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I'd like to meet Bill Hwang and ask, "What the heck were you thinking?" All those paper profits would have to be converted into real money at some point, and t

I'd like to meet Bill Hwang and ask, "What the heck were you thinking?" All those paper profits would have to be converted into real money at some point, and the massive sales would have dampened the share prices, negating the point in the first place. He was trading like a WSB subscriber but with actual billions in capital. From what is known publicly, the guy lived frugally and wasn't a status or prestige chaser. He seems more like someone with an excessive risk appetite who got in over his head. I also find it interesting that Bill Hwang amassed over $30 billion, and no one would have known if his family office hadn't fallen apart. This makes me wonder how many Wall Street billionaires are hiding in plain sight, only known by industry peers.

phkahler 2y ago
>> All those paper profits would have to be converted into real money at some point, and the massive sales would have dampened the share prices, negating the point in the first place. Sometimes I fear the 401k plans in the US will collectively do the same. Is there any way to see the net inflow and outflow of these plans?
underlipton 2y ago
Get big enough that your failure represents a systemic risk, allowing you to call on institutional backstops?
HDThoreaun 2y ago
The problem was that eventually he (through his brokers hedges) owned enough of these equities to cause massive slippage if he cashed out. He knew this, so he couldnt really cash out, even though he was up massively on paper. And then his stocks had a bad couple weeks and he wasnt up massively and the banks tried to unwind and discovered the massive slippage problem he already knew about. I think in basically every case like this it just comes down to getting in too deep and the only way out looking like doubling down. When the options are "5% chance of success if I double down or 0% if I dont" you double down because why would you care if the banks lose more.

phkahler 2y ago

>> All those paper profits would have to be converted into real money at some point, and the massive sales would have dampened the share prices, negating the point in the first place. Sometimes I fear the 401k plans in the US will collectively do the same. Is there any way to see the net inflow and outflow of these plans?

underlipton 2y ago

Get big enough that your failure represents a systemic risk, allowing you to call on institutional backstops?

HDThoreaun 2y ago

The problem was that eventually he (through his brokers hedges) owned enough of these equities to cause massive slippage if he cashed out. He knew this, so he couldnt really cash out, even though he was up massively on paper. And then his stocks had a bad couple weeks and he wasnt up massively and the banks tried to unwind and discovered the massive slippage problem he already knew about. I think in basically every case like this it just comes down to getting in too deep and the only way out looking like doubling down. When the options are "5% chance of success if I double down or 0% if I dont" you double down because why would you care if the banks lose more.