I haven’t read Michael Lewis The Great Short: Inside the Doomsday MachineBut I find it hard to believe that the author expressed much sympathy for participants in the US housing bubble before the 2008 financial crisis. By contrast, his account of former FTX CEO Sam Bankman Fried (SBF) is relatively glowing.
in Going to Infinity: The Rise and Fall of a New Entrepreneur, Published on October 3, Lewis released several largely unknown details about FTX’s downfall. This included SBF trying to pay former President Donald Trump not to run for office again, and writing a list of pros and cons to former Alameda Research CEO Carolyn Ellison about their sexual relationship. But what stood out was not the background to Bankman-Fried, but rather the fact that the vast majority of the material focused on explaining how SBF’s mind worked in relation to money and his interactions with others.
An entire chapter is devoted to SBF’s motivations behind effective altruism: the idea that people should earn as much money as possible in order to donate it and make the world a better place. But the term also seems to be the subject of the book, as it paints a picture of SBF as someone who brought together influential people with little or no crypto experience or funding to launch Alameda and FTX to frame them as crusaders working for a noble cause — largely ignoring what was happening on the other side. , as many FTX users lost their savings once everything collapsed.
When FTX had to declare bankruptcy in November 2022, a lot of people were hurt financially and emotionally. Some media outlets have portrayed SBF as a rising star who could one day bridge the gap between cryptocurrencies and traditional finance, and FTX holds billions of dollars from many retail investors. Unless these investors were quick enough to cash out their money immediately once the stock market’s downward spiral began, most of them were cut off from their money for several months.
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According to the book, Ellison’s farewell letter to Alameda employees in the aftermath of the crash seemed carefree, disconnected from the reality of people losing their jobs, money, and credibility. It seems as if there was only one time Lewis changed this narrative, describing a conversation between Constance Wang, the former COO of FTX and SBF after the exchange went bankrupt.
“When you were doing this, did you ever think about how harmful this event would be to people,” Wang said, “and is that part of your ‘initial expected value’ calculation?”
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However, both before and after writing about this encounter, Lewis seemed to treat Bankman Fried in many ways, often portraying the narrative around him as a highly skilled trader but completely incompetent at tasks that most adults take for granted. He included details of FTX’s headquarters in the Bahamas, which was planned around the space of a cube made of pure tungsten. The book ends with Lewis discovering the thing, and SBF’s only comment on the endeavor: “Badminton courts.”
If only prosecutors prosecuting the case against the former FTX CEO had the information available Going to infinityIt is doubtful that there were any charges. The matter could have been considered a misunderstanding and settled out of court. Lewis himself concluded that FTX users’ money went nowhere, and implied that hedge fund managers had no knowledge of wrongdoing before the stock market crash.
“All sorts of people who had no idea what exactly happened inside Sam’s world now thought they knew everything they needed to know. A surprising number of them thought the crime should have been obvious all along. It wasn’t.”