaker 1: I think it is Kennedy. He is a Yeah, he's
Speaker 1: he's that. He is as you do not get much
Speaker 1: more of a rarefied like intellectual air. He's wearing Linen's around.
Speaker 1: This is how I think about this. This is a
Speaker 1: child who at age eight, has strong opinions on a
Speaker 1: manual kant Um, which will cheer for him at the table. No, No,
Speaker 1: we're about to get into that, Jamie loves. I just
Speaker 1: had I just had a vision of a child sitting
Speaker 1: at like a holiday dinner and saying derivative and then amazing, Wow,
Speaker 1: he is really coming along, isn't he. Yeah, this is
Speaker 1: a little kid that, when he likes sits down at
Speaker 1: the doctor's office, pulls out a fucking I don't know,
Speaker 1: doritta or something book just just just so you know,
Speaker 1: just so you know, he knows fancy philosophers. God damn
Speaker 1: it board book. So his parents and his raised him
Speaker 1: in his brother to be utilitarians. Uh one of the
Speaker 1: articles about them into SpongeBob. Okay, yeah, yeah, I was.
Speaker 1: I was raised to hassle cows in our back forty Um.
Speaker 1: His parents nights. So this article notes that nights around
Speaker 1: the family dinner table often focused around debates about how
Speaker 1: to do the greatest good for the greatest number of people. Um.
Speaker 1: In later interviews with I'm gonna get to this guy
Speaker 1: in a second, the absolute dick writing this journalist to
Speaker 1: ever write, Dick Sam would claim that his most formative
Speaker 1: moment came at age twelve, when he was weighing arguments
Speaker 1: around the abortion debate. So, first off, because because not
Speaker 1: only no, also like in the context of like where
Speaker 1: would he have been doing this? I'm guessing at like
Speaker 1: around the family table or when they have the all.
Speaker 1: You know, everybody's got their brandy and he's drinking in
Speaker 1: some sort a fucking t that's insufferable, and they're all
Speaker 1: talking about people's rights as if it's like a fun
Speaker 1: intellectual problem, like how to fix it for them? It
Speaker 1: is because whenever, wherever they land, the rules aren't going
Speaker 1: to apply to them anyways. Yes, yes, where does he?
Speaker 1: Where does he fall? Where does That's a great question.
Speaker 1: So I'm going to quote now from an article previously
Speaker 1: published by Sequoia Capital and written by Adam Fisher, who
Speaker 1: should never be allowed to lift this article down. When
Speaker 1: I say the dick writing ist like fucking pr flak journal,
Speaker 1: it's it's it's shameful quote right. A rights based theorist
Speaker 1: might argue that there aren't really any discontinuous differences, as
Speaker 1: a fetus becomes a child, and thus fetus murder is
Speaker 1: essentially child murder. The utilitarian argument compares the consequences of each.
Speaker 1: The loss of an actual child's life, a life in
Speaker 1: which a great deal of parental and societal resources have
Speaker 1: been invested, is much more consequential than the loss of
Speaker 1: a potential life in utero, and thus to a utilitarian
Speaker 1: abortion looks more like birth control than murder. SPF. That's
Speaker 1: what they always call him, the kid Sam spfs application
Speaker 1: of utilitarianism helped him resolve some nagging doubts he had
Speaker 1: about the ethics of abortion. It made him feel comfortable
Speaker 1: being pro choice, as his friends, family, and peers were.
Speaker 1: He saw the essential rightness of his philosophical faith. So
Speaker 1: that's very fucked up. That is, that is so deep,
Speaker 1: Like the term choice is used at the very ind there,
Speaker 1: but it's clear that like he's not thinking about this
Speaker 1: in terms of like the actual value of human bodily autonomy.
Speaker 1: That does not weigh in the utilitarian calculus for him whatsoever. No,
Speaker 1: that is, to would argue my friend Robert, no, no, no,
Speaker 1: And again, even like, look, I ship reflexively sometimes on utilitarianism,
Speaker 1: not because of the inherent value or disvalue of thinking
Speaker 1: that way, but about the way it gets talked about
Speaker 1: by these people. But like, if you're actually a utilitarian
Speaker 1: and you care about the greatest good for the greatest
Speaker 1: number of people, then bodily autonomy should factor into at right,
Speaker 1: like human bodily autonomy is he should be hugely important
Speaker 1: to you. But no, that's not logical. All that matters
Speaker 1: is like, well how many If you've if less resources
Speaker 1: than this have been invested in the fetus, then it's
Speaker 1: not a person. So abortion makes that's fucking bullshit logic.
Speaker 1: Fuck you, you're doing too much math. Stop, this isn't
Speaker 1: This isn't a math problem, Sam, Like, this is not
Speaker 1: a fucking math problem. Not everything is goddamn math problem. Robert,
Speaker 1: he won't listen to unless you call him SBF, and
Speaker 1: I was like, sunscreen, Yeah, we'll get that. They all
Speaker 1: call him fucking SBF, and I hate it. But also
Speaker 1: as this went on, I started using it more and
Speaker 1: more because it's a pain in the astotype his whole
Speaker 1: fucking last name out. Um. I look, I this is
Speaker 1: one where I'm not going to give him a pass.
Speaker 1: But I get it. If you write about this sucker
Speaker 1: a lot, it does make it easier. So anyway, all
Speaker 1: of this is very bad. Um, but you know what's
Speaker 1: not bad, Jamie, the products and sir this to support
Speaker 1: this podcast. That's not true. They are that's well, I've checked.
Speaker 1: Hold on, I just ran a quick check on that,
Speaker 1: and you can. But but what about the greatest good
Speaker 1: for the greatest number of people? And and given that
Speaker 1: I'm I'm a people, so it works out pretty well,
Speaker 1: it works out very well for me. I think that
Speaker 1: if you actually have more advertising revenue, you will actually
Speaker 1: built a really fast train like you've been promising me
Speaker 1: you would. Yeah, I'm gonna I'm gonna build the hyper loop.
Speaker 1: Um yeah, yeah. And I'm gonna promise you one thing.
Speaker 1: It's going to kill a hell of a lot more
Speaker 1: people than that Simpsons monorail did and that and and
Speaker 1: I'm gonna and and look, not everyone is going to
Speaker 1: hold you to task for that, but I am thank you, Jamie,
Speaker 1: thank you for keeping me honest and ensuring that we
Speaker 1: we we really make a memorable disaster. Look, I'm available anytime.
Speaker 1: I'm not visiting my friend Liz in jail. M uh
Speaker 1: we are back. What a good time. So Sam bankman
Speaker 1: Fried is above all else a numbers guy, and I
Speaker 1: guess as a kid he was a numbers kid. His
Speaker 1: parents sent him to Crystal Springs Uplands, a fancy prep
Speaker 1: school in Hillsborough, California. I looked through the website because
Speaker 1: I wanted to make fun of it, but it just
Speaker 1: kind of seems like a really fancy school. I don't know.
Speaker 1: I'm sure it's a great place to get an education.
Speaker 1: They make, they put a lot of I will tell this.
Speaker 1: They devote a lot of screen resources to letting you
Speaker 1: know that they are not racist and that most of
Speaker 1: their students aren't white. Um. They also have a friend.
Speaker 1: They also have a French cinema class for sixth graders,
Speaker 1: which is fine, But the cranky asshole in me that
Speaker 1: still has a little piece of my soul raised by
Speaker 1: right wing radio wants to say shit about it. I
Speaker 1: was raised by by left wing people, and I still
Speaker 1: think that that's some loser shit, and I think that
Speaker 1: that's fucking dorky and goofy and like should it's like
Speaker 1: what you know you meet because you meet people like
Speaker 1: that in the wild, and they're sometimes there and maybe
Speaker 1: even often very sweet people. But I'm like trying to
Speaker 1: be like, oh, you know who Plankton is, and they're
Speaker 1: like no, and then but they've been watching French movies
Speaker 1: since they were like seven, and I just don't expect
Speaker 1: that if I made a sixth if I meet a
Speaker 1: sixth grader with strong opinions about French cinema, like I'm
Speaker 1: just gonna leave. I'm gonna leave. I'm just gonna walk away, Robert,
Speaker 1: that's really brave of you to march out of a
Speaker 1: conversation with an eleven year old like I am not.
Speaker 1: I'm not putting up with that ship. Absolutely not. I'm
Speaker 1: leaving this sixth grade class. My name is Robert Evans,
Speaker 1: and out here do fi is? Go watch your Renoir?
Speaker 1: Is that one of them? That sounds like one of them?
Speaker 1: Cloud Renoir? Is he a painter? Or Renoir is a painter?
Speaker 1: I know the one you're looking for it, and I
Speaker 1: was looking for it too, but I don't remember. But
Speaker 1: guess who do you know who Plankton is? Of I
Speaker 1: know who Plankton is, And I also know that at
Speaker 1: least one of the directors they study as a pedophile.
Speaker 1: Just knowing a little bit about French cinema, that's that's unavoidable.
Speaker 1: So he does well. Again, the school is probably fine.
Speaker 1: He does well. At the school. UM, he was notably insular.
Speaker 1: He avoided most of his classmates to play StarCraft, which
Speaker 1: is good, and League of Legends, which objectively sucks. He
Speaker 1: also played a lot of magic the Gathering. So I
Speaker 1: am confident he did not get late in high school. Um,
Speaker 1: this is based on extensive personal experience. Like I just
Speaker 1: actually did some field research and about four years of it. Okay. Interesting.
Speaker 1: For college, he was accepted to and attended My Tea,
Speaker 1: which marked out his family's elite North American University punch guard. Um,
Speaker 1: they really hit him all now now that they've got
Speaker 1: it in my kid in the family, they get a
Speaker 1: free coffee. There used to be an m I T.
Speaker 1: So when I was doing comedy in Boston, there was
Speaker 1: like m I m I T had like a secret
Speaker 1: comedy club that was just for M I T students
Speaker 1: And it was awful. That's oh god, Yeah, they paid you, okay,
Speaker 1: But it was like they're like, if you like knew
Speaker 1: someone who like met someone who went to M I
Speaker 1: T and they came to your shows, and they're like,
Speaker 1: oh we we've we did the math and you are
Speaker 1: allowed to come to our They called it their speak
Speaker 1: easy I wonder if it's still around. It was so
Speaker 1: it was. I mean it's not fun. Yea not a
Speaker 1: fun crowd, I will say. But best of luck to
Speaker 1: to whatever was going on there. So he goes to
Speaker 1: m He goes to he might have been at one
Speaker 1: of those shows where he might have because he joins
Speaker 1: a fraternity there. Uh and and M I T. Well, Jamie,
Speaker 1: it's a an M I T specific co ed nerd fraternity.
Speaker 1: So night it's theta Um. And here's how Adam Fisher,
Speaker 1: the guy I hate, described them in his article, which
Speaker 1: was bad quote. A co ed fraternity of super geeks
Speaker 1: similarly interested in magic and video games. Theten's are fond
Speaker 1: of debating math, physics, computer science, linguistics, philosophy, and logic
Speaker 1: problems for fun at alcohol free parties. Now I do
Speaker 1: know a little bit about M I T. And I
Speaker 1: know another thing these nerds often do is kill themselves
Speaker 1: using nitrous oxide, because they will try to flood entire
Speaker 1: rooms with nitrous to do like nitrous to ratio and
Speaker 1: kill themselves. It's a thing that happens. Look it up
Speaker 1: in M T. Nitrous des Yeah. I all I did
Speaker 1: in college was drink too many blue moons. It's uh,
Speaker 1: it's it's quite a thing. Um. So I don't know
Speaker 1: doing over there, I don't know, I don't know, I
Speaker 1: don't know. I don't know how much I believe that
Speaker 1: that they were always alcohol and drug free parties, because
Speaker 1: if there's one thing I know from ner, it's that
Speaker 1: they do a shipload of drugs. I definitely didn't hear
Speaker 1: of this one because I went to a couple of
Speaker 1: m I T frat parties and they were, um, not sober.
Speaker 1: Fun fact one the one of the m I T
Speaker 1: frat parties I went to some for some reason when
Speaker 1: I was in college, and I would get really drunk.
Speaker 1: I would always I would like, I would I like
Speaker 1: to like steal things from wherever I was. And so
Speaker 1: I stole two critical pool balls from an m I
Speaker 1: T frat house and someone was able to trace it
Speaker 1: back to me and they demanded their pool balls back. Um,
Speaker 1: and I embarrassingly, I think I capitulated. I think I
Speaker 1: did give them back. I shouldn't. Wow. Wow. Actually, so
Speaker 1: this one kid I'm finding and died because he put
Speaker 1: a bag over his head to in hale Nitris, which
Speaker 1: is the funk man. How did you get into in
Speaker 1: M I T. I don't know any I was like
Speaker 1: this guy, I don't know, don't put bags. Don't put
Speaker 1: bags over your head kids. Um, yeah, I learned that
Speaker 1: in public school. No less, so many there ways to
Speaker 1: do whippets than putting a plastic bag over your head anyway, whatever.
Speaker 1: According next, according to the popular Sam Bankman Freed endorsed
Speaker 1: version of the story, he pivoted towards an almost obsessive
Speaker 1: devotion to ethics. In his freshman year, he went vegan,
Speaker 1: he organized a protest against factory farming, and he worried
Speaker 1: obsessively over how he could change the world for the better.
Speaker 1: And it was at this point that Sam met a
Speaker 1: man who was going to change his life forever. William mcgaskell. UM.
Speaker 1: If you want to learn more about this guy, I
Speaker 1: do recommend the episode of it could happen here on
Speaker 1: Effective Altruism. UM. This guy is today the most the
Speaker 1: pop philosopher of effective altruism and long term is UM.
Speaker 1: He is an elon Musk's text messages that we all
Speaker 1: got as a result of the Twitter lawsuit. UM. At
Speaker 1: this point he was also at M I T, and
Speaker 1: he met with Sam at a cafe in Cambridge, Massachusetts
Speaker 1: where mccast which one, which one? Which I don't know.
Speaker 1: I'm sure it's out there somewhere, Jamie. Um it's I'm
Speaker 1: sure you've gotten a hot dog there. Um, that's that
Speaker 1: seems likely now, any place this guy's going it doesn't
Speaker 1: have hot talk. They're not ethical. They're famously unethical, So
Speaker 1: you're probably right. So mccaskell explained the concept of effective
Speaker 1: altruism to him, which is again this idea that like
Speaker 1: what matters is you should like think kind of coldly
Speaker 1: and robotically about how you do help to make sure
Speaker 1: that your charity money does the most that it can do.
Speaker 1: But one of the big like arguments about it is
Speaker 1: that like, okay, well, what if you, you know, should
Speaker 1: you save a drowning child instead of saving like three
Speaker 1: kids from a burning building. And it's like, that's a
Speaker 1: nonsense choice. Nobody's ever been presented with that choice at
Speaker 1: any point in the history of the human race. It
Speaker 1: is not a reasonable that is not a there's no
Speaker 1: point to that ethical argument. You're not smart, just draft driver. Yeah,
Speaker 1: it makes no sense. Yeah, it makes no fucking sense.
Speaker 1: There's like bits of it that are reasonable, which is
Speaker 1: that like, well, you know, it makes sense to like
Speaker 1: look at the best thing you can do financially, you know,
Speaker 1: in terms of donating money, is you know, malaria prevention,
Speaker 1: because it winds up being the most cost effective thing.
Speaker 1: But it's like, okay, does that mean we shouldn't put
Speaker 1: money into making the water in Flint, Michigan drinkable? And
Speaker 1: a lot of these guys will say no, because that's
Speaker 1: not the best use of money. And it's like, well,
Speaker 1: we could do many things with money, especially if we
Speaker 1: tax billionaires and put it towards rebuilding infrastructure. Um number
Speaker 1: a number of things can be done anyway, McCaskill. McCaskill
Speaker 1: kind of pills this guy on effective altruism. He frames
Speaker 1: it as a strategic investment whose success um was measured
Speaker 1: in populations worth of human lives. He estimated, using back
Speaker 1: of the envelope math that two thous dollars could save
Speaker 1: one life, and so a million dollars could save five
Speaker 1: hundred people, a billion could save half a million, and
Speaker 1: a trillion dollars could theoretically save half a billion lives.
Speaker 1: Based on that totally legitimate math, people are math it
Speaker 1: all works out that way based based on that absolutely
Speaker 1: real math. The only ethical way for a genius like
Speaker 1: Sam to use his time and talents is to become
Speaker 1: the world's first trillionaire. And I'm gonna quote again from
Speaker 1: that article that I know. SPF listened nodding as MS
Speaker 1: Castell made his pitch. The urn to give logic was
Speaker 1: air tight. It was SPF realized applied utilitarianism. Knowing what
Speaker 1: he had to do, SPF simply said, yep, that makes sense.
Speaker 1: But right there, between a bright yellow sunshade and the
Speaker 1: crumb strewn red brick floor, SPF's purpose in life was set.
Speaker 1: He was going to get filthy rich for charity's sake.
Speaker 1: All the rest was merely execution risk. His course established,
Speaker 1: McCaskill gave SPF one less navigational nudge to set him
Speaker 1: on his way, suggesting that SPF get an internship at
Speaker 1: Jane Street that summer, and so for the good of man,
Speaker 1: from the good of mankind, get in the finance industry
Speaker 1: and gamble like a mother final asshole. I god fucking
Speaker 1: hate these people so much. What makes sense? Yeah, you know, look,
Speaker 1: I think that I can't debate that lot. There's no
Speaker 1: argument to be made about that logic. Jamie. I mean,
Speaker 1: I know that this is the wrong person to be
Speaker 1: turning on in this moment, but this is the dick
Speaker 1: writing is like, this is the Jamie's like, he has
Speaker 1: not begun to ride dick. This is this is this
Speaker 1: man's got no gag reflection down, Jamie. I'm going to
Speaker 1: read you some passages from this that are going to
Speaker 1: make you gag. It is unbearable. So and it's like
Speaker 1: this article is like ten fucking words. It took me
Speaker 1: like an hour to get through this thing. It's massive.
Speaker 1: Is He's like, maybe if I do it, he'll give
Speaker 1: me a kiss on the mouth. Well, basically this this
Speaker 1: was published by Sequoia, which is a massive like investment
Speaker 1: fucking fund thing on their website journalistic entity. Yeah, it
Speaker 1: looks like that. It looks exactly like an article from
Speaker 1: like Wired or something like. They clearly laid it out
Speaker 1: like that. But I think it was done because they
Speaker 1: put like two hundred million dollars into his company, so
Speaker 1: they needed to justify it by making them look like
Speaker 1: a genius. So it's like those articles that like are occasionally,
Speaker 1: I mean, it's more scary when they're on actual journalistic outlets.
Speaker 1: And then there's just a little tag saying like hey,
Speaker 1: this is sponsored by RuPaul's fracking farm or whatever the funk,
Speaker 1: and it's like why why on mobile um LGBT icons.
Speaker 1: So yeah, Sam Bankman freed gets into finance and he's
Speaker 1: a very good trader. As I mean, I have no
Speaker 1: way to judge this, but Sequoia says he was a
Speaker 1: good trader. Um, he was good at making a lot
Speaker 1: of money for other people and also a lot of
Speaker 1: money for himself. Besides from he gave away fifty percent
Speaker 1: of his income to his favorite charities, but those charities
Speaker 1: were mostly the Center for Effective Altruism and eighty thousand Hours,
Speaker 1: which is also an effective altruism charity. Good money, that's
Speaker 1: a great question, Jamie. Um. It allows guys like like
Speaker 1: mccaskell to live very well, while also saying they only
Speaker 1: take thirty thou dollars in salaries and give away the
Speaker 1: rest because their lives are heavily subsidized by these organizations
Speaker 1: that allow billionaires to pretend to be heroes. So like,
Speaker 1: so like charity, so like charity. Yeah. So he remains
Speaker 1: there happily for years until two thousand seventeen, when he
Speaker 1: begins to feel as if something is not right. Now
Speaker 1: spoilers having crisis, he is having a quarter life crisis.
Speaker 1: And this kid absolutely as a con artist. And what
Speaker 1: I am giving you was the polished, press friendly version
Speaker 1: of the story for a guy whose entire life, as
Speaker 1: far as I can tell, was one long set up
Speaker 1: for an ambitious con. So when I say stuff like
Speaker 1: he gave a lot of money to charity, because there's
Speaker 1: like other charities he gives to some which sound reasonable,
Speaker 1: but I have actually no evidence that he did like,
Speaker 1: I have no evidence that he did, and I haven't
Speaker 1: seen it. Um So when I say stuff like he
Speaker 1: felt like that, or when they say stuff like he
Speaker 1: felt unfulfilled at Jane Street, that doesn't mean he actually did.
Speaker 1: Because we are at present reliant on a lot of
Speaker 1: reporting from back when this kid was the toast of
Speaker 1: Wall Street. Now after his life fell apart and his
Speaker 1: company crash and it became clear that he was a
Speaker 1: financial criminal, it also came out that the guy who
Speaker 1: wrote the big short has been following him for six months.
Speaker 1: So I suspect at some point it's got that's gonna
Speaker 1: be fun. We're all going to be in for a
Speaker 1: real treat when that books. I love. I love when
Speaker 1: you're like, and guess who is following him around? You're like, oh,
Speaker 1: he's got Michael Lewis on his dail. It's like and also,
Speaker 1: if you're an investor, shouldn't like it's somebody involved in
Speaker 1: one of these companies. Probably should have been able to
Speaker 1: find out, like, oh, hey, the big short guys hanging
Speaker 1: out with him, that probably means this is a giant
Speaker 1: financial crime. That guy's not gonna just hang out with
Speaker 1: a dude who's good at legally making money to write
Speaker 1: about how good he is it making money legally, because
Speaker 1: that's not Michael Lewis is beat. I'm kind of going
Speaker 1: for like a change of paces time, just gonna try
Speaker 1: to see a guy who's like doing something right. Yeah, Michael,
Speaker 1: aren't you the guy who only writes about financial crimes
Speaker 1: on like a gigantic scale. No, No, I think this
Speaker 1: is he's just probably just trying to network. Yeah, it's
Speaker 1: just just just really like this guy's attitude towards altruism.
Speaker 1: So anyway, um, yeah, anyway, here's how that again, very
Speaker 1: dick writing pr flack motherfucker wrote about what happens next.
Speaker 1: He was he realized too secure. Spfs mind had been
Speaker 1: trained almost from birth to calculate as a schoolboy that
Speaker 1: hedonic calculus of utilitarianism. And I'm trying to maximize the
Speaker 1: utility function measured in Util's of course for abortion. During
Speaker 1: his teenage game I know, I know that's a sentence.
Speaker 1: Does he say, of course? Uh no, No, I said
Speaker 1: that he does say, he does say, he does say,
Speaker 1: of course, yes, measured of course, of course. Suck my ass,
Speaker 1: you find unbelievable. During his teenage gaming years, his mathematical
Speaker 1: abilities allowed him to sharpen his tactics and win. And
Speaker 1: of course, every trade spf Ever made at Jane was
Speaker 1: the subject of a risk reward calcul lation, all of
Speaker 1: it boiled down to expected value. The formula is fairly simple.
Speaker 1: If the amount one multiplied by the probability of winning
Speaker 1: a bet is greater than the amount loss multiplied by
Speaker 1: the probability of losing a bet, then you go for it.
Speaker 1: Irrespective of units Util's euros, dollars, We're all subject to
Speaker 1: the same reckoning. But at Jane, spf us most another
Speaker 1: trading principle. He learned to be risk neutral. In simple terms,
Speaker 1: a trader given a choice between a fifty fifty dollars
Speaker 1: and a fifty chance at a hundred dollars must be
Speaker 1: agnostic if they want to maximize the expected value of
Speaker 1: earnings over a lifetime. Those who prefer that sure win
Speaker 1: are risk averse and those who would rather gamble our
Speaker 1: risk lovers. But both risk lovers and the risk averse
Speaker 1: are suckers equally because over the long run they lose
Speaker 1: out to the risk neutral who take both deals without prejudice.
Speaker 1: That makes no sense. That makes no sense at all,
Speaker 1: because like you, you're you're assuming you have to like
Speaker 1: choose between one? Can you just take both? Is that
Speaker 1: like the is that the offer? Because it seems like
Speaker 1: the whole thought experiment is about choosing between one. None
Speaker 1: of this makes very much sense. I had a brain
Speaker 1: hemorrhage in them it all of that, and then I
Speaker 1: was thinking I couldn't stop thinking about do you think
Speaker 1: of the utilitarians? How do utilitarians feel about kissing with tongue?
Speaker 1: Do you think, um, how many utils does it take
Speaker 1: to kiss with tongue? Or or don't waste your fire.
Speaker 1: Let me write the equation out, Jamie and try to
Speaker 1: try to sketch out the math on I think they
Speaker 1: wouldn't be into it. I think they would be like, well,
Speaker 1: what's the point. Yeah, that's that seems real. Five utils. Sorry, James, Jamie,
Speaker 1: I gotta continue to say, I don't know, but we
Speaker 1: have to read another one quote here. SPF realized was
Speaker 1: the rub When he applied this principle to his own life,
Speaker 1: he came up short. There was little chance he'd get
Speaker 1: himself fired from Jane Street. Thus, the decision to stick
Speaker 1: with Jane was a risk averse preference. It was the
Speaker 1: logical equivalent of being offered a choice between fifty dollars
Speaker 1: and fifty of a hundred dollars and saying give me
Speaker 1: President Grant. SPF was risk neutral on behalf of Jane Street,
Speaker 1: but not He realized for his own life, to be
Speaker 1: fully rational about maximizing his income on behalf of the poor,
Speaker 1: he should apply his trading principles across the board. He
Speaker 1: had to find a risk neutral career path, which, if
Speaker 1: we strip away the trader jargon, actually means he needed
Speaker 1: to take on a lot more risk. Oh Jamie, you
Speaker 1: need to hear this, boy. We're driving it away. I've
Speaker 1: been asleep for six minutes. Come on, Which if we
Speaker 1: strip away. The trader jargon actually means he felt he
Speaker 1: needed to take on a lot more risk in the
Speaker 1: hopes of becoming part of the global elite. The math
Speaker 1: couldn't be clearer. Very high risk multiplied by dynastic wealth.
Speaker 1: Trump's low risk multiplied by mere rich guy wealth. To
Speaker 1: do the most good for the world, SPF needed to
Speaker 1: find a path on which he'd be a coin toss
Speaker 1: away from going totally bust. So has this risk neutral,
Speaker 1: But that means taking a lot of risk, because the
Speaker 1: most risk is the only way to become the wealthiest
Speaker 1: person in the world. And only by becoming the wealthiest
Speaker 1: person in the world can you avoid risk. You get it, Jamie. Yeah,
Speaker 1: And that's the most ethical thing you can do. That's
Speaker 1: the really the most logical ethical way to live. So
Speaker 1: do you think that they kissed with done or not?
Speaker 1: I mean, I think what he's saying is ordered in
Speaker 1: order to avoid the risk of catching an STD you
Speaker 1: have to take on a job as the bathroom at
Speaker 1: at a brothel. Um Ah, that's the risk a verse
Speaker 1: or risk neutral presentation. Frantically rubbing my final grand cells together,
Speaker 1: trying to make heads or tails of that, and it is.
Speaker 1: It is howling clown shit. It is absolutely sparking nonsense.
Speaker 1: Is like of a vortex of bullshit to be like,
Speaker 1: so anyways, it's really clear and the math couldn't be
Speaker 1: clear that he has to be the most richest guy
Speaker 1: or everyone is going to die, like actually really urgent.
Speaker 1: You know, it's one of those things because I have
Speaker 1: I have known a number of rich guys in my life, um,
Speaker 1: and some of them are in late for you, there's
Speaker 1: two kinds. There's people. There's people who were poor at
Speaker 1: one point, and some of those people are unhinged and
Speaker 1: some of them still remember being poor enough to talk
Speaker 1: like normal people. And then there's people like this who
Speaker 1: Sam was never rich as a kid, but he lived
Speaker 1: in this rarefied air where finance and like the concept
Speaker 1: of worrying about money or his economic status was not
Speaker 1: a thing because everyone around him when he was a
Speaker 1: kid was so high status. And he like, he's just
Speaker 1: lived in this it's not even a it's not even
Speaker 1: a bubble. He grew up on a different planet, Like
Speaker 1: the world does not exist to him the same way
Speaker 1: it does to everyone else. And so he's like, that's
Speaker 1: the only way you can talk about things in this way. Um,
Speaker 1: that you're sort of sinister thing where you're talking about
Speaker 1: everything like it is very my thinking. It's like it's
Speaker 1: so easy for him and people like this to think
Speaker 1: of other people as theoreticals because they've never had a
Speaker 1: problem before. So it's are a game of chance because
Speaker 1: met a person, right, right, he has never known a
Speaker 1: human being. Just Stanford professors exactly, just Stanford professors and
Speaker 1: problems in his video games. So yeah, and not that
Speaker 1: all nerds. I mean, I'm not I'm I'm afraid of nerds,
Speaker 1: you know, people who identify as nerds coming into my mansis.
Speaker 1: I'm not saying that that's everybody, but I'm saying like
Speaker 1: he's not socialized like a person, and that these are
Speaker 1: has to do with class. Yeah, God damn it. Um.
Speaker 1: So the next thing that SPF did after deciding he
Speaker 1: had to quit Jane Street, um is start pondering how
Speaker 1: he might change the world in a way that minimized
Speaker 1: his risk. By maximizing his risk or some ship anyway,
Speaker 1: as he told it, he considered four career fields and
Speaker 1: this is These are his notes on the four things
Speaker 1: he might do after being a traitor. Number one journalism
Speaker 1: low pay, but a massively outsized impact potential. Number two
Speaker 1: running for office or maybe just being an advisor. Number
Speaker 1: three working for the movement e a effect of altruism
Speaker 1: needs people. Number four starting a startup. But what exactly
Speaker 1: Number five bumming around the Bay Area for a month
Speaker 1: or so just to see what happens. Now again, it
Speaker 1: sounds like a bad bumble day, Like it's like, so
Speaker 1: what do you do? It's like, oh, well, um, so
Speaker 1: start up maybe, but what is a start up? Really?
Speaker 1: What is a startup? So again, he spent years working
Speaker 1: in finance, He's got plenty of money. He came from
Speaker 1: the Bay Area, So five was an option and it's
Speaker 1: one he took. Um And by the way, like as
Speaker 1: a general rule, if you decide to quit your job
Speaker 1: and you have the financial ability to put her amount
Speaker 1: around for a month or two and think things through,
Speaker 1: not a bad idea, um, But Sam is going to
Speaker 1: do this in the worst way possible. He eventually hits
Speaker 1: upon his great next idea, which is to make a
Speaker 1: shipload of money in crypto now when he quits. Jane
Speaker 1: Street is two thousand seventeen, and if you guys can
Speaker 1: remember back that far, that's the first big winter when
Speaker 1: cryptocurrency boomed like kind of all throughout the last quarter
Speaker 1: or so of two thousand seventeen, bitcoin was just say
Speaker 1: laying up like massive rises. Ether had a big rice
Speaker 1: to just kind of went around early. A lot of
Speaker 1: bitcoin nerds who have people have been making fun of
Speaker 1: her years became overnight multimillionaires. And this was kind of
Speaker 1: the first point at which normal people started to think, ship,
Speaker 1: maybe I should get into this, maybe I can make
Speaker 1: a lot of money. Right. This is this is the
Speaker 1: thing that blew up bitcoin. And there was a crash
Speaker 1: after this, but it recovered, YadA, YadA, YadA. Sam was
Speaker 1: savvy enough to look at this and know that these
Speaker 1: moments where this thing where a lot of funny money
Speaker 1: is on the table but there's no regulation um and
Speaker 1: regular people who started to get interested because they think
Speaker 1: they might get rich. This is the point at which
Speaker 1: an unethical person can make the absolute most money in
Speaker 1: a financial market. Right, And you can be unethical, to
Speaker 1: quote one of the greats, you can be unethical and
Speaker 1: still be illegal. That's the way I live my life.
Speaker 1: And you know who else lives their life that way?
Speaker 1: Jamie loftus you and you're tossing the ads. Yeah, that's right,
Speaker 1: I am indeed, baby. Uh here we go, all right
Speaker 1: and we're back. So Jay Loft, Yes, it's actually j Low.
Speaker 1: It's the first. I'm the first person to use that,
Speaker 1: and it's really starting to catch on bowls um afflex
Speaker 1: calling me one sect, Jamie, let me take this call.
Speaker 1: Oh that's why, boyfriend. Now he's just weeping outside of
Speaker 1: a dunkin Donuts and pocket dialed me again, normal normal
Speaker 1: Ben stuff? Am I right? Ben? Look sometimes I meet
Speaker 1: I meet up with my friend Ben at the Atwater
Speaker 1: Dunks and I really, I really said him straight. It's nice. Yeah,
Speaker 1: Ben afflick sober for years and looks like he's hungover
Speaker 1: in every single photograph. What a king man, I know,
Speaker 1: I do, I do. I have a lot of There's
Speaker 1: just a something about him that warms my heart. It's
Speaker 1: his back tattoo. You love his back tattoos. It's just
Speaker 1: that takes courage, you know, oral courage. I think he's
Speaker 1: amazed that I think we need to have that back
Speaker 1: tattoo and still got to marry Jennifer Lope. I think
Speaker 1: I think put his name on the Vietnam Memorial in
Speaker 1: honor of the courage that it took to get that
Speaker 1: that back tattoo really is braver than the troops. And
Speaker 1: he did for a while hold hold the status of
Speaker 1: most divorced man in America. Um, but that is now
Speaker 1: what he fixed it. But the contest, I was going
Speaker 1: to say, they did they did get married at a plantation.
Speaker 1: I don't know. Yeah that I mean, that's all. That's
Speaker 1: all very fucked up. But I do feel the contest
Speaker 1: for most divorced man. Did you ever watch dragon ball
Speaker 1: Z as a kid, Jamie, I didn't know. I didn't know. Well,
Speaker 1: there's this thing that Dragon ball Z would always do
Speaker 1: this thing where like you have this guy and he's
Speaker 1: like the most badass person ever that everybody has to
Speaker 1: figure out how to fight. And it's this big problem
Speaker 1: because this is the most terrifying thing in the universe.
Speaker 1: And the next season, like there's something that's like a
Speaker 1: thousand times scarier. It's just this like power creep kind
Speaker 1: of thing. I feel like we've all been dealing with
Speaker 1: that with a divorced guy, because divorced guy Ben affleck
Speaker 1: Not doesn't even register on the divorced guy scale. Living
Speaker 1: in the Age of Kanye and it's really divorced and
Speaker 1: look out because Tom Brady is about to hit the world. Trade.
Speaker 1: Tom Brady is gonna go super say and divorce that
Speaker 1: is going to a third divorce Man has hit the world.
Speaker 1: It's incredible. So back to Sam Bankman freed. He is
Speaker 1: just he has just decided to get into crypto now
Speaker 1: the first way to make money in crypto. That that
Speaker 1: occurred to him because he spends a bunch of time
Speaker 1: looking into the market and he finds he sees that
Speaker 1: there's this thing called I think it's like the Kimchi
Speaker 1: premium or whatever like that. They come up with some weird,
Speaker 1: kind of racist name about it, which is basically bitcoin
Speaker 1: is worth a lot more in Japan and Korea than
Speaker 1: it is in the United States. Right, It's like worth
Speaker 1: fifteen grand in Japan and Korea and it's like tin
Speaker 1: grand in the United States something like that. Why is
Speaker 1: that there's a variety of complicated factors. Basically there's a
Speaker 1: bunch of different laws around banking and who can and
Speaker 1: cannot hold accounts and execute trades in those areas. That
Speaker 1: leads to this premium. Because like normally, if a premium
Speaker 1: like that, if the markets were kind of accessible to
Speaker 1: each other, and bitcoins worth fifteen grand in Asia and
Speaker 1: ten grand in the US. Then you buy bitcoin in
Speaker 1: the US and you sell it in Asia and you
Speaker 1: get free money, right um. Very obvious, um if you can.
Speaker 1: But you can't do that because you can't get access
Speaker 1: to as an American, you can't like get a Chinese
Speaker 1: account in order to buy bitcoin there, right M or
Speaker 1: a Korean account or a Japanese account. There's all these
Speaker 1: laws and they can't VPN. No, you can't. You cannot
Speaker 1: do that, and no one can figure out how to
Speaker 1: do it how as a Westerner to sell bitcoin over
Speaker 1: in these parts of Asia and get that premium, right
Speaker 1: and like just get a bunch of free cash. Sam
Speaker 1: years out a way to do it, um, which is
Speaker 1: basically like picking up a pile of free money. Right
Speaker 1: if you're buying bitcoin for ten grand and other people
Speaker 1: want to pay fifteen grand for it, you're just making cash,
Speaker 1: right um. And primarily the way he does that is
Speaker 1: through friends in the effective altruism community who are like
Speaker 1: placed in banks and stuff over in Asia, who like
Speaker 1: help him figure out how to do this. I'm not
Speaker 1: going to go into details. They I mean, this fucking
Speaker 1: dick writing article spends a long time explaining how he
Speaker 1: figures this out, and it might even have been legal.
Speaker 1: He may not have broken the law to do this,
Speaker 1: although it's kind of hard to know because all of
Speaker 1: this is complicated finance gibberish um. By the way, honestly,
Speaker 1: I'm not getting a word of this. Finance guys call
Speaker 1: this an arbitrage, and it's basically the ideal that if
Speaker 1: you can, if there's a resource that's worth a bunch
Speaker 1: more money one place than it is the other place,
Speaker 1: you buy it where it's cheap, and you sell it
Speaker 1: where it's expensive, and you get free money. Right, that
Speaker 1: makes sense? Yeah? Yeah, If if my drug dealer sells
Speaker 1: me ketamine for like forty bucks a graham, right, and
Speaker 1: I don't know, at a house party you're hanging out
Speaker 1: at a couple of blocks away, somebody gibb says that
Speaker 1: they'd pay seventy dollars a graham for ketamine. You can
Speaker 1: make thirty free bucks by taking the ketamine you bought
Speaker 1: for forty bucks and selling it at that other house party. Right. Okay,
Speaker 1: so that was you speaking to me in terms that
Speaker 1: you would understand. But I do think I got it. Yeah, yeah,
Speaker 1: ketamine makes everything makes sense. So he just gave it
Speaker 1: to me. In Robert's speak, I got it, I got
Speaker 1: he makes He makes a shipload of money doing this,
Speaker 1: and he decides to roll this money into a company
Speaker 1: which will allow him to hire employees to gamble with
Speaker 1: cryptocurrency at scale, to try and find different funked up
Speaker 1: little areas like this where they can make a bunch
Speaker 1: of money by executing trades. He picks members of the
Speaker 1: e A community as his first employees, including Carolyn Ellison,
Speaker 1: a former coworker co worker at Jane Street who we
Speaker 1: will be talking about in a little bit, and Nishad Singh,
Speaker 1: a former Facebook employee. Industrial scale dick writer Adam Fisher
Speaker 1: lets you know that sing is an incredible, almost impossibly
Speaker 1: good human being by describing him this way. He often
Speaker 1: wears a T shirt with the words Compassionate to the
Speaker 1: core printed in diminutive all lower case font over his heart.
Speaker 1: Do you do you think that this guy, this writer
Speaker 1: like just it's at this point he's on like a
Speaker 1: bucking bronco ASBFS dick, Like it's just absolutely he is
Speaker 1: he is, he is fift this guy's dick by weight.
Speaker 1: It is unbelievable. What does he think is going to
Speaker 1: happen for him? He's got to get paid by Sequoia
Speaker 1: to write a ten thousand word article that they then
Speaker 1: pull from their website. When it becomes clear this man
Speaker 1: is a massive financial crinamental, he's like, no, my greatest work,
Speaker 1: it's extremely funny. No, look, I don't know sing. But
Speaker 1: based on the description that guy gives, I am convinced
Speaker 1: he's murdered a child with his bare hands. And that
Speaker 1: is my head cannon for this man. UM. No one
Speaker 1: else would wear that shirt. So these these e A
Speaker 1: nerds all form a trading firm called Alameda UM, and
Speaker 1: in doing so, they came down on one side of
Speaker 1: probably the biggest split within the crypto community. See, the
Speaker 1: core of the idea that's not bad that exists within
Speaker 1: cryptocurrency is that decent is that centralized state controlled money
Speaker 1: is like has problems, right, you know that there's things
Speaker 1: about that that are bad, um, And it could be
Speaker 1: cool and useful to be able to separate the money
Speaker 1: from the state if you could do that right, if
Speaker 1: you could do that in a way that reduced the
Speaker 1: state's power to like you know, just locked down the
Speaker 1: bank accounts of dissidence and stuff like that. There's there's
Speaker 1: cool benefits to it. And what I just had an idea,
Speaker 1: what if we did that, but then we gave all
Speaker 1: the money to one guy. Well that's kind of what
Speaker 1: keeps happening. Um So. But also like spfs on the
Speaker 1: other side of this argument, right, because obviously most of
Speaker 1: the actual benefits of a truly decentralized online currency are
Speaker 1: just you can buy drugs with it over the internet.
Speaker 1: But still that is a real value people do in
Speaker 1: fact by drugs using cryptocurrency, and that's fine, um And
Speaker 1: the committed ideological crypto people tend to keep their money
Speaker 1: offline in a wallet only they can access, right. So
Speaker 1: you basically you have like a hard drive that has
Speaker 1: all of your crypto on it, and that that only
Speaker 1: touches the Internet when you plug that into your computer
Speaker 1: and you use it to make a transaction, right and
Speaker 1: otherwise it's completely offline, and so people can't just take
Speaker 1: it from you, right right, that's the smart people. This
Speaker 1: is a pain in the ass though, right, Like keeping
Speaker 1: it in this thing, like there's all these security you
Speaker 1: can lose your password people actually do lose their money
Speaker 1: this way too, But anyway, it's it's there's a measure
Speaker 1: to which it it makes sense and is secure, but
Speaker 1: most people don't want to go through that pain in
Speaker 1: the ass, so they put all of their cryptome currency
Speaker 1: and what are effectively crypto banks these exchanges, and these
Speaker 1: exchanges are places like Mount Cox which a few years
Speaker 1: ago all of the money got stole, and from an
Speaker 1: f t X which Sam Bankman freedmakes, which also all
Speaker 1: of the money gets stolen from. Right. So the people
Speaker 1: who are like, no, you shouldn't do what Sam is doing.
Speaker 1: You shouldn't make an exchange because that's not decentralized, and
Speaker 1: we like this because it's decentralized, they are the ones
Speaker 1: who get robbed less often because because they're a little
Speaker 1: smarter um. And that's part of the point these exchanges.
Speaker 1: They're meant for people who don't see crypto actually is like, well,
Speaker 1: I I want to fight the state by removing my
Speaker 1: money from the banking system. There for people who are
Speaker 1: like I want to try to get rich quick by gambling, right,
Speaker 1: and that's why those people are also the most vulnerable
Speaker 1: to scams. UM. However, anytime you explain crypto with me.
Speaker 1: To me, even though I know I need to understand
Speaker 1: it for the context of the episode, I just feel
Speaker 1: like I'm in a corner at a house party and
Speaker 1: I'm holding a clammy bud light and it's mostly empty,
Speaker 1: and You're like, just one more thing though, because you know,
Speaker 1: I mean, the important thing to understand is that what
Speaker 1: Sam has done so crypto is like unregular aided right.
Speaker 1: It is detached from any state, Okay, which is why
Speaker 1: people like it, Which is why people like it. Yes,
Speaker 1: Sam has what Sam has done has come in and
Speaker 1: he's not the first persons to do this and said,
Speaker 1: I have built a place where you can keep all
Speaker 1: of your crypto and you can trade it with other
Speaker 1: crypto to try to make money the same way people
Speaker 1: do with the stock market, right where it is more secure. No,
Speaker 1: because here's the thing, Jamie, he says, it's secure. But
Speaker 1: here's the thing. So you know how the banking system,
Speaker 1: how banks used to just go bust and everyone would
Speaker 1: lose their money and it caused a great depression. You
Speaker 1: get that part of the history of finance, right. Oh yeah,
Speaker 1: one of the characters from Titanic killed themselves over that.
Speaker 1: Exactly exactly. So that was a big problem, and we
Speaker 1: developed a bunch of regulations so that So what Sam
Speaker 1: has done is he's built a bank that has none
Speaker 1: of that so that people can gamble on the internet.
Speaker 1: So yeah, got exactly. That's all you need to understand
Speaker 1: is that Sam has built a big unregular they did
Speaker 1: bank for people to gamble with. UM. Yeah, anyway, UM,
Speaker 1: and this is this is it is. It could not
Speaker 1: have been clearer that this was a Ponzi scheme. And
Speaker 1: two eighteen they put out an advertisement to investors and
Speaker 1: I'm going to read it right now. I think you'll
Speaker 1: be like. We offer one investment product, annualized fixed rate loans.
Speaker 1: We can accept both fiat and crypto and can pay
Speaker 1: interest denominated in either. UM. These loans have no downside.
Speaker 1: We guarantee full payment the principle and interest enforceable under
Speaker 1: US law and established by all parties legal counsel. We
Speaker 1: are extremely confident we will pay this amount in the
Speaker 1: unlikely case where we lose more than two percent. Anyway, Again,
Speaker 1: I'm not a finance expert. Neither of you Jamie banks
Speaker 1: offer like three percent return on like a fucking uh.
Speaker 1: If you're like putting a pile of cash in a
Speaker 1: bank and you're getting three percent back, You're doing okay
Speaker 1: nonsense that nobody, no one can guarantee that it's not
Speaker 1: a real product. I would pretty struck by their use
Speaker 1: of the length whiche like we're pretty confident we're gonna
Speaker 1: be able to play it sounds like it's such just
Speaker 1: sounds like someone who is not actually very confident. And
Speaker 1: also if this is if you are if you are
Speaker 1: investing in a mark in the stock market, right, and
Speaker 1: someone says this investment has no downside, it's impossible for
Speaker 1: it to fail. That person's lying to you and breaking
Speaker 1: the law because it could and often does. Oh right,
Speaker 1: because then you're just you're you're making an almost guaranteed
Speaker 1: false problems. Yes, you cannot do you cannot say this
Speaker 1: stock can't go down. Right, If you're a stockbroker, you
Speaker 1: cannot tell a client it is impossible for your investment
Speaker 1: in this company to fail because that would be a crime. Um.
Speaker 1: But with crypto crypt that's unterted territory, territory, you can
Speaker 1: do anything. This is also a Ponzi scheme, right, What
Speaker 1: what what fucking made Off was doing is he had
Speaker 1: this investment portfolio that was I forget with the exact
Speaker 1: but it was promising an unbelievably high return and guaranteeing
Speaker 1: that people would get it right. And what he was
Speaker 1: doing is as new people put money into the investment,
Speaker 1: he was using their money to pay the old investors
Speaker 1: so that nobody noticed that things were sucking up. But
Speaker 1: eventually new people stopped putting money into the thing, and
Speaker 1: it all fell apart and a lot of people lost
Speaker 1: billions of dollars, right, Like, yeah, he was also using
Speaker 1: a lot of that money to live, you know, an
Speaker 1: incredibly lavish rich guy live anyway. Sorry, I only understand
Speaker 1: financial concepts when Selena Gomez breaks the fourth wall and
Speaker 1: explains it to me. I'm doing my best to be
Speaker 1: your Selena Gomez. But do you know who Selena Gomez is? Yeah,
Speaker 1: she's that chick from the Thing Nailed It. She's she's
Speaker 1: kind of in the middle of a fun scandal right
Speaker 1: now where she's in a feud with someone who donated
Speaker 1: her a kidney what which is a very funny online
Speaker 1: feud feud with that person because she Okay, if you
Speaker 1: asked Robert, this is something I can explain to you.
Speaker 1: This so, so what happened was Selena Gomez needed a
Speaker 1: kidney donated her close friend who works in the industry.
Speaker 1: I don't know who it was, but I guess she's
Speaker 1: like sort of famous gave her a kidney a couple
Speaker 1: of years ago. Then Selena Gomez turns around a couple
Speaker 1: of weeks ago and says, I have no friends in
Speaker 1: the industry except Taylor Swift incomes her kidney dontor being like, oh,
Speaker 1: that's interesting because I'm one kidney light d like I'm
Speaker 1: not quoting it, but and then, and then Selena, instead
Speaker 1: of apologizing, Selena Gomez is like, oh, sorry, I didn't
Speaker 1: thank every person I've ever met in my life. Yeah,
Speaker 1: but I mean, Selina, she did give you a kidney. Yeah,
Speaker 1: that's a special kind of friend. You guys weren't just
Speaker 1: like drinking buddies. She literally gave you a kidney. Um,
Speaker 1: and that she did. She did the thing that you
Speaker 1: would use as like a joking description of someone who've
Speaker 1: done a lot for you, to like like hyperbolically say
Speaker 1: that you owed them a lot you know who's done
Speaker 1: and implying that Taylor Swift has done more for you
Speaker 1: than your kidney don't so. I just think it's the
Speaker 1: funniest feat of all time. Alright, we were talking about
Speaker 1: a cryptocurrency. We weren't. Um, we were talking about let's
Speaker 1: let's get back to cryptocurrency. So to talk about what
Speaker 1: came next after establishing Alameda, UM, I'm going to quote
Speaker 1: again from that sequoia right up at this point mid
Speaker 1: two thousand nineteen, SPF decided to double down again and
Speaker 1: scratch his own itch. He would bet Alameda's multimillion dollar
Speaker 1: trading profits on a new venture, a trading exchange called
Speaker 1: f t X. It would combine coin bases, solid stolen
Speaker 1: regulation loving approach with the kinds of derivatives being offered
Speaker 1: by by Anance and others. He only gave himself a
Speaker 1: twenty chance of success, but in his mind, SPF needed
Speaker 1: extreme risk to maximize the expected value of his lifetime
Speaker 1: earnings and therefore the good his earn to give strategy
Speaker 1: could do. The fact that he was, by his own
Speaker 1: lights overwhelmingly likely to fail was besides the point. The
Speaker 1: point was this, when SPF multiplied out million billions of
Speaker 1: dollars a year, a successful cryptocur and the exchange could
Speaker 1: throw off by his self assessed chance of successfully building one.
Speaker 1: The number was still huge. That's the expected value. And
Speaker 1: if you live your life according to the same principles
Speaker 1: by which you trade an asset, there's only one way forward.
Speaker 1: You calculate the expected values, then aim for the largest one,
Speaker 1: because in one, but just one alternate future universe, everything
Speaker 1: works out fabulously. To maximize your expected value, you must
Speaker 1: aim for it and then march blindly forth, acting as
Speaker 1: if the fabulously lucky f b SPF of the future
Speaker 1: can reach into the other parallel universes and compensate the
Speaker 1: fail sun spfs for their losses. It sounds crazy, perhaps
Speaker 1: even selfish, but it's not. It's math. It follows the
Speaker 1: principle of risk neutrality. Yes, it actually is crazy. That's
Speaker 1: not math. I'm sorry, that's actually not math, but a
Speaker 1: lot of words all at once. That is like, oh
Speaker 1: my god, the spiraling launch is this? You are using
Speaker 1: hundreds of words and high minded bullshit rhetoric to be
Speaker 1: like gambling is the best way to make money. He's
Speaker 1: fabulously three times in one sentence. Yeah, man, you know who.
Speaker 1: I've heard this basic argument from my friends drunk in
Speaker 1: Las Vegas, explaining what they're trying to play at the craps.
Speaker 1: Why they don't want me to leave the little Horsey game?
Speaker 1: This is something. Yeah, someone's like, no, don't leave the
Speaker 1: Sex in the City slot machine, and you're you want
Speaker 1: to You want to hear my mathematical thinking on gambling,
Speaker 1: Jamie Loftus, because this will make more sense than anything
Speaker 1: that happens in the Sequoia article. Okay, when I go
Speaker 1: to Las Vegas, I find me the penny slots where
Speaker 1: I can see the most waitresses walking around with those
Speaker 1: little trays that they have the drinks and stuff on.
Speaker 1: Then I sit down at them and I don't start
Speaker 1: to play until one gets close to me, and then
Speaker 1: I pressed the button as soon as she walks past,
Speaker 1: and I like, catch your attention, and then I get
Speaker 1: a free drink. And the way that it works out
Speaker 1: is that as long as I can get more free
Speaker 1: drinks than I'm spending at the penny slots, and mostly
Speaker 1: I'm just reading a book and hiding it while I'm
Speaker 1: at the penny slots and only press it when the
Speaker 1: waitress gets near. Like the other Vegas guys, I can
Speaker 1: drink effectively for free. Right, it works out to be
Speaker 1: like twenty five cents of drink if you're really smart
Speaker 1: about it. That is my financial advice to all of you.
Speaker 1: I do. I do respect that how you make it
Speaker 1: even better. I used to go with a bag because
Speaker 1: when I was poor. What I would do is I
Speaker 1: would go to Vegas once every couple of years, usually
Speaker 1: for work, and I would get all the free drinks,
Speaker 1: which came in glasses a lot of the time, and
Speaker 1: I would keep the glasses, and so I was able
Speaker 1: to furnish my apartment with stolen Las Vegas glasses. Love
Speaker 1: stealing glasses. I've my fair share of glasses. And I
Speaker 1: would get up to the floors where there were the
Speaker 1: nicer hotel rooms, and I would find all the people
Speaker 1: who set out their plates and stuff from like room service,
Speaker 1: and I would just take those and take them back
Speaker 1: to my house. I respect that. I'm trying to think.
Speaker 1: I was like, I don't have a real system for well. Actually,
Speaker 1: when I go to Vegas, I always stay at the
Speaker 1: hotel with a roller coaster on top. And here's what
Speaker 1: I do. I go on the roller coaster once, sometimes twice.
Speaker 1: Then I go see one show. Usually it's horrible. The
Speaker 1: last time to see the Backstreet Boys. And guess what
Speaker 1: I found out One of the Backstreet Boys is in
Speaker 1: Q and on and then I got bumped up from this.
Speaker 1: It was a real The point I want to make, Jamie,
Speaker 1: is that what I just described to you, my Vegas
Speaker 1: strategy has made me infinite, infinitely more money and net
Speaker 1: profit than Samuel Bankman. Freed is actually going to make
Speaker 1: in crypto Kurts. Oh fun foreshadowing. Um, So never hang
Speaker 1: out near waitresses though, because he's probably afraid of women.
Speaker 1: He's probably afraid of them. But I am fine with
Speaker 1: asking women for a free drink as long as I'm
Speaker 1: paying at the penny slots, you know, So it's not weird. Wow.
Speaker 1: Feminist icon, robertist icon, Robert Evans, getting those getting those
Speaker 1: shitty Vegas Irish copies. They come in the glasses. I
Speaker 1: want a nasty but I like the glasses they used
Speaker 1: to come in. They do have, I know, but then
Speaker 1: there's the consequence of having to drink with inside. Well,
Speaker 1: you know, Jamie, that's why they call me a hero. Um.
Speaker 1: But the Mahatma Gandhi of the West, they call me
Speaker 1: the Jesus Christ. And podcasting. These are all things people
Speaker 1: if you're gonna lie, make it realistic, James, So James soup. Anyway,
Speaker 1: let's continue. Um, I'm like, yeah, I think it's hard
Speaker 1: to justify being risk averse on your own personal impact
Speaker 1: impact SPF told me when I quized him about it,
Speaker 1: unless you're doing it for personal reasons. In other words,
Speaker 1: it's selfish not to go for broke if you're planning
Speaker 1: on giving it all away in the end. Anyway, again,
Speaker 1: just clown shit. So all of this is a con spoilers,
Speaker 1: so you don't have to think that much about it.
Speaker 1: In a recent series of text messages with a Vox journalist,
Speaker 1: after his entire exchange exploded and everyone found out he
Speaker 1: was a financial criminal, Sam Bankman, Freed more or less
Speaker 1: admitted that everything he'd had to say about effective altruism
Speaker 1: was a con meant to get people to trust him
Speaker 1: and invest in his company. And I'm gonna read the
Speaker 1: text Yeah, I'm gonna read the texts to you between
Speaker 1: him and this journalist who, by the way, he put
Speaker 1: money in the v so he helped fund this journalist.
Speaker 1: So the ethics stuff, this is the journalist. So the
Speaker 1: ethics stuff mostly affront people will like you if you
Speaker 1: win and hate you with you lose, and that's how
Speaker 1: it all really works, Sam, Yeah, I mean that's not
Speaker 1: all of it, but it's a lot. The worst quadrant
Speaker 1: is sketchy and lose. The best is win plus question
Speaker 1: mark question mark question mark clean plus loses bad but
Speaker 1: not terrible. He also misspells terrible but whatever the journalist
Speaker 1: and then replies, you were really good at talking about
Speaker 1: ethics for someone who kind of saw it all as
Speaker 1: a game with winners and losers. Yeah, he he, I
Speaker 1: had to be. It's what reputations are made of. To
Speaker 1: some extent, I feel bad for those who get sucked
Speaker 1: by it. But this dumb game, we woke Westerner's play
Speaker 1: where we all say the right shibboleths and so everyone
Speaker 1: likes us. And that's the actual truth here, right, That's
Speaker 1: the thing that's honest about it is Like, man, it
Speaker 1: was all of this talk for everyone. That's the entire
Speaker 1: this Miscastell motherfucker. The only reason his effective altruism thing
Speaker 1: exists as a funded thing is as a fucking shibba
Speaker 1: left for billionaires who don't want to pay taxes and
Speaker 1: want to let the world crumble around them. Will sucking
Speaker 1: as much value out of the working class as they
Speaker 1: can and want to pretend like their heroes at the
Speaker 1: same time, so that people write their dicks and articles
Speaker 1: like that fucking sakoyapies that absolutely fucking ridiculous text. Actually
Speaker 1: is like a very important document. It's incredibly important. It's
Speaker 1: deeply crucial. I hate that there's such a crucial document
Speaker 1: that also includes he in it. Yeah, there's nothing to
Speaker 1: be done about that one, Jamie, Look, there's it doesn't
Speaker 1: feel good, but you know we are previous most important
Speaker 1: document to that effect was an I am that said
Speaker 1: ha ha, So a text with he he is kind
Speaker 1: of the logical progression that is fascinated. Do you have
Speaker 1: any like insight into like why he would so freely
Speaker 1: admit that? Now, I don't. Actually, one of two things
Speaker 1: has to be happening, because again the spoilers, this all
Speaker 1: falls apart. His exchange goes from worth thirty two billion
Speaker 1: dollars to worth basically zero dollars. In the space in
Speaker 1: my head anytime you say, like like twenty four hours
Speaker 1: this happens, his net worth falls in a day, Um,
Speaker 1: like it is it all because they realized that all
Speaker 1: of the money has gone that he'd been taking money
Speaker 1: from one business and using to gamble in another, and
Speaker 1: also to pay him and his friends, and all of
Speaker 1: the money that the investors had put in when they
Speaker 1: tried to withdraw it, like the their money that was
Speaker 1: supposed to be in there on paper, none of the
Speaker 1: money existed because again he had stolen it um anyway,
Speaker 1: the context of this article makes it clear that he
Speaker 1: felt like, I don't know whatever. This was all the
Speaker 1: confidence game, right, that's the key all of this could work,
Speaker 1: and the balance because people were looking at their balance. Shee,
Speaker 1: I'm making money. I'm making money. The returns are great.
Speaker 1: And that money existed on paper until they tried to
Speaker 1: take it out because then it actually wasn't there because
Speaker 1: he had already frittered it away. It's a confidence game,
Speaker 1: and we have an you know that's the way it
Speaker 1: actually worked. We also know and this is all still
Speaker 1: coming out, so I'm not gonna get too much into it,
Speaker 1: but we know that he had f t X loan himself.
Speaker 1: Sam BigMan freed about a billion dollars, Like his paper
Speaker 1: value was like two billion, but he gave himself basically
Speaker 1: a billion dollars in other people's money. Um, although he
Speaker 1: may have gambled that away. It's really unclear how much
Speaker 1: money he actually has liquid at the moment um do
Speaker 1: we think he has any I have no idea either either.
Speaker 1: He was like actually a gambling addict and a narcissist
Speaker 1: and he really did lose it all or this was
Speaker 1: a con from the beginning, knowing it would all collapse,
Speaker 1: and he got as much as he could out of it,
Speaker 1: and he's going to wind up someplace without extradition, right like,
Speaker 1: and that was the goal. If you asked me a
Speaker 1: couple of years ago, I would have said it's the latter.
Speaker 1: But I feel like the last couple of years have
Speaker 1: demonstrated so often that like people are just straight up
Speaker 1: not smart and don't have a plan, and it is
Speaker 1: all a narcissist shell game. It's very it's it's un
Speaker 1: at the moment. I'm going to read you some things
Speaker 1: at the end here and you can kind of make
Speaker 1: your anyway. Whatever. So after you know, starting FTX, the
Speaker 1: company moves to Hong Kong and then the Bahamas and
Speaker 1: they use they buy these very like a thirty nine
Speaker 1: million dollar mansion that he lives in with his friends
Speaker 1: using FTX tokens, which is like internal cash that his
Speaker 1: company issues based on the perceived value of the company.
Speaker 1: They don't know how many rooms is that it's a shipload,
Speaker 1: and and they're able to buy it because everything's like
Speaker 1: their paper on paper. They've gone from nothing to worth
Speaker 1: thirty two billion dollars in like a year or two.
Speaker 1: And these these idiots, like property owners in the Bahamas,
Speaker 1: are like, well, clearly, the best thing we could do
Speaker 1: is by this building using the fake money they created
Speaker 1: for their own company that they tell us is worth
Speaker 1: a lot of money. This is worth it. Um. So
Speaker 1: since everything collapsed, some people that SPF had like reached
Speaker 1: out to as early investors have commented about why they
Speaker 1: didn't invest in this company in the early days, and
Speaker 1: most of them it's because, like what they could see
Speaker 1: of his investments, the tens of millions that he promised
Speaker 1: to charities in the long positions in risky cryptocurrent companies
Speaker 1: didn't make sense. They would look at like the things
Speaker 1: he was buying with the company assets and the things
Speaker 1: that like he was investing in and be like, well,
Speaker 1: there's no way he could have that kind of liquidity
Speaker 1: if this is a legitimate exchange right, he can't have
Speaker 1: that kind of cash on hand. It doesn't make any sense.
Speaker 1: Rich fucking assholes always telling themselves like that, that's funny.
Speaker 1: And what's funny is that, like I found one of
Speaker 1: these guys who like, yeah, I didn't invest because I
Speaker 1: could tell it was a con and then was like,
Speaker 1: but I didn't tell anybody because I didn't want to
Speaker 1: get yelled at. That's unfortunately. I do see myself that
Speaker 1: statement a little bit where I was like, oh, someone
Speaker 1: might be someone might send me a rude text. I
Speaker 1: guess I will this. Yeah, oh my god, it's very fine,
Speaker 1: goofy bullshit. I don't I'll tell you one thing, Jamie.
Speaker 1: He's a spineless guy who still has his fucking money. Wow,
Speaker 1: you're in love with him? That's what. Yeah, you know whatever.
Speaker 1: It's the finance industry. They're all ghoules from what we
Speaker 1: can actually tell now, because again, this fucking Captain Dick writer,
Speaker 1: the bad writer, Like, I have to read you another
Speaker 1: quote that I didn't have in my script to give
Speaker 1: you an idea of just how much he fucking how
Speaker 1: much he loves SBF. Here's a quote, um from him.
Speaker 1: Uh okay, yeah, this is this is actually, Jamie, oh boy,
Speaker 1: this is when this is when, this is when, this
Speaker 1: is when the writer Captain Dick writer is hanging out
Speaker 1: with him in the Bahamas at his office quote, and
Speaker 1: he's like, what if we kissed? Sensing an opportunity for connection,
Speaker 1: I chip in with my own two satoshi, which is
Speaker 1: two cents but a bitcoin term. Anyway, I'm going to
Speaker 1: walk into the ocean. Wow. Okay. I don't pay any
Speaker 1: attention to social media. Not because I have any moral
Speaker 1: case against it, I say, but because for me, reading
Speaker 1: books is the highest band with way I know to
Speaker 1: get quality information into my brain, which just craves the
Speaker 1: stimulation I'm addicted to reading, which explains how I ended
Speaker 1: up being a writer. Oh yeah, said SPS say, SPF,
Speaker 1: I would never read a book. I'm not sure what
Speaker 1: to say. I've read a book a week from I
Speaker 1: hate them both because I'm not sure what to say.
Speaker 1: I read a book a week for my entire adult life,
Speaker 1: and I have written three of my own. I'm very
Speaker 1: skeptical of books. I don't want to say no book
Speaker 1: is ever worth reading, but I actually do believe something
Speaker 1: pretty close to that explains SPF. I think if you
Speaker 1: wrote a book you fucked up and it should have
Speaker 1: been a six paragraph blog post. Those guys writing word
Speaker 1: article that he will not read. It's like two guys
Speaker 1: whose heads are made out of rocks, just like clunking
Speaker 1: against each other repeatedly. Just just wait, Jamie, Jamie. It
Speaker 1: has it hasn't gotten as bad as it's going to get.
Speaker 1: Whatever the case, I hate books. Whatever the case, I
Speaker 1: find myself sad for the man, And it occurs to
Speaker 1: me that my reaction is exactly what might be expected
Speaker 1: from a beta in the brave New world Old Crypto
Speaker 1: is creating. Whoa how can you write that and not
Speaker 1: leap off the top of the building He literally self
Speaker 1: identified as a beta to also, just like what I
Speaker 1: love about this is just like what we have to
Speaker 1: take it. We have to take it as given that
Speaker 1: Crypto is creating a brave new world and none of
Speaker 1: us has any choice in that. It's inevitable, it's unstoppable.
Speaker 1: It's going to dominate everything, which is like capitulate to
Speaker 1: our Yeah, so I think again, what I wonder does
Speaker 1: he think? I think? Wouldn't someone with i Q points
Speaker 1: to spare realized that dismissing books, all books is essentially worthless?
Speaker 1: Might rile a writer? Was he playing with me? Is
Speaker 1: this fun? Is this humor? I'm satisfied with my meta
Speaker 1: analysis until I realized that one can always increment the
Speaker 1: level of strategic play in this sort of game. It's
Speaker 1: like poker. Level one is just thinking about how to
Speaker 1: strengthen your own hand. Level two is thinking about what
Speaker 1: your opponent's hand is. Level three is thinking about what
Speaker 1: your opponent thinks your hand is, and so on. And
Speaker 1: since SPF is obviously a genius, I should simply assume
Speaker 1: that compared with me, SPF will always be playing at
Speaker 1: level in plus one, which was making which makes my
Speaker 1: analysis of the intent behind SPS books for losers idea
Speaker 1: spiral into infinity and crash like a computer like it
Speaker 1: was how you write about me and your diary? No, Jamie,
Speaker 1: because do you know what the only ethical speaking of ethics,
Speaker 1: you know what, if you think this way about conversations,
Speaker 1: the ethical thing to do is fill your pockets with
Speaker 1: rocks and walk into the ocean. Wow, you're wolfing this guy. Yeah,
Speaker 1: I absolutely am him and Sam Bankman Free. I could
Speaker 1: not hate these people more. I mean, they're both there.
Speaker 1: There's never been two wronger people having a conversation, and
Speaker 1: of course it came out. He's just like, well, obviously
Speaker 1: he's a genius. We have to assume that because he
Speaker 1: became a billionaire. So and he's like, no, he was
Speaker 1: never a billion There his defense, that's math he did
Speaker 1: to balance sheet, Like we've now gotten access because he
Speaker 1: had to like go to the bankruptcy and step down.
Speaker 1: So like there's a caretaker trying to get people's money
Speaker 1: out of the company, and we know ship like we've
Speaker 1: seen the Excel files where they kept their financial records,
Speaker 1: and it's him being like, this is basically bullshit, Like,
Speaker 1: sorry about this, we funck this up. We weren't actually
Speaker 1: keeping records here the company balance sheet. There was no
Speaker 1: accounting department. People would file there, like like when they
Speaker 1: would spend hundreds tens and hundreds of millions of dollars
Speaker 1: and things, they would just message each other on signal
Speaker 1: about it to get approval and had deleted deleted messages
Speaker 1: on so there's actually like no record of a lot
Speaker 1: of the accounting they did. At one point hier and
Speaker 1: outside accounting firm to handle their accounting of this thirty
Speaker 1: two billion dollar company and the firm they hired is
Speaker 1: the first builds itself as the only metaverse based accounting firm.
Speaker 1: Um His the accounting firm for this thirty two billion
Speaker 1: dollar company, exists entirely within a crypto themed video game
Speaker 1: called decentral Land. Um. It is so futpid with everything
Speaker 1: you're saying. Okay, so this is really this is bad
Speaker 1: and this field bad to hear Um, I have a question, Yes,
Speaker 1: Jamie Um, who is I guess because I am I
Speaker 1: am kind of back in in Lizzy holmes Land because
Speaker 1: that whole last I mean, like departments that should be,
Speaker 1: you know, taking care of ship don't even exist, which
Speaker 1: is very farops adjacent to me parasian if you will.
Speaker 1: As with both written books, we can just make up
Speaker 1: for Yeah, of course, yeah, that's that's mostly what writing
Speaker 1: a book is. For sure. I view myself as the
Speaker 1: beta of this conversation, and so I feel comfortable asking
Speaker 1: Robert Um who is ultimately affected by this, Like what
Speaker 1: is the like trickle down of this what happens? Um?
Speaker 1: Is it just other rich assholes or it doesn't affect regularly?
Speaker 1: Like does it affect Probably there will presumably be some
Speaker 1: here's the thing, and here's why there's that lawsuit against
Speaker 1: like Larry David and all those other guys who appeared
Speaker 1: to the ft X. AD. Yeah, presumably a bunch of
Speaker 1: regular people got suckered into putting their money on ft X,
Speaker 1: and those people have probably lost some money. That said,
Speaker 1: for the most part, it's fine because most of the
Speaker 1: people who lost money are like gamblers who probably suck
Speaker 1: as much as this guy did. Um. And it's one
Speaker 1: of those things. There's just an article I think at
Speaker 1: Financial Times where someone's like, actually, and I think they
Speaker 1: actually had a good point. We shouldn't regulate the crypto
Speaker 1: industry because if we regulated, it will be brought in
Speaker 1: closer to the actual financial industry as it exists, and
Speaker 1: banks will put more investments into crypto and it will
Speaker 1: get seen as like legitimate and backed by the state.
Speaker 1: And so when these conmen destroyed tens of billions of
Speaker 1: dollars overnight and cause panic in the industry, it will
Speaker 1: affect the real economy. And right now it doesn't seem
Speaker 1: to And like, yeah, I guess that is kid, that's
Speaker 1: not a bad point. Maybe we just let it die
Speaker 1: on its own. I don't know. Um, And it seems
Speaker 1: so more like, well we'll know more. So, yeah, we
Speaker 1: will continue to learn more. One of the things that's
Speaker 1: funny is about this is that Sequoia, this investment firm,
Speaker 1: put like two hundred million dollars into the company, which
Speaker 1: they have all written off. Now they're accepting it as
Speaker 1: a total loss. They're going full that girl on this. Okay, Now,
Speaker 1: when you hear this very serious investment firm put two
Speaker 1: hundred million dollars into this business, you probably assume Jamie wow,
Speaker 1: I bet he had a good pitch, right, I actually
Speaker 1: I don't know if we're talking Sarin knows. I actually
Speaker 1: don't think that that is. That's not just qualifying to
Speaker 1: have a dogshit pitch. You know. You know who can
Speaker 1: make this clear for us is Captain Dick Ryder. Thanks
Speaker 1: SPF told Sequoia about the so called super app. I
Speaker 1: want FTX to be a place where you can do
Speaker 1: anything you want with your next dollar. You can buy bitcoin,
Speaker 1: you can send money in whatever currency to any friend
Speaker 1: anywhere in the world. You can buy a banana. You
Speaker 1: can do anything with you you want with your money
Speaker 1: from inside f t X. Suddenly the chat Yeah, I
Speaker 1: don't know, I feel like I can do anything I
Speaker 1: want with my debit card, Like I've never run into
Speaker 1: a thing I wanted to buy and been like, ah,
Speaker 1: I cannot know how do I even buy drugs with it?
Speaker 1: By going to an A t M. If I were
Speaker 1: to be a person who buys drugs, which I'm not,
Speaker 1: I could go to an A t M and take
Speaker 1: out cash and purchase support your local drug dealer and
Speaker 1: banana vendor for crying out so he gives this banana
Speaker 1: pitch quote. Suddenly, the chat window on Sequoia's side of
Speaker 1: the zoom lights up with partners freaking out. I love this, founder,
Speaker 1: typed one partner, I am a tin out of tin
Speaker 1: pinned another Yes, exclamation point, exclamation point, exclamation point, exclaimed
Speaker 1: a third. What Sequoia was reacting to was the scale
Speaker 1: of SPFS vision. It wasn't a story about how we
Speaker 1: might use fintech in the future, or crypto crypto or
Speaker 1: a new kind of bank. It was a vision about
Speaker 1: the future of money itself, with a total addressable market
Speaker 1: of every person on the entire planet. I sit tin
Speaker 1: from him, and I know it's These people are just
Speaker 1: actually like three executives doing lines of coke and once
Speaker 1: swallowing a banana with the peel still on. They're like, yes, yep,
Speaker 1: oh my god. Okay, so it's I mean, which does
Speaker 1: kind of continue with the trend of like, you know,
Speaker 1: as as b F has never had a problem or
Speaker 1: a like anything to overcome, Like if it's this easy
Speaker 1: for him to con people into ship, like, of course
Speaker 1: you would have a god complex. You've never you've never
Speaker 1: been told no, yep, yep, yep, yep, yep, yep. It's cool.
Speaker 1: So what Sequoia was? Yeah, sorry, I have to continue
Speaker 1: this this fucking quote. And next he's going to talk
Speaker 1: about a person who works at Sequoia and is in
Speaker 1: the room for this. I sent ten ft from him
Speaker 1: and I walked over thinking, oh shit, that was really good.
Speaker 1: Remembers Aurora. And it turns out that fucker was playing
Speaker 1: League of Legends through the entire meeting. And this is
Speaker 1: framed in the article and in all the coverage before
Speaker 1: everything fell apart. It's like, so awesome, He's so cool.
Speaker 1: This writer talks a bunch about how like Sam never
Speaker 1: stops playing video games when he's talking to this writer,
Speaker 1: when he's having corporate meetings, he's playing video games. Basically,
Speaker 1: a hundred percent of the time. Um, and this has
Speaker 1: always mentioned like he's always working, He's always in the office,
Speaker 1: he sleeps in a beanbag chair at his desk, and
Speaker 1: it's like, no, dude, he's not always working. He's conning you.
Speaker 1: And he plays video games all the time and pretends
Speaker 1: that that's a fucking job. Um, which is great, great
Speaker 1: con good for you always working in always They're two
Speaker 1: very different flavors of things happen exactly. Um, it's all
Speaker 1: part of the fucking con So is the fact that
Speaker 1: he always he always were like ratty old athletic shorts
Speaker 1: and like a wrinkled T shirt. Because like that's if
Speaker 1: you are a young man in the tech industry, that
Speaker 1: makes people think you're a genius, right, because genius is
Speaker 1: dressed like shit. Yeah, he's like, now, if I bring
Speaker 1: a real stink into their people are gonna like jack
Speaker 1: up my already fake i Q score about twenty points. Yeah,
Speaker 1: and it's what you know who else dresses like ship
Speaker 1: the guy I used to buy weed from. Yeah, yeah,
Speaker 1: you know who? Also? You know who wears the same
Speaker 1: outfit of Sam Bankman Freed, my old buddy who once
Speaker 1: at a party got into an argument with the guy
Speaker 1: and broke fifteen bones in his face because they were
Speaker 1: both drinking. Not a corporate genius. I do like that
Speaker 1: shared aesthetic where it's like, really the difference is the
Speaker 1: pet snake, that is that's the that's that's how you
Speaker 1: truly can sniff out the africa he's based. He's the
Speaker 1: same kind of person as Elizabeth Holmes and he was
Speaker 1: again he's a confidence man, and this gets us into
Speaker 1: the Larry David ship because the thing about being a
Speaker 1: confidence man is that as long as people are convinced
Speaker 1: there's money, their money is safe and most of them
Speaker 1: don't try to pull it out, then you can keep
Speaker 1: the con going, and you can keep the fake numbers increasing,
Speaker 1: and you everyone will think you're richer and you can
Speaker 1: actually get real money out of this. So one of
Speaker 1: the things that he did is he would pour shiploads
Speaker 1: of money into sponsorship deals and to other ventures to
Speaker 1: make his company seem legit. One way he did this, Yeah,
Speaker 1: he spent seventeen and a half million through FTX to
Speaker 1: sponsor the athletic teams that you see Berkeley. Uh. He
Speaker 1: launched a twenty million dollar ad campaign with Tom Brady
Speaker 1: and just sell Bunchen. He offered n F T s
Speaker 1: at coach uh huh, And he spent a hundred and
Speaker 1: thirty five million dollars on the naming rights for the
Speaker 1: Miami Heats Home arena. And the purpose this is all
Speaker 1: to build confidence, right you see, you see it's the
Speaker 1: It's the same thing Crypto dot Com did, by the
Speaker 1: way with the arena, and I want to say, I
Speaker 1: was like, I feel like the Crypto dot Com arena
Speaker 1: is not long for this world, and you should I
Speaker 1: don't recognize that as an act. Is my money safe
Speaker 1: in this thing that's a bank but not a bank?
Speaker 1: Well their name is on the arena, so it's probably legit.
Speaker 1: Here's the thing, is like, yeah, it's like now walking
Speaker 1: into the Crypto dot Com area arena, I couldn't feel
Speaker 1: less safe. I couldn't feel less secure. Like when it
Speaker 1: was the Staple Center. I'm like, oh, you know what's
Speaker 1: never going to go out of style? Little notebooks. People
Speaker 1: have been using Staples since we were cavemen. I assume. So, yes,
Speaker 1: technology just like the worst fucking name on earth. But
Speaker 1: it infuriates me these people. So if he has a
Speaker 1: dog in the fight, I do In his interview with Vox,
Speaker 1: Sam basically admits this, albeit in a slightly careful way.
Speaker 1: Journalist so, f t X technically wasn't gambling with their money.
Speaker 1: F t X had just loaned their money to Alameda,
Speaker 1: who hadn't, who had gambled with their money and lost it.
Speaker 1: And you didn't realize it was a big deal because
Speaker 1: you didn't realize how much money it was. Same response.
Speaker 1: And also, I thought Alameda had enough collateral to reasonably
Speaker 1: cover it. Journalist says, I get how you could have
Speaker 1: gotten away with it, but I guess that seems sketchy.
Speaker 1: Even if you get away with it, Sam, it was
Speaker 1: never the intention. Sometimes life creeps up on you, um
Speaker 1: so literally that life comes at you fast. So Sam's
Speaker 1: worth taps at around twenty two billion dollars on paper.
Speaker 1: In reality, neither Alameda nor ft X had ever taken
Speaker 1: and even close to that much money. The valuation was
Speaker 1: based entirely on nonsense calculations that were themselves based on
Speaker 1: lies from ft X. Is extremely cooked books. There's a
Speaker 1: lot more about this than we're getting into. People are
Speaker 1: still finding this all out. There's one thing I should
Speaker 1: probably read, which is, so you know when his company collapsed,
Speaker 1: he had to step down from running it, right, And
Speaker 1: because a lot of money is still in there and
Speaker 1: a lot of like investments are still tight up in that,
Speaker 1: they put a guy in charge of the company again, right.
Speaker 1: And there's like there's specific dudes in the business world,
Speaker 1: um whose like job is to come in when a
Speaker 1: company fucks up like this and like try and get
Speaker 1: as much money back out for the shareholders as possible
Speaker 1: to minimize the bleeding. So they kind of have like
Speaker 1: a like how they had like old Hollywood, they have
Speaker 1: like a fixer guy. Yeah, yeah, yeah, they have. And
Speaker 1: this is this fixer guy specifically, he is the guy
Speaker 1: that they brought in, um when in Ron, he took
Speaker 1: over in Ron after it fell apart in order to
Speaker 1: try and like minimize the damage from it. So he
Speaker 1: is the guy who got brought in to deal with
Speaker 1: like the fact that this massive fucking crime happened with Enron.
Speaker 1: UM one sec. My my favorite, um, my favorite en
Speaker 1: Run memory not that you asked, um, was the women
Speaker 1: of Enron playboy spread that I got too archived during
Speaker 1: my time there. Oh god boy, did those en Ron
Speaker 1: girl bosses have their there? So the second only two
Speaker 1: women of seven eleven, which is my actual favorite spread
Speaker 1: continue first option. This company has about a million creditors,
Speaker 1: so about a million people possibly lost their entire investment
Speaker 1: in this company, which is a stunning amount of people
Speaker 1: to take money from um. And again, we're probably we
Speaker 1: are probably looking at like five or ten billion dollars
Speaker 1: stolen something like that. Kind of unclear the exact amount,
Speaker 1: but anyway, this is what the guy in the Delaware
Speaker 1: bankruptcy court filing. This is what the guy who was
Speaker 1: the guy who took over in Ron after it became
Speaker 1: clear that the whole company was a criminal enterprise. This
Speaker 1: is what that guy wrote about Sam's company. Oh no,
Speaker 1: never in my career have I seen such a complete
Speaker 1: failure of corporate controls and such a complete absence of
Speaker 1: trustworthy financial information as occurred here. From compromise systems integrity
Speaker 1: and faulty regulatory oversight abroad to the concentration of control
Speaker 1: in the hands of a very small group of inexperienced, unsophisticated,
Speaker 1: and potentially compromised individuals, this situation is unprecedented. Again, that's
Speaker 1: the guy who took over in Ron, literally like Bill
Speaker 1: Clinton dropping a notes post, being like never have I
Speaker 1: seen a more cheated on my wife? And like, well,
Speaker 1: I will say it's different. This guy did not commit
Speaker 1: any of the iron crimes, right, this is the guy
Speaker 1: who comes saw them all. This guy is after he's
Speaker 1: brought in it becomes clear that none never in my career.
Speaker 1: This guy, Yeah, it's probably best to look at this
Speaker 1: guy is like an E M. T. When it becomes
Speaker 1: clear that a company that has a shipload of money
Speaker 1: in it and is central in the economy has collapsed
Speaker 1: because people broke the law. He comes in to minimize
Speaker 1: the damage. But he was not working at in Ron previously, right, Like,
Speaker 1: it's not he's not trying to like stop anyone from
Speaker 1: getting in trouble. He's trying to minimize how many people
Speaker 1: are hurt by this anyway. Yeah, um, I just want
Speaker 1: to make clear, like that guy's anyway whatever, he's not.
Speaker 1: He's not the end he is not the end runner.
Speaker 1: He did not make in roun bad. He's just was
Speaker 1: there afterwards and was like this company is even worse.
Speaker 1: He bought the issue of Playboy and then he pushing
Speaker 1: so I should god, there's yeah, we're we're getting close
Speaker 1: to done. I should note that before everything collapsed. Sam again,
Speaker 1: he's in the effect of altruism. He's he's he promised
Speaker 1: to donate like a couple of hundred million dollars to
Speaker 1: these e A causes. I'll lot less than that actually
Speaker 1: wound got out. Some of them were good, but a
Speaker 1: lot of it was like So he made a huge
Speaker 1: point that he was like his one of his major
Speaker 1: priorities was pandemic prevention. Right, we have to stop the
Speaker 1: next pandemic. I'm gonna put as much money as i
Speaker 1: can to pandemic prevention. That's the best effective altruist thing
Speaker 1: that I can do. Um to talk about how well
Speaker 1: that actually worked, I want to quote from the Washington
Speaker 1: Post here. Ft X backed projects ranged from a twelve
Speaker 1: million dollars to champion a California ballot initiative to strengthen
Speaker 1: public health programs and detect emerging virus threats. Amid lackluster support,
Speaker 1: the measure was punted four to investing more than eleven
Speaker 1: million on the unsuccessful congressional primary campaign of an Oregon
Speaker 1: bio security expert, and even a hundred and fifty thousand
Speaker 1: dollar grant to help moncleft Slough, the scientific advisor to
Speaker 1: the Trump administration's Operation Warp speed vaccine accelerator. Right his memoire.
Speaker 1: So that sounds like a giant waste of money. Right,
Speaker 1: that sounds like none of it. Even if it was
Speaker 1: like good, it sounds like it did in the like,
Speaker 1: even if the goals are good, like well, the ballot
Speaker 1: measure failed, like it got punted, So it's not like
Speaker 1: it worked. Um, and it gets worse because SPFS fund
Speaker 1: also put a lot of money, like five million dollars
Speaker 1: into Pro Publica. And Pro Publica they've done a lot
Speaker 1: of cool stuff. They also published an extremely flawed investigation
Speaker 1: that backed the lab leak hypothesis. Um, I'm gonna the
Speaker 1: l A Times and their analysis of this deeply flawed,
Speaker 1: flawed piece of reporting. And also, you know, we've got
Speaker 1: some notes for the l A Times as well. Yes,
Speaker 1: nobody's perfect. The The l A Times called it a
Speaker 1: train wreck, noting the article is based heavily on Chinese
Speaker 1: language documents that appear to have been mistranslated and misinterpreted,
Speaker 1: according to Chinese language experts who have piled on via
Speaker 1: social media since its publication. It also takes as gospel
Speaker 1: or a report by a rump group of Republican congressional
Speaker 1: staff members asserting that the pandemic was more likely than
Speaker 1: not the result of a research related incident. And this
Speaker 1: has been the fact that Pro Publica published this has
Speaker 1: like provided a shipload of fuel to the It was
Speaker 1: all a fucking lab leak for China. It's China's fault.
Speaker 1: Um Republicans. Yeah, Sam Bankman Freed funded that ship. Um
Speaker 1: and god yeah, basically none of the ship he was
Speaker 1: putting in money into that was supposed to be good
Speaker 1: really worked, and a lot of it was. So another
Speaker 1: thing the right is doing right now is they're talking
Speaker 1: about he was like the number one or number two
Speaker 1: donor to Democrats during the mid term elections. Seth McFarland. Yeah, yeah,
Speaker 1: but none of his donations worked. And also he gave
Speaker 1: it was like thirty two million he gave to the DIMS.
Speaker 1: He gave like twenty four million to the Republicans. And
Speaker 1: the reason he was giving this money Number one, there
Speaker 1: were some like pro pandemic response candidates he wanted to back,
Speaker 1: most of whom didn't you know, do well. But also
Speaker 1: like a lot of the money was towards Republican and
Speaker 1: Democratic candidates who were going to be part of the
Speaker 1: regulation of the crypto industry because he wanted to have
Speaker 1: a seat at the table and push regulations in a
Speaker 1: way that yeah, that would enable that is yeah exact lee. Um.
Speaker 1: So anyway, in general, nothing at Alameda or f t
Speaker 1: X was as it seemed. And that Dick writing Sequoia
Speaker 1: article Carolyn Ellison, the CEO of Alameda is he talks
Speaker 1: about her a bit, and like she frames her as
Speaker 1: like this quintessential innocent nerd girl, plucky and ethical and
Speaker 1: optimistic to show like these are the kind of you know,
Speaker 1: smart young gen z kids that are you know, building
Speaker 1: this this great company. And like she showed up in
Speaker 1: Larpe gear to meet with Sam and talk about the
Speaker 1: future of their great financial enterprise. And she's an ethical altruist. Um.
Speaker 1: Since everything fell apart, it's come out that she and
Speaker 1: Sam were dating each other and possibly other members of
Speaker 1: the company. Um. And also people have found her here
Speaker 1: we go. People have found her tumbler um, and boy
Speaker 1: is she's sketchy as hell. Um. I'm gonna quote from
Speaker 1: a report on her tumbler activity and decrypt dot com. Boy, howdy.
Speaker 1: When I first started my first foray into POLLI I
Speaker 1: thought of it as a radical break from my trad,
Speaker 1: pas asked, the account wrote in February, but tbh, I've
Speaker 1: come to decide that the only acceptable style of polly
Speaker 1: is at best characterizes something like imperial Chinese harem. The
Speaker 1: account went on to detail how a polyamorous dynamics should
Speaker 1: ideally function as a cutthroat market of sexual competition and subjugation.
Speaker 1: None of this, none high, non hierarchical bullshit, the account elaborated.
Speaker 1: Everyone should have a ranking of their partners, people should
Speaker 1: know where they fall in the ranking, and there should
Speaker 1: be vicious power struggles for the ranks. God, it gets worse, Jamie.
Speaker 1: The Ellison linked account also demonstrated a substantial preoccupation with
Speaker 1: hb D or human biodiversity, an online euphemism for the
Speaker 1: discredited fields of race science and eugenics popularized right, oh
Speaker 1: oh boy, give me one more paragraph and then we
Speaker 1: can talk about this. Jamie Ellison has for years vocalized
Speaker 1: her die Heart obsession with Harry Potter, and one post
Speaker 1: her affiliated Tumbler account tied her love of online character
Speaker 1: chrizz Is Quizzes to her pinshot for sorting Indians by
Speaker 1: their cast, which she presumed to indicate nedic distinction. Oh
Speaker 1: my god, it even J. K. Rowling wasn't thinking something
Speaker 1: that fucked up, and that's really saying something there, someone
Speaker 1: is amazing astonishing. Tumbler is exclusively for Sherlock fan fiction
Speaker 1: and things that trigger my eating disorder. That's it. I
Speaker 1: cannot like. Oh, that's so dark, it's I almost can't
Speaker 1: fathom it. Right, And again, there's so much. We probably
Speaker 1: will do a follow up at some point because like
Speaker 1: the fact that the fact that it was this easy
Speaker 1: for like some fucking crypto rage are the ones who
Speaker 1: reported on it to find her Tumbler where she talks
Speaker 1: about race science makes me think these guys were all
Speaker 1: probably into a lot more fucked up ship than they
Speaker 1: let on. Yeah, so we'll see, we'll see. I just
Speaker 1: we don't have the hour for me to decompress the
Speaker 1: way I need to after hearing that sentence. Specifically, I
Speaker 1: need a cigarette. I'm going to start smoke today. And
Speaker 1: I hope she's fucking happy. Oh my god, that is
Speaker 1: that is brutal place to land. Hopefully they're all all
Speaker 1: of their money's gone, but they probably squirreled away millions
Speaker 1: and stuff for themselves, although at least one of the
Speaker 1: articles I've read says that, like, his net worth is
Speaker 1: effectively zero now, but I don't think anyone actually knows
Speaker 1: what his net worth is right now, like and how
Speaker 1: much he got, like his company went from valued at
Speaker 1: thirty two billion dollars to most recently there's something like
Speaker 1: six fifty dollars in actual assets left. Um. But I
Speaker 1: also kind of think he and the others probably have
Speaker 1: millions or tens of millions that they set aside um
Speaker 1: in shady ways for themselves. Yeah, I mean, well that
Speaker 1: does sound like what the Beanie Baby's guy would do,
Speaker 1: and that is my yardstick for morality. That is so
Speaker 1: um that that is very very scary to uh to consider.
Speaker 1: I feel like guys like that the thing that is,
Speaker 1: I mean, I don't know whatever you hear about, Like
Speaker 1: it is so karmically satisfying to know that someone like
Speaker 1: SBF can can be completely bottomed out and like destroyed
Speaker 1: by something like this. But the thing is like when
Speaker 1: when rich guys like that lose everything, they just come
Speaker 1: up with worse, more hateful ideas and then come back.
Speaker 1: And that is like always what kind of scares me
Speaker 1: about that? It is so funny. Um. I don't know, Jamie,
Speaker 1: I don't know what the solution is. That's not like
Speaker 1: I want him to have money again. I just you know, what,
Speaker 1: how can you make someone say less again? I think
Speaker 1: the podcasters dilemma. Look, here's here's where I'll land on this.
Speaker 1: You know, I don't think I don't think people should
Speaker 1: be thrown into cages generally unless there's literally no other
Speaker 1: way to stop them from harming folks. So and I
Speaker 1: don't think that's the case with these people. So instead,
Speaker 1: I think the actual solution is to close from the
Speaker 1: outside all of the doors to that the fucking rich
Speaker 1: person apartment complex they occupy in that Bahamas development, lock
Speaker 1: it from the outside, and once a week drop in
Speaker 1: food and necessities via a helicopter and never let them
Speaker 1: leave or use the internet again. Them all just be
Speaker 1: with their friends in their in their weird little compound,
Speaker 1: going increasingly insane with their Chinese harem ship. I don't know.
Speaker 1: I guess that's another kind of prison. But if we
Speaker 1: film it, we can make money. But then SBF might
Speaker 1: may have to face his worst fear, which is reading
Speaker 1: a book. Yeah, I guess, Like, like, my serious answer
Speaker 1: is what do you do to people like this is
Speaker 1: you stop them from ever being able to have access
Speaker 1: to money again, or start companies again, and hopefully eventually
Speaker 1: they find something to do that actually helps human beings.
Speaker 1: And it is like like of any kind of use,
Speaker 1: Like we're going to a a grocery store there, that's a
Speaker 1: real benefit. People need to get food, and people need
Speaker 1: like that's a respectable, honest way to make a living. Um.
Speaker 1: And if any of these people were to get a
Speaker 1: job working in a safe way, they would be providing
Speaker 1: an infinitely greater benefit to the human race than they
Speaker 1: could ever have performed. Perhaps a bit more of that
Speaker 1: that ethical side of the ethical altruism you're looking. I'll
Speaker 1: be honest. I did not come to the recording today
Speaker 1: with a solution for the prison industrial complex. But I don't.
Speaker 1: But I still don't like it. Um, I still don't
Speaker 1: love it. Um. Yeah, yeah, I have no solution. Um,
Speaker 1: But you know what I do have, Jamie, what you're plug?
Speaker 1: No you don't. I have those? Well you have them,
Speaker 1: but I'm letting you have them. Oh my god. I mean,
Speaker 1: I mean I could probably do them. If nobody wants
Speaker 1: to take this job, I'll do it. I can. I'll
Speaker 1: do them, Sophie, do you want to do them? Yeah?
Speaker 1: I mean you can pre order Jamie's book. Um, and
Speaker 1: that that is linked in her Instagram bio. Um that
Speaker 1: you can follow her on Instagram at Jamie christ Superstar
Speaker 1: and you can follow her on Twitter at Jamie Loftus.
Speaker 1: Help if Twitter is still around. Uh. She has a
Speaker 1: podcast that she co hosts with Caitlyndt called The backtel Cast.
Speaker 1: You should listen to her many limited run series, including
Speaker 1: her most recent run, which is Ghost Church and Sophie
Speaker 1: produced along with The Vital Cast and everything every podcast
Speaker 1: on the planet. This has now become a plug for me. Um,
Speaker 1: do I get everything, Jamie? Yeah, that's exactly what I
Speaker 1: would have said, except worse. Yeah. So pre pre pre
Speaker 1: order raw Dog. Yeah, thanks, Sophie. Yeah, preorder raw Dog.
Speaker 1: If you listen to the hot Dog episode of Bastards
Speaker 1: and didn't like it, you did like it now by
Speaker 1: the book, Yeah, legally you did like it. And if
Speaker 1: you disagree with that statement, we will send the CIA
Speaker 1: to kill your family. Yeah. And that, and let's make
Speaker 1: sure to attribute that quote to Robert Evans specifically, and
Speaker 1: speaking specifically, Robert Evans specifically, Margaret killed Joy specifically, and
Speaker 1: myself will be doing a Behind the Bastards virtual livestream
Speaker 1: show on December eight. You can get tickets at a
Speaker 1: moment dot co slash bTB. Yeah. Also, I have a
Speaker 1: sub stack now because Twitter's not doing great. So that
Speaker 1: makes me so sad. Why I like writing things. I
Speaker 1: got to write a thing last night. Write more things
Speaker 1: better for me than being on Twitter all the goddamn time. Yeah,
Speaker 1: you can find it at shatter zone dot sub stack
Speaker 1: dot com. Go there and I will be writing. I'll
Speaker 1: try to write something every week. Maybe I won't, maybe
Speaker 1: all of this will will fall apart, be austin time
Speaker 1: like tears in the rain. Or maybe you'll get a
Speaker 1: new thing for me every week. There's no way to
Speaker 1: know every time. Half the time, when I get something
Speaker 1: from someone's substack, because I have subscribed to quite a few,
Speaker 1: but every time I get a message from someone's substack,
Speaker 1: it's always like I'm so sorry and like I didn't notice.
Speaker 1: Just give me the content and I'll send to hear
Speaker 1: about Yeah, yeah, it's fine, Look we all I don't know.
Speaker 1: I'm meaning to write more stuff as opposed to just
Speaker 1: tweeting ship posts. So maybe it will happen, maybe it won't.
Speaker 1: There's no way to know, perfect by Behind the Bastards
Speaker 1: is a production of cool zone Media. For more from
Speaker 1: cool Zone Media, visit our website cool zone media dot com,
Speaker 1: or check us out on the I Heart Radio app,
Speaker 1: Apple Podcasts, or wherever you get your podcasts.