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What Happened at Alameda Research

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Re: What Happened at Alameda Research

#331

Post by ajross »

wikfwikf wrote: post #321
ajross wrote: post #258

Earlier quoted context omitted.

> This isn't news reporting, it's a form of entertainment journalism I don't see where you're justifying that. I read this article and it gave me a good overview of the situation. You're right, I guess, that it's not "new" investigative journalism and that if I'd been paying better attention I could have found the same info elsewhere and earlier. I don't see how a correctly-reported review piece becomes "entertainmen…

I justified it, at length, in the above comment by pointing out how little real information there was in the article about what had actually happened to BTX and Alameda. I did not say anything about "new investigative journalism". I said it was not news reporting. The claim that is is entertainment journalism is very simple. This type of piece is written, not to inform, but to entertain. That's why it focusses on col…

I'm still not understanding what part of the article you think is incorrect, and/or what information you wanted it to contain that it didn't. All this meta stuff about "what the article is for" is just confusing me.

Again, I read it and liked it. If you don't want me to read this piece, what summary should I be reading?

Re: What Happened at Alameda Research

#332

Post by strikelaserclaw »

PeterStuer wrote: post #10

I find it curious Musk was able to snif out SBF as a bullshit artist in his 30 min. Meeting with him, whereas countless polititions and regulators aparently did not have a clue despite years of meetings and other contacts.

Elon Musk is a master self promoter, so i would take what he says with a bit of caution.

Re: What Happened at Alameda Research

#333

Post by MichaelCollins »

spaceman_2020 wrote: post #316
jasonwatkinspdx wrote: post #289

Earlier quoted context omitted.

Just to explain as someone that was initially a fan of Musk but now highly critical of him: SpaceX owes a great deal of it's success to the people around Elon, particularly Shotwell, minimizing his bad behaviors. Compare this to Tesla and now Twitter, where Elon has unilateral power. At the first he managed to get in trouble with the SEC in the dumbest way possible, as well as continues the Fully Self Driving saga th…

The EV industry as well as the spacetech industry would have none of the momentum they currently have if there was no messianic figure like Musk leading the pack. Industries need charismatic evangelists to attract capital. Musk made investing in serious hardware ventures cool. Now all the billionaires have their own space companies just to compete with Musk. All in, a net positive. Otherwise Bezos billions might have…

> Now all the billionaires have their own space companies just to compete with Musk.

Do they? The only other billionaire-owned space company that comes to mind is Blue Origin, but they were founded years before SpaceX. (Which incidentally, seems to debunk the common argument that any billionaire funding a space program would have success similar to SpaceX/Musk. If success with such funding were inevitable, Blue Origin would have gotten to orbit years ago but in reality they still haven't.)

Re: What Happened at Alameda Research

#334

Post by jrochkind1 »

joenot443 wrote: post #317
jrochkind1 wrote: post #221

A side issue, but I found it distracting that the text consistently refers to Caroline Ellison by her first name alone, rather than last name or both names or initials like all other people discussed (and like is generally done for public figures covered in news articles etc). But I'm not in the "community", I don't read a lot of this inside baseball stuff. Is this the way she is usually referred to? It looks like he…

Sometimes peoples' first name ends up being what they're known as by the general public, usually because using just the last name might be ambiguous. Nobody called him "West" before the name change, it was always "Kanye". Similarly, one might not immediately know who "Winfrey" is, but everyone knows "Oprah". Presumably, since Larry Ellison is also a figure in the high-net-worth tech world, one might unintentionally m…

I mean in that first-name-celebrity sense, it actually is kind of bombastic, rather than denigrating. Is another read. It still seems weird to me.

The celebrity first-name-ism is sort of an attempt to claim a global fame, as well as a sort of artificial familiarity. I refused to call them "Hillary" or "Bernie" either, they aren't my friends, they are public figures.

It seems notable and weird and interesting to me in this case (as well as distracting as a reader who wasn't expecting it), but I'm not certain or making assumptions about what's behind it, I'm curious.

Re: What Happened at Alameda Research

#335

Post by bena »

tommica wrote: post #306
matthewdgreen wrote: post #260

Earlier quoted context omitted.

I wonder how much of those $16B in customer deposits were actually lightly-traded altcoins that could never have been liquidated at anything close to that value? There is no doubt they defrauded people of a lot of (real!) money, but my guess is a huge chunk of that $16B top-line figure is fantasyland dog-coin nonsense. Whereas the LTCM and Enron investors at least started with real cash.

But those coins were most likely purchased with real money?

I think his point is that while it was bought with real money, it couldn't be sold for real money.

If I buy 50 RandoCoins for $1 today, tomorrow it shows that it's now valued at $2, and then the next day RandoCoin is hacked and all the coins are stolen, I didn't really lose $100, I only lost $50.

So he's wondering if the value of loss is being expressed as the money used the purchase the coins or the perceived value of the coins.

Re: What Happened at Alameda Research

#336

Post by [deleted] »

nova22033 wrote: post #144
flanked-evergl wrote: post #9

Before or after they were bribing politicians for favourable regulation for FTX at the detriment of their competitors who were not fraudulent? https://prospect.org/power/sam-bankman-frieds-multimillion-d... > Crypto’s supporters in Congress are determined to ignore the massive gap in capacity between the two agencies; in fact, they likely understand that its incapacity is part of its appeal to FTX. A bill proposed by…

FTX has stocked up its ranks with former CFTC officials This is regulatory capture. If you think it's bad for crypto, wait till you see how bad it is for the agencies that approve our drugs.

[deleted]

Re: What Happened at Alameda Research

#337

Post by throwaway82635 »

nova22033 wrote: post #144
flanked-evergl wrote: post #9

Before or after they were bribing politicians for favourable regulation for FTX at the detriment of their competitors who were not fraudulent? https://prospect.org/power/sam-bankman-frieds-multimillion-d... > Crypto’s supporters in Congress are determined to ignore the massive gap in capacity between the two agencies; in fact, they likely understand that its incapacity is part of its appeal to FTX. A bill proposed by…

FTX has stocked up its ranks with former CFTC officials This is regulatory capture. If you think it's bad for crypto, wait till you see how bad it is for the agencies that approve our drugs.

Much of the regulation of CFTC-regulated entities is done through the NFA, and the NFA committees look like this:

https://www.nfa.futures.org/about/committees/index.html

The influence of the regulated companies is entirely transparent.

Re: What Happened at Alameda Research

#338

Post by kwertyoowiyop »

anonymoushn wrote: post #122
SnowHill9902 wrote: post #117

Earlier quoted context omitted.

Kelly criterion is not the best strategy for one. It’s the best strategy for an ensemble of ones in many universes but you can only live in one universe. It’s a nerd trap because it seems so elegant and reasonable.

This isn't true? If you aggregate utility across universes using addition and have utility linear in wealth then you maximize your aggregate utility by going all-in on every favorable bet. Kelly turns out to be equivalent to maximizing expected log-wealth, if one stays within a single universe, or to maximizing the probability that one will eventually have more wealth than any agent in the same universe that employs…

Only on HN is it necessary to define that we are only discussing the single-universe case!

Re: What Happened at Alameda Research

#339

Post by Scoundreller »

DebtDeflation wrote: post #120

> Most news accounts seem to portray the scale of the bankruptcy as relatively small. This is a key point. They lost $16B in customer deposits. LTCM lost $4.6B in investor funds. Enron lost $11B in shareholder capital. Interestingly, while Madoff is widely quoted as having lost $65B, that was almost all fabricated paper wealth, actual losses were around $18B and $14.4B of that was recovered and returned. All of these…

An interesting part of Madoff recoveries were through settlements against originators/feeder funds because they « ought » to have known it was a ponzi.

Unsure if FTX creditors will be able to do the same.

But mostly, Madoff himself didn’t really spend much money. Just did nothing with it. The few pieces of fancy real estate he lived in were actually profitable because he didn’t build some gawdy illiquid palace.

But there was a lot of time-value loss that isn’t accounted for. Even 14 years later there are still distributions. Even getting $1 back on your 1995 $1 is still a big loss.

Re: What Happened at Alameda Research

#340

Post by xhkkffbf »

eternalban wrote: post #253
DebtDeflation wrote: post #120

> Most news accounts seem to portray the scale of the bankruptcy as relatively small. This is a key point. They lost $16B in customer deposits. LTCM lost $4.6B in investor funds. Enron lost $11B in shareholder capital. Interestingly, while Madoff is widely quoted as having lost $65B, that was almost all fabricated paper wealth, actual losses were around $18B and $14.4B of that was recovered and returned. All of these…

Unless there is some sort of event horizon in financial systems, it is wrong to use the word "lost" as if it is impossible to find out who got these kingly sums. Billions of dollars were "blown" and the question we should be asking, very forcefully, is who got that money.

It could be that no one "got that money." If a stock is trading at $2X and the value of all of the shares is $1 billion, no one gets the money if the stock opens the next day at $X. That's the problem with thinking of stock prices as real money. (And, indeed, real cash can also lose value through inflation.)
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