Speaker 1: Pushkin.
Speaker 2: This is Talk Easy. I'm Stan Fragoso.
Speaker 3: Welcome to the show.
Speaker 2: Today we are joined by writer and podcaster Michael Lewis.
Speaker 2: He's the host of Against the Rules and the author
Speaker 2: of several best selling books, including Liars, Poker, Moneyball, and
Speaker 2: The Big Short. His latest is called Going Infinite, The
Speaker 2: Rise and Fall of a New Time. The tycoon in
Speaker 2: question is Sam Bankman Freed, the FTX crypto mogul, who
Speaker 2: was once listed by Forbes as the richest person in
Speaker 2: the world under thirty. That was until the cryptocurrency exchange
Speaker 2: collapse last fall, when several billions from customers and investors
Speaker 2: were lent to Alameda Research, a cryptocurrency trading firm co
Speaker 2: founded by Bankman Freed. Sam now stands trial in a
Speaker 2: Manhattan federal court where he's been accused of orchestrating a
Speaker 2: scheme to siphon money from FTX into various political contributions,
Speaker 2: real estate purchases, charitable donations, and venture investments. He currently
Speaker 2: faces seven criminal counts, including wire fraud, conspiracy, and money laundering.
Speaker 2: But at each twist and turn in Sam's improbable story,
Speaker 2: there's only one person that really had a front row
Speaker 2: seat to the action Michael Lewis. Since the publication of
Speaker 2: Going Infinite in early October, the book has received a
Speaker 2: wide array of reviews. The Guardian, for one, marveled at
Speaker 2: Lewis's ability to quote, pace, structure, and humanize a story
Speaker 2: about something as dense and unfriendly as crypto. However, as
Speaker 2: Michael and I discussed at the top, others have been
Speaker 2: less charitable, including The New York Times, The Washington Post
Speaker 2: and The Atlantic, each of which have suggested in one
Speaker 2: way or another that Lewis grew too close to his
Speaker 2: subject that he failed to demonstrate quote a healthy helping
Speaker 2: of skepticism, as one Calmness wrote. But in my view,
Speaker 2: the book, much like the subject at its center, is
Speaker 2: a bit more complicated than those descriptions, and so this
Speaker 2: week I wanted to sit with Lewis to discuss the
Speaker 2: thornier elements of Going Infinite, along with the whirlwind press
Speaker 2: tour he's been on as bankman Freed remains on trial.
Speaker 2: We also discuss Sam's belief in effective altruism and all
Speaker 2: the ways in which he planned to use his money
Speaker 2: for the greater good. And then, finally, in the last act,
Speaker 2: Michael reflects on his own journalistic philosophies and how he
Speaker 2: managed to write this book in the aftermath of great
Speaker 2: personal tragedy. That's all coming up next with our guest
Speaker 2: and fellow Pushkin podcaster Michael Lewis.
Speaker 3: I hope you're intruct.
Speaker 2: Michael Lewis, Welcome back to the show.
Speaker 1: Sam's good to see you.
Speaker 2: How are you feeling anything interesting happening in your life?
Speaker 1: Well? Yes, as a matter of fact, I'm having an
Speaker 1: experience I've had versions of before where book comes out
Speaker 1: and it just kind of goes nuts. It upsets some people.
Speaker 2: A lot of people.
Speaker 1: Yeah, very angry. Yeah, a lot of people very angry.
Speaker 2: Why are they so mad at you?
Speaker 1: So let me just back up a little bit. I've
Speaker 1: had people angry with me before. The first I don't know,
Speaker 1: six weeks of Moneyball was miserable, and it was miserable
Speaker 1: because the people are right out of the gate, were
Speaker 1: people who were wedded to the old way of doing things,
Speaker 1: and it was an insult to the old way of
Speaker 1: doing things.
Speaker 2: And as a Cubs fan, I was insulted.
Speaker 1: Yeah, people were insulted. I'm trying to get my mind
Speaker 1: around the anger this time because it's a little it's
Speaker 1: a little less clear. It's not universal, highly concentrated in
Speaker 1: the United States, which is a little odd because you know,
Speaker 1: the book is about Sam Bekman freedom FTX, and the
Speaker 1: vast majority of the losses are outside of the United States.
Speaker 1: The people who you would think would be angry because
Speaker 1: they lost money are in Turkey, in China and India,
Speaker 1: and the outrage is here. I mean even so, I
Speaker 1: just came back from touring in Ireland. In England and
Speaker 1: the feeling near there is curiosity and a desire to understand.
Speaker 2: Well, those are the guiding principles of this podcast. Yes,
Speaker 2: we're the last interview you're doing on your press tour,
Speaker 2: which I know you have not been overjoyed to do,
Speaker 2: in part because the subject of your book is currently
Speaker 2: on trial and has just announced that he will be
Speaker 2: testifying later this week. Sam Bankman Fried is the founder
Speaker 2: of FTX, the cryptocurrency exchange. He plans to defend himself
Speaker 2: against claims that he orchestrated a sweeping scheme to steal
Speaker 2: as much as ten billion dollars in deposits from fts customers.
Speaker 2: He's pleaded not guilty to seven charges of fraud, conspiracy,
Speaker 2: and money laundering. If convicted, he would face what amounts
Speaker 2: to a life sentence. Now, you spent the better part
Speaker 2: of the last two years with Sam and his colleagues
Speaker 2: and his family, first as a fly on the wall,
Speaker 2: then as a kind of sounding board before we dive in.
Speaker 2: Are you surprised that Sam has elected to testify? And
Speaker 2: more importantly, do you think it's a good idea?
Speaker 1: Not surprised, because he's been adamant all along, and then
Speaker 1: he would do.
Speaker 2: It if he got the medication required, If.
Speaker 1: He got the medication required for ADHD right, And he's
Speaker 1: been adamant all along about his feeling of his own innocence,
Speaker 1: has maintained all along the gap between his perception of
Speaker 1: this event and the prosecutor's perception. So there was never
Speaker 1: like there was never in the air ideal. It was never, oh,
Speaker 1: let's talk to them about maybe five years in jail.
Speaker 1: It was I think I'm innocent, and they think I
Speaker 1: should go to jail for life. So I knew that
Speaker 1: he wanted to tell his story from the witness stand.
Speaker 1: Is it a good idea? Every lawyer in the world
Speaker 1: would tell you no.
Speaker 2: And it's including maybe his own father possibly who's an attorney.
Speaker 1: The parents long ago learned that anything they try to
Speaker 1: tell him backfires, so that they wouldn't be so unwise
Speaker 1: as to give their advice because he just does the opposite.
Speaker 1: And the reason why it's a bad idea is interesting.
Speaker 1: It isn't that like he can make it worse, because
Speaker 1: it's already as bad as it really as he can get.
Speaker 1: I mean, every lawyer in the world will also tell
Speaker 1: you that the jury is likely to convict, so you
Speaker 1: kind of think, well, why not. It's kind of a
Speaker 1: hail Mary. But if the judge takes offense at his testimony,
Speaker 1: if the judge thinks he purchases himself in the court
Speaker 1: in his courtroom, the judge has a great latitude as
Speaker 1: the sentencing, and the judge might just layer on some
Speaker 1: more years because of whatever Sam says on the stand.
Speaker 1: And I know he's been told that, so he's running
Speaker 1: that risk. And I have no idea. I haven't had
Speaker 1: any contact with him since he was put in jail,
Speaker 1: so I don't know what he's going to say.
Speaker 2: Have you tried to have contact with him.
Speaker 1: I floated the idea of going in to visit. I
Speaker 1: had a few more questions. I wanted to put to him,
Speaker 1: and everybody agreed it was a bad idea for him
Speaker 1: to let me in because the prosecutors were already agitated
Speaker 1: about my presence in his life.
Speaker 2: Now you've said that the prosecution has one story, the
Speaker 2: defense has another story, which we're about to hear, which
Speaker 2: we're about to hear for the first time. You've said
Speaker 2: that you have the best story. Why do you think
Speaker 2: that is?
Speaker 1: Because I had context for it all, Because I interviewed
Speaker 1: all these people when things were good up until November
Speaker 1: of last year. Everyone in the world wanted to be
Speaker 1: aligned with Sam Begman freed. After November, everybody wanted to
Speaker 1: The last thing they wanted was to have anything to
Speaker 1: do with him or be aligned in any way. And
Speaker 1: so I saw that. I saw both. I saw the
Speaker 1: states of mind of the participants, which have now been
Speaker 1: I think a little distorted on the witness stand and
Speaker 1: distorted by social pressure. So I had just had a
Speaker 1: text for it all. Also, there's all kinds of stuff
Speaker 1: that isn't admissible in a courtroom. It would be important
Speaker 1: for someone who's just curious about what happened, but that
Speaker 1: is irrelevant to the legal proceedings. A couple of examples
Speaker 1: the whole effective altruism angle, like what these people lived
Speaker 1: in eight and breathes for and they really did all
Speaker 1: of them. That's not come up in the courtroom. You
Speaker 1: kind of need to know that, you know, the kind
Speaker 1: of the spirit in the air and the weirdness of
Speaker 1: the whole thing. Another example the fact that it's looking
Speaker 1: increasingly like all the customers are going to get their
Speaker 1: money back. The bankruptcy people have said that they're eight
Speaker 1: point six billion dollars in customer deposits that are missing,
Speaker 1: that they found seven point three and they're sitting on
Speaker 1: at least one one private investment that seems to be
Speaker 1: worth several billion dollars. That's not admissible in the courtroom.
Speaker 1: It's sort of like when you tell someone over dinner that, oh,
Speaker 1: by the way, there's likely to be close to full recovery.
Speaker 1: Their jaws are on the floor. What do you mean,
Speaker 1: I thought he stole all the money? Well, he put
Speaker 1: the money in the wrong place and used it for
Speaker 1: his own purposes when he should have and he put
Speaker 1: people at risk that he shouldn't have put at risk,
Speaker 1: which is a crime, which is all of course. So
Speaker 1: it's like the courtroom has a very narrow purpose, and
Speaker 1: my purpose is just much broader.
Speaker 2: If we had had dinner in October of twenty twenty two,
Speaker 2: at that point, FDx had ten million account holders, to
Speaker 2: whom it owed eight point seven billion dollars. It had
Speaker 2: generated a billion dollars in twenty twenty one, it was
Speaker 2: likely to do the same in twenty twenty two, even
Speaker 2: despite crypto prices crashing. It was on the surface a
Speaker 2: booming business, with venture capitalists suggesting that Sam could be
Speaker 2: the first trillionaire. So if we were to have that dinner,
Speaker 2: how would you explain the book you were writing at
Speaker 2: the time.
Speaker 1: It's funny you asked this question because I had that
Speaker 1: dinner at the very beginning of November with a friend
Speaker 1: who was a film director. It wasn't a dinner, it
Speaker 1: was a cup coffee. But I really like his storytelling,
Speaker 1: Chops like, I really kind of He's a good sounding board.
Speaker 1: And the point of the conversation was, I don't know
Speaker 1: if I have a book, and so I've been sitting
Speaker 1: with this guy for a year. Let me just tell
Speaker 1: you this material, and let me tell you why I
Speaker 1: haven't decided whether I'm going to write it. Or not,
Speaker 1: and I sort of laid out what I knew about
Speaker 1: Sam Bankman Freed. I laid out it was effectively the
Speaker 1: first six chapters of the book.
Speaker 2: So how did you do that?
Speaker 1: In conversation, I said, here's this character, born without a
Speaker 1: full complement of human feeling, born without empathy, born without
Speaker 1: ability to feel pleasure, who lives a completely isolated childhood,
Speaker 1: isolated beyond belief, given that he's being raised by two
Speaker 1: Stanford law professors on the Stanford campus who were quite
Speaker 1: social people themselves and had a brother, and had a
Speaker 1: brother who regarded him as a tenant in the house
Speaker 1: because he didn't have anything to do with each other.
Speaker 1: This person sort of compensates for what he lacks by
Speaker 1: taking what he can do and imposing it on the world.
Speaker 1: What he can do is math calculations. He can think quantitatively, analytically,
Speaker 1: and so he kind of turns life into this math
Speaker 1: problem and would seem to not fit anywhere in the
Speaker 1: world until he collides with Wall Street Wall Street and
Speaker 1: its modern incarnation, high frequency trading, And when he collides
Speaker 1: with that, he finds what he thinks is special about himself.
Speaker 1: It's a particular kind of problem solving. It isn't exactly math.
Speaker 1: It's making decisions, aren't calculations in semi chaotic environments, environments
Speaker 1: where there isn't you can't get to a right answer.
Speaker 1: You can just get to a better answer. It's not
Speaker 1: playing chess. It's playing chess on a clock where you
Speaker 1: have to make a move every five seconds and the
Speaker 1: rules change, like the rules change every five minutes, so
Speaker 1: the pieces the queen's become pawns or whatever. So you're
Speaker 1: dealing with this kind of chaotic environment. But where it
Speaker 1: does help to have a quantitative, analytical kind of aptitude,
Speaker 1: and it happens to be Those are the kind of
Speaker 1: tests they put him through. His Jane Street is his
Speaker 1: high frequency trading for him in order to before they
Speaker 1: hire him, and he's exceptional at it, and this defines him.
Speaker 1: And what I'm telling the film Rector is I'm so
Speaker 1: interested in this character because he goes from being having
Speaker 1: no place in the world to sitting at the center
Speaker 1: of the world. He goes from being nobody to being,
Speaker 1: you know, the richest person in the world under thirty
Speaker 1: and he's an octopus with his tentacles everywhere.
Speaker 2: At that point, what did the center look like.
Speaker 1: The center is bizarre because of where he is is
Speaker 1: the Bahamas. He's in the jungle hut you know that
Speaker 1: with and in a fancy condominium that he sleeps in.
Speaker 1: But the office is this nondescript hout in the middle
Speaker 1: of the jungle in the southern part of the main
Speaker 1: island of the Bahamas. But what does it look like?
Speaker 1: It looks like the fanciest, most celebrity drenched dinner party
Speaker 1: you've ever been to. You name the famous person in
Speaker 1: there there and the person who you don't recognize, Sam
Speaker 1: Bankman Freed in shorts and a T shirt and droopy
Speaker 1: white sox with his hair all over the place is
Speaker 1: the center of attention. Everybody's around, hanging on every word,
Speaker 1: and he's just starting to have in luance every which way.
Speaker 1: And so the question is like, what is this telling
Speaker 1: us about the world? That was always what interested me
Speaker 1: about him. So I'm telling the film director this story.
Speaker 1: It takes me an hour to get through it, and
Speaker 1: he says, this is interesting. He says, you have a
Speaker 1: problem that this story does not have a third act.
Speaker 1: You don't know where it's going, so you don't have
Speaker 1: an ending. So it's not a movie, he said. He said,
Speaker 1: but you're a good enough writer. You can fool the
Speaker 1: reader into thinking you have an ending, and you probably
Speaker 1: it's also interesting. You should probably just write it. Three
Speaker 1: days later, FTX falls apart and he writes and says,
Speaker 1: can I direct the movie? It's like, this is incredible.
Speaker 2: You mentioned in court that they have not brought in
Speaker 2: effective altruism, which is sort of his entire mode of
Speaker 2: operation is based on. That. Is that what initially brought
Speaker 2: you into the story, that made you interested in him.
Speaker 1: It was one of the things that made me interested
Speaker 1: in him. I had this long standing curiosity about effective altruism.
Speaker 1: I didn't know the name, but back in I would
Speaker 1: it had been. It had been about the time Sam
Speaker 1: was starting on Wall Street twenty twelve, thirteen fourteen. I
Speaker 1: started to hear from friends about this guy they'd hired.
Speaker 1: It wasn't Sam, some other person who had come to
Speaker 1: work at some Wall Street firm, not because he wanted
Speaker 1: to get rich, or rather not because he wanted to
Speaker 1: get rich for himself, because he wanted to make money
Speaker 1: to give it all away. And I thought it was
Speaker 1: such a seditious idea when I first heard it, and
Speaker 1: kind of a fun idea. I thought this like might
Speaker 1: be the one thing that could sink Wall Street is
Speaker 1: that everybody there was actually there just to give the
Speaker 1: money away. So I had taken a slight interest in
Speaker 1: it long ago without knowing what it was, and that
Speaker 1: when I finally meet this dude who actually has done
Speaker 1: this in such a big way, it's one of the
Speaker 1: things that interests me.
Speaker 2: So you two go on a hike that first meeting.
Speaker 1: A walk, A walk, a two hour walk, A two
Speaker 1: hour walk.
Speaker 2: Yeah, we don't want to overemphasize his athletic prowess, yes
Speaker 2: or mine? You used to play baseball? Come on, come on,
Speaker 2: so tell me when you replay that converse now, can
Speaker 2: you still recall what exactly pushed you over the edge
Speaker 2: to say I need to spend the next couple of
Speaker 2: years of my life with him.
Speaker 1: I didn't say I need to spend the next couple
Speaker 1: of years of my life with him. I said to
Speaker 1: him at the end of two hours, this is so strange.
Speaker 1: Can I just come watch? I just want to be
Speaker 1: an observer in your life for a while and see
Speaker 1: what there is to do here, and the things that
Speaker 1: struck me as strange or interesting won the sums of
Speaker 1: money Forbes was either had just we was about to
Speaker 1: declare him worth twenty two and a half billion dollars.
Speaker 1: He was a child of two liberal law professors at Stanford. Clearly,
Speaker 1: in most other moments in human history, he would have
Speaker 1: been at best like a physics professor. He wasn't interested
Speaker 1: in money the way Wall Street people normally are, so
Speaker 1: that it was a different vibe about the money. It
Speaker 1: was like more ambitious in when I'm going to use
Speaker 1: it to do the fact he was quite open about
Speaker 1: how he was meddling in politics. He was The newspapers
Speaker 1: had him as Biden's second biggest donor. He said, no,
Speaker 1: I'm actually only the seventh. But still it's going to
Speaker 1: get very big. He was talking about a billion dollars
Speaker 1: into the next presidential election site. I thought that's just wild.
Speaker 1: He said something that was really interesting to me. He said,
Speaker 1: there's not enough money in politics, and I thought, I
Speaker 1: have always had the opposite view, and I thought, but
Speaker 1: his point was, when you see what the stakes are,
Speaker 1: and you see that the rules have changed to allow
Speaker 1: rich people to do basically whatever they want to do,
Speaker 1: it's amazing that rich people aren't doing even more that
Speaker 1: that was a very interesting kind of take on the
Speaker 1: whole thing, and if he was going to follow through
Speaker 1: on this, he was going to be a big deal
Speaker 1: in the elections. But by that point, the crypto markets
Speaker 1: had gone from being worth you know, cryptos as a
Speaker 1: as an asset class, gone from being worth zero in
Speaker 1: two thousand and eight to two trillion dollars, and I
Speaker 1: had taken I was thinking, I wonder what the social
Speaker 1: consequences of that kind of instant wealth creation is. Like,
Speaker 1: You've got people walking around two trillion dollars in their
Speaker 1: pocket who didn't have anything before, and here was this
Speaker 1: walking example of it that crypto had yielded it for
Speaker 1: him in a matter of eighteen months, twenty two billion dollars.
Speaker 1: I was kind of thinking, like, maybe he's a way
Speaker 1: to get it that, like the social consequences, So I
Speaker 1: just went and loitered for a year.
Speaker 2: So as you're loitering, he begins to explain that this
Speaker 2: effect of altruism, in part comes from Will mccaskell. This
Speaker 2: earn to give philosophy should you do good or make
Speaker 2: money and pay other people to do good? That anyone
Speaker 2: basically with the ability to go to wall Street has
Speaker 2: something like a moral obligation to do so. But when
Speaker 2: it comes to Sam, he described himself in one exchange
Speaker 2: with a colleague as quote, not really having a soul.
Speaker 2: In the end, there's a pretty decent argument that my
Speaker 2: empathy is fake, my feelings are fake, my facial reactions
Speaker 2: are fake. You yourself said that he does not have the
Speaker 2: full complement of human feelings. He does not have empathy.
Speaker 2: So if everything in his life is fake, do you
Speaker 2: believe his interest and effective altruism.
Speaker 1: Is fake his reasons not fake? Isn't explain that, Well,
Speaker 1: he's not attracted to effective altruism because he's got an
Speaker 1: emotional attachment to other people. I mean, the mistake people
Speaker 1: make is, oh, you're an effective altress because you really
Speaker 1: cared deeply about other people, like individual other people. You're
Speaker 1: saying he cares about mind, cares about math and humanity.
Speaker 1: Is like that seemed abstractly to be something he should
Speaker 1: be servicing, and the math is this is the best
Speaker 1: way to do that. Peter Singer would be the oldest
Speaker 1: living sort of exponent of this. That you have the
Speaker 1: idea that you have. The Singer idea is that you
Speaker 1: have you have a duty not just to the people
Speaker 1: around you, but to people you don't even know. The
Speaker 1: argument is, you have an obligation to give if sort
Speaker 1: of the cost to you is less than the benefit
Speaker 1: to others, it's a hard way to live.
Speaker 2: Did you buy that way of living?
Speaker 1: I admired the spirit of it. I admired the idea
Speaker 1: of expanding your circle of empathy or caring about people.
Speaker 1: To get someone to buy in that into that argument,
Speaker 1: don't go be a doctor in Africa, but instead go
Speaker 1: be a banker and pay to have ten doctors go
Speaker 1: to Africa. It really helps if they don't actually get
Speaker 1: any emotional benefit to physically helping other people, you know,
Speaker 1: there's no feeling there to start with, they just buy
Speaker 1: the argument. But once you're in this argument and the
Speaker 1: argument is about, and this is what these philosophers that
Speaker 1: are at Oxford eventually do. They morph the movement away
Speaker 1: from helping living people on the planet now to maximizing
Speaker 1: the lives you say, for all eternity. And so this
Speaker 1: is the real weirdness to the movement that Sam buys into,
Speaker 1: and that actually the movement buys into is when it
Speaker 1: flips to existential risk. And Sam, if you when I
Speaker 1: meet him, he's on the practical end of the spectrum
Speaker 1: of the people in this conversation because he's thinking, yeah,
Speaker 1: there's this list of risks less asteroid strikes or climate
Speaker 1: change or AI for example, pandemic or pandemic prevention, and
Speaker 1: or Donald Trump's democracy or actually the actually Donald Trump
Speaker 1: is on his list. There is a kind of like
Speaker 1: ven diagram. It's the risks in one circle, but the
Speaker 1: tractability of them in another circle. Like some of these things,
Speaker 1: you don't know what to do about them. I mean,
Speaker 1: what do you give money to just to prevent AI
Speaker 1: from right now? It's very hard to know. But when
Speaker 1: we were on that walk, one of the things that
Speaker 1: did interest me was, I just come out of writing
Speaker 1: the Premonition. It was appalling to me the governments weren't
Speaker 1: being more aggressive on the subject of especially building a
Speaker 1: better a kind of better prediction a model for disease.
Speaker 1: There is every reason why we should be building essentially
Speaker 1: a national weather service for disease. And the lack of
Speaker 1: real energy behind that movement, not that it doesn't exist,
Speaker 1: it's just sort of lack of energy was shocking to me.
Speaker 1: And it was really interesting to me that a private
Speaker 1: citizen was talking about generating the wealth he needed in
Speaker 1: order to do such a thing. So that partly interested
Speaker 1: me too.
Speaker 2: So if that describes like the principled approach to his work,
Speaker 2: I want people to understand how he views life probabilistically.
Speaker 2: And to do that, I thought we'd read from a
Speaker 2: chapter of your book entitled how to Think about Bob?
Speaker 1: Who do you want me to do it? You want
Speaker 1: to do it? You talk easier than I do, so
Speaker 1: you know, look, all right, that's funny. You pick this
Speaker 1: passage because I think it's like an important passage.
Speaker 2: It is against the rules for me to read your book.
Speaker 1: Okay, do you.
Speaker 2: Want to set up any context for this or does it? So?
Speaker 1: I'll do some content. I'll do a little context so
Speaker 1: that this is the this is the foreshadowing of the
Speaker 1: collapse that's going to happen. Four years later, Sam has
Speaker 1: just started a crypto trading hedge fund with nothing but
Speaker 1: a bunch of effective altrusts. Within two months, they're at
Speaker 1: each other's throats, and half the effect of altrus think
Speaker 1: Sam is either so catastrophically disorganized and chaotic or possibly
Speaker 1: criminal that they up and quit, and the immediate subject
Speaker 1: of conversation is some money that's been missing, just like
Speaker 1: not like stolen, but like lost, like you lost your keys.
Speaker 2: And this is not money lost at FTX.
Speaker 1: No, this is alimeter research before FTX.
Speaker 2: This is another project.
Speaker 1: This is back in twenty eighteen. And the money is
Speaker 1: in the form of a crypto tooken called ripple, and
Speaker 1: so I'll start with that. Sam is arguing, we don't
Speaker 1: need to worry about the ripple, it'll turn up. His
Speaker 1: colleagues are arguing, that's four million dollars of other people's
Speaker 1: money we should worry about it.
Speaker 2: Sounds awfully familiar to Yes, the reframe we've been hearing lately.
Speaker 1: This is exactly right. The missing Ripple reminded him of
Speaker 1: a favorite thought experiment. You have a close friend, Bob,
Speaker 1: he explained, he being Sam. He's great, you love him.
Speaker 1: Bob is at a house party where someone gets murdered.
Speaker 1: No one knows who the murderer is. There are twenty
Speaker 1: people there. None are criminals. But Bob is less likely
Speaker 1: in your mind than anyone else to have killed someone.
Speaker 1: But you can't say that there's zero chance Bob killed someone.
Speaker 1: Someone got killed, no one knows who did it. You
Speaker 1: now think there's like a one percent chance Bob did it.
Speaker 1: How do you see Bob now? What is Bob to you?
Speaker 1: And there's no updating, there's no new information about Bob.
Speaker 1: One answer was that you should never go near Bob again.
Speaker 1: There might be a ninety nine percent chance that Bob
Speaker 1: is the saint you always thought him to be, but
Speaker 1: if you're wrong, you're dead. Treating Bob's character as a
Speaker 1: matter of probability felt problematic. Bob was either a cold
Speaker 1: blooded killer or he wasn't. Whatever probability you assigned before
Speaker 1: you found out the truth about Bob would appear after
Speaker 1: the fact unfair and even absurd. There doesn't exist a
Speaker 1: guess you can make that is overwhelmingly likely to be
Speaker 1: roughly correct, said Sam. Bob is either completely blameless or
Speaker 1: far more guilty, and yet assigning a probability to Bob's
Speaker 1: character was, in Sam's view, the only way to think
Speaker 1: about him, or indeed any uncertain situation. It's not good
Speaker 1: enough to say Bob's not the kind of guy I
Speaker 1: want to be around. So what is the probability at
Speaker 1: which you say, Okay, I'm going to just stay away
Speaker 1: from Bob until this was resolved, said Sam. It's sort
Speaker 1: of mind bending. There's no way to deal with Bob
Speaker 1: right now. That's just.
Speaker 2: The next line is my favorite, which I'll do okay.
Speaker 2: Life's uncertainties often made a mockery of a probabilistic approach,
Speaker 2: but in Sam's view, there was really no other approach
Speaker 2: to take. A lot of things are like Bob, said Sam.
Speaker 2: I thought that the ripple was like Bob would either
Speaker 2: get it back or not. I like how you were
Speaker 2: mouthing your own words as I was reading that.
Speaker 1: Sorry about that. Yeah, I laugh at my own jokes too,
Speaker 1: so I'm sorry about that. The punchline in this is
Speaker 1: that over the ripple, the ten effective altrus is quit
Speaker 1: and then they find the ripple, confirming in the minds
Speaker 1: of the other people who stayed behind, a group that
Speaker 1: includes the current witnesses in the trial and the shots
Speaker 1: seeing Caroline Ellison and Gary Wang, that Sam was kind
Speaker 1: of right all along.
Speaker 2: So he is redeemed in some way. But what do
Speaker 2: you think that story in terms of foreshadowing, What do
Speaker 2: you think that story tells us about his way of
Speaker 2: moving through the world, about his psychology that.
Speaker 1: He doesn't have firm principles. Everything is shifting odds.
Speaker 2: Which could be a problem when running a company. Yes,
Speaker 2: what you're saying is reminded me of a passage of
Speaker 2: a piece of writing that actually comes from Sam's mother, Barbara.
Speaker 2: She wrote an essay. We haven't really talked about Sam's
Speaker 2: parents much, but they both were Stanford law professors. By
Speaker 2: all accounts, upstanding, downful people, accomplished in their respective fields.
Speaker 2: But she wrote an essay in twenty twelve in The
Speaker 2: Boston Review titled Beyond Blame. Have you read this?
Speaker 1: I've heard it.
Speaker 2: I want to read a little bit from it. The
Speaker 2: piece is about the philosophy of personal responsibility and how
Speaker 2: it is ruined criminal justice and economic policy, and how
Speaker 2: it's time to move past blame, which is exactly, by
Speaker 2: the way, when I did something wrong as a child,
Speaker 2: that exactly how my mom would render how we should
Speaker 2: move forward, which I don't think we should really blame.
Speaker 2: My mom was also an attorney, so she writes in
Speaker 2: the piece, the reality is that we are all at
Speaker 2: best compromised agents, whether by biology, social circumstance, or brute luck. Tellingly,
Speaker 2: the more information people have about the context of the crime,
Speaker 2: the person who committed it and the circumstances he or
Speaker 2: she came from. The more nuanced are their views of
Speaker 2: moral responsibility.
Speaker 1: What do you think of that?
Speaker 2: What do you think of that?
Speaker 1: Now? What do you think of that?
Speaker 2: No, what do you think of that?
Speaker 1: Well? I think it's interesting that the second part of
Speaker 1: it is just a statement of fact. I think I
Speaker 1: think it is true that the more you know about
Speaker 1: the circumstances of any crime, the more you know about
Speaker 1: the person, the more complicated your response is to it.
Speaker 1: And that we also live in a society that isn't
Speaker 1: terribly interested in that, that we jail people at a
Speaker 1: rate that's unseen anywhere out in the world, right to punish.
Speaker 1: I think that's an interesting point of view, and I
Speaker 1: think I think she's that observation is not wrong. Is
Speaker 1: it a useful way to parent your child that, I
Speaker 1: don't know, like teaching them that you we're not gonna
Speaker 1: blame you for anything. I don't parent my child that way.
Speaker 2: I guess what I'm getting at. Early in this conversation,
Speaker 2: you said Sam's parents had long given up trying to
Speaker 2: teach him anything. It seems to me that maybe they
Speaker 2: didn't get a lot of things through but they seem
Speaker 2: to have crafted part of his guiding principles.
Speaker 1: So this is true. It's also interesting how he and
Speaker 1: his brother view this because he and his brother emerged
Speaker 1: from this household self conscious utilitarians consequentialists. You move through
Speaker 1: life evaluating your decisions, evaluating your actions, evaluating other people
Speaker 1: based on their consequences rather than their intent. And the
Speaker 1: principle you are gunning for is the greatest good for
Speaker 1: the greatest number. So when you see something like the
Speaker 1: famous trolley problem where you're on a trolley and the
Speaker 1: trolley's rolling down the track and it's about to roll
Speaker 1: over four people, but you can pull a switch and
Speaker 1: send it on a side rail that kills only one person,
Speaker 1: doesn't even occur to you not to pull the switch.
Speaker 1: They don't have a problem with that kind of thing.
Speaker 1: It's like you're evaluating actions based on their consequences. You
Speaker 1: were trying to maximize good and minimize bad. The brut
Speaker 1: but I was going to say, is that this isn't
Speaker 1: from Sam, this is from his brother. Because I pushed on,
Speaker 1: I pushed on both of them. I said, it is
Speaker 1: kind of amazing that you two both think you've come
Speaker 1: to your own principles all by yourself, but they happened
Speaker 1: to be kind of close to your parents' principles. They
Speaker 1: extended their parents' principles like their parents were not fond
Speaker 1: of effective altruism, very hostile to it in fact. But Gabe,
Speaker 1: Sam's brother, said, this looks like, oh, our parents influenced us,
Speaker 1: and surely they must have in some way, but in
Speaker 1: real time, it felt like we came to these ideas ourselves.
Speaker 1: So it's funny how they interpreted this. The point isn't
Speaker 1: that Sam wasn't influenced by his parents. The point was
Speaker 1: Sam resisted the eye idea that he was influenced by
Speaker 1: his parents at the same time he was influenced by
Speaker 1: his parents.
Speaker 2: Is that because he thinks anyone over the age of
Speaker 2: forty five is meaningless and useless.
Speaker 1: Yes. I think it's because he had vanity about his
Speaker 1: own mind, and part of the vanity was everything that
Speaker 1: happened into it in it was his doing. It was
Speaker 1: very hard to get him to point to influences. He
Speaker 1: sort of liked the idea that he was thinking everything
Speaker 1: up by himself. From first Principles.
Speaker 2: Were bright back with writer Michael Lewis coming back why
Speaker 2: don't we talk about some of who is doing Because
Speaker 2: from November two to November twelfth of twenty twenty two,
Speaker 2: FTX goes from having seemingly limitless potential to being on.
Speaker 1: Its last legs, being bankrupt.
Speaker 2: I was being generous. Now that we're a year removed
Speaker 2: from that ten day catastrophe, how do you understand what happened?
Speaker 1: So this is my best guest. I mean this is
Speaker 1: also taking some stuff that came up in the trial.
Speaker 1: You start with a person who is vain about his
Speaker 1: risk management abilities, thinks he's maybe like God's gift to
Speaker 1: managing financial risk. You couple it with a character who
Speaker 1: has almost psychological need for a chaotic environment. So I
Speaker 1: think in the very beginning they create FTX, they don't
Speaker 1: do the first thing you would do is segregate the
Speaker 1: customer's funds from your funds. They didn't do this in
Speaker 1: the original hedge fund all. But I'll jumble together with
Speaker 1: Sam's money with the investors' money. So you haven't you
Speaker 1: already have a problem right from the beginning. That's real
Speaker 1: clear that like the customer's money is available to out
Speaker 1: Talameda if it wants to use it. Flash forward to
Speaker 1: June of twenty twenty two. I think in May of
Speaker 1: twenty twenty two, certainly like April twenty twenty two, if
Speaker 1: all the customers of FTX had showed up and said
Speaker 1: we want our dollars and bitcoin and whatever back, I
Speaker 1: think they would have gotten them back. There was the
Speaker 1: money was there. The prosecutor seemed to not be pushing
Speaker 1: this point, but a combination of crypto collapsing and crypto
Speaker 1: lenders who lent money to Alameda asking for their loans
Speaker 1: back caused Sam with Caroline to make a decision to
Speaker 1: pay lenders back their money and use the depositors' money
Speaker 1: in their place. That seems to be what happened. That's
Speaker 1: what Caroline says happened. Do you believe that, Yes, we
Speaker 1: know they did that. The question is how involved he was,
Speaker 1: how where he was of what that implied for the deposits,
Speaker 1: and how much risk he was putting the customers at
Speaker 1: all that, how much money he thought was inside of Alameda.
Speaker 1: There are questions about that, But the fact is they
Speaker 1: did that, which was a weird decision because the wealth,
Speaker 1: all their wealth was tied up in FTX. If they
Speaker 1: had just said to the lenders sorry, Ris Stiff and
Speaker 1: you and all if you want to, if you want to,
Speaker 1: you want to force the issue, Alameda will go bankrupt.
Speaker 1: They'd just still had their crypto exchange. It would have
Speaker 1: taken a blow, but it would have survived. You know,
Speaker 1: all of Sam's all, the twenty two billion is his stake,
Speaker 1: All of Caroline's wealth is a stake in FTX. So
Speaker 1: it was a really strange decision. So we're going to
Speaker 1: depend at why they might have made that decision. Even
Speaker 1: though it's so strange. He's tied up with Sam's vanity
Speaker 1: about how he's perceived as a risk manager. That if
Speaker 1: he's seen as, oh, he's not the idiot who blew
Speaker 1: up a hedge fund, he couldn't stand that narrative. So
Speaker 1: then what happens from June to November. This is where
Speaker 1: it gets messy. I like that.
Speaker 2: You think this is where it gets messed, Well, this is.
Speaker 1: Where it gets really messy into sort of trying to
Speaker 1: recreate what happened. Caroline would say did say that from
Speaker 1: that moment on she lived in this state of existential
Speaker 1: dread until finally the deposits ask for their money back
Speaker 1: and they're exposed and the whole thing collapses. Naishad, who
Speaker 1: is also a party to this. Dashad Singh, who was
Speaker 1: sort of number two or number three at FTX, says
Speaker 1: he doesn't even didn't even realize there was a hole
Speaker 1: in Alameda until September.
Speaker 2: An eight point seven billion dollar hole.
Speaker 1: Maybe bigger than that, but in the end, right now
Speaker 1: it's an eight point six billion dollar hole. But they
Speaker 1: were supposed to be the gross numbers were They were
Speaker 1: supposed to be sixteen billion dollars of customer deposits on FTX,
Speaker 1: and they weren't there. They were all over the place,
Speaker 1: somewhere there, but most were like all over the place
Speaker 1: where it gets weird to be. And like, what hasn't
Speaker 1: been explained in the trial is if Caroline is in
Speaker 1: this state of existential dread for five months, why when
Speaker 1: it blows up, does she not know where the money
Speaker 1: is that they have. This is a bizarre thing. So
Speaker 1: the couple of days it's all blowing up. Other people,
Speaker 1: not Sam. Other people who are in the room are
Speaker 1: struck by banks calling them up and saying, hey, do
Speaker 1: you know that we have three hundred million dollars of
Speaker 1: your dollars? Do you want it back? And they don't
Speaker 1: know that they a bank has the dollars. And John Ray,
Speaker 1: the bankruptcy guy who's been running it, has said the
Speaker 1: same thing to me. He said, this has been like
Speaker 1: an easter eg hunt. There's money all over the place.
Speaker 1: There's money and crypto exchanges in age. Are their money
Speaker 1: in banks that they didn't have records of. If you
Speaker 1: are terrified in June of not having the money to
Speaker 1: pay customers back, wouldn't you actually gather up all this
Speaker 1: money or at least have a list of where it was.
Speaker 1: It's hard to explain why they made no effort until
Speaker 1: it all blows up to a sort of account for
Speaker 1: what they had and what they didn't have. It's messy
Speaker 1: what's going on from June to November, because they don't
Speaker 1: do the things you would think you would do if
Speaker 1: you were panicked or worried. They also the other thing's
Speaker 1: odd is in that period you would think if they're
Speaker 1: all that worried about this, they would stop spending money,
Speaker 1: and they don't stop spending money, and they don't raise money,
Speaker 1: and makes me wonder just how worried.
Speaker 2: She was you spent The good part of Sam's house
Speaker 2: arrest with him is that right.
Speaker 1: I didn't go live at his house, but I was
Speaker 1: able to id ahol passed.
Speaker 2: They didn't like pull out a cop for you or
Speaker 2: something like that.
Speaker 1: I didn't pullot a cop, but they did. And when
Speaker 1: you went, you had to notify the authorities and they
Speaker 1: met you outside the door and they took away your
Speaker 1: cell phone. But I went. Every other week, I go
Speaker 1: down and spend six or seven hours with him.
Speaker 2: So obviously you're asking him questions like how did this happen?
Speaker 2: Where do you think the money is. You've said recently
Speaker 2: in a Time magazine interview that Sam is not a
Speaker 2: serial liar, but that he is a serial withholder. Yes,
Speaker 2: explain the difference.
Speaker 1: If I'm talking to you, I say, Sam, where were
Speaker 1: you born? And you say, hah, I was born in Nashville, Tennessee,
Speaker 1: but actually you were born in Portland, Oregon. That's one
Speaker 1: kind of thing if I say Sam, where you were
Speaker 1: born and you kind of change the subject, that I
Speaker 1: never get to the answer of why you where you
Speaker 1: were born? He's very good. He was very good at that.
Speaker 1: There's a footnote in the book, and you know it's
Speaker 1: in the text of the book, but it's that tries
Speaker 1: to deliver the reader an example of just this thing
Speaker 1: he does. I asked him, all right, one of the
Speaker 1: mechanisms for the money getting from FTX into Alameda, from
Speaker 1: this exchange into your private edge fund, was that Alameda
Speaker 1: alone didn't have its risks managed by FTX, the risk
Speaker 1: engine that stopped other people from losing money on FTX,
Speaker 1: which switched off for Alameda. If I had asked you
Speaker 1: directly back in the day before things went bad, is
Speaker 1: Alameda subjected to the risk engine? What would you have said?
Speaker 1: And he says, I would have either made a word
Speaker 1: salad or I would have answered a different question. That's
Speaker 1: him being weirdly honest about being weirdly dishonest. If you
Speaker 1: asked him the right one question, and this happened to
Speaker 1: him before, when things were good, people would ask him
Speaker 1: questions and he'd get himself in trouble because if the
Speaker 1: question was exactly right, he tended to answer it. It
Speaker 1: was almost a mechanical kind of thing. But if you
Speaker 1: asked him, oh, I don't know, do you have conflicts
Speaker 1: of interest between Alameda and FTX, he would answer a
Speaker 1: question about how the kind of conflicts of interest that
Speaker 1: exist on us stock exchanges between the stock exchanges and
Speaker 1: high frequency traders kind of thing. He would answer a
Speaker 1: slightly different question.
Speaker 2: Do you think you asked him in retrospect the wrong
Speaker 2: set of questions?
Speaker 1: No, I mean he gave me answers like the one
Speaker 1: he gave me about how I wouldn't have given you
Speaker 1: the answer, So you know I got And in the book,
Speaker 1: you know, I was really careful to keep myself out
Speaker 1: of the inquisition of Sam Bankman Freed. I let other
Speaker 1: people do it, and in particular did it his chief
Speaker 1: operating officer. And I think she asked all the right
Speaker 1: questions too, she just didn't get the answers she got.
Speaker 1: I thought we had more money. Uh huh. That's a
Speaker 1: state of mind thing. It's kind of hard to the point,
Speaker 1: isn't that it's true. The point is it's hard to falsify.
Speaker 2: In the book you described Zain Packet. He was a
Speaker 2: colleague of Sam's right there.
Speaker 1: He was kind of the original crypto great there who'd
Speaker 1: been in the crypto markets for a long time and
Speaker 1: who was kind of the face of FTX to old
Speaker 1: crypto people.
Speaker 2: Well, in the book you said that he doesn't care
Speaker 2: much about why Sam dibbity did, but how he asked?
Speaker 2: Why had neither he nor anyone else he knew seen
Speaker 2: this coming? And I think this is a question that
Speaker 2: through this book tour of yours, you have been asked
Speaker 2: repeatedly you spent all this time with them? You are,
Speaker 2: of course, Michael lewis known for shrewd observations. Humanistic portraits
Speaker 2: generally have a good sense of people and why they
Speaker 2: do things. Did you really not see any of it coming?
Speaker 2: Or was it more advantageous for a potential book to
Speaker 2: not see it coming?
Speaker 1: It's certainly the latter is certainly true, but I'm not
Speaker 1: sure it's an either or a question. It's completely true
Speaker 1: that just watching and not kind of judge them too
Speaker 1: strongly was very helpful to generating the literary material for
Speaker 1: a book. That's true. But let me just point out
Speaker 1: that one hundred and twenty of the world's leading venture
Speaker 1: capitalists gave him money. I didn't give him money.
Speaker 2: Didn't you put two thousand dollars in ftx US.
Speaker 1: Only to see if it were and actually put most
Speaker 1: of it in Swiss francs.
Speaker 2: But those venture capitalists did not write Moneyball or The
Speaker 2: Big Short or liar's poet. There, I interview Obama.
Speaker 1: So on the whole place was so chaotic, so comically chaotic,
Speaker 1: that the absence of lists of employees, the absence of
Speaker 1: an organization chart, no titles matched what the person was doing,
Speaker 1: just and all the people unhappy because Sam wouldn't manage anybody,
Speaker 1: because he didn't believe in managing anybody, because he thought
Speaker 1: everybody should just manage themselves. All that stuff. So it
Speaker 1: was bound to lead to something. It was a very
Speaker 1: volatile situation.
Speaker 2: Something bad, probably bad.
Speaker 1: But the actual thing that happened did not make a
Speaker 1: lot of sense. It did not, like make a lot
Speaker 1: of sense for them to put this goal mine. They
Speaker 1: had FTX in peril for the sake of Sam's vanity
Speaker 1: trading fund, and leave Sam out of it for a minute.
Speaker 1: The other principles. If you said, oh, is the FTX depositors'
Speaker 1: money inside of Alamede instead a thing? Nobody said. By
Speaker 1: the way, zero people said that, I would have said,
Speaker 1: nobody would allow that. Mishad and Gary and Carolyn, they
Speaker 1: just wouldn't let that happen because all their wealth is
Speaker 1: tied up with FTX. They just wouldn't let it happen.
Speaker 1: It was such an idiot crime to do that, to
Speaker 1: set up the place in the first place, so that
Speaker 1: the money that's supposed to be an FTX is actually
Speaker 1: in Alameda. I did not see that coming. I did
Speaker 1: think something was going to happen that was going to
Speaker 1: give me the ending to the book.
Speaker 2: It all came tumbling down between November two and November twelfth.
Speaker 2: As I said, you did not get back down to
Speaker 2: the Bahamas until November ninth. Right at what point in
Speaker 2: that week did you realize you had a third act?
Speaker 1: Immediately? I had childcare reasons. While I could, I couldn't
Speaker 1: get down to the Bahamas on November the third or fourth,
Speaker 1: but I should have. But I got down there the
Speaker 1: day he signed the bankruptcy papers.
Speaker 2: Can you set that scene for us?
Speaker 1: It was wild. The whole book is wild, like the
Speaker 1: whole stories wild. But this was the Friday of the
Speaker 1: disastrous week. Virtually all the employees have already fled, fled
Speaker 1: so fast that they've left all their possessions in their condominiums.
Speaker 1: All the food is on the shelf, all their possessions
Speaker 1: at worker are still at work. They've just run to
Speaker 1: the airport and basically run home to their parents' basements.
Speaker 1: And I get there still there is Natalie Tin and
Speaker 1: Natalie was the important character of the book. She was
Speaker 1: Sam started out of Sam's scheduler and PR person. She
Speaker 1: ran PR for them. She knew she was the one
Speaker 1: person knew where Sam was at any given moment. So
Speaker 1: she picks me up at the airport in the Bahamas,
Speaker 1: and she has, at that point, for the first time
Speaker 1: since I've known her, no idea where Sam is. That
Speaker 1: she doesn't care anymore. She's like the whole place is
Speaker 1: blown up. She's furious with Sam. On the way there,
Speaker 1: I said, could we stop at the FTX offices because
Speaker 1: she passed them anyway. And she was really nervous about
Speaker 1: doing this because she had one of the last remaining
Speaker 1: FTX cars that had all been repossessed or dumped at
Speaker 1: the airport, and she was afraid someone's going to see
Speaker 1: her with it and they would take away her car
Speaker 1: and she wouldn't have anybody to get out. But I
Speaker 1: talked her into going to the FTX offices and it
Speaker 1: is these collection of huts in the jungle. There's no
Speaker 1: one at the guard booth. We drive around the guard booth,
Speaker 1: and in the distance is Sam walking circles around the
Speaker 1: office buildings all by himself, and he's obviously not bathed
Speaker 1: or shaved in days. He's in an agitated state of
Speaker 1: He sees us, walks over, gets in the car like
Speaker 1: we're an uber, and almost the first thing he says is,
Speaker 1: you know, it's weird to think about Saturday. Saturday everything
Speaker 1: was normal, he said, about six days earlier, everything was normal,
Speaker 1: and now his empire lay in ruins. And from then
Speaker 1: I really disquatted as best I could in the Bahamas
Speaker 1: until he was extradited.
Speaker 2: When you saw Sam there in the parking lot, you
Speaker 2: said on sixty minutes that if I were a better person,
Speaker 2: I would have been deeply distressed by all of this.
Speaker 2: What do you mean by that? A better person?
Speaker 1: If I were chiefly worried about his suffering or the
Speaker 1: suffering of those around them, I would have gone there
Speaker 1: in my head it would have been like, oh, this
Speaker 1: is all so sad, and this does happen to me.
Speaker 1: It's just how I'm wired. I was just interested, like
Speaker 1: so interested, And I was also aware that this answers
Speaker 1: the question of where this story went, and it made
Speaker 1: sense of an awful lot of what had come before,
Speaker 1: an awful lot like things that were kind of like
Speaker 1: pieces of the puzzle, and I couldn't figure out how
Speaker 1: they all fit together. They started to fit together, like
Speaker 1: the many collapse that had happened back in twenty eighteen.
Speaker 1: It all sort of like resonated in a different way.
Speaker 1: So my mind is racing with the story. I didn't
Speaker 1: feel chiefly worried about the people around me. I felt
Speaker 1: chiefly worried about my reader. And even as a father,
Speaker 1: what do you mean, even as a father, Well, you're
Speaker 1: a father, and I imagine you see a young kid
Speaker 1: whose life is falling apart, whose lives he's ruined, many
Speaker 1: many people's lives he's ruined. There was a little heart
Speaker 1: and still a little hard to know what's going to
Speaker 1: happen there. The people whose lives he ruined, or rather
Speaker 1: he caused a lot of damage.
Speaker 2: To, were colleagues.
Speaker 1: His colleagues. They all had their money on the exchange.
Speaker 1: Their reputations are in tatters. His parents, his parents, that's painful.
Speaker 1: His parents were painful for me.
Speaker 2: Why was that?
Speaker 1: Because I was watching parents lose a child, and I
Speaker 1: had lost a child. You know, I know what that
Speaker 1: feel like, I mean, it's a different way to lose
Speaker 1: a child, but I know that that was something that
Speaker 1: that's still something that's hard for me is watching them
Speaker 1: process this event. Here's a moment. It's not in the book.
Speaker 1: And maybe this is partly why maybe our partly left
Speaker 1: it out because it was just it just it seemed
Speaker 1: like too raw for them. The day he was put
Speaker 1: in jail and the Bahamas and he was put in
Speaker 1: a prison that's like, it's like it makes our prisons
Speaker 1: look pretty cush. It's it's like ranked the top ten
Speaker 1: worst prisons in the world. Or the day after they
Speaker 1: went to visit and I went with them. As we're
Speaker 1: getting in the car, his mother said to me, tell
Speaker 1: me something that will make me feel better. And I said.
Speaker 1: The first thing I said was, well, in a month,
Speaker 1: he's probably going to be home under house arrest in
Speaker 1: Stanford at your house. And she said that doesn't make
Speaker 1: me feel better. She actually said try again, and I said,
Speaker 1: you will be amazed how adaptable you are. You'll be
Speaker 1: amazed how your mind can adjust to a situation that
Speaker 1: you find right now unimaginably painful. And she said that
Speaker 1: makes me feel better now. So why do I mention
Speaker 1: this moment. I didn't think of that as material. I
Speaker 1: was actually connecting to them just as a person, as
Speaker 1: a human.
Speaker 2: Being, as a father who just lost their daughter.
Speaker 1: Right, And I was in a different emotional space than
Speaker 1: I am in almost all the time when I'm thinking
Speaker 1: about some piece of writing. There was like a famous
Speaker 1: Joan Didion moment line It's probably apocryphal where and I
Speaker 1: can't remember even what book it was from. Someone asked
Speaker 1: her how she felt when she walked into a room
Speaker 1: and she saw a five year old girl with a
Speaker 1: cocaine in her hands, and it was acid. I was
Speaker 1: an acid heye, Ashbury, you know this? Then?
Speaker 2: Do you know what she said?
Speaker 1: You tell me it was gold? It was gold. And
Speaker 1: when I'm wandering around the world thinking about how to
Speaker 1: write about something, I am filtering it that way, thinking
Speaker 1: like what's the meaning of this, Like what's the story
Speaker 1: of this? I'm not thinking. I'm not thinking I am
Speaker 1: responsible for it. I'm an observer. So I didn't feel
Speaker 1: responsible for Sam. Right, I was aware of how much
Speaker 1: damage he'd caused in other people's lives. So if anything,
Speaker 1: I was, you know, like massively irritated with Sam for
Speaker 1: that if I thought about it, but mainly I was
Speaker 1: just watching it for like, how is this going to
Speaker 1: play out?
Speaker 2: But in that moment with his mother, you said that
Speaker 2: you were not in your traditional journalistic state. You were
Speaker 2: in a different emotional state.
Speaker 1: I wasn't writing that down right, and I knew almost instinctively,
Speaker 1: I would not write about that. I'm talking about it,
Speaker 1: but I knew and that it wasn't like, oh, this
Speaker 1: isn't exactly material, because I had watched the relationship and
Speaker 1: I'd seen how far he kept them from what he
Speaker 1: was doing. Not everything like the mother received. He gave
Speaker 1: money to the mother's political causes, and his dad was
Speaker 1: involved in a lot of philanthropic efforts, but at the
Speaker 1: core of the operation, they were kept far from it,
Speaker 1: like they couldn't get on his schedule. Natalie, who kept
Speaker 1: his schedule, said, one of the biggest embarrassments for me
Speaker 1: is that the mom and dad would call up and
Speaker 1: say they went fifteen minutes with Sam, and Sam will say,
Speaker 1: you know, you know, dodge that for two weeks, and
Speaker 1: so they'd been kept at this kind of distance from
Speaker 1: the thing that had happened, and they'd been led to
Speaker 1: believe this thing about their child, that he was the
Speaker 1: richest person in the world in under thirty, that he
Speaker 1: was a miraculous human being who was going to save
Speaker 1: us all from pandemics, all that stuff, and then it
Speaker 1: was all ripped away so fast, and that they were
Speaker 1: staring right away pretty realistically at the situation that this
Speaker 1: is going to end very, very badly for him. So
Speaker 1: it was hard not to feel something for them, you.
Speaker 2: Know, when you got in the car with Sam and
Speaker 2: he said, it's so strange. Everything last Saturday was so normal,
Speaker 2: you know. In prep for this, I went back and
Speaker 2: I thought, when did you and I first talk? I
Speaker 2: found the date it was. It was May thirteenth of
Speaker 2: twenty twenty one.
Speaker 1: It was eight days before Dixie died.
Speaker 2: Yeah, And of course this book is dedicated to her,
Speaker 2: and she was just on my mind. She's been on
Speaker 2: my mind in reading this that you've had to hold
Speaker 2: that while writing this book, that you have held it
Speaker 2: while writing this book. How the hell have you done
Speaker 2: all that?
Speaker 1: She helped me? So this is she enters this book
Speaker 1: in a very curious way. There's an opening to another
Speaker 1: book I wrote called Home Game, which is a collection
Speaker 1: of basically notes on fatherhood, and it's she's the opening,
Speaker 1: and she's a little kid and she's standing up to
Speaker 1: some bullies that are trying to bully her older sister.
Speaker 1: Unbelievable act of bravery. And she was that way all
Speaker 1: the time. I mean to a fault, had this nerve
Speaker 1: in the face of what she perceived as injustice or
Speaker 1: attacks from bad people, or she was a fighter. The
Speaker 1: one thing I had to worry about writing this book
Speaker 1: was there was a mob waiting for it. I knew
Speaker 1: that if I wrote it, wrote what I thought and
Speaker 1: what I thought to be true, that lots of people
Speaker 1: are going to be angry about it. And I thought,
Speaker 1: I'm going to do this the way Dixie would do it.
Speaker 1: I'm just going to say fuck it. And so it
Speaker 1: helped knowing that her spirit was there. There's another answer
Speaker 1: to this question too, And the other answer to the
Speaker 1: question is how could I not throw myself into work
Speaker 1: When Dixie died very shortly after, like days after, it
Speaker 1: was so traumatic. I realized that, like I got a
Speaker 1: sheet of paper out and I said, draw a line
Speaker 1: on a sheet of paper on one side, put the
Speaker 1: things that make you feel worse on the other side.
Speaker 1: Make the things that put the things that make you
Speaker 1: feel better and just do the things on the left
Speaker 1: side and don't do the things on the right side.
Speaker 1: Like it's so bad that you have to sort of
Speaker 1: service yourself in order to survive. And one of the
Speaker 1: things that made me feel that her was working, loving
Speaker 1: and working, like forcing the relationships with people I love,
Speaker 1: like making sure I'm expanding the circle of love all
Speaker 1: that that, Like Dixie's loss was a loss of love,
Speaker 1: and finding love and insisting on love was really important.
Speaker 1: But work, for whatever reason, it's probably because I love
Speaker 1: my work, it was it was became even more necessary.
Speaker 1: So you know, I was grateful that a story walked
Speaker 1: into my life, even if it took me a while
Speaker 1: to figure out what it was. You are right, Yeah,
Speaker 1: all right, she was brave. I try to. I've sort
Speaker 1: of one of the things that I intend to do
Speaker 1: going forward is live as bravely as possible.
Speaker 3: Uh.
Speaker 1: And it's sort of to honor her.
Speaker 2: I want to play a clip for us from that
Speaker 2: conversation we had, Okay, and it's about the future ambition,
Speaker 2: what you passed down to your kids, how you hope
Speaker 2: they moved through the world, how you moved through the
Speaker 2: world basically a lot of what we've been talking about
Speaker 2: in this back and forth. And I wonder just where
Speaker 2: it lands with you now.
Speaker 1: I mean, to this day, when I go to New Orleans,
Speaker 1: I'm you know, yeah, I'm a writer, but I'm Tom
Speaker 1: and Diana Lewis's son and uh and thus interpreted by
Speaker 1: bye and and I could spend weeks in New Orleans
Speaker 1: trying to get someone to take me seriously without without succeeding.
Speaker 1: So that's just a different attitude towards life. And I
Speaker 1: loved it. I growing up. I just I didn't have
Speaker 1: I mean, I eventually sort of developed ambition, but it
Speaker 1: I didn't. It wasn't there all the time. Like one
Speaker 1: of the things that I mean is different from my
Speaker 1: children My life and my children's lives is they have
Speaker 1: forced upon them enormous anxiety to like you're supposed to achieve.
Speaker 1: And no one even no one ever suggested that to
Speaker 1: me that I was supposed to achieve something.
Speaker 2: Do you think you sit on them?
Speaker 1: I've tried not to, you know, It's it is an
Speaker 1: unfortunate byproduct of being a successful author, Like my books
Speaker 1: are out there and I'm on TV and all that crap.
Speaker 1: That they see me as a success, and it probably
Speaker 1: they internalize it as well. I have to be a
Speaker 1: success too, so in that sense, maybe I do. But
Speaker 1: I try to explain to them that the success should
Speaker 1: just be thought of as like whatever, it's a byproduct
Speaker 1: of doing something I really love doing, and that the
Speaker 1: goal is to move through life in a way that
Speaker 1: you don't you don't miss the thing that you really
Speaker 1: love to do, that you don't walk away from it
Speaker 1: by mistake, that you that you're alive to it when
Speaker 1: it walks in the front door. And we shall see
Speaker 1: if I've succeeded in getting that message across. That doesn't
Speaker 1: sound like bad advice. I don't disapprove of that person.
Speaker 1: My youngest walker is sixteen years old, and I try
Speaker 1: to live that with him. I mean I try. I
Speaker 1: try to explain, like the trick to happiness is finding
Speaker 1: the things you like to do in doing them and
Speaker 1: not trying to be famous or be rich or any
Speaker 1: of that. And it's funny, I sometimes find myself talking
Speaker 1: to like a deaf eared boy, like he just doesn't believe.
Speaker 1: He doesn't believe me. He's easy for you to say,
Speaker 1: it's basically his attitude towards it all. Soon we're gonna
Speaker 1: do kids. I'm gonna tell you fun can't tell you
Speaker 1: a funny story to end on. I don't know if
Speaker 1: we're about to end. But before I walked on the
Speaker 1: out of the door on the book tour, word had
Speaker 1: gotten out in his school or whatever that I had
Speaker 1: actually been living in Sam bankmin Free's life for the
Speaker 1: last eighteen months, and I had this book that was
Speaker 1: going to come out, and that was incredible. How did
Speaker 1: I know? You know all that stuff? And we were
Speaker 1: sitting on a sofa. We were talking about his homework,
Speaker 1: his history homework. We're talking about this kind of weirdly appropriately,
Speaker 1: the Safe, the Salem witch trials, and talking about mobs.
Speaker 1: And when we were finished, he was it was late
Speaker 1: at night, and he was kind of tired and gets
Speaker 1: tired all of a sudden, He's eight years old all
Speaker 1: over again. And he looks up. He says, Dad, are
Speaker 1: you a genius? And I said, no, no, no, not
Speaker 1: a genius. He said, would anybody say you're a genius?
Speaker 1: And I said, only some stupid people, like nobody would
Speaker 1: say I'm really say I'm a genius. And he said,
Speaker 1: there's like this relief that came over his face, and
Speaker 1: he said, that's what I thought, because you never say
Speaker 1: anything that's that intelligent. I thought some of the good
Speaker 1: has happened here.
Speaker 2: And you're saying this because the book tour you've been
Speaker 2: on has been a lot of people saying the same thing.
Speaker 1: The reactions of the book have been have been so volatile.
Speaker 1: I mean, Twitter is one thing, but the reactions I
Speaker 1: have gotten to the book have been as all over
Speaker 1: the place I've had all over the place reactions before,
Speaker 1: but more all over the place than usual, extremes in
Speaker 1: every direction.
Speaker 2: So your son prepared you, Yeah.
Speaker 1: He did. Family life prepared you. Right. You may think
Speaker 1: you're interesting, but they don't.
Speaker 2: That advice you gave in that clip for your kids,
Speaker 2: if it walks in through the door, like be alive
Speaker 2: enough to hold it to take it on. It seems
Speaker 2: to me that you have done that again and again
Speaker 2: and again, and you've done it with this new book.
Speaker 2: I guess I want to know when you started this book,
Speaker 2: you had that question, what is this story tell us
Speaker 2: about the world? What does Sam tell us about the world.
Speaker 2: Do you have an answer to that?
Speaker 1: Well, there's something Sam says that's I think recurs throughout
Speaker 1: the story and recurs throughout the response to the collapse
Speaker 1: of FDx. People see what they're looking for, they don't
Speaker 1: see what they're not looking for, and when someone really
Speaker 1: unusual walks into the room, they have a hard time
Speaker 1: placing him. The other thing I'd say is that runs
Speaker 1: right through the book is how unsettling and revealing it
Speaker 1: is when you have a character who's devoid of feeling
Speaker 1: when there's no when you try to strip life of
Speaker 1: emotional content and you kind of try to denature it
Speaker 1: and reduce it to a math problem the way like
Speaker 1: an AI would how much you lose, what you gain,
Speaker 1: and what you lose. It's an incredible character study of
Speaker 1: that particular character trait.
Speaker 2: When we're done here, you're going to have a meeting
Speaker 2: that you're going to do a book event, and then
Speaker 2: you're going to go to New York City to see
Speaker 2: Sam testify. Is that right correct? How do you think
Speaker 2: this is going to play out?
Speaker 1: You know it's it's The sentencing is curious. It's not clear.
Speaker 1: The judge is a hanging judge. He's a tough sentencer,
Speaker 1: and the judge doesn't like him. But the judge has
Speaker 1: enormous latitude as to the sentence, so it's not clear
Speaker 1: exactly what the sentence will be. It isn't even if
Speaker 1: he's convicted of all the charges. The most the judge
Speaker 1: can sentence him to is one hundred and twenty years.
Speaker 1: But he could say you're also free to go. He
Speaker 1: could say anything. I don't know what the judge is
Speaker 1: going to do, how I think it plays out. I
Speaker 1: don't know how much more there is to play out.
Speaker 1: It's pretty clear he's going to be convicted.
Speaker 2: Do you want him to be punished?
Speaker 1: He needs to be punished in some way. I don't
Speaker 1: think he's just going to escape punishment. It seems a
Speaker 1: waste to stick them away in jail for a life.
Speaker 1: I don't know. I feel a mixture of like, yeah,
Speaker 1: he did things, he did things he shouldn't have done.
Speaker 1: He broke the law almost certainly, and when people do that,
Speaker 1: they are punished. There's a part of me that, even
Speaker 1: as I think that, I also feel kind of sympathy
Speaker 1: for the situation. When I first met him and I
Speaker 1: started to watch him move through the world, I thought,
Speaker 1: there's a place for this person that there would never
Speaker 1: have been in earlier in other times on Wall Street
Speaker 1: in society, this instant child billionaire is this new character
Speaker 1: and willingness to accept as an authority a person who
Speaker 1: generates vast amounts of wealth for himself very quickly, without
Speaker 1: knowing very much about who this person is, and allow
Speaker 1: them to start exercising influence over the culture in all
Speaker 1: kinds of ways that you might not if you knew
Speaker 1: who this person was. And it's partly a byproduct of
Speaker 1: a collapse in trust in institutions, governments. All the rest
Speaker 1: is sort of looking to this person to do what
Speaker 1: our institutions should do, so putting in a position of
Speaker 1: authority that really probably no individuals should be.
Speaker 2: In my last question, because we had to go. The
Speaker 2: thing that you have, I think cemented over the years
Speaker 2: is a trust between you and the readers. I think
Speaker 2: that's why people keep coming back to as readers. It's
Speaker 2: probably why people keep agreeing to be subjects in your books.
Speaker 2: And I'm curious because when Dixie passed said I didn't
Speaker 2: know if I wanted to write again. I suppose as
Speaker 2: we leave, I wondered, now, two and a half years
Speaker 2: since she left us, how do you feel about writing
Speaker 2: in this moment?
Speaker 1: Just loved it. I mean, I took such joy and pleasure.
Speaker 1: I shouldn't have more joy than I should have taken
Speaker 1: in writing the story. I've had this feeling several times
Speaker 1: and would that I have it several times again. I
Speaker 1: felt I was limited only by my abilities. I thought
Speaker 1: that the world had generated, once again this material that
Speaker 1: was so good. I could only screw it up. And
Speaker 1: having that gives me enormous pleasure, the same pleasure like
Speaker 1: whatever that happy place is I'm in when I'm writing,
Speaker 1: it's there, and so I feel great about it. My
Speaker 1: worry when I think about writing now is that I
Speaker 1: force it, like that I go force the need to
Speaker 1: go write a book rather than sit back and let
Speaker 1: it walk in the door. This walked in the door,
Speaker 1: and I think other ones will. But I think I
Speaker 1: want to be careful to make sure sure that I
Speaker 1: only write the books that feel like they really need
Speaker 1: to be written, because that's the joy. That's the joy,
Speaker 1: it's the pleasure of that.
Speaker 2: Michael Lewis, thank you for sitting and congratulations on the book.
Speaker 3: Thank you, Sam, And that's our show.
Speaker 2: If you enjoyed today's episode, be sure to leave us
Speaker 2: five stars on Spotify, Apple wherever you do your listening.
Speaker 2: I want to give a special thanks this week to
Speaker 2: Elizabeth Riley, the publishing team at w W Norton, Lydia,
Speaker 2: Jean Kott, and of course, our guest and fellow Pushkin
Speaker 2: podcaster Mike to order his new book, Going Infinite, The
Speaker 2: Rise and Fall of a New Tycoon. Be sure to
Speaker 2: visit our website at talk easypod dot com. There you'll
Speaker 2: also find other episodes with great writers including Zadi Smith,
Speaker 2: fran Lebowitz, David Sedaris, min Jin Lee, and Hilton Nows.
Speaker 2: To hear those and more Pushkin Podcasts listen on Apple Podcasts, Spotify,
Speaker 2: or wherever you like to listen. You can also follow
Speaker 2: us on Twitter, Facebook, Instagram, at talk easypod. If you
Speaker 2: want to join our mailing list, drop me a line
Speaker 2: at SF at talk easypod dot com. That's SF at
Speaker 2: talk easypod dot com. You can also purchase one of
Speaker 2: our mugs at Come and Cream or Navy, or our
Speaker 2: vinyl record with fran Leibowitz at talk easypod dot com
Speaker 2: slash shop Talk easy is produced by Caroline Reebok. Our
Speaker 2: executive producer is Jennixi Bravo. Our associate producer is Caitlin Dryden.
Speaker 2: Today's talk was edited by Kaitlin Dryden and mixed by
Speaker 2: Andrew Vastola. Our music is by Dylan Peck. Our illustrations
Speaker 2: are by Chris Chenoy. Video and graphics by Ian Chang,
Speaker 2: Derek gaberzak Ian Jones and Ethan Seneca. Photographs today are
Speaker 2: by Julius chu House. I want to thank our team
Speaker 2: at Pushkin Industries, Justin Richmond, Julia Barton, John Snars, Kerrie Brody,
Speaker 2: Heather Fane, Eric Sandler, Jordan McMillan, Cura Posey, Tara Machado,
Speaker 2: Jason Gambrell, Justine Lang, Malcolm Gladwell and Jacob Weisberg. I'm
Speaker 2: Sam Fragoso. Thank you for listening to Talk Easy. I'll
Speaker 2: see you back here next week with another episode until
Speaker 2: the Stay Safe and So Long.