Marc Cohodes on SBF, Fraud, & The FTX Death Spiral | #456

The Meb Faber Show - Better Investing

The Idea Farm

Business, Investing, Management

4.7 • 938 Ratings

🗓️ 25 November 2022

⏱️ 68 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Today's guest is famed short-seller Marc Cohodes. Marc has investigated and brought down some major frauds in the past, and earlier this year he set his eyes on crypto darling Sam Bankman-Fried, the founder of FTX. Unless you’ve been living under a rock, you must be aware of the bankruptcy of FTX and other related crypto entities, but the bigger story may be the alleged fraud, which includes accusations of stealing billions of dollars of customer deposits, providing executives with loans up to $1 billion, and much more. This is a story that almost seems too insane to be true. Hindsight bias comes for us all, and while many people now say the red flags were clear as day, there were very few people criticizing or Sam & FTX before the recent couple of weeks. But on August 1 this year, Marc tweeted, “The Best Short on The Board is this fella…SBF.” John Ray is the new CEO & Chief Restructuring Officer for FTX and famously oversaw the liquidation of Enron. Given his decades of experience in this role, the statement he made in the recent bankruptcy filing is eye-opening and summarizes the depth of the situation: "never in my career have I seen such a complete failure of corporate controls and such a complete absence of trustworthy financial information as occurred here [at FTX].” Since this is a story that seems to change by the day, note that we are recording this on Monday, November 21st. ----- Follow Meb on Twitter, LinkedIn and YouTube For detailed show notes, click here To learn more about our funds and follow us, subscribe to our mailing list or visit us at cambriainvestments.com ----- Today’s episode is sponsored by The Idea Farm. The Idea Farm gives you access to over $100,000 worth of investing research, the kind usually read by only the world’s largest institutions, funds, and money managers. Subscribe for free here. ----- Interested in sponsoring the show? Email us at [email protected] ----- Past guests include Ed Thorp, Richard Thaler, Jeremy Grantham, Joel Greenblatt, Campbell Harvey, Ivy Zelman, Kathryn Kaminski, Jason Calacanis, Whitney Baker, Aswath Damodaran, Howard Marks, Tom Barton, and many more. ----- Meb's invested in some awesome startups that have passed along discounts to our listeners. Check them out here! Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Welcome to the Medfavor Show, where the focus is on helping you grow and preserve your wealth.
0:11.0	Join us as we discuss the craft of investing and
0:13.5	uncover new and profitable ideas all to help you grow wealthier and wiser.
0:17.2	Better investing starts here.
0:20.0	Meff Faber is the co-founder and chief investment officer at Cambria Investment Management.
0:23.4	Due to industry regulations, he will not discuss any of Cambria's funds on this podcast.
0:27.2	All opinions expressed by podcast participants are solely their own opinions and do not reflect the opinion
0:31.1	of Cambria Investment Management or its affiliates.
0:33.4	For more information, visit cambria Investments.com.
0:39.6	Welcome, podcast friends.
0:40.9	We have a special podcast today with fame shortseller Mark
0:44.5	cohodes. Mark has investigated and brought down some of the major frauds in
0:49.1	history and earlier this year he set his eyes on crypto darling FTX.
0:54.4	Unless you've been living under a rock, you must be aware of the bankruptcy of FTX and other related
0:59.2	entities, but the bigger story here may be the alleged fraud, which includes accusations of stealing billions of dollars of customer deposits,
1:07.0	providing execs with billion dollar loans, and more.
1:11.0	This is a story that almost seems too insane to be true. Hindsight bias comes for us all, and
1:16.0	while many people now say the red flags were clear as day, there were very few people criticizing
1:21.8	Sam, FTX, before the recent couple of weeks.
1:24.4	But on August 1st of this year Mark tweeted,
1:27.0	the best short on the board is this fella SPF.
1:30.4	John Ray is the new CEO and chief restructuring officer for FTX and famously
	...

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