YouSaid · the spoken record

Sam Bankman-Fried

lines on the record: 72
first: 2024-04-01
most recent: 2024-04-01
sittings or episodes: 1
sources: podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

“Having good accounting, having the kind of adults professionals come in who could do risk management actually point out what on earth was going on with where different stashes of money were. Because this is another thing that shows just how insane the whole venture was. At the time of collapse, they just didn't know where most of their assets were. You know, there would be hundreds of millions of dollars in a bank account somewhere and they wouldn't even know it existed. The bank would have to call them to tell them, by the way, you've got these assets on hand.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I mean, I see the deep kind of vice that ultimately though of this all is Hube this, where they were not very experienced, they were very smart, they grew a company in what was, for the while an impressive way. And Sam in particular, I just think, thought he was smarter than everyone else. And this was something that I didn't like about Sam and noticed during the time he would not be convinced of something just because other people, even if everyone else believed X and he believed Y that would give him no pause for doubt. And so I think he got kind of corrupted by his own success. I think he felt like he had made these bets that had paid off in the spite of people being skeptical time and again. And so he just thought he was smarter. And that means that very basic things like...”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Posing enormous risks on them, and the gains were really quite small compared to the potential loss of not only everything in the company, but also the huge harm that it would do to the rest of the world, to the effect of altruism movement itself. It really just makes no sense from a utilitarian perspective at all. And that's why when I inhabit this mode of them making these kind of carefully calculated rational decisions, I think there's too many facts that seem in tension with that or inconsistent with that for that to be the kind of best, at least my best guess at what happened.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's the way almost all the money flowed from FTX to Alameda. It was also like a lending program, which was really focused on by the prosecution. But that actually, yeah, we can go into that in more detail as well. I think that's actually not where the action was in terms of how the money moved. And if you're just really getting to the heads of the people at this time, okay, let's now suppose they're the most ruthless consequentialists ever and they want to just make as much money as possible. Let's say it's just dollars raised. They're not risk averse at all, which wasn't even true, but let's even assume that. Why on earth would they take that money and then invest it 5.5 billion of it into illiquid venture investments? So companies basically.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“And in fact, it was at that time that they discovered that they had been double counting $8 billion. So customers for FTX, one way they could put money on the FTX exchange was by sending money to Alameda, that Alameda then should have given to FTX. And it seems that in June of that time, they realized that had not been happening. Alameda had thought that money was within Alameda legitimately, I guess, and FTX had thought that money was there. And now I'm not going to claim I know that wasn't like conveniently overlooked or something, but at least Cataline on the stand testified that, you know, Sam might, she at least didn't know that Sam knew that that money prior to that point in time was in Alameda, whereas it should have been in FTX.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Why would they be associating themselves with EA so much as well if that was also what they seemed to care about? And then the second thing is it's just absolutely agreed by everyone that the companies were a shambles. There was not even the most basic accounting, not the most basic corp that controls. In June of 2022, there was a meeting between the high-ups where they were very worried because it looked like there was a $16 billion loan from FTX to Alameda. And they thought that was really bad. It turns out that was a bug turned out that was a bug in the code. And actually, it was only an $8 billion loan. And they were apparently elated at the time. So they didn't know how much their assets were to within $10 billion.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“But just briefly on why that's, I think, not what happened. So one is just the overall plan makes so little sense if it was a long con. A con kind of from the very start. So if that was the case, then why would they be trying so hard to get regulated? Why would they be so incredibly public about what they were doing? And in fact, fairly actively courting their attention, or in fact having Michael Lewis, one of the world's leading financial writers, following them around having access.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. So, yeah, one thing that's just absolutely true was Sam what seemed unusually risk tolerant and was unusually risk tolerant. And at the outset, like when the collapse happened, I absolutely was worried that perhaps what had gone on was some sort of carefully calculated flawed, carefully calculated willingness to break, just to break the law in the service of what he thought was best. You know, I was worried that maybe they would come out a spreadsheet that, you know, did a little cost-benefit analysis of Flord and was clear Thaw to see. I think, yeah, I think that there are just good reasons for thinking that's not what happened. And I'll discuss that first and then let's come back to the important points about attitudes to risk and ends justify the means reasoning.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Decision. It was just. Was irrationality, it was a failure, a failure of intuition rather than kind of reasoning. And that's my best guess at what happened here as well, where, yeah, I think what happened, it seemed, is that, I mean, yeah.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“And he argues, and it's on the basis of interviews with many of the most famous white-collar criminals, and he argues quite strongly against the idea that these crimes are a result of some sort of careful cost-benefit analysis, mainly in part because the cost-benefit analysis just does not make sense. Often these are actually really quite wealthy, really quite successful people who have not that much to gain but everything to lose. But then secondly, looking at how the decisions actually get made, the word he often uses is mindless. You know, it's like people aren't even paying attention. It might be that, you know, this was true for the CEO of McKinsey, gets off a call from the board of Goldman Sachs, I think, and immediately 23 seconds later calls her friend to tell him about what happened in the board meeting in a way that was illegal inside a trading. This was not a carefully calculated.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“As an action. And one piece of evidence has actually just learning more about other white-collar claims. So Bernie Madoff, being one example, but the inlawn scandal and many others too. So there's this Harvard business professor, Eugene Salters, who's written this really excellent book called Why They Do It About White Collar Climb.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“And so you were asking on how to interpret the story, and you gave two interpretations. One was that effective altruism was a sham. His commitment to that was a sham. He was just in it for his own power, his own greed. The second was that it was some carefully calculated bet that may have been, was illegal, had good intentions, though, or perhaps twisted intentions, but didn't pay off. My personal take is that it was neither of those things. And obviously I'll caveat, you know, I've followed this a lot because I've really tried to resolve the confusion in my mind about what happened. But I'm not an expert in this. It's extremely complicated. But I think there's a few pieces of evidence for thinking that this just wasn't rational or calculated decision, no matter what utility function Sam and the others were following, it did not make sense.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Alameda and FTX, this is one of the things that's so bizarre about the whole story and even tragic is just that the companies themselves were making money, in fact, large amounts of money. But the customer asked it. So in that sense, they were not Ponzi schemes. But the customer assets held on FTX that should have been there, should have been bank vaulted separate from everything got used by Alameda research, the trading firm, in a way that should not have been possible, should not have even been possible.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, that's right. Bernie Madoff was committing the fraud for about eight years. And yeah, he was needing anytime a customer, or sorry, anytime a client of his wanted to withdraw money, he would raise more money in order to give it back. Give the fiction, you know, what should have been there. To the customers, which”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, but also as opposed to the amount today. So often people will say putting Bitcoin on the exchange. Bitcoin is now worth more. It was then. The standard navigative of this has been that that has happened becauseenthropic, a particular investment that was made, has done well. My best understanding is that actually that's not accurate. That has helped, but even putting that to the side, kind of even as of September last year when there had not been a crypto-wise, customers would have been made whole. So the issue was not that money was taken and then just lost. The sense of like spent or just lost on badge or something. Instead, that the money was illegally taken and invested into assets that couldn't be liquidated quickly.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“The scale of this is just unbelievable. And actually, recently, the prosecution, the least Twitter messages that Sam had deceived during the collapse. And they're really heartbreaking to read. Like one is from a Ukrainian man who had fleed Ukraine. And in order to get his money out, put the money on FTX. Another person who was going to be made homeless had four children he needed to feed. And so”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so this is something that I've now spent many months over the last year and a half really trying to understand. I didn't know about the fraud or have suspicions about the fraud at the time. So my understanding of things here, there's really me trying to piece together the story on the basis of all that's come out as a result of the trial and media coverage over the last year and a half. One thing I'll say kind of before we talk on this is very easy once you start getting into trying to inhabit someone's mental state to start saying things where it sounds like you're defending the person or something. And so yeah, I just want to be clear on just how bad and how harmful what happened was. So a million people lost money.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Exchange that should have been there was not there. And that should not have been possible. It must have been the case, therefore, that Sam and the others leading FTX had misappropriated that money in some way, all the while saying that the assets were perfectly safe, that they were not invested. That led to the complete collapse of FTX. A number of people, so three other people who were high up at FTX or Alameda, so Cataline Ellison, Gary Wang and Nishad Singh. They all pleaded guilty to fraud a couple of months after the collapse. Sam did not plead guilty, but there was a trial at the end of last year, and he was found guilty.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Those seem to be incredibly successful. So by the end of 2021, he was worth tens of billions of dollars, the company FTX was worth $40 billion. And he seems to be living up to his kind of claims. He was saying he was going to donate everything, essentially everything he earned, 99% of his wealth, something like that. And through the course of 2022, had actually started making those donations too, had donated well north of $100 million. But then, as it turned out, in November, it seemed like the company was not all that it seemed. There was what you could call a run on the bank, except it wasn't a bank. So there was a loss of confidence in FTX. A lot of people started with throwing their money. But the money that customers had deposited on the...”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Told me we hadn't been much in touch in that period, but then he told me that he'd got an internship at Chainstleet, which is this quantitative trading fund. And that was very impressive, I thought. He seemed just this very autonomous, very morally motivated person, animal welfare was his main focus at the time. He said later he'd also asked some animal welfare organizations, would they rather his time? Would they rather they work for him? Or would they rather that he go make money in order to donate it to them? And they said, we'd rather have the money. And so he went and did that at Change theme, but then subsequently left and set up a trading firm called Alameda the Search that was a cryptocurrency trading firm. And then a couple of years later, an exchange, as in a platform where others could trade crypto currency called FTX in 2019.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. So earning to give was the idea that rather than say directly working for a charity, instead you could deliberately take a career that was higher paying, something you were perhaps particularly good at, in order to donate a significant fraction of your earnings, where depending on how much you made, that might be 50% or more. And the core idea was that, well, you could say become a doctor in the developing world and you do a huge amount of good by doing that, or you could earn more and donate enough to pay for many doctors working in the same cause and thereby perhaps do even more good again. And this was one of the things that I was talking about at the time. And he found the ideas compelling. You know, we discussed it back and forth at the time. I next met him something like six months later at a vegan conference. And he...”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure, I'm happy to. And yeah, he did, from my perspective, seemed like a promising young man, even though that's very much not how it turned out. So I first met Sam all the way back in 2012. I was giving talks for a new organization I'd set up, 80,000 hours, which were about how you can do good with your career. And I was going around college campuses speaking about this. I can't remember who, but someone put me and Sam in touch. I think he had been quite active on a for them for people who are interested in utilitarian philosophy. And so ideas like earning to give had been discussed on that for them. And as a result, we met up for lunch and he came to my talk. He was interested in a number of different career paths at the time, so politics, earning to give was one.”
2024-04-01 · Making Sense with Sam Harris · #361 — Sam Bankman-Fried & Effective Altruism · IDENTIFIED FROM THE TRANSCRIPT · source