Also media a welcome back to Behind the Bastards, our special edition episodes on Sam Bankman, who is not freed because he is still in jail. That's it's the intro I've got. It's the same as the last episode.
No, you're hilarious. It's still very funny. Sophie's favorite.
This is the only time I've made Sophie laugh in years. That's not true. Well, okay, Switzerland on this issue. You're Swiss on this issue. Swiss you Jamie. Speaking of Switzerland, you also were neutral in World War Two? Is that correct? Yeah?
I was sort of like kidding. You made me laugh again.
Congrats two for two, baby, So we took a couple of days and tween recording part one and part two. Really let it sink in. How are you feeling on our technically not a Behind the Bastards on Michael Lewis, but basically a behind the Bastards on Michael Lewis, author of The Big Short.
I So in the interesting days, I've talked about the Michael Lewis of it all with a couple of different people, just to see if I was like if I had just missed something. But every single person I talked to I found had a similar experience to me, where they did not know that he wrote The blind Side. Oh good, okay, yeah, and then when they found out that he wrote the blind Side, they were like, oh, yeah, I could see that he is a you know, he's an honorary bastard.
Yeah, maybe he is kind of a hack. Yeah right, well.
Yeah, they were like, yeah, Michael Lewis Moneyball the Big Short, And You're like, and another thing, how did that? How how do we collectively forget that he wrote that? It feels like he got away with something.
Yeah, And I guess I've been thinking about what he's doing with Sam Bankman Freed as I think about the upcoming Napoleon movie, which I will have watched by the time this comes out, but it's not out yet. So excited about that time. I'm ready. Everyone, especially like all of these history Twitter podcast people, are so livid that Ridley Scott's basically like, who can say what the truth of Napoleon's life was, which is it is a ridiculous thing to say. He's very well documented. We actually know
a lot about Napoleon. But also, I don't give a shit. It's the guy who made Gladiator, like well, and also.
I appreciate because all biopics are you know, nonsense, yeah or shit right, And so you're like, well, this is the one director who's going to say my biopic is kind.
Of horse, it's just lies, which also very appropriate for Napoleon. But what is the line with that? Why Why am I angry at Michael Lewis for what he's doing? And I don't really care.
He's a journalist, there is he's a journalist.
One he's not the director of fucking Gladiator, the least accurate movie about Rome ever made.
It's been a great it's been a great week for like weird old guys who we could argue had have peaked creatively, although I wouldn't say that for Scorsese. But there was a great quote that was floating around in the last couple of days where I guess Scorsese said on the Killers of the Flower Moon press stor that he was like always worried about running out of time and he never knew what his last movie would be.
And Ridley Scott was asked to like react to that, and he said, since he started Killers of the Flower Moon, I've made four films. No I don't think about it. I get up in the morning and say, ah, great, another day of stress.
Honestly, those are both completely valid answers. Yeah, I refuse to be a part of some sort of like pretending that what Scott is saying isn't as valid as what Scorsese's saying. There are two ways to deal with mortality, one of the.
Two genders of creative march Yeah.
Yeah. One is oh my god, I will die and I won't have said everything I need to say, And the other is what the fuck I got I got shit to do, I gotta move, I gotta have time with the answer to this fucking question. Yeah.
Meanwhile, Robert Paul Schrader is on Facebook, and Paul Schrader's posting about Taylor Swift in a kind of horny way, so like, yeah, the old men are just there on one this week, and Michael Lewis walks among them.
There's only one old, great creative who has taken the reasonable, respect like answer to mortality, and it's John Carperdue, who's like, Nah, I'm done directing movies. I'm gonna get high, play video games, watch basketball the rest of my life, and God, bless God, bless him. Yeah, God bless them. There's a man who understands what's valuable in life, a thing that Sam Bankman Freed never understood. And we're and we're back. Yeah, we're back.
So one of the things that comes up a lot in Michael Lewis's book is he's sort of going into the mind and psyche of Sam Bankman Freed, is that Sam had this belief that no one ever does anything useful after like age forty to forty five, somewhere around there is the last time you have a useful thought in your entire life, which I guess is relevant to our discussion of aging aging powerful men.
I will say that that's true of many stand up comedians, but I can't speak of that outside of that.
Yeah, yeah, I mean I think it's true, especially like once you get really rich, it's you tend to like lose complete touch with the world and go insane. So I think that is somewhat accurate, at least for some
creative professions. But Sam is not in a creative profession, and it's actually kind of ridiculous to me the idea that like people in business after age forty four, like Steve Jobs did all of his best shit like well after that point, like his most influential like evil things and most like really successful businessmen are just kind of getting started by their mid forties, right, because it takes that much time to get that's momentum.
You've got a lot of evil like you got.
He's lot of horrible things left to do, plenty of time.
First is in front of you.
I think he's got three to five ethnic cleansings in a minimum minimum Jamie, Yeah, maybe eight. You know, I could see him having eight more ethnic cleansings.
He does seem like someone who just will like have a kissinger like affinity for life.
Yeah, so bankman Freeds, I understand belief that, like after age forty five, he's not going to be capable of having any useful ideas. This is what pushed him, you know, along with his effective altruist idea. This is why he felt like he had to he had to continually gamble rather than like taking the slow, sustainable path making money off of his exchange at like a reasonable pace. No, no, no, I only have a few more years left before my
brain shrivels up. And so if I'm going to do anything good for the world, I have to keep putting every dollar I've made on a fifty to fifty bet endlessly, right, mm hmmm, which isn't it? Which is like, I don't know, you should probably get help if you feel that about the world world, because that's a deeply self destructive way
to think about yourself and about your assets. This is a big part of why FTX did not have a really crucial thing for any company, particularly a financial company, to have, which is a risk officer.
Right.
A risk officer's job is to analyze the deals the company is doing and go, well, that's an insane risk, so let's not do that one. Or you know, that's an insane risk. We need to offset it with this stuff. They also did not have a chief financial officer or a bunch of other critical executive positions.
Yeah, no CSOs, that's one I've heard of. You should have that one.
It's a really basic job, and its job is basically to know how much money you have, right, Like, there's other stuff to it, but it's pretty critical. FTX also did not have a board of directors, and they're lacking a bunch of other very basic executive positions, and a big part of why is that the only people Sam feels like he can trust are like his friends, and he has this deep aversion to bringing in adults, like people who were not in their twenties, like his the
friends he went to college with. And shit, he said in one interview with Michael, we tried having some grown ups, but they didn't do anything. This was true for everyone over the age of forty five. All they did was worry, which, like, again, given what happened, perhaps they auto have been.
Maybe I'm just like sort of on one with the idea that very few stand ups have a valuable thought after forty five. But I would say now reflecting on it, like Sam Bankminfried is using the improv troop approach to a very high stakes business. Yes, Like he's like, no, I will only work with people I went to college with,
we know best. I don't want no fucking crusties in the room, like if he I mean, And we could debate all day about whether Sam bankmdfried would have done more evil in his life so far or in his life as an improv comedian, because I think they should all be in forever jail. So it's kind of like, it's difficult, it's difficult.
This is what Levenworth should be right. Military needs to take stand up comedians into custody. I've always had and I'm on a lot of lists.
Yeah, you know how many bars have performed in to know people, I'm on a lot of lists.
So Sam's response when he was asked by Michael, like, why don't you guys even have a CFO? That seems important? He says, there's a functional religion around the CFO. I'll ask them why do I need one? Some people cannot articulate a single thing the CFO was supposed to do. They'll say, keep track of the money or make projections, And I'm like, what the fuck do you think I do all day? You think I don't know how much
money we have? Which is funny because his whole legal defense in court was I had no idea how much money we had or where it was, and that's why I didn't commit a crime, right because I just was incompetent. I didn't know where the money was. But it's all somewhere Like, very silly thing to say, given what he's about to say. Okay, So after Sam's life fell apart, Michael Lewis continued to talk and visit multiple sometimes would call like three or four times a day through the
eight months that Sam was on house arrest. And it's interesting to me because, like Michael, if I was a journalist like Michael Lewis, and I had had a conversation with somebody when they were one of the biggest names in an industry, being like a CFO is useless. I know where the money is, and then their entire life explodes because they didn't know what the money is. I would at some point asked him the question, Hey, was
that maybe a bad idea? Michael does not bring this up to Sam after the collapse in any of the dozens of conversations that they've had, and in fact, and this is why that's weird. The actual villain of his book, Going Infinite, the one person that Lewis is super critical of in like a really uncharitable way, is the CEO brought into takeover the FTX after Sam like leaves and
declares bankruptcy, a guy named John ray the Third. Now, I am not going to go to bat for John ray the Third because he he's John His name is John ray the Third, Like that name.
To go to bat Ford, Yeah.
But he Is. You know, he's the guy who got brought into liquidate in Ran and he's he's kind of a corporate undertaker, right when a when there's a huge scandal at a company, when it like collapses, goes into bankruptcy, and you need someone to kind of do the post mortem. You bring in John Ray and he's like, as far as I know.
Not the first or second.
No, not the first or second. Those guys are useless.
No fucking clowns. Okay, you're gonna want to bring in the third.
You need a j R. Three.
I'm with you, so yes, sir.
Yeah, it's interesting, like the degree to which he has because this guy comes in later and I think because he's boring, Michael Lewis finds him disgusting. Like I haven't run into any info that he's like bad at what he does. It's certainly not his fault, but Michael is livid because he's this kind of like stodgy old businessman and he doesn't understand sam spe playground or like the wonderful thing that he built, and he's just kind of exasperated at how badly it all works.
See that's fascinating to me because to me that says like Michael Lewis is, I mean, either just hates boring people, which fair enough, but you know he should know as a journalist that boring people are often and maybe most often tremendously capable of doing bad shit. But it seems like he's looking more for like, well, Bradley Cooper can't play you in a movie. You're useless to me, your garbage, you're boring.
There's nothing. Yeah, there's nothing sexy about him. He's just trying to deal up, like clean up after a disaster. And there's some really funny lines in the book because like one of the things that Lewis has to do in order to kind of defend Sam as a genius is explain how he didn't steal nine billion dollars, right, And the answer that Lewis has come to is that money is all there, that he just didn't know where nine billion dollars was. Oh yeah, he didn't steal it
or gamble it away. He just misplaced it, dude, rank and competence that he committed because he was too smart to keep track of things. And there's a I'm going to read you a very uh yeah, there's a really fun quote there he describes like Lewis describes FTX as a real business, but he says that John Ray, who like attacked it as the worst run company I'd ever seen, was just too much of an idiot to like understand
it right. He describes Ray trying to figure out what company assets actually existed in what didn't, as quote like an amateur archaeologist who had stumbled upon a previously unknown civilization,
unable to learn anything about its customs or language. He just started digging, right, Like really, he's too dumb to understand the brilliant thing that Sam built up, so he just starts like churning about in the wreckage without really appreciating everything that went into making this monufental edifice.
And I really wonder, like what I mean, this is like getting into the weeds a little bit. But I'm very curious, like what, like who on Michael Lewis's editorial team is keeping him in check. It doesn't sound like he's hired a fact checkers to sound like he has a personal Jimminy Crickett, So he's just saying shit like his personal biases couldn't be more out.
They wanted to rush this thing out, so you don't have much time to edit it, right, True? Yeah, a year to write and release a book is not a long time.
No, not enough time one might, not enough.
Time, one might argue. And also Michael Lewis has the kind of clout to make that not happen. Right, And again, I also kind of think that his hatred of Ray here is based on the fact that Ray did not fall for Sam's bullshit the way Michael did. Right. Here's what Ray said shortly after taking over and getting a look at ftx's finances, and this is from an our
article in Business Insider. At the hearing, Congresswoman an Wagner of Missouri asked Ray to elaborate on the specific ways FTX was worse than quote one of the largest corporate frauds in history. Ray explained that FTX was unused and then it had no record keeping whatsoever. He said that employees would exchange invoices and expenses on Slack, the ubiquitous workplace chat room. They used QuickBooks, he added, referring to
the accounting software quick Books. Congresswoman Wagner asked for clarification, QuickBooks very nice tool, not for a multi billion dollar company. Rake confirmed and that's like basically they're using the kind of thing that you would use if you're like a person keeping track of you, or maybe your small business is accounting.
Yeah, I've done that and like that. That's nuts.
Yeah, that is like the close attitude too.
Yeah.
I was like, that's the closest thing I've come to debuting. Like, Wow, if I was also the tasked with multi billion dollars, I'd be like, I don't know, yeah books, Well we go to turbo tax, what do we do? I would hire a CFO.
Yeah, I would hire someone who's done that before, right.
Yeah yeah QuickBooks. Holy shit.
Yeah. So you can decide whose interpretation sounds more realistic John Ray recognize you can. Basically, the two possibilities are like either John Ray just recognizes basic incompetence when he sees it and gets angry, or he's just not brilliant and special enough to understand Sam's world, which is is
what That's what Michael lewis, that's he in caps. That's what Michael Lewis refers to FTX as is Sam's world, right, this is a He basically treats the whole situation as like, yes, Sam's Sam lived in this magical world, and you know, his business was actually secretly good, but it encountered this temporary issue and he was forced out. And then John Ray came in and he tore it all apart because he's just the mean, old, grumpy businessman.
Right.
That's that's really like the thrust of Michael Lewis's book, and part of how he kind of emphasizes the magical inner world Sam lived in is this kind of obsession with gaming returning to like Lewis is just sort of fascinated with like the fact that Sam was an addict. Right, Sam is a gaming addict. That's what when you can't like handle your basic functions, but because you're too busy
playing Storybook Brawl, that's an addiction, right, yeah. Yeah. And it's interesting both because Storybook Brawl was made by his childhood friend and he used consumer funds to purchase it. It seems to have been a pretty mid game. It shut down after he got arrested, so I can't play it to tell you if it's actually good. But Lewis doesn't describe it as like a middle brow app game. He describes it as like better than chess, like more
complex than chess. A greater intellectual expert or exercise than chess, and he writes this paragraph about it. Sam didn't care for games like chess, where the players controlled everything and the best move was, in theory, perfectly calculable chess. He'd have liked better if robot voices wired into the board.
Hollered rule changes at random intervals. Nights are now rooks, all bishops must leave the board, ponds can now fly, or almost anything, so long as the new rule forced all players to scrap whatever strategy they'd been pursuing and improvise another better one. The game Sam loved allowed for only partial knowledge of any situation. Trading crypto was like that, and I think getting.
Fucking ridiculous, Like is there any chance that Sam Bankman Freed paid Michael Lewis to say this shit?
Like I maybe I don't know that he was still the money one of the things.
Not that there's no proof that he isn't dense, But this is like above and beyond.
The reason why I get that a lot that like, well, Michael Lewis is obviously bribed, but like Michael Lewis is very rich, Like I don't know how you could bribe Michael Lewis, especially after you lose your money.
Yeah, and even and even if he wasn't from money, he'd be there.
Yah. Yeah, Yeah, He's always been rich and always will be. So I don't know how much I think that's that's likely. I think he just this is his first time ever hearing about games, and so he thinks Sam is brilliant and special because he played them obsessively. I also think, you know, we just did our episodes on Lord John asked and all, who is like this this British gambling maven who took away who like basically uh got the upper class of the England and like the mid century
to just gamble away all of their fucking money. And a big part of why this kind of like old generation of the aristocracy lost so much is they were into these specifically games of chance like Shamanda fair, which is a kind of bacca where basically there's no skill involved. It's pure it's as close to pure chance as possible.
Because there was this like change in the kind of gambling the upper class like to do that I've heard theorized it's basically just like, well, these people had nothing in their life but gambling, right, They've always been rich, they're born rich, they've always lived these super safe lives. The only thrill they had was throwing a bunch of money on like the effectively a complete chance.
And for understand that, because it's like, what's the worst that's going to happen. You're going to become marginally less rich but still maintain the same quality of life.
That sounds boring, Yeah, you've just they've they are just insulated from anything thrilling because they're insulated from any real danger, right. And so I think Sam being this kind of rich, sheltered kid that's Lewis interprets. It's like he's too smart to play a game like chess. He wants a game where he doesn't actually know what's going on, and a
lot of that's random. It's like, well, I just see these old British gamblers and Sam Bankman freed, where again, this kid has nothing but the throw of the dice inside him and that's what he liked, right, and he put a lot of other people's money on those bets. Yeah, anyway, this is a little beside the point, but I did want to read the actual part of the book where Lewis describes Magic the gathering because it's it is very boom. Magic had been created in the early nineteen nineties by
a young mathematician named Richard Garfield. It was the first kind of a new kind of game, designed perhaps for a new kind of person. Garfield had started with an odd question, could a strategic game be designed that allowed the players to come to it with different equipment? And again, Games Workshop had started making Warhammer years before Magic came out, Like all games have existed forever.
I couldn't hear you over the sound of imagining Garfield the cat saying.
That, Yeah, which Garfield? Bill Murray? Are we talking Chris Pratt?
There's also a secret third Garfield Garfield whoever did the voice acting on Garfield and Friends, which is my canonical Garfield voice, certainly not Chris Pratt Garfield there. I forget who tweeted this, but there is a vibe with the new Garfield that Chris Pratt has been locked in a room forced to voice every major ip. It's like a it's his infinity punishment. He'll be rich, but he can never leave the room.
I'm okay with that. Actually, yeah, let's keep.
Him in the room. He doesn't have any good ideas.
No, No, keep in the room. Every every six years he can come out to do another interminable Jurassic World movie.
No, the villain was Locus.
So Lewis is so ignorant of kind of the basic of youth culture to this day that he sort of transposes a lot of completely normal millennial and zoomer behaviors As evidence of Sam's unique brilliance. Here's another clip from sixty Minutes where he describes how Sam treated effective altruism. That that ties into this and this is remarkable.
What it means in Sam's instance is you can go out and have a career where you do good. You can go be a doctor in Africa, or you can go out and make as much money as possible and pay people to be doctors in Africa. If you're a doctor in Africa, you get you end up saving a certain number of lives.
But you're only one doctor. But if you can.
Pay forty people to become doctors in Africa, you're gonna save forty times a number of lives.
This is like a strategy game.
Well, you don't understand sammcmcfreed. Unless you understand then he turns everything into a game. Everything is gamified.
He's describing a pyramid scheme of doctors.
Yes, am I like, And he's.
Saying this on sixty minutes, I like, I cannot put rout my Okay, now I am like taking him being paid off like or paid on or off off the table because you're just like, this is ridiculous.
This is like you stupid.
Yeah, like to like the fact that people somehow collectively forgot that you wrote the blind Side on fire to say this shit on sixty minutes, it just like, is it's what he's describing a pyramid scheme.
He sure is, he is describing a fucking pyramid scheme. And also like this hole he turns everything into a game, like because.
The through like connection there is like Jigsaw for good.
Sure, Sam could have been a doctor in Africa, but by making a lot of money, he could hire a bunch of doctors in Africa. And the through line you're meant to make is he was He was the guy who was best suited making a lot of money because he turned everything into a game. And man, that's again not unique to Sam. A significant percentage of the US economy.
It's based around taking the logic and addictive strategies game developers use and applying it to every imaginable industry, right, like that's fucking everywhere, Like Sam is again not unique in this, And also the it's just such a the fact that Lewis seems to have bought into the basic logic of like, well, it's better to pay a bunch of doctors than becoming one is silly because like, well, we have a shortage of doctors. We don't have a
shortage of assholes who gamble with other people's money. There's there's not actually enough doctors for the people who need them.
And also, I mean to that point, it doesn't sound like would I trust, knowing what I do, of Sam Bankman Freed's ability to multitask that would I trust him doing surgery? I don't think I would. I don't think I would. I wouldn't trust him doing either of those in Africa?
Yeah, yeah, no, he would, he would never have right, like but yeah, anyway, but.
It sounds like he I mean, maybe I'm like, you know, giving him too much credit and he's playing a game of forty t but it doesn't seem that way, and I like, he sounds ridiculous.
I kind of outside of he's just completely deluded. His two options are he's just so out of touch with the youth that he thought Sam was unique in this, or he he decided from the moment he met him. This is the framing device I want to use for Sam's genius in my book because I can think. I think they could film it easily, right, because I'm sure
he thinks that way about the books he's written. He's had so many of them adapted, and like, yeah, if I you know, there's a lot of fun ways you could film this super genius solving his math problems through like imagining games out in the real world, right, hmm, yeah, So I my guess is that he just couldn't get himself off of this idea he had for like the inevitable Sam Bankman Freed movie, you know, crafted for the Big Bang Theory audience.
Yeah, Like sure, he's already he's like, oh yeah, who's hot right now, Paul Mezcal, Well, well we'll dye his hair. It's gonna be fucking great.
No, I think they should have had Timothy shallomeh I think they should have had Timothy Shallo may do like a you know, what's his name the Batman guy where he would like wildly change his appearance in ways that are bad for his health every since.
Don't talk about Robbert Pattens in that way.
Or I want to see Timothy do a Christian bale to look like Sam Bankman Freed. That's that sounds fun.
I just worry about Timothy shalmy. It looks like if you like touch him, he may shatter. I just worry about him. He looks a.
Frail Yeah, that's the right thing. He looks like he's got consumption. Yeah, but like that, they would say that about him in the in the in the in the distant past. Yeah.
And it's like if Sam Bankman Freed is looking heartier than you are, like you're in trouble my man.
Uh huh. Yeah, Well I wouldn't say that about Sam. But so there's an amusing coda to Lewis's loving descriptions of Sam as a compulsive gamer. This paragraph occurs right after the FTX customers pull a run on the bank, annihilating its cash reserves and starting its collapse. Is like the employees are all huddled inside thirty million dollar Bahamas suites to try to figure out how to fix things.
Nishad was agitated with Sam in a way that Romnik had never seen, at one point, turning on him and screaming,
will you please fucking stop playing storybook brawl? And I like that anecdote, But it gets to another frustrating issue with Going Infinite, which is that Michael Lewis has all the ingredients for a great modern Icarius story of Hubris and the Fall, but making it work tonally would require him to see these things that are obvious warning signs as warning signs and structure his book that way, right, and then you get some Catharsis in the payoffs. But
these warning signs are just sort of scattered around. They're not given the significance he would give them if he saw them as warning signs, because he's clearly taken with all of this stuff. Another example of a valid through line Lewis seems to have missed is Bankman Freed's complete disregard, even distaste, for the competence of the women around him. Lewis spends a fair amount of time on Sam's relationship with Carolyn, and he he prints these letters between them
that certainly don't make Sam look great. It began with a seriously compelling list titled arguments against this is arguments against her dating him in a lot of ways, I don't really have a soul. This is a lot more obvious in some context than others. But in the end there's a pretty decent argument that my empathy is fake, my feelings are fake, my facial reactions are fake. I don't feel happiness. What's the point in dating someone you physically can't make happy. I have a long history of
getting bored in claustrophobic. This says the makings of a time when I'm less worried about it than normal, but the baseline prior might be high enough that nothing else matters. I feel conflicted about what I want. Sometimes I really want to be with you. Sometimes I want to stay at work for sixty hours straight and not think about anything else.
And so I want to say that I have this amount of self love to not fall for this, but I can't even say that one hundred percent. I just really feel for Carolyn, And at a lot of points in this story, because it's oh my god, I feel like there's a version of someone who would be like, oh I can fix him, where you're like, oh no, this is like it's like queen fiction of like there's only one and she loves me. I know, I know she's a disadvantage.
And it's it's difficult because like Lewis come discusses kind of Sam's inability to be like functional with the people in his life because and he clearly has a thing like he lets he funds another another exchange by another woman in Crypto who he tries to date women in CRISTI. Yeah, he's got this kind of thing going on. But Lewis kind of always writes off his his his behavior is like well, you know, he just he was too depressed. He was too he can't vooe. He's too brilliant to like be it's.
A torture genius playbook of just like oh, and he's horrible to women, but only because his mind. Like there's I mean, they did the same and this happens every ten years, like that happened with Zuckerberg. They're like no, he's like he's a rampant misogynist because like his business started off of misogyny because he just had so many good ideas that it was like pressing on the woman respect Like yeah, it's ridiculous kind of.
Meanwhile, when Lewis is describing like why Carolyn did what she did, he includes Lane, which she's like. He's like, he quotes someone as saying she would throw away all of her principles to be loved, Like she's the only one of the effective altruist kids who doesn't really believe
in it. She's just so desperate for affection that she would like do anything for it, which like, I don't know, Like I don't know the person, but it's it's weird that Louis is so cynical about her and so full of excuses for Sam.
I would have I would have a fair amount of guesses as to why that may be. Uh, And the way that it seems like in many ways that you know Lewis has seen himself in Sam, and like, if you're especially if you're used to like writing profiles of very successful, eccentric people, which he is, if this is the precedent you've set for the kind of behavior that you would excuse, such as clear racism or sexism, why
would this be any different? Likes it fucking And then also on the other end of Carolyn being characterized as this like desperate for affection. Person I try to like tap into that of like God, if any of my personal correspondents came out, I'd be fucking cooked.
Oh it would be devastating so.
Many people and being singled out. Yeah, of course, Yeah, everyone's desperate for affection.
So you know, anytime you see Lewis writing about Sam, he writes in kind of the terms Sam as one of the people in this weird effective altruism cult. He uses terms like he talks about his priors, which is like it's a way of like bringing Baysian mathematics into personal decisions, and all you all you're saying when you're saying like, well, these are my priors, is like, well, this is the shit I believe without any kind of evidence. Right, That's largely what that means. These are like my pre
existing biases. But saying pre existing biases like doesn't sound as smart as my priors. And likewise, Sam would always talk about like, well, every decision I make is like a mathematical decision, and I calculate what's the expected value of this outcomers is this outcome? And then I do the thing with the highest expected value, right, which is another way of saying I do whatever will make me feel good, which is you know, a lot of us are like that a lot of the time. That's human nature.
We are.
Creatures of comfort in a lot of ways. But there's Sam is just dressing up selfishness in lines like this, Sam wanted to do whatever at any given moment, off her the highest expected value, and his estimate of her Carolyn's expected value seemed to peak right before they had sex and plummet immediately after. And like, oh, that's no different than a lot of guys in their twenties.
It just sounds like a fucking guy.
Oh so you're saying he got horny and then he didn't care about her afterwards. Well that's not special, Like.
How I I can't relate?
Wow, yeah, that is. That's not just millions of men, that's millions of people.
Like it's so, I mean, even just outside of his relationships with women, in his relationship with Carolyn, I don't know. It gives me sort of like mensa PTSD, where there is this like two hander where it's either, uh, you can't understand what I'm doing because I am a super genius and you are not operating on my level. You could never understand why I am fucking up at this tremendous rate. And then if they're challenged enough, it's like, well,
actually I'm you know it. I don't know the correct way to like characterize this, but it almost becomes like internet speak where it's like, no, I'm actually just like I don't give a shit. It's actually I'm using quick books because I don't give a fuck. It's like either I am a genius or I don't care, and there's nothing in but and it's like what is in between is just the fact that they're full of shit.
Yeah. Yeah, and you know who else is full of no time to head to ads? Ah? Boy, I sure do love ads. Those were some good ones. So yeah,
so we're back. We're talking about Sam Bakman Free's issues with women, as chronicled by Michael Lewis, who does, to his credit, make a point of noting that all of the company's moves as CEO from the US to Hong Kong and then from Hong Kong to the Bahamas were prompted by like he and Ellison would have some big relationship conversation and she would say like, I want to have a closer relationship and then he would move the entire company without telling anybody, which, again, like the instant
you hear that anecdote, you're like, oh, well, this guy, there's nothing. This guy is not a super genius, Like this guy is just a can't deal with confrontation. Like, yeah, that's not special again, millions of us.
Every conflict avoidant person has their approach. It knows no gender, but it skews towards one. Yeah, my last boyfriend bought an upright base. That was how bless is sorry? I don't think.
Yeah, the real shame here is that I don't think Lewis draws any sort of connection between how Sam treats the women at his company and how like Sam treats adults with the specialized financial knowledge that might have saved
his company, because there is a relate. Like, I'm not trying to discount his misogyny, which is certainly a thing, but like, I think the bigger through line with Sam that is present outside of justice dealing with like the women that he was in relationships with and worked with, is that Sam doesn't think anyone besides him has worthwhile thoughts or ideas, and that anything he doesn't understand is not worth paying attention to, which is a big thing
in tech guys, right, this attitude that like you're seeing it now with these AI freaks where there they don't think that there's any value in the human creation of art because they don't understand it. Like they're willing to like have an AI just like come up with some crap that's vaguely patterned off of a historical See, isn't this picture of like, you know, isolation and anomy in modern society? Better now that we've turned it into a bunch of friends having brunch outside of a cafe. Look,
it's much brighter now and prettier. It's like, No, that's not the point of the art. You don't understand, but like they don't. Yeah, it's this thing.
That a computer could come up with the image of Hal Walker and Brian the Dog in a convertible. No, that's a uniquely human artistically instinct we would created. Only humans would get it.
This idea that like I am smart, and therefore if I don't understand something, it's not important, right, It's it's something for like people who are less than me to deal with. This is why the company fell apart, And it's interesting to me that like Lewis, he clearly does see aspects of how Sam treats women unfairly, but he doesn't make any sort of leaps between the way Sam treats like everybody who's not him and I find that interesting.
I do too.
Yeah, yeah, good good stuff. So perhaps the biggest major through line in Going Infinite is Michael Lewis not getting the joke. That section where he quotes SBF explaining why CFOs are dumb is a perfect example. On a casual reading, you might even assume that we were supposed to find the line what do you think I do? What the fuck do you think I do? All day? Do you think I don't know how much money we have? Funny because Sam did not know how much money they had.
At the climax of the book, after FTX is crumbled, Lewis goes into detail to discuss all the money that was recovered by John Ray quote at the end of June twenty yeah the third. At the end of June twenty twenty three, John Ray filed a report on his various collections. Today the debtors have recovered an approximate least seven billion in liquid assets, he wrote, and they anticipate
additional recoveries seven point three billion to be exact. Ray was inching towards an answer to the question I'd been asking from the day of the collapse, where did all that money go? The answer was nowhere. It was still there,
And that's not true. The reason he's writing this is that earlier in Sam's career, a bunch of people leave Alameda because he loses four million dollars and they think that he's lost four million dollars in investor money, and he's a dick about it, and later they find it like he had just misplaced it, basically, and so Lewis is being like, that's just what happened. They were never really in bankruptcy. See, it was a good business. Like they just didn't have any record keeping, so they lost
the money. In this meanie, John Ray thinks it's bad to lose several billion dollars, but Lewis is saying is not true. He is kind of lying here. Maybe he just maybe it's an honest mistake. I don't know, but it's not accurate because for one thing, seven ish seven point three billion has been found, almost nine billion is missing. So that's one and a half billion dollars unaccounted for. Still, that's still one of the largest financial frauds in history.
Right, significant, that's why maybe as much as two billion, yeah, does even if you're trying to get through to someone who knows nothing about finance, the second number, the missing number, is bigger than the first.
The number if not good. He tries to cut close that hole by being like, and a lot of that money is in these you know, money they paid to these companies that they'll probably get back. And it's like, why would you think that a lot of that money went to other shady crypto people who don't bank in the US. Why do you think the money's gonna come back?
Well, see, this is interesting because now, ugh, I feel back because I know Michael Lewis is not the bastard of the episode. However, he's kind of applying Yeah, Sam, if we're applying Sam bankman Free's theory that you do not do any valuable work after forty five, that may in fact apply to Michael Lewis. Yeah, Like, maybe he's lost the thread because it's the way that he's talking about money. I mean, and I have not read this book.
Well, you're just.
That's why they pay you the big buss, But like to hear how he talks about money in this book and to know that his most famous works have to do with finance, with the exception of the of the Blindside, which everyone forgets that he wrote like it calls his entire body of.
Work in the question yeah yeah, and it's like, yeah, just the ridiculousness of being like, well, look, guys, seven you know, they've recovered seven billion out of nine point three billion, so things are basically good, Like that's insane. But also, as we'll get to later, he is he that even that doesn't tell the whole truth, Like this idea that everyone's going to get their money back is
not true. But Lewis in order to continue believing that Sam was a super genius, he has to have this kind of tragic store where like he didn't really lose the money, it was a misunderstanding. It's all unfair. And because he needs to believe this, I think for the sake of his own ego, bringing up the fact that there's a lot of money missing is a really easy way to piss him off. And I'm going to play
you this clip. It's the most revealing clip that I found And this is from an interview he did with on a YouTube channel called Intelligence Squared after the FTX collapse, like after his book came out. So while Sam is on trial, basically.
Okay, seven point three billion, So it's one point three billion that's missing plus it, and there's still.
More to be and it's more than that, it's more thought.
This is where today today the prosecution, the prosecution sent a motion to the court saying, can we please not talk about the possibility the customers are all going to get their money back? And that in particular, can we you're gonna let me finish?
Oh my god, I think, well, I care. Is the fact that I do think it's important. I think at the very least he's irresponsible.
Of course, I'm not saying he's not irresponsible. I'm saying it's just different than you think.
Okay, okay. A few observations. First of all, to pay. Second of all, uploaded four second that right, his haird does not looking real colors. It's not giving matching color. Second observation upload date four weeks ago, gnarly. Third observation, obviously he cuts off a woman aggressively to be wrong, and then Finally, it's just the because the listeners cannot see the size of that venue. It gave me a
brief like it. I felt it in my stomach to be like, wow, that many people will gather to be to see Michael Lewis just spew bullshit and yet fifteen people show up to watch me but chug a quart of milk.
It's ridiculous, Yeah, Jamie. Though, here's the thing. This is the difference between you know, it's the same. This is the difference between what I call vulgar art, which is the stuff that will be forgotten, you know, within a generation, and immortal art, right like the Parthenon. You know, you butt chugging the contents of infinite jest was a Parthenon level work of art. It will be with us.
Years time misunderstood it, just.
Like the Parthenon.
He's in like a fucking cathedral. Though, I mean it.
Does look like Sophie. Can you bring up a freeze frame of his face at like twelve fifty seven in that because he is doing and I think you should leave face like he is. He is almost a perfect character from one of those fucking sketches.
Tim Robinson could do this.
Tim Robinson could do an amazing job of this. There's that sketch from the recent season where he's being like an on air pundit who like gets on his phone and gets real quiet whatever he loses an argument that like Lewis is definitely doing that kind of.
Face in this God right there.
That's he's doing it, Tim Robinson.
He's really, oh boy, doubling down on my two on the two pay theory.
Right yeah, that hair isn't to.
See if we've got the if we've got the veneers to match.
But he's too rich to not have veneers.
I aspire to the veneers. That's I just want to have exactly that much money.
I wanted to you how angry he gets there, because we're going to address the actual facts of his claim. Now, even if you take Lewis at his word, which is that it's basically fine because they were covered seven point three out of like nine point three billion dollars, he's
he's obfuscating the truth. It is accurate that Ray has announced FTX customers will see ninety percent of every dollar of recovered assets returned, which I would still call that problematic because if somebody stole ten percent of your bank account. You'd be kind of miffed. But that is even not
what it seems like. And I'm quoting from Investipedia here To be clear, the ninety percent number refers to the funds FTX is able to gain access to, rather than total customer deposits at the time of the exchange's collapse. That doesn't necessarily mean customers will gain access to ninety percent of their assets that were left on the exchange. Rather, customers will gain access to ninety percent of the funds
FTX is able to distribute to their creditors. FTX and FTXUS had an estimated eight point seven billion dollars combined shortfall by the time the crypto firm filed for bankruptcy, roughly six point nine percent roughly six point nine billion dollars of that shortfall, including a Bahama's real estate portfolio, has been recovered. Let's consider bitcoin, the largest cryptocurrency by market capulation, as a capitalization as a proxy for the
broader cryptocurrency markets. On November eleventh of last year, the petition date, bitcoin was trading at around seventeen thousand. On Friday, it crossed thirty thousand. So simply put, if the current plan goes through, you'd likely get eighty five percent of the dollar value of your cryptocurrency had held on FTX as a last November, even if the same points have almost doubled in value today. So one of those like both, he's kind of overestimating the amount that they're going to
get back. And also because they lost, like they still lost access to that money for it'll probably turn out to be two or three years, Like people have had to sell their homes and shit, because like they had all of their money. Like that, there's harm here, right, that's what the courts are taking. Not only is there still money missing and not an insignificant amount, but like people suffered in the interim where they didn't have access to their money, and yeah, they're crypto gamblers. I'm not.
This isn't the most sympathetic population, but that is not relevant to determining whether or not Sam has legal He's stealing fifteen or twenty percent of a bunch of people's savings accounts is a substantial crime.
The legal question is is it a scam? Which like yes, you know, and I'm sure that like everyone who understandably because I walk amongst them, like everyone who was seeing this happen a couple of years ago up to very recently, We're like, yeah, you're what are you talking about? This happening is like a very you know, it's like easy to cheer it on, but it's also like, yeah, no, Sam Bankmintrede was taking advantage of every possible mark he could.
Yeah, and yeah, and people are still suffering ongoing harm as a result of it. He's acting like Lewis is acting as if there wasn't really anyone hurt, and it's like, well, no, like even if all of them, which will not happen, at least about twenty percent of that money of depositor money is just gone, probably more. But even if he hadn't done that, if you're still locked out of your money for two years because a guy illegally gambled with it,
are you going to be fine that it came back eventually. No, you still didn't have that money for years, and that's a problem for you. That's a crime, I.
Mean, And I would be more amenable to that perspective if it was coming from someone who isn't as like historically fabulously rich as Michael Lewis is, because it's like a rich gaming the rich story can be really satisfying, but this is not the guy to be making it, and he's falling on the wrong side anyways.
And it's like gaming the rich, gaming the rich because like Larry, you didn't they didn't hire Larry David to do a commercial so they could scam billionaires, right, they hired Larry David to do a commercial so they could scam your mom, you know, because your mom likes Larry David. I'm not saying the rest of the show. I mean most moms do. Right, He's pretty popular amongst the moms.
In the comments. I don't know if my mom knows who I.
Mean, the women in my family Seinfeld fans.
Does your mom watch curb Message?
No? No, no, but Seinfeld?
Oh yeah, okay, I'm back, come back.
Yeah. So anyway, Michael Lewis, Yeah, it's interesting to me, like the fact that the I the fact that Sam bankmin Freed stole money from depositors, because that that's what it is. When you take money out of one company illegally and use it to gamble in another company, that's stealing. Michael Lewis never uses the term stolen to describe what Sam did, and he basically goes to great lengths to
claim that Sam misplaced all this money. This is again wildly inaccurate, and a good example of that is Alameda's hashtag fiat account, which is like that was one of the names for the account where they were putting all of the actual US dollars that customers put in the exchange, So customers would put US dollars into FTX and then use it to buy cryptocurrency, right, But those US dollars needed to stay in the exchange so that people could
cash out their positions, right, Otherwise you're not doing legitimately what you're supposed to do as a business. FTX was not a bank. A bank is allowed only has to keep a certain amount in reserve, right, That's what a reserve currency is. This is an exchange. They were supposed to keep enough reserve in there to cover the value of their deposits. Sam instead took all that money and put it into Alameda, and there's evidence that it like
never it went directly into Alameda. The money people thought they were depositing into FTX went into another company entirely, I would call that. And in fact, Sam was convicted because this is an example of fraud. Lewis depicts it as an honest mistake, and here's the New Yorker quote. Lewis finds it not only wholly implausible that this was in fact a gigantic accounting error, explained by ftx's difficulty securing bank accounts. As Lewis concludes, his story implausible as
it sounded, remained irritatingly difficult to disprove. And Lewis very gently insinuates that Ellison, in over her head, might have made some very bad decisions. And in court, which again is a couple of weeks after his book comes out, it is proven with data from the company that Sam not only did not like not only knew what he was doing, but he ordered other people to obscure this
fact from customers. Right, he ordered his employees to hide from customers that their money going straight into another company. This was proven when they like actually, during the court case, they had the people who programmed the exchange on Sam's behalf like post code. And I found an analysis of ftx's code by Molly White, who does a newsletter called Citation Needed, which is quite good. Molly knows code and stuff.
So here's her analyzing that, prosecutors questioned Wang, who was the guy who was coding the exchange, about the FTX insurance fund, which was ostensibly supposed to protect both FDx and its customers from trades that went badly, even more quickly than the exchange's risk engine could account for. FTX published the funds supposed balance on their website and bragged
widely about its existence, including a testimony to US Congress. However, according to Wang, the numbers showed on the website was falsified. And the question is like, is this a real number, Wang, No, so it's a fake number. Yes. Was the real number higher or lower than the fake number? Lower? And yeah.
The way that they would do this so like they're supposed to have this urance fund, which is part of what makes FTX safer than the other exchanges is that we keep you can't do a run on the bank because our entire like like all of our deposits are backed up by cash, right, so we can't collapse the way that other exchanges do. And like to make people feel comfortable they had, they would show them they had, like you could see like what the insurance fund was.
That they would regularly brag, we have this much money in our insurance fund.
It can number accurate.
Like No, all they were doing is so the code snippets show that, like they had Sam ordered Nashad Singing to write some code that would update the insurance fund amount randomly by adding it to the daily trading volume, like the amount of Basically they would it would calculate how much has been traded today, and that would multiply that by a random number somewhere around seventy five hundred and then divide it by a billion. So it would was how it was just describe how you do business.
They're like bus, there was never an insurance a real insurance fund of any like meaningful amount of money. They just pretended it was there by having a computer do a random equation, so it seemed like it was fluctuating over time.
Yeah, that's that's not legal to do.
No, that's that there.
And I feel like this, like this level of like splitting hairs in The New Yorker wouldn't happen unless the two main players, Michael Lewis and Sam Bak Midfried, weren't tremendously privileged like for any other people, you would be like, yeah, so this was a lie and then this happened, like you wouldn't be splitting hairs like this.
To be fair. The actual thrust of that New Yorker article is like, Michael Lewis is what the fuck is happening with this guy? Because he's clearly falling, Like the New york article is very critical of him. It's bringing up that he is not calling Sam Bankman free to fucking con man when he clearly is right.
So they're like headline, Michael Lewis, low key, he fell off?
Yeah, looking, he fell off, that's right, Molly. I also brings up something else that was left out of court, but the prosecution published evidence of it, and I found this really telling. Elsewhere in the code, it's possible to observe that the amount of FTT, which is the token created that represented basically voting shares, was like it was ftx's funny money, was actually represented by a hard coded value in the user interface and was not pulling from
an external data source to get a real number. So again they're lying about how much money is in this fund. And part of how you can tell is when you would ask to see the insurance fund, it wouldn't consult back to the servers. It was just it was doing the calculation on your own machine, right, which is evidence that like, there was never any attempt to give people accurate information. Wow, it's fun stuff. There's other fund reveals during the court case, for example, twists.
Yeah.
During ftx's days as a functioning business, a lot of crypto people notice there was a potential conflict of entr between FTX and Alameda. They were like, hey, it seems like you run both these companies, and traders on Alameda are our trading on FTX. Is it possible that they're getting preferential treatment on the exchange that you also owned.
There's a really telling Twitter conversation on Molly's blog where someone asks this and SBF says, Alameda is the liquidity provider, but their account is just like everyone else's, and the respondent rightfully says, I guess we're just supposed to trust you. And it turned out they were right to be worried. One of the chief selling points about FTX is that it's crash proof. Right. Crypto exchanges have this weird habit, like twenty years old now, of getting really big and
then collapsing, taking everyone's money with them. Sometimes this is due to hacks, but also there's a lot of because there's no regulation, a lot of times major traders will go bust and that causes losses for the whole exchange, which gets socialized. Right, everybody loses money because one bad gambler gambled too much. One of ftx's like selling points
was that it was different. They had an algorithm to automatically freeze trades on an account once that account had suffered losses equal to the amount of money they'd put in the exchange, right, So you can't lose more money than you put in is the basic idea. So that's how it was supposed to work, and that's how it
worked initially. But the limit that Alameda had for its gambling to make sure that it couldn't get in over its skis, was removed later on Sam Bankman Freed's orders, and in court, Gary Wang, Sam's business partner, explained how Sam directed them to do this. Wang explained that Alameda had not started out with such a high credit limit, but that periodically the trading firm had run into issues
placing trades because they didn't have enough collateral. Sam Bankman Freed kept asking him to increase their credit limit to prevent it from happening. According to Wang, the limit was originally set to a few million dollars, but then it was increased to a billion. After they ran up against that limit too, bankman freed asked him to set it to a number so large they wouldn't likely hit the limit at that point. Wang set it to around sixty
five billion. And when I read that, what I see is this is a gambler in Vegas who's like taking out loans to keep gambling because he's run out of money.
Like he's like, hey, you just imagine like someone like on their knees in like shitty pinstripe. Ye can't being like come on, man.
Yeah, give me, just give me some credit. Man, I'm good for it.
But he got up to sixty five billion in credit.
Yeah yeah, which is insane. Now, when you pair all this with the stories that SBF tells that Lewis tells of SBF's gaming addiction, you might conclude was this kid just a fucking gambling addict, Which is, by the way, that's my interpretation there.
I mean there. To me, it sounds like this shit is Neo points to him, Like it really is. Like, if there's anything that got the millennial generation hooked on capitalism and random gambling, it was Neopets. And if anyone has proof that Sam Bankminfreed was a Neopets user, he just sounds like the worst version of a Neopets user. To me, the worst endgame for a neo Pets user is what you've been describing to me for for several hours.
And I think you and I were not invested in Sam Bankmanfreed ever being particularly smart, So we can see.
This, Lewis, he's a Neopets users. I bet it was better at it than him.
Well, that's the other thing. He was never very good at games. Like people found his like League of Legends account and were like, yeah, he was mid Like I'm sure he wasn't good at Storybook Brawl, right, Like he's just he was never good at this.
But it was the first time that Michael Lewis had heard of story But yeah, so Sam bank Fred said he was the best at it. Why not believe him?
Yeah, and that's just the idea. Like again, Lewis can't be like, yeah, this kid had a gambling problem and he also owned a bank, so it became everyone's issue. But like, you're not a bank man. It's hard to portray someone as smart if they're just addicted to gambling, right, because that's not a smart person thing. It Actually a lot of smart people are horrible addicts in a variety of ways. But like, but it's a serious press in
the Hollywood way. Make it look like somebody's a genius if they just can't control themselves, right.
Yeah, it's a serious, serious problem.
Yeah. Yeah, and again no shame on people who have that problem. But like that that does not work with how Lewis wants to portray him, right, And yeah, speaking of things that don't work.
Shit, everything you're about to advertise, we.
Won't have to work if you purchase these products.
Okay, good good self crush. Yeah, I actually will continue to work more accurate.
Yeah, both both true. We're back. So you know, I think it's clear from the stuff that came out in the court case that I just read some of there's no way Alameda NFTX would have done the things that I just described if they hadn't meant to disguise the reality of their business from the world, which is fraud. Right. The reality is that Sam Bankman Freed used to positor money to gamble, and he was gambling in part on
his own chances. He wasn't just gambling. This is the thing that is important to understand past a certain point. Most of his gambling was not him betting on cryptocurrencies.
Right.
The big shit he did that made the news, the billion dollars that he pumped into naming, renaming that stadium in Florida, to bringing in all these celebrities to these high dollars Super Bowl ads, that was a gamble. He was pulling a slot machine on his own chances of ascending to the halls of power. Right, sounds like him, Yeah, yeah, yeah.
One of my favorite aside bits from the court case is that on the stand when she was being questioned, Carolyn Ellison told everybody that Sam confided in her he thought he'd had a five percent chance of becoming president of the United States.
Which, well, I mean, it sounds ridiculous, but also like, look at some of the dumbasses we've got. He's probably not wrong that he eman. He at least could have been like, who is that fucking loser from Starbucks? He could have only s been.
That, Yeah, he could have. I think he could have had a failed presidential but no, like yeah, oh yeah, they're all dumb, Like Joe Biden and Donald Trump are both have both done very stupid things, different kinds of very stupid things, but they both have charisma.
Right, that's true.
That's they But like, like you could again say what you will about Joe Biden, he wouldn't have been in politics this long if you couldn't make enough people like him. And obviously Donald Trump is very charismatic, Sam Bankman free just isn't like you don't become the president if you are avoid of charisma.
No, we and we've learned that time and time again.
Yeah yeah, yeah, And that's the thing, like he was always all of his his his sudden rise to public prominence was not based on him actually being interesting. It was based on him spending tens of millions of dollars to get like Bill Clinton, to pretend to be his buddy. Like that was all there ever was to it. You know, in my general research on the crypto industry, and if you're looking for actual good reading, don't buy Going Infinite.
You won't get anything valuable at it. If you do want to get something valuable in a deeper understanding about like how grifty this whole industry was, and also how grifty Sam was. There's a book called Number Go Up by Zeke Foe Zeke Faux really good book, Number Go Up, which I do recommend to people curious for the dark side of crypto. Zeke also spent time with Sam in the Bahamas, and I found this passage from his book
relevant to what I just mentioned. A few hours into our conversation, Bankman Freed told me he had to make a call. I had asked him if there was anyone who'd support his version of events, and he said I could talk with one of his few remaining supporters. While I waited, in walked a haughty man with a long, scraggly beard, a pot belly, and mismatched socks, one of them with a pac Man design who was an employee of FTX who'd stuck around to help Bankman Freed try
to find an investor to rescue the exchange. I threw out an easy question, why are you still here? I asked. He started off by saying he wanted to help ftx's customers, Then, unprompted, he told me he thought there wasn't much of a risk that bankment freed would ever get in trouble. I firmly believe once somebody he becomes a certain level of rich, they're never poured again. He said, they don't go to jail, nothing bad happens to them.
Wait, he has his own Zuckerberg quote. He has his own You could be unethical and still be lad. That's the way I live my life. Haha. Wait, read it again for me so I can really take it in again.
This is Sam's friend who stuck by him after his business collapsed. I firmly believe once somebody becomes a certain level of rich, they're never poured again. They don't go to jail, nothing bad happens to them.
Poetry.
Yeah, it's beautiful. It's a beautiful thing to think in that moment too, where all of the smarter people have just fled the island, and in that moment he was.
Infinite that yeah, wow, wow.
Yeah, I'm speechless. It's so funny too, because like I don't know, man, just historically, do you remember, like Marie Antoinette was pretty rich and like that didn't end well, you know, like like there's a lot christ had a lot of money. It didn't go well for him. You know, bad things happened to rich people too.
And that's that's your main political stance, as I recall.
Yeah, yeah, I will hang out with anybody rich because nothing bad can happen to them, obviously untrue. I kind of suspect that that that sort of I don't know, you know, the fact that so much of what was said, like Zeke foe Is probably is clearly someone who's smart enough to like understand when he's being lied to by these people and understand their fundamental absurdity, and that comes across in his book. I don't think Lewis got that right.
He believed fundamentally in the fundamental honesty at the center of Sam Bankmin Freed, and I kind of suspect that's why he covered his face with his hands that day in court. He's not a dumb man, and he must have realized by that point the evidence that came out in the trial was undenied and made it undeniable that he got conned too. One of the most remarkable things about Going Infinite is how much detail Lewis provides about ftx's collapse without ever calling Sam a liar. The Guardian's
review noted this too. He thought Bankman Freed hadn't lied to him at all, or at least that he'd only lied by a mission, not by commission. Late in the book, Lewis asks bankman Freed, what would you have done if I'd ask you specifically about FTX customer funds being used by Alameda. Bankman Freed admits that he would have changed the subject or rustled up a word salad and whatever
the facades erected by other effective altruists. Lewis considers bankment Freed to be enigmatic, but essentially genuine, and certainly not out to enrich himself because he has no desire for the things that money can buy. Lewis's refusal to believe that Sam Bankman Freed is a liar in the most venal base sense of the word is based, I think,
on a sense of professional pride. That explains why he's so adamant about pushing the line that there was no money missing, and it's why he continued to defend Sam's dissembling as a fun, quirky character trait while the trial was going on. See as part of the Cash in Ongoing Infinite Michael Lewis launched a podcast Judging Sam the Trial of Sam Bankman Freed.
Oh it was a dough is he and oho? But everyone on this call knows that the first sign that your life is about to be fucking torched, yes, is starting a podcast.
That's right, right, it's the last refuse, refuge of fools and scoundrels. Yeah, please pay for the cool sound free subscription at what do we call it, Sophie so uh. The trial Judging Sam is part of Lewis's Against the Rules podcast on Pushkin, and I can't speak for the regular episodes of that podcast. I have not listened to any of the other ones, but I can say his Sam Bankman Freed Trial podcast is an uneven effort at best. Most of the work is done by Lydia Jean. She's
a journalist, she's okay. I don't have any huge issues with her. I think we get a little too much, like, here's what the court kitchen is like, here's anecdotes from the fun lives of the journalists covering it.
That also gets Yeah. Then it's like my least favorite part of every public radio and I love public radio, but the broadcast where it begins with six minutes of a guy stepping on leaves, and you're like, oh my god, I get it. You're in fucking New Hampshire in.
October fall, where you NPR people leave. We understand, yes, but every podcast on this trial does something like that. I think it's just because they have to. They were doing like basically daily episodes and needed to fill run time, and like, look, is that lazy? Yes? Have we all been there? Yes? So I simply can't throw stones at this classhouse.
What are what are you talking about? As someone who's never had a daily podcast, I condemned this behavior because I've never had to do it.
So LUs Lydia takes most of the have the lifting on this show because Lewis was on tour for his book, right, and so he couldn't be there for most of it. He was barely at the trial.
Yeah, he was screaming at women in cathedrals.
He was busy, Yeah, But he does occasionally come on and one of the episodes that does like he shows up to court on the day that Sam takes the trial or it takes the stand in his own defense, and you know during this portion where he's like Sam's being cross examined, he says, I don't recall more than one hundred times. Here's how a right up from the verge summarizes his time on the stand. Bankman Freed's demeanor suggested a spoiled child complaining he didn't get the biggest
scoop of ice cream at his birthday party. He didn't want to answer the prosecutor's questions or his lawyer's questions. He wanted to answer his own questions, which he liked better. He often replied to yes and no questions with nonsense. We were getting introduced to a document where bankman Freed listed his priorities, including getting accounting right on FTX. Cohen and Bankman Fried, Cohens's lawyer and bankman Freed used this to show how devoted bankmn Freed was to getting to
the bottom of the general fiasco with Alameda's money. The idea was to display in real time ftx's revenue in expenses, where its bank accounts were, how much investor money it had, and so on. This did reveal Bankman Fried's priorities. Getting accounting right was ranked ninth oh for the stories Bankman Freed wanted to tell, we had to rely on Bankman Freed.
We moved on to bankman Freed's argument about hedging, which I still do not understand except as a way for him to say he's a smarter trader than his ex girlfriend, the former Alimeter Research CEO Carolynellis.
God, this is more stand up behavior.
The actual evidence suggests that Ellison is both a better trader and much savvier than Bankman Freed. She modeled out her risk scenario that matched almost exactly what happened to FTX, for instance, to try to keep him from sinking two billion into venture investing. And like, what happens is he's putting, you know, all this money and advertising into like playing celebrities. He's putting like two billion dollars into these random series
of investments. And she's like, hey, we've taken depositor money to gamble with. We have to keep more cash on hand, otherwise the whole exchange could collapse. Sam ignores her, the exchange collapses, and then he blames her for not hedging right.
And a hedge is when you take like a bet that one thing will happen, you take the opposite bet at a smaller amount of money, so that no matter what happens, you can't lose too much money, right, But there's no hedging the kind of risks that FDx was taking because the fundamental risk was we don't have enough money if there's a run on the bank, you.
Know, well, it was like there risk goes, We're never gonna die, Like you can't, you can't hedge that.
Yeah.
What is wild to me is like everything you're describing is ridiculous, and it makes total sense that it fucking imploded in the catastrophic way that it did. But then you also, I mean, so much of it sounds like the kind of stuff that, for example, Michael Lewis might report on is a tremendous scam that worked out great for everybody.
Yeah, and it's so you know, again, that quote from the Verge is pretty similar to how most reporters who were there at the trial described it. It is wildly different from how Michael Lewis describes how Sam reacts on the stage, right, Oh okay, Yeah, And it's interesting because like obviously most people were able to see, Oh yes, Sam is just lying on the stand, he's obfuscating, he's
refusing to answer the question. But Michael Lewis not only does Michael Lewis like being lied to by Sam Bankman Freed. He thinks Sam's defensive cloud of bullshit right this like word salad, is better than the truth. And he says this in his fucking podcast Jamie, You're gonna love this clip.
Today he didn't get in as much trouble as he got yesterday, though.
Not as nothing, but still a little bit more than other witnesses.
That's true. The bigger point is the judge is sitting there listening to see if Sam is actually answering.
The question because he knows he doesn't do that yet.
Or generating a word salad for us all to consume. And I was thinking about this again to day. Why Sam's word salads are so.
Fun, like why he gets waiting Like most people when they don't answer a question, your alarm bells go off pretty quickly, like that you just redirected in some way. He's really really good at starting the answer in a place where you think, oh, that's where the beginning of the answer belongs, and then making a little jump into things are actually interesting to know about, so you're not bored, You're actually interested in what he's saying.
You're saying like there's substance to it. He's not just saying nothing. He's saying something that's substantive and makes you think it's just not what you asked. But then you're thinking and you forget what you asked.
That's exactly what happens.
Yeah, so that's like he's he's just saying that, like, yeah, Sam's lies. He's really good at lying, like and it's fun to listen to him lie as if that's a defense right where they're saying, like, well, they really painted a different picture of Sam because they you know, he got to get up on the stage and bullshit, that's good.
That's a very interesting exchange to listen to as well, because it's like, you know, because it's very clear that Michael Lewis has very little to do with this podcast.
I don't know, like I can think of a number of examples of a like big name a podcaster coming on their show to like be combative with the people who are actually making the show for them, and that like exchange too is like no, like I know what you're saying, but yeah, and even in what she's describing, like the court approaches either he's a genius or he's like an incompetent sweetie pie, but you're just like or he's a malevolent dumb ass, or he still seem to be the.
King con Man. Yeah, but like, yeah, I love this idea that like, yeah, we're getting to see the real Sam, who is a guy who never answers your actual question. But like I want to continue the clip because Lewis says something very very ridiculous right after this.
Okay, he's really really good at starting the answer in a place where you think, oh, that's where the beginning of the answer belongs, and then making a little jump into things are actually interesting to know about. So you're not bored, You're actually interested in what he's saying.
You're saying like there's substance to it. He's not just saying nothing. He's saying something that substantive and makes you think it's just not what you asked. But then you're thinking and you forget what you asked.
That's exactly what happens. It's engaging. It's like, maybe it's even better than the answer to the question.
Right, Maybe it's what you should ask Yes.
Maybe it's not even what you should have asked. That's exactly right.
Yeah, it's Sam. The answer the question Sam answers that aren't what he's being asked or what you should have asked, right, Like, he's smarter than you, the interviewer, and he knows what you actually should have asked, which I just thought was a wild thing for a journalist to say. This is
you know, we're getting to the end here. But the last thing I wanted to bring up was maybe the most interesting case of Michael Lewis following Sam's crap, which is him believing that Sam's outfit, his hairstyle, his poor hygien oral evidence of his brilliance. Right, Sam just didn't have time to like take care of his appearance in
any way. He was too smart to waste any of it, like his brain power on that And that article in Jacobin gives a really good summary of the actual testimony of Sam's former friends in court blew this idea out of the water. The prosecutor followed with questions about Sam's approach to public relations. Ellison explained he was trying to cultivate an image of himself as a sort of very smart competence somewhat acentric founder. I was sitting in an
overflow room on that day. So when the prosecutor asked, how would you describe the defendant's personal appearance through twenty twenty two, the room was allowed to erupt into laughter. Ellison replied, he looked like he didn't put a lot of effort into his personal appearance. He dressed sort of sloppery, sloppily, and didn't cut his hair often. He said he thought his hair had been very valuable. He said ever since
Jane Street. He thought he had gotten higher bonuses because of his hair, and it was an important part of fdx's narrative and image.
God yeah, first embarrassing, but also I think, you know, clearly predicated on the dipshit billionaires that came before him, Like there is a clear aesthetic and a clear like you know, slovenly genius thing that he'd like.
It's strategic and that's interesting, right, the fact that Sam is standing on the shoulders of giants of Steve Jobs, unwashed shoulders like you know, Mark Zuckerberg's hoodie and whatever.
Genocideary that he wears.
Yeah yeah, and it's like yeah. Lewis describes it as like everything in Sam's appearance felt less like a decision than a decision not to make it decision and no, what everyone says at FTX is like he was obsessed with like his hair. When they were spending trying to build their two hundred million dollars or whatever new headquarters. His only design note was that it should be shaped so it looked from the side like his hairs do, because he thought that, like he thought it was iconic, right like.
Which is also based on the what we were just listening to. What the like logo to that podcast is is the shape of his hair. Everyone's playing into it.
It's yeah, fuck, it's fucking wild. Anyway, Jamie, that's my episode. Do you think we should fire Michael Lewis into the sun?
Well, I was, I was thinking earlier. I am very curious because you know, I think it's like a waste of time to ask, like, well, Michael Lewis have another opportunity to course correct his career. Of course he will, of course you will.
Yes, He's gonna write seventy more books.
Well, what I'm curious about is like where he goes from here. I feel like it's pretty telling if you've been con to this fucking degree, because no one clocked him in the blind Side, But now he's been pretty severely clocked as like giving in to his worst biases and reporting it as fact. And I do wonder, like, if that's the position you're in, and you will absolutely read another book because you're unkillable financially, Like, I wonder
which direction he's going to go in. Is he going to be hyper cautious, is he going to play it safe? Is he going to be self reflective at all? Or is he going to double down on the falling for it kind of stuff? I genuinely don't know, because I just like it's very hard to discern what kind of person Like it seems like he's certainly, you know, like high in his own supply and is like, well, you know, of course anyone could have fallen for it, but he is sort of conceding to the fact that he fell
for it. I just am curious what happens to someone from there.
My suspicion, and maybe I'll be wrong about this. I think we'll know pretty soon. I think he's going to do another SAM. I specifically think he's going to yeah a second, a second SAM has hit the Michael Lewis bibliography, and it's going to be Sam Altman, like he's going to do with Sam Altman, the open AI guy who just got fired from his job. He's going to do a book on Sam Altman. I suspect you're probably right.
You're probably because then he'll be like and I would know I can see through Sam's now having been conned by one. I certainly won't becoming.
Sammy wants Sam on you, Sam me twice, won't get Sammed again. You know, I am just like.
Other Sam Sammy chit Wow, Yeah no, that.
That's my guess as to where this goes is Sam Altman.
What why is Michael Lewis being presented with a second Sam doesn't seem fair?
Second Sam? Is it that? Well, I've already done that joke once and it worked and all. It always works, j it always works. Yeah.
Yeah, Well I don't feel well. You know, I've I would say that this is like in the top twenty percentile of Bastards episodes. I've come out feeling like, you know, I don't feel that bad. I usually feel like really dire. I feel pretty good. Yeah, he's in forever. He's in forever jail.
He's in he is in forever jail, right, Yeah, speaking of forever jail, Jamie talent is like a jail that locks you into, for example, making a weekly podcast. And I am happy that you and I are about to be cell mates.
We are I'm so excited. Yeah, we get to do the fun thing where we're like, we can't talk much about it yet, but there's.
A weird podcast about it. But Jamie Loftus Weekly is coming to the cool Zone Network. You were going to be the cool hand Luke of our podcast.
Pure welcome God. I would love to be the cool hand look of the podcast. I gotta get some new outfits.
Gotta get some new outfits. Gotta No, that's not the one. Is that the one where he throws a baseball at the wall or is that the Great Escape?
I feel like that was cool hand a long time.
Neither of I not since I was like seven, So I don't know.
Why are you a cool hand look when you were seven?
Yeah, my mom loved that movie.
Nice.
My mom had very strict rules on like what I could watch on as movies as a kid unless it was a movie she liked, which is why I was in first grade when we watched Alien.
So that explains so much about you too.
She was so excited that all the men die and and and the woman didn't. But like, yeah, she wanted me to see that movie at a very young age. What a legacy, truly, The sentence because men are stupid was uttered two or three times during that.
Movie, which does unpack a lot of the plot intended or not there. My mom would let me watch soap operas very young, and would I would be like, what do they mean when they say making love? And she would say, what do you think?
I don't know?
I'm seven?
Yeah you haven't. You have not equipped me to answer that question.
Mother.
Well, yes, weekly podcast coming soon early next year? Was it about you? Guess? But don't contact me about it because you're wrong?
Yeah? Yeah, A second Jamie has hit the cool zone. I mean, you've done more than two podcasts. This joke never worked, But.
A first Jamie has hit the cool zone. Weekly. That's right, Amy, What podcast is this of ours? Oh? God? How many? How many?
This is?
This will be?
What?
Oh my god?
Oh it's possible to say it's impossible.
I think it's like six. Yeah, I think it's like six. We've entered the half dozen range. It's getting dangerous.
That's so cool for us.
I know we're forever wives, Sam Bankman freed forever, Jill ever jail us forever wives.
Oh uh so, Jamie, anything else you wanted to plug before we ride on out of here, like Michael by.
Raw Dog bitches. Yeah, it's the holidays. Are you looking for something to get for your loved or hated one? I won't know. Buy a copy of Raw Dog. It's my book about hot dogs. And if you don't like hot dogs, the title's funny, and I think that's you know, about sixty percent of the purchases I've gotten have been off that alone, So you should buy Raw Dog.
And yeah, buy raw Dog. And now I'm not going to make a raw Dog jake. That's just gonna get me in trouble anyway. Buy a Cooler Zone Media subscription and you won't have to hear ads, Or don't buy a Cooler Zone Media subscription and continue to listen to ads. It's I don't care, live your life. I'm not your fucking dad.
If you really want to hear the advertisings that Robert's disparaging, I personally think it's more fun to imagine it. So you should get a cooler Zone Media subscription.
Yeah, once everyone's on cooler Zone Media, then we can finally get that sweet Lockheed Martin subscription that I've or whatever ad deals that I've been wanting to have.
Robert can finally live inside a grenade like it's always been his dream.
That's been my dream, that's been my dream, Jamie. Yeah, all right, we're done.
We did it. Behind the Bastards is a production of cool Zone Media. For more from cool Zone Media, visit our website cool Zonemedia dot com, or check us out on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts.