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Agustin Lebron

lines on the record: 64
first: 2022-06-23
most recent: 2022-06-23
sittings or episodes: 1
sources: podcast

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“Useful skills, and at the end of it, there's like a six figure job with a Western company. Like, there's no reason that companies like Infosys should be taking the lion's share of that arbitrage opportunity. Like there's this incredible need in the world for people that are, you know, smart and motivated. And there's this incredible supply that we're just systematically undertapping. So my answer to your question is yes. I strongly believe there's a trillion dollar business potentially or maybe it's a nonprofit, I don't know, in closing this arbitrage gap.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“I don't think so. In fact, I think that the most common failure mode I see in tech company hiring is hiring for skills instead of hiring for abilities and potential. And it's just because skills are very legible. Like it is fairly straightforward to spend an hour with somebody and understand whether they can write code in Python, right? And so it's like the drunk looking for the keys near the lamppost. You just evaluate what's easy to evaluate. My dream in some sense, and this is something that I can't really work on right now, but who knows, someday I could, is the idea of doing mass mass screening for people around the world. Like what I'd love to find is the smartest 0.1% of high school graduates around the world, India, Nigeria, all these countries that are being massively underserved by their educational system and their opportunities and putting them in these sort of boot campy situations for six months or something where they learn.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so this varies from company to company and even has varied over the course of the history of Jane Street, certainly. Like when I started, it was very much the Socratic method, right? You sit next to a senior trader in their jobs to teach you everything they know. And so it's just a continuous stream of questions, answers, conversations, etc. JSTRE, to their credit, has improved on that. There's now sort of a boot camp that you go through where you basically just intensively learn the fundamentals of everything that the firm needs feels like you need to know as a trader. So that, again, accelerates the process. But it is very much sort of putting people in situations to sort of experience the decision-making process and iterating on that decision-making process. Like, what are you thinking about here? What do you think about that? Hey, did you think about that? What would you do in this situation? Why? Why not? etc. And that just takes time.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Positive edge trades like they're probably on average losing money. And so you would like the person to realize that maybe this is not a winning game for them, and so they shouldn't be playing it. And so again, there's sort of this adverse election of, well, if they can't realize they're playing and losing game here, then that's probably not great.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“I guess the thing I'm thinking of is that the concept of a domain is probably a lot narrower than people understand it to be. If I'm there sitting there on my Robin Hood account punting stocks back and forth, like that is not the same domain as what a trader at a market maker or at a top trading firm would do. And in fact, to the extent that you think that that's the same domain, that is a thing that you have to unlearn when you come work at, you know, we'll say a real company. You know, that can happen, but it's just, it's kind of a problem. Like, it's just a thing you have in them back of your mind, right? Like, you'd rather take a blank slate, a really smart, motivated blank slate, and sort of teach them what they need to know, then undo something and then teach them the thing they need to know. You see this a lot of the time. The other thing is from, again, at a meta level, probably in expectation, the person who's doing trading in their personal account isn't doing.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“So one of the things I've always said, maybe you've heard me say this before, is I would love to talk to the person who is the third best player in the world at some weird obscure chess variant because that is probably very correlated with things that I care about, such as a willingness to really grind and try to get really, really good at something. And to do so, not because there's a huge pot of gold at the end of the rainbow, but because you just find inherent enjoyment in getting really, really good at something. So I think that's pretty good. But yeah, just general, again, aside from sort of the mathematical and... You know, that can take many forms, but I think that's a big part of it for sure”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so I mean, I think the motivation of like winning the game, of like making money, and that is sort of how we determine who wins the game. I think that part of making money motivation makes a lot of sense for a trader. But the all I want to do is make the most money possible is correlated to things that aren't maybe so great. Because a lot of the job is sort of having an inherent curiosity about random things, for example. And if your whole motivation is like, where can I sort of make the most money today? It's not necessarily optimal over the long haul. And so you kind of need to sort of balance that against these other things, like enjoying the game for its own sake, enjoying the game for like, you know, sort of as an exploratory kind of thing. So maybe that's like maybe a little bit inconsistent with something that I really...”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“No, I think there's something to that. Certainly, doing a lot of the hiring that I used to do, one of the biggest, almost red flags is when somebody comes to you and says, oh, I've been wanting to be a trader my whole life. Because first of all, they don't know what trading is, right? They haven't known what trading is their whole life. They don't know what the job really involves. It's not tangible in the way that being a doctor is tangible. And so what they're really telling you is I've been wanting to make a lot of money my whole life, which is generally a pretty... Well, say like in some jobs it's a good motivation, but it's not necessarily the motivation you're 100% looking for out of the gate in hiring someone.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that's a different question because in the end, companies have a pretty good idea, or at least should have a pretty good idea of what the marginal value of an additional employee is. It's true certainly that people, by and large, give up things in order to get the security of working at a company. So maybe that counteracts that sort of adverse election in terms of pay. It's not clear which way it washes out, I think, to me.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, you're right. From the employer side, it's definitely adverse election all around. Like, first of all, if you're looking for, if you're just sort of posting a job ad, the applicants that apply are selected against in the sense that you're selected against that pool because the people who are really, really good, probably their employers know they're really good. And so they're really incentivized to keep them. And so the people who are kind of on the market are probably at the margin not as good. Not only that, but even just the mechanics of hiring, the person who has the final say in terms of whether this happens or not is the employee. And so you're going to get adversely selected there because the people who are really, really good are going to have lots of job offers. And so they're going to pick from one of many offers. The people who aren't so good are going to pick from few offers. And so employers just systematically get adverse selected that way. Now, whether that means that they're sort of systematically overpaid.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, no, I mean, big picture, we're building a crypto protocol that is kind of new and has some pretty cool cryptographic guarantees against things that people don't like when they trade in crypto.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“A few years, and then left Chain Street a few years ago and started my own consulting company, basically just helping tech companies with growth things like management and hiring and that sort of thing. And in the last few months, started a new company in the crypto space.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so my background is engineering. That's kind of what I did in university. I did engineering for about six years professionally. I was a chip designer. At the time, I was playing a lot of online poker. Back when that was profitable and arguably legal thing to do. And so engineering was getting kind of boring and I wanted to do something else. And so I thought, well, what's halfway between engineering and poker? And of course, that's quad trading. January 2008 walked into my boss's office and I said, I want to quit. And he said, oh, where are you going? And I said, I'm going to go into finance. And he's like, are you sure this is a good time to be doing that? And said, yep, no, I'm dead set on it. And a few months later, managed to get a job at Jane Street and wrote out the implosion of Western civilization. The seat of a trading desk”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source
“I think you pretty much hit the nail on the head. I think a lot of the times that people sort of start thinking about trading seriously, they start realizing more and more how hard a job it really is to do well. And the answer is probably, look, if you're smart enough and good enough and hardworking enough to make it go at it and make a living at it in financial markets, there's probably an easier way to make money and have a satisfying life most of the time.”
2022-06-23 · Dwarkesh Podcast · Agustin Lebron - Trading, Crypto, and Adverse Selection · IDENTIFIED FROM THE TRANSCRIPT · source