Sam Bankman-Fried is found guilty on all seven counts and faces up to 115 years in jail

[Tia]

Well Sam Bankman-Fried gets 25 years, at least for the moment. I don't have issues with him going to prison but to me this was overly harsh. I have to admit I am influenced by the Michael Lewis book about SBF Going Infinite. It's strange to have a biography written in almost real time but circumstances allowed for it to happen. Of course he is the only guy going to prison for this crime while it looks like everyone else in the company walks. Elizabeth Holms make a fake blood tester and only gets 11 years. I never felt the intent was there by SBF to deserve such a sentence. Not like Madoff. That was total intentional fraud. Into the volcano he goes while the other shady pumpers still go on tv and make reckless claims about the invisible money

So he was in Washington DC for meetings then making millions in political donations, buying properties , moving crypto of clients for his own access , partying etc etc . Tried to manipulate witnesses and move money afterwards if I recall so judge removed him from his parents home/put him in jail . I didn't read the books posted by Brett. But none of that is intentional??

edit to say oh maybe he thought it was one big video game he was making $$$$$$$$$ at??

 

[needvaca]

And this is why people should only invest in regulated industries. After Madoff, the SEC came in and required thousands of unregulated investment managers to register and comply with SEC rules.
However crypto, etc remains unregulated and does not fall under these rules. So buyer beware

 

[WaikikiFirst]

With both parents teaching law and economics at Stanford, I don't believe he has a lack of business knowledge. It is more likely a case of greed and lack of ethics. I haven't heard whether the millions in political donations were ever returned.

This. All of this. Sam & I have same alma mater. It sounds like he was more of a geek ("smarter")than I ever was. Somehow, it took me a few months of working in the "financial services" industry to understand all these terribly difficult concepts, such as not "cross-mingling" assets, (more bluntly, LOANING THEM OUT), etc etc. And those first few months, I was with a firm that didn't even solicit customer assets. The first morning someone goes into the office and accepts customer assets, esp from "non-sophisticated" investors, the bleep he was pulling is kryptonite, and that is well-known.
And neither of my parents went to college, nor ever taught me an iota about "business". Look at this guy's parents and his connections. Look at the lawyers he can hire with the assets / revenue he attracted.

A pure case of purposeful megalomania riding a tsunami that he thought would just push all boats higher & higher. Throw away the key.
btw, nope, I didn't lose a penny to FTX or any other crypto scam, just pretty POed that a MIT guy did this. Oh, and Ellison, the partner-in-crime, is the daughter of 2 MIT econ profs. This is worse than the MIT people who helped blow up LTCM thru plain-old smartest-guy-in-the-room stupidity. SGITRS was a frequent source of amusement for me in my days in that business.

Did Sam's parents give back their criminal gains? Ellison's may not have to since she "got a deal". Good one

 

[WaikikiFirst]

There must have been no way to envision what happened. To be fair I don't think Sam B-F. wanted to rip anyone off. It was not a pyramid like Bernie Madoff. He used money, (or tokens) that he was not supposed to use to trade.

You obviously don't know 1/3 of what was going on. You're completely wrong. Did he INTEND to go bust? No. But he had every intention to trade OTHER PEOPLE'S MONEY to make himself a fortune, and let the OTHER PEOPLE unknowingly take the risk.

 

[WaikikiFirst]

many say Michael Lewis got a little too close to Sam Bankman-Fried to be objective

That isn't the first time. Lewis is a GREAT writer. Lewis is a Bay Area liberal who goes out of his way to support other Bay Area liberals and their "ideas" in his writing. Lewis has been doing it for a while now. Maybe The Big Short was the last thing he wrote in which he didn't do it?
It is like naming 3 or 4 cable "news" shows and trying to "guess" which side of any issue each one will support. Really difficult. Really it is.

 

[WaikikiFirst]

this is why people should only invest in regulated industries

Well, FTX was an EXCHANGE. This was not about some tiny RIA.
Maybe it was an "oops, I guess it just happened" that SBF happened to base his exchange in the Bahamas. And then give lavish gifts to the top people in the Bahamas. Nah, SBF had no ill intent. It just happened. He is sorry.

 

[jorcus]

My original post.

It's funny how bitcoin is supposed to be it's own currency but people talk about how much dollars were lost. Should the reported losses be the number of Bitcoins as well as the other tokens people bought or stashed in FTX? Why are they putting a dollar value on it? It fluctuates up to 10% in a day which means no one knows what it's worth. The original creators of bitcoin seemed to imply that it would be a peer to peer currency with no middlemen. There must have been no way to envision what happened.

To be fair I don't think Sam B-F. wanted to rip anyone off. It was not a pyramid like Bernie Madoff. He used money, (or tokens) that he was not supposed to use to trade. That's the funny thing about inexperienced traders. They never think they are going to lose and don't protect themselves enough. It's the old wall street saying, bulls make money, bears make money, pigs get slaughtered! Too bad the other pigs just get to stand around and watch the sacrifice.

WakikikiFirst response.

There must have been no way to envision what happened. To be fair I don't think Sam B-F. wanted to rip anyone off. It was not a pyramid like Bernie Madoff. He used money, (or tokens) that he was not supposed to use to trade.

You obviously don't know 1/3 of what was going on. You're completely wrong. Did he INTEND to go bust? No. But he had every intention to trade OTHER PEOPLE'S MONEY to make himself a fortune, and let the OTHER PEOPLE unknowingly take the risk.

If you are going to quote me to make a point please do not snip parts of two different paragraphs to make yours. The point in the first paragraph has nothing to do with the point of the second.

 

[WaikikiFirst]

do not snip parts of two different paragraphs to make yours. The point in the first paragraph has nothing to do with the point of the second.

LOL. What I "snipped" out was empty space. If the 1st sentence in Para 2 has nothing to do with the last sentence in Para 1, there is something wrong with your approach to writing. I would have hit "reply" to all of it, but the prior sentences are so void of any understanding of finance nor economics that I could not stand to look at them again.

It is as if I went around proclaiming how Revlon should strategize, develop and test products in the cosmetics business. Egad!

 

[jorcus]

LOL. What I "snipped" out was empty space. If the 1st sentence in Para 2 has nothing to do with the last sentence in Para 1, there is something wrong with your approach to writing. I would have hit "reply" to all of it, but the prior sentences are so void of any understanding of finance nor economics that I could not stand to look at them again.

It is as if I went around proclaiming how Revlon should strategize, develop and test products in the cosmetics business. Egad!

So that's what you got out of 2 simple paragraphs? It's a BS response. You seem bent on insulting me for some reason. I let it go once but how can any one take you seriously if you can't grasp what I wrote. I don't buy for one second you do not know what you did. At least you should have known what what you did. Just own it an move on.

 

[WaikikiFirst]

can't grasp what I wrote

I completely grasp what you wrote. You understand basically nothing about finance nor economics nor "the markets". And then you compound your complete lack of understanding into a series of conclusions about SBF. It is as if a 20 yr old just got a brokerage account and now he is a "Master of the Universe".

I'm all ears if you're ready to explain the amazing insights that were in that empty space.

 

[DrQ]

That isn't the first time. Lewis is a GREAT writer. Lewis is a Bay Area liberal who goes out of his way to support other Bay Area liberals and their "ideas" in his writing. Lewis has been doing it for a while now. Maybe The Big Short was the last thing he wrote in which he didn't do it?
It is like naming 3 or 4 cable "news" shows and trying to "guess" which side of any issue each one will support. Really difficult. Really it is.

Read "Liar's Poker" to see that Lewis worked in the financial industry (Solomon Brothers) during the S & L debacle so he may have a better perspective on the matter than most.

 

[WaikikiFirst]

Read "Liar's Poker" to see that Lewis worked in the financial industry (Solomon Brothers) during the S & L debacle so he may have a better perspective on the matter than most.

I know Lewis' background quite well, thanks. Liar's Poker & The Big Short are 2 of my favorite books. Lewis' perspective on it has been highly subjective since those early days. Lewis has a "thing against" "Wall St", which is what he always calls it. Well, so do I , sort of, even though Wall St made both of us wealthy.

"may have a better perspective on the matter than most"... Lewis worked an entry-level position on "Wall St" in the '80s. I had my own firm managing money in the 2000s. That is both more relevant to and more contemporary with what SBF's side-fund was doing. I'll say again, his The Big Short is an awesome book. TBS covers the housing / MBS bubble. I lived through amazingly similar experiences during the tech bubble years earlier. If Lewis had followed me around for 5 years, he could have written almost the exact same book, simply changing the specifics of the bubble.. Otherwise, it is unbelievable how realistic TBS, and I know that because I lived thru the exact same stuff. I had days exactly like some of the iconic scene in TBS. I have always wondered if "non-Wall-St" viewers understand how deadly accurate TBS is. If anyone thinks TBS dramatically overstates events and Wall St tit-for-tat, think again. TBS is deadly realistic and accurate. (well, whatshername in the bathtub may not be accurate, but we won't discredit the film for that, will we?)

Want evidence of how subjectively-slanted Lewis' perspective has been since those early days? Lewis wrote Liar's Poker thinking he was skewering "Wall St", and as a "warning" (his quote) to people to not go to work on Wall St. Well, guess what. LP became, again in Lewis' own words a great recruitment tool to attract the best and brightest to Wall St. Lewis' narrow ideology blinded him to reality of what he had seen and what he was doing. He has admitted that. Search google using " Lewis Liar's Poker warning recruitment REGRETS HE EVER WROTE LIAR'S POKER". You'll find the quotes by him.

His great writing, his perspective, his knowledge & his credibility have all suffered due to his increasing desire to simply push ideology. Like the rest of US media and even society.

 

[emeryjre]

SBF made the same mistakes as some other money managers
He found out people would give him money
He found out he could break the rules of money management
He could hide the losses for a while
He seemed to think to himself he would make the losses back when the markets turned
I do not think he is a clever, narcissistic, con man going into this with the intent of defrauding his clients
He was not a responsible and mature individual
He will pay the price and spend time in jail
If things hadn't caught up with him, where would he be today now that BTC is around 70K a coin
He does need to go to jail