The S.B.F. Chronicles, Part 3: The Big Short

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Happy Wednesday, and welcome back to Dry Powder.

While Sam Bankman-Fried was being fêted by the bulls on Wall Street, the politicos in D.C., and across the country by a flock of “effective altruist” acolytes as the next J.P. Morgan, the renowned short-seller Marc Cohodes was sounding a five-alarm fire. There was “something terribly wrong” about the golden boy narrative surrounding the now-indicted S.B.F., he told me. And of course, he was right.
In this third installment of The S.B.F. Chronicles, my conversation with the highly quotable Cohodes about what first triggered his bullshit-radar and set him on a winding journey for answers.
Bill

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The S.B.F. Chronicles, Part 3: The Big Short

Back when Bankman-Fried was buying arena naming rights and casting Larry David in commercials, the short-seller Marc Cohodes smelled something funky. “Who would give this mop-headed, dyslexic, A.D.D. guy a dime on some crazy strategy?” as he told me. This is the third in a series.

WILLIAM D. COHAN

About a year ago, the renowned and often-successful short-seller Marc Cohodes began to get very suspicious about Sam Bankman-Fried, his crypto exchange FTX, and his hedge fund Alameda Research. At the time, S.B.F. was at the height of his prowess. FTX was valued at $32 billion and S.B.F. was worth around $25 billion on paper. He was being compared to Warren Buffett and J.P. Morgan. He was on the covers of Fortune and Forbes, both of which hailed him as the second coming. But for Cohodes, there was “something terribly wrong” about the S.B.F. narrative. “It makes no sense,” he told me a few weeks after FTX filed for bankruptcy, but before S.B.F. was arrested and extradited to the United States...

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FOUR STORIES WE’RE TALKING ABOUT