3 ms·

If a store employee steals $500 from the till, gambles it on what he thinks is a sure bet, doubles the money, and returns $600 back to the till, that’s still th

If a store employee steals $500 from the till, gambles it on what he thinks is a sure bet, doubles the money, and returns $600 back to the till, that’s still theft, wrong, and punishable, even if the store happened to win in the end. Perhaps not an exact analogy, but seems reasonably close. It must be driving Sam insane though to think he could have made it all fine if he had hung on a few more months.

mandevil 3y ago
Eh, he had made exactly these sorts of bets before and he won those. Because it is gambling, eventually you lose a bet or two. While experienced gamblers learn to manage risk- mostly by diversifying and betting small chunks of your pot on different, uncorrelated bets, SBF never did. He continually bet his entire net worth- and his freedom- in one big gamble again and again. And it worked for a while. Until it didn't. But if he did get this bet to pay off, then he would have done it again, clearly. And eventually, one of the gambles would break like this one did.
- jcranmer 3y ago
  The crime isn't that FTX lost its gambles. The crime is that FTX was gambling with money it legally couldn't use for the gambles.
  - mandevil 3y ago
    Right. I was responding to the comment that "it must be driving Sam insane though to think he could have made it all fine if he had hung on a few more months." But the problem is, even if he had made this gamble pay off, by his very nature the man was determined to bet his freedom and net worth again and again on, at best, 51-49 bets. Because he wasn't actually a very good gambler.
  - webmaven 3y ago
    In effect, it was an unsecured high-stakes side-bet on whether he would get caught.
awongh 3y ago
I feel like it must be true that there are many others out there that were able to hang on and now we merely know about them as a wealthy person, rather than as a criminal. The question is what the ratio is: one caught for every ten not caught?
- c22 3y ago
  This is probably more rare than you think since very few fraudsters seem to know when to quit. Even after getting away with massive gains there is temptation to do it again (and now the risk seems even more justified due to past experience).
scosman 3y ago
And they put the money back in the till years later, after the owner of the store lost their house.

mandevil 3y ago

Eh, he had made exactly these sorts of bets before and he won those. Because it is gambling, eventually you lose a bet or two. While experienced gamblers learn to manage risk- mostly by diversifying and betting small chunks of your pot on different, uncorrelated bets, SBF never did. He continually bet his entire net worth- and his freedom- in one big gamble again and again. And it worked for a while. Until it didn't. But if he did get this bet to pay off, then he would have done it again, clearly. And eventually, one of the gambles would break like this one did.

jcranmer 3y ago
The crime isn't that FTX lost its gambles. The crime is that FTX was gambling with money it legally couldn't use for the gambles.
- mandevil 3y ago
  Right. I was responding to the comment that "it must be driving Sam insane though to think he could have made it all fine if he had hung on a few more months." But the problem is, even if he had made this gamble pay off, by his very nature the man was determined to bet his freedom and net worth again and again on, at best, 51-49 bets. Because he wasn't actually a very good gambler.
- webmaven 3y ago
  In effect, it was an unsecured high-stakes side-bet on whether he would get caught.

awongh 3y ago

I feel like it must be true that there are many others out there that were able to hang on and now we merely know about them as a wealthy person, rather than as a criminal. The question is what the ratio is: one caught for every ten not caught?

c22 3y ago
This is probably more rare than you think since very few fraudsters seem to know when to quit. Even after getting away with massive gains there is temptation to do it again (and now the risk seems even more justified due to past experience).

scosman 3y ago

And they put the money back in the till years later, after the owner of the store lost their house.