Hello and welcome. You are listening to Patrick Boyle on Finance, a podcast exploring ideas from quantitative finance, examining events occurring in markets right now and financial history to see what lessons can be taken away, including interviews with some of the most interesting people in the world of finance. To learn more about the podcast, visit onfinance.org.

Look, a lot of people took up hobbies in the early stages of the pandemic. People were making

pasta, they were cutting their own hair, they were buying dogs that they could then clean up after.

Things like that.

Now, one of the most popular hobbies was, of course, retail trading in meme stocks, and that

exact hobby turned out to be the undoing of Bill Huang.

I can't help but think that all was going well for Bill and then he fell under the influence

of Dave Portnoy and decided it was time to go all in.

Stonks only go up as Bill probably used to say.

So anyhow, this week US federal authorities arrested and charged Bill, the founder of

Arquico's Capital Management, which is a family office not a hedge fund, as is often reported.

He's accused of executing a vast scheme to manipulate stocks.

He's been arrested on federal racketeering, fraud and market manipulation charges, which is bad.

It would appear that Bill's core investment strategy was to pick a basket of around 10 stocks

and then using leverage from around a dozen prime brokers by an awful lot of them.

As his buying pushed up the prices of these stocks, he had marked market profits.

He would then use these profits to get even more leverage from the banks to buy even

more of these stocks.

This made the prices go up even more, which created more profits, which gave our hero

more money to buy more of the same stocks.

I guess the idea was that this could continue on forever

in an infinite loop, but sadly for Bill, that's not what happened, but he did have a great

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