BREAKDOWN: Corruption, Leverage and Cheap Money – Archegos and the Fastest Loss of Wealth in History

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CoinDesk

Tech News, Business News, Daily News, News

4.7 • 698 Ratings

🗓️ 1 April 2021

⏱️ 18 minutes

🔗️ Recording | iTunes | RSS

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Summary

A TL;DR on how Archegos went from betting $50B or more to having nothing overnight. This episode is sponsored by Nexo.io. The financial world has been rocked by the Archegos scandal. A family office managing at least $10 billion and betting with $50 billion-$80 billion on leverage that was completely undone, literally overnight. In this episode, NLW breaks down: Bill Hwang’s origins in Julian Robertson’s Tiger Management Hwang’s conviction for insider trading How Hwang leveraged his fund’s performance to get off prime broker blacklists Why Goldman Sachs, Morgan Stanley and others decided to margin call Archegos last week What the whole affair says about markets today - Nexo.io lets you borrow against your crypto at 5.9% APR, earn up to 12% on your idle assets, and exchange instantly between 75+ market pairs with the tap of a button. Get started at nexo.io. - Image credit: Emile Wamsteker/Bloomberg/Getty Images See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Transcript

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0:43.9	Wondery, UK. That's audible.com slash Wondery UK. These aren't some galaxy brain-evil
0:51.7	schemes. It's just a lot of people fudging the rules just enough.
0:55.7	Acting against their better judgment, just enough.
0:58.2	Leaning into greed, just enough.
1:00.3	It's Huang potentially not really letting all these prime brokers know how deep he was with
1:04.0	each of the others.
1:05.2	It's Archegos using instruments that aren't illegal, but which certainly skirt around
1:09.0	regulatory intent.
1:10.6	And it's about banks
1:11.2	reversing course to do business with convicted financial criminals because the volume of
1:15.6	their trading has just gotten too big to ignore. It's the banality of modern corruption.
1:22.5	Welcome back to The Breakdown with me, NLW. It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world.
1:33.5	The breakdown is sponsored by nexus.io and produced and distributed by CoinDesk.
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