WEBVTT - The AI Billionaire Who Lost $30 Billion Before His Wedding

0:00:00.760 --> 0:00:02.800
<v Speaker 1>We got it. We got the message from h Q

0:00:03.080 --> 0:00:08.920
<v Speaker 1>that Citadel actually brought a lot of Microsoft stock. And

0:00:09.600 --> 0:00:12.000
<v Speaker 1>that brings us to this story of Leo. I want

0:00:12.039 --> 0:00:14.840
<v Speaker 1>you to tell his story and then I'm an I'm

0:00:14.840 --> 0:00:16.720
<v Speaker 1>gonna add the animation to it.

0:00:17.000 --> 0:00:20.599
<v Speaker 2>All right, all right, okay, so let's talk about Leo

0:00:20.640 --> 0:00:26.720
<v Speaker 2>bo Uh. I'll put it like this. This is somebody

0:00:26.920 --> 0:00:31.080
<v Speaker 2>who is super intelligent, obviously worked for open Ai, left

0:00:31.080 --> 0:00:34.199
<v Speaker 2>the company, decided to create a hedge fund about a year,

0:00:34.280 --> 0:00:37.680
<v Speaker 2>maybe eighteen months ago. But the hedge fund was based

0:00:37.720 --> 0:00:42.040
<v Speaker 2>on investing in AI infrastructure. The AI story a lot

0:00:42.040 --> 0:00:46.320
<v Speaker 2>of energy, a lot of semis inside that, and the

0:00:46.440 --> 0:00:49.479
<v Speaker 2>portfolio was like again, started about eighteen Let me tell,

0:00:49.520 --> 0:00:51.519
<v Speaker 2>Let me tell the story, which one, which part all

0:00:51.520 --> 0:00:51.959
<v Speaker 2>the whole thing.

0:00:52.159 --> 0:00:54.480
<v Speaker 1>Let me let me just tell the animated part of it,

0:00:54.920 --> 0:00:57.880
<v Speaker 1>and then you add the technical part of So Leo.

0:00:58.200 --> 0:01:00.880
<v Speaker 2>So, once upon a time was a guy named Leo Leopold,

0:01:00.960 --> 0:01:03.440
<v Speaker 2>which I don't even like the name, but that's another story.

0:01:03.760 --> 0:01:07.880
<v Speaker 1>Leo super smart dude, but not really a background in finance,

0:01:07.959 --> 0:01:12.720
<v Speaker 1>working in open AI and starts at hedge fund and

0:01:12.920 --> 0:01:15.920
<v Speaker 1>really studies the stock markets. He sees where this thing

0:01:16.040 --> 0:01:19.880
<v Speaker 1>is going as far as chips are concerned, and becomes

0:01:20.360 --> 0:01:23.399
<v Speaker 1>an overnight sensation as far as investment is concerned, giving

0:01:23.440 --> 0:01:27.319
<v Speaker 1>you the abbreviated version, starts a hedge fund and within

0:01:27.440 --> 0:01:30.920
<v Speaker 1>like eighteen months grows the hedge fund. Grows the hedge

0:01:30.920 --> 0:01:33.600
<v Speaker 1>fund to forty five billion dollars.

0:01:33.319 --> 0:01:35.520
<v Speaker 2>From two twenty five two hundred and twenty five million

0:01:35.600 --> 0:01:38.880
<v Speaker 2>to forty five billion, and about little over eighteen months.

0:01:39.040 --> 0:01:42.640
<v Speaker 2>There's the company's He invested in, cor Weave, Nibius, Slarris,

0:01:42.760 --> 0:01:49.680
<v Speaker 2>applied with Digital Court, Scientific, Bloom Energy, Iron, Micron, sand Disk,

0:01:50.120 --> 0:01:50.880
<v Speaker 2>just to name a few.

0:01:51.000 --> 0:01:52.560
<v Speaker 1>So his hedge fund was crazy. It was up like

0:01:52.560 --> 0:01:55.800
<v Speaker 1>four hundred and fifty percent over the year. It was

0:01:55.880 --> 0:01:58.640
<v Speaker 1>just he was the everybody wanted to invest with him.

0:01:58.960 --> 0:02:02.040
<v Speaker 1>He figured it out the code for Wall Street, and

0:02:02.080 --> 0:02:04.720
<v Speaker 1>he's invested in all those companies, all of those companies,

0:02:04.800 --> 0:02:09.680
<v Speaker 1>all the companies that had crazy run ups. And he

0:02:09.800 --> 0:02:12.720
<v Speaker 1>was doing so good in life that he actually decided

0:02:12.760 --> 0:02:13.400
<v Speaker 1>to get married.

0:02:15.680 --> 0:02:18.480
<v Speaker 2>He didn't get married, he did. He got married this weekend.

0:02:18.760 --> 0:02:21.440
<v Speaker 1>I understand that. So that's what I'm saying. So he

0:02:22.400 --> 0:02:24.000
<v Speaker 1>was on a run. He's on a hell of a run.

0:02:24.440 --> 0:02:28.560
<v Speaker 1>He's a billionaire overnight. His portfolio that he's managing, his

0:02:28.560 --> 0:02:31.880
<v Speaker 1>worth almost fifty billion dollars. He's got his investors four

0:02:32.000 --> 0:02:37.200
<v Speaker 1>hundred and fifty percent over the year. Yeah, gets married,

0:02:37.800 --> 0:02:41.760
<v Speaker 1>sets his wedding to get married fair. It's a whole

0:02:41.800 --> 0:02:47.000
<v Speaker 1>it's a whole situation. And he even put a thesis

0:02:47.040 --> 0:02:49.240
<v Speaker 1>out last month saying like, this is a generational by

0:02:49.280 --> 0:02:51.360
<v Speaker 1>opportunity for all of these companies that Da Da Da,

0:02:52.240 --> 0:02:55.280
<v Speaker 1>And it's like, man, the biggest gangsters, they all live.

0:02:55.760 --> 0:02:57.680
<v Speaker 1>It's on Wall Street. That's why I was so fascinated

0:02:57.720 --> 0:02:59.400
<v Speaker 1>with Wall Street when I was a kid, because I

0:02:59.400 --> 0:03:01.760
<v Speaker 1>would watch these movies and the way that they would

0:03:01.760 --> 0:03:05.919
<v Speaker 1>just move like vultures and sharks and piranhas, and it's

0:03:06.000 --> 0:03:11.680
<v Speaker 1>just so it's just so ruthless. So one fatal mistake

0:03:11.760 --> 0:03:14.000
<v Speaker 1>that he made is that he over leveraged himself. You

0:03:14.120 --> 0:03:16.480
<v Speaker 1>tell you guys that all the time he was doing

0:03:16.520 --> 0:03:20.040
<v Speaker 1>so well, that he started he started playing a leverage game.

0:03:20.280 --> 0:03:22.919
<v Speaker 2>He made a few mistakes. He made a few mistakes.

0:03:22.960 --> 0:03:25.480
<v Speaker 2>The leverage game was number one. I think investing in

0:03:25.480 --> 0:03:27.520
<v Speaker 2>those companies early was the smartest thing he did. He's

0:03:27.639 --> 0:03:31.440
<v Speaker 2>very intelligent. As he's making the money he decides to

0:03:31.520 --> 0:03:34.080
<v Speaker 2>start shorting other positions. Right, so when you're short, you're

0:03:34.080 --> 0:03:36.280
<v Speaker 2>making puts in that these things are going to depreciate.

0:03:37.240 --> 0:03:39.680
<v Speaker 2>But you got to realize when you're in this space,

0:03:39.800 --> 0:03:43.880
<v Speaker 2>especially at that billionaire club, like you're managing that money,

0:03:44.000 --> 0:03:50.240
<v Speaker 2>type of money. Your supporters are watching, but the people

0:03:50.880 --> 0:03:53.880
<v Speaker 2>who you're taking money from and taking customers from, they're

0:03:53.920 --> 0:03:57.720
<v Speaker 2>also watching. I think he might have underestimated that. In fact,

0:03:57.760 --> 0:04:00.600
<v Speaker 2>I definitely know he underestimated that. Because this is great

0:04:00.720 --> 0:04:02.440
<v Speaker 2>when you're the golden child and hey, this is a

0:04:02.520 --> 0:04:05.400
<v Speaker 2>new hatch fun. This kid is twenty five years old. He's,

0:04:05.440 --> 0:04:07.360
<v Speaker 2>you know, the wolf, the real Wolf of Wall Street.

0:04:07.360 --> 0:04:10.560
<v Speaker 2>At this point, the old guard is looking at it like, wait,

0:04:11.360 --> 0:04:14.040
<v Speaker 2>how's he getting these returns? Number one? Is he taking

0:04:14.080 --> 0:04:17.120
<v Speaker 2>our clients? Number two? And how can we stop him?

0:04:17.200 --> 0:04:17.680
<v Speaker 2>Number three?

0:04:18.680 --> 0:04:20.680
<v Speaker 1>It's like it's like the as No so on back

0:04:20.720 --> 0:04:23.839
<v Speaker 1>in the days. It's like when we first started, nobody

0:04:23.880 --> 0:04:28.440
<v Speaker 1>noticed us, nobody gave a shit. But the bigger we get,

0:04:28.680 --> 0:04:33.560
<v Speaker 1>the more we're taking from other people. So he starts,

0:04:33.640 --> 0:04:36.760
<v Speaker 1>he starts to take market share, he starts to leverage,

0:04:36.800 --> 0:04:39.520
<v Speaker 1>he starts to be very vocal. He has to be

0:04:39.560 --> 0:04:42.880
<v Speaker 1>taught a lesson. So all of these stocks that he

0:04:43.000 --> 0:04:48.320
<v Speaker 1>invests in all of a sudden have historically bad month. Yeah,

0:04:48.400 --> 0:04:52.960
<v Speaker 1>down thirty five percent, down, forty down, fifty percent, historic

0:04:53.760 --> 0:04:58.440
<v Speaker 1>drop in the portfolio, which forced simultaneously.

0:04:58.760 --> 0:05:02.359
<v Speaker 2>Simultaneously, as the stocks are dropping, the ones that he

0:05:02.440 --> 0:05:06.400
<v Speaker 2>puts shorts on are appreciating, right, So those companies are

0:05:06.400 --> 0:05:08.760
<v Speaker 2>actually going up in price. So like if you look

0:05:08.760 --> 0:05:11.320
<v Speaker 2>at a Service now which is shorted, it's going up

0:05:11.360 --> 0:05:13.920
<v Speaker 2>in price. You look at a Microsoft going up in

0:05:13.960 --> 0:05:17.839
<v Speaker 2>price again, that software basket, he will shorten it. And

0:05:17.880 --> 0:05:19.480
<v Speaker 2>so they looked at it and sall right, well he's

0:05:19.480 --> 0:05:23.359
<v Speaker 2>shortened that, and he publicly made that public. Okay, let's

0:05:23.360 --> 0:05:26.160
<v Speaker 2>go put some capital in there to have those companies rise.

0:05:26.520 --> 0:05:28.880
<v Speaker 2>So as he's saying like that's gonna go down, those

0:05:28.880 --> 0:05:31.359
<v Speaker 2>companies are going up, and he's putting big bets on

0:05:31.400 --> 0:05:34.680
<v Speaker 2>this to appreciate those are coming down drastically.

0:05:34.880 --> 0:05:38.280
<v Speaker 1>So as so he's losing money left and right. He's

0:05:38.279 --> 0:05:40.160
<v Speaker 1>losing money. He's losing money because the stocks just keep

0:05:40.200 --> 0:05:42.719
<v Speaker 1>going down. MU going down crazy, saying this is going

0:05:42.760 --> 0:05:45.440
<v Speaker 1>down crazy. So these is billions of dollars this portfolio

0:05:45.520 --> 0:05:48.479
<v Speaker 1>is now in the red. And what happens when you

0:05:48.520 --> 0:05:51.800
<v Speaker 1>can't lose any more money. The bank wants their money back,

0:05:52.080 --> 0:05:55.760
<v Speaker 1>so they start calling his margin costs, which forces him

0:05:55.800 --> 0:06:00.880
<v Speaker 1>to liquidate stocks in mass and it gets so bad.

0:06:01.360 --> 0:06:04.160
<v Speaker 1>It gets so bad for him within a couple of weeks.

0:06:04.520 --> 0:06:08.200
<v Speaker 1>Last week he was faced with the predicament that he

0:06:08.240 --> 0:06:11.640
<v Speaker 1>had to liquidate his whole entire portfolio. And who called

0:06:11.720 --> 0:06:16.520
<v Speaker 1>him the godfather Ken Ken Griffin.

0:06:17.360 --> 0:06:20.080
<v Speaker 2>Yeah, not that kN Griffin, the real Kan Griffin, Griffin,

0:06:20.200 --> 0:06:23.120
<v Speaker 2>Citadel Citadel's Kan Griffin, Citadel's King Griffin.

0:06:23.160 --> 0:06:24.760
<v Speaker 1>If you don't know who he is, google.

0:06:25.160 --> 0:06:28.400
<v Speaker 2>The one of the wealthiest people on the planet, their godfather.

0:06:28.720 --> 0:06:33.320
<v Speaker 2>Last year he brought in thirty three billion dollars thirty

0:06:33.320 --> 0:06:33.839
<v Speaker 2>three billion.

0:06:33.960 --> 0:06:38.120
<v Speaker 1>The boss of all bosses gave him a call, I

0:06:38.160 --> 0:06:41.360
<v Speaker 1>believe it was Wednesday, this happened, yep, and said, look,

0:06:41.520 --> 0:06:43.440
<v Speaker 1>I know that you you know you're in a bad

0:06:43.480 --> 0:06:48.719
<v Speaker 1>spot right now. I'll buy your entire portfolio, probably thirty

0:06:48.720 --> 0:06:52.440
<v Speaker 1>percent on a dollar, got a deep discount, brought his

0:06:52.600 --> 0:06:54.040
<v Speaker 1>entire portfolio.

0:06:53.640 --> 0:06:55.600
<v Speaker 2>But he was allowed to keep some of his portfolio.

0:06:55.600 --> 0:06:57.760
<v Speaker 2>We gotta give him on all FI ten he had,

0:06:57.800 --> 0:07:00.720
<v Speaker 2>so he has private investments. He was invested in and anthropic.

0:07:00.800 --> 0:07:03.040
<v Speaker 2>They allowed him to keep that. But the margin call.

0:07:03.160 --> 0:07:05.359
<v Speaker 2>And this is why we tell people like yo, be careful,

0:07:05.480 --> 0:07:08.120
<v Speaker 2>don't don't play with margins, because when it margin call happens,

0:07:08.240 --> 0:07:10.800
<v Speaker 2>you don't have that capital. They're gonna call you once

0:07:11.640 --> 0:07:13.559
<v Speaker 2>and they're not gonna call you again. They're just gonna

0:07:13.600 --> 0:07:16.720
<v Speaker 2>start liquidating the portfolio in general. So if you had

0:07:17.080 --> 0:07:19.040
<v Speaker 2>ten thousand shits or something, you're like, oh no, I

0:07:19.040 --> 0:07:21.440
<v Speaker 2>don't want to sell that because I'm trying to hold

0:07:21.440 --> 0:07:23.480
<v Speaker 2>onto that I can get the money. Say what, They're

0:07:23.480 --> 0:07:27.200
<v Speaker 2>gonna call you once. They not calling you again. They're

0:07:27.240 --> 0:07:30.880
<v Speaker 2>liquidating everything they can to get their money back.

0:07:31.560 --> 0:07:34.960
<v Speaker 1>And what so what happens? Okay, so he's had a

0:07:35.040 --> 0:07:37.920
<v Speaker 1>terrible moth. His portfolio goes down forty percent, the margin

0:07:37.960 --> 0:07:40.600
<v Speaker 1>calls get called. Ken hits him in the middle of

0:07:40.600 --> 0:07:42.360
<v Speaker 1>the night like, look, I'll take this off your hands

0:07:42.360 --> 0:07:44.400
<v Speaker 1>because you have to get rid of it. He really

0:07:44.440 --> 0:07:46.840
<v Speaker 1>has no option at this point in time. They squeezed

0:07:46.880 --> 0:07:48.880
<v Speaker 1>him out. He had to sell. He sold his He

0:07:48.920 --> 0:07:52.200
<v Speaker 1>sold the majority of his whole portfolio to King Griffin

0:07:53.200 --> 0:07:59.240
<v Speaker 1>and the next day are his historic rally, A historic

0:07:59.320 --> 0:08:01.360
<v Speaker 1>rally happened the next day.

0:08:01.600 --> 0:08:03.920
<v Speaker 2>I think as the news broke, the rally was happening.

0:08:04.400 --> 0:08:07.560
<v Speaker 2>That broke like Wednesday morning, and by nine thirty you

0:08:07.720 --> 0:08:10.760
<v Speaker 2>just saw a reversal on all these these companies. Mike

0:08:10.760 --> 0:08:13.920
<v Speaker 2>Crown was up twenty percent, saying this up twenty seven percent,

0:08:14.120 --> 0:08:17.800
<v Speaker 2>Western Digital up twenty percent, Coral were up fourteen percent,

0:08:17.880 --> 0:08:22.120
<v Speaker 2>Idyots up fifteen percent. Then, I mean, the timing of

0:08:22.160 --> 0:08:24.760
<v Speaker 2>it speaks valumes.

0:08:24.800 --> 0:08:28.400
<v Speaker 1>And you know what the craziest part is, it was

0:08:28.480 --> 0:08:29.920
<v Speaker 1>a week before his wedding.

0:08:30.360 --> 0:08:32.079
<v Speaker 2>A day two days. He got married this week and

0:08:32.120 --> 0:08:33.120
<v Speaker 2>he was supposed to get I don't know if he

0:08:33.120 --> 0:08:34.880
<v Speaker 2>got married this weekend, but the wedding was supposed.

0:08:34.520 --> 0:08:41.320
<v Speaker 1>To be the week So allegedly Wall Street plotted against him,

0:08:41.800 --> 0:08:45.480
<v Speaker 1>tanked stocks on purpose, squeezed him out of his position,

0:08:46.040 --> 0:08:50.040
<v Speaker 1>brought his portfolio for pennies on the dollar, then skyrocketed

0:08:50.040 --> 0:08:52.920
<v Speaker 1>the stocks back up the very next day, and that

0:08:53.320 --> 0:08:56.600
<v Speaker 1>he lost his portfolio. He got squeezed out of thirty

0:08:56.600 --> 0:08:59.800
<v Speaker 1>five billion dollars and they And the cold part about

0:08:59.840 --> 0:09:02.199
<v Speaker 1>it was it was two days before the wedding.

0:09:03.840 --> 0:09:10.360
<v Speaker 2>Filthy. Now it's filthy for so many reasons. Obviously, the

0:09:10.760 --> 0:09:14.440
<v Speaker 2>money being an intelligent investor here would have helped them

0:09:14.480 --> 0:09:19.960
<v Speaker 2>out tremendously. But the idea that you want to get

0:09:20.000 --> 0:09:22.880
<v Speaker 2>into positions, especially from retail investors, we always talk about

0:09:22.880 --> 0:09:26.199
<v Speaker 2>getting in these investments and a good time watching the

0:09:26.280 --> 0:09:31.320
<v Speaker 2>moving averages, checking volume. Imagine at the institutional level, as

0:09:31.360 --> 0:09:33.960
<v Speaker 2>they're watching a SanDisk get up to twenty two hundred,

0:09:34.080 --> 0:09:36.800
<v Speaker 2>or they're watching a Micron get up to thirteen hundred,

0:09:37.280 --> 0:09:40.200
<v Speaker 2>and they weren't big on those stories early on, they're

0:09:40.240 --> 0:09:43.520
<v Speaker 2>sitting asking themselves the same thing. We're going to get

0:09:43.520 --> 0:09:45.800
<v Speaker 2>a better price for that. We're going to get a

0:09:45.800 --> 0:09:49.199
<v Speaker 2>better price for that. In fact, allegedly we're going to

0:09:49.240 --> 0:09:50.800
<v Speaker 2>make sure we get a better price for that. This

0:09:50.920 --> 0:09:54.440
<v Speaker 2>guy is becoming a golden child. He was big on

0:09:54.480 --> 0:09:57.719
<v Speaker 2>these stocks. He's run up to forty five billion. We're

0:09:57.760 --> 0:09:59.680
<v Speaker 2>going to make sure we get better prices. And better

0:09:59.720 --> 0:10:02.520
<v Speaker 2>prices came in July. Now we could say it came

0:10:02.559 --> 0:10:04.040
<v Speaker 2>at his cost, but it came at a lot of

0:10:04.040 --> 0:10:05.800
<v Speaker 2>our costs. A lot of us are in those Micron

0:10:05.880 --> 0:10:07.680
<v Speaker 2>calls and have shares. A lot of us are in

0:10:07.720 --> 0:10:09.679
<v Speaker 2>Sandus and have those shares. A lot of us, you know,

0:10:09.920 --> 0:10:12.079
<v Speaker 2>and blew them and we were in these courts core

0:10:12.160 --> 0:10:15.640
<v Speaker 2>we and so as a retail we just take the

0:10:15.679 --> 0:10:19.120
<v Speaker 2>brunt of that. Now on the flip side, was he

0:10:19.200 --> 0:10:24.520
<v Speaker 2>wrong in his investment strategy? Partially the companies were right,

0:10:24.640 --> 0:10:27.120
<v Speaker 2>they're spot on right. If they weren't, Citadel went and

0:10:27.240 --> 0:10:29.920
<v Speaker 2>came and said, hey, let me get that portfolio. So

0:10:29.960 --> 0:10:32.679
<v Speaker 2>they got the portfolio with all those companies at a

0:10:32.720 --> 0:10:35.319
<v Speaker 2>really good price, and now they have that into the future.

0:10:35.960 --> 0:10:38.800
<v Speaker 2>He didn't have time because number one, he had margin.

0:10:38.840 --> 0:10:41.680
<v Speaker 2>He was way over leverage, right, and he used margin

0:10:41.720 --> 0:10:46.400
<v Speaker 2>to get a scaled approach to his investments. But this

0:10:46.440 --> 0:10:48.760
<v Speaker 2>is this is the crazy part. As he's selling it.

0:10:48.800 --> 0:10:51.120
<v Speaker 2>You know what he's doing the same day putting out

0:10:51.120 --> 0:10:53.640
<v Speaker 2>a letter to say, you know what, I'm gonna start

0:10:53.640 --> 0:10:56.800
<v Speaker 2>a new fund and we're raising capital. I'm like, this

0:10:57.400 --> 0:10:58.280
<v Speaker 2>is like how the world work.

0:10:59.520 --> 0:11:02.040
<v Speaker 1>Its orange story of killing. You fucked me out of

0:11:02.120 --> 0:11:04.280
<v Speaker 1>thirty five billion. I'm gonna need my payback. I'm gonna

0:11:04.280 --> 0:11:07.480
<v Speaker 1>need mons the day before my wedding. Now it's all

0:11:07.520 --> 0:11:10.760
<v Speaker 1>for life. It's smoke for life. Now now I'm on

0:11:10.840 --> 0:11:13.400
<v Speaker 1>a whole different look. The dude he gonna be back,

0:11:13.720 --> 0:11:16.760
<v Speaker 1>learned his lesson. He learned not to overleverage himself. He

0:11:16.880 --> 0:11:18.800
<v Speaker 1>learned to probably be a little bit more quiet about

0:11:18.840 --> 0:11:22.880
<v Speaker 1>his moves. Look, he took it. It's a major it's

0:11:22.920 --> 0:11:26.960
<v Speaker 1>a major loss. But he's gonna have a comeback because man,

0:11:27.400 --> 0:11:29.880
<v Speaker 1>that's the origin, that's the make up origin story right there. Man,

0:11:29.880 --> 0:11:33.280
<v Speaker 1>he got he got done dirty. He got done really

0:11:33.280 --> 0:11:34.120
<v Speaker 1>really really dirty.

0:11:34.280 --> 0:11:37.199
<v Speaker 2>It's a it's a dirty game. But just no, man,

0:11:37.200 --> 0:11:42.000
<v Speaker 2>there's always somebody watching your movements. And Citadel, I mean

0:11:42.000 --> 0:11:44.560
<v Speaker 2>it's only a few companies funds that would be able

0:11:44.600 --> 0:11:49.079
<v Speaker 2>to even take on that level of acquisition. They were

0:11:49.080 --> 0:11:52.079
<v Speaker 2>one of them, and they struck right when the iron

0:11:52.160 --> 0:11:52.440
<v Speaker 2>was hot.

0:11:52.480 --> 0:11:56.480
<v Speaker 1>Now it's the diaper dot com story in many ways. Yes,