Michael Lewis how many books have you written by the way I don't know I looked it up and it kept going and going and going and going it's just I don't know and the distinction needs to be made there's a list there in the front of the in front of this book some of them are books and some of them are book like objects I mean I so it's one thing to sit down like this and write and and plot create structure whole book it's Another to write four magazine articles and and put them together
in a book and so boomerang or the fifth risk or the money culture those are all I mean I don't I'll defend them but they are book like objects not books all right I have 16 I counted there's 16 things yeah no well 16 I think most of these were books yeah 16 items and I bet six of them were bookl like objects really yes well talk about the stars aligning your book is coming out at the same time Sam bankman Freed is on trial y I mean did you all plan this was this serendipitous
how did this happen we kind of planned it well I knew I started writing this thing at the end of January and I I know it usually takes me six months once I've got all my stuff and so I knew when I'd have it finished so they knew when they arranged they it was coming out in the fall and but then they announced the trial date and it seemed it made sense oddly the trial was supposed to start Monday but The judge has some personal reason he wanted to start it Tuesday so he actually start
it the book was launched on the day of the trial so uh yeah it's and it it's part of me kills me that I'm not there because the I've seen the list of the prosecutors Witnesses who they're likely to call and it Maps very closely on the characters in the book so it'd be like what it's like watching you know characters from a novel come to life or something like that feels like that We're going to get into the intricacies a little bit simplified of the trial and the crimes Etc but I want to go
back back to the beginning Michael because you're almost a literary Anthropologist I find your book so interesting because I think In fairness I saw this on 60 Minutes but you take a character and that character Becomes emblematic of another big issue and and you met with this young man more than a hundred times over two years so if you Had to use one word to describe what your experience what your time was like with BF as he's called what word would that be I'm going choose a strange one satiric uh in that right from the
beginning he struck me as walking social satire he had acquired he' gone from zero to having 22 billion dollar in about 18 months and all of society had reorganized itself around this pile of money and everywhere he goes he what is Either happening to him or his observations cuz he's a bit he's a martian he like comes from another planet and he sees SE the world in just a different way it felt like social satire so satiric it felt I mean this can sound very odd given these circumstances it was funny I mean it was
a funny it was a funny s funny and sad you know funny and sad go together but there was a lot of funny and so satiric that's the thing that come and surreal And something that almost sounds like the pages of a Tom Wolf novel honestly so I just watched a documentary about Tom Wolf you're featured I loved it by the way it was based on your profile of Tom Wolf and Vanity Fair and you know as I read about Sam I thought whoa this is the kind of thing Tom Wolf the kind of person
the kind of creature Tom Wolf would have been all over do you agree I agree especially early wolf he you know he wrote these pieces that were fabulous About Silicon Valley people right before before the internet right it was like the semicond conductor people but he was he he it was like these people are of the moment and they're changing the culture in some way also the Mary pranksters that that crowd I mean this is a version of the Mary prank pranksters I mean these people who are rolling through the world just creating disruption wherever
they go uh he would have been drawn to Sam Bankman freed I so yes I think completely TR that's completely true do you think that SPF represents capitalism at its worst in a way it's it represents capitalism in its most chaotic and uh and there's a reason for that there's he was drawn to chaos from when he figured out that he excelled relative to other people in these semi chaotic environments where his mathy brain still was useful but he needed it To be really messy at the same time it couldn't be orderly couldn't be structured
couldn't be perfectly predictable when he figured that out figured that out on Wall Street when he's 21 years old he then proceeds to create those environments in which he'll succeed so he he thrives in chaos he thrives in mess and chaos and and he knows everybody else doesn't so at some level and so he feels most comfortable when that is that that's the environment Um it he's also capitalism and its most current I mean if you think about history just put him in some sort of historical context you think oh this is just how it
is now Mark Zuckerberg is a bit like this he came out of nowhere and had billions of dollars instantly but that doesn't really happen in history like most people who got this Rich they had to like dig oil out of grounds build railroads build build stuff build build companies uh this instant acquisition of A fortune is so peculiarly of now and it's and what so one among the things that so odd about it is that the person who in possession of the fortune is a stranger to the world like nobody knows who they are they
he will goes from being nobody who and he has no social relations kind of thing to being at the center of some Universe instantly before anybody has a chance to figure out should he be you know uh so that's a curious feature of of modern capitalism I think and this guy is a singularly unique figure I mean even more fascinating to me than Mark Zuckerberg just because he is what is you you read it so was it I'd like to know how his mind works I'd like I mean he struck me as someone who might
be kind of like Rainman honestly um I wondered about sort of his particular way of thinking uh is he does he have autism is there you know what is it with the with the deck of cards and the moving is feet and Sort of his whole I mean how do you even put it Michael his whole frame of reference and I I wanted to understand his brain yeah I wanted to get into Sam bankman wait I wanted to get into Sam bankman Freed's brain yes yes I did too like I well you did cuz you
spent so much time with him I want to hear about that in a moment but first you start the preface of the book you say I first heard about Sam bankman Freed at the end of 20121 from a Friend who oddly enough wanted me to help him figure out who he was so this guy is saying to you Michael can you sus this guy out I want to invest in crypto but I don't really I I want to see what his character is like as you talk about so you meet this guy you guys take
a walk you take a hike yeah in California so what would tell me right you meet someone what was your first impression it first impression was um there's a kind of artlessness about him And an openness and a willingness to answer talk about things that normally people just wouldn't be easy talking about like how much money he had where it come from how crazy it was he had it that his parents didn't know what to make of it because they were two professors at Stanford and he was raised not caring about money and it was
that kind of just trying to figure out he so first impression was very he was also very peculiar uh that he was disheveled When he came out he he he he always looks like he just fell out of a dumpster right I mean he's got he looks like an unmade bed oh my God yes yeah an unmade bed on top of an unmade bed he looks and it it was the total of interest in his own appearance uh the the the total in his head like and the so normally when you meet somebody it's an
exchange right they ask questions about you you ask questions about them let me Guess he asked you no questions zero and we are I'm me tell you something two years later he's still not asked me any questions so he he has as far as anyone knows nothing about me and knows nothing about what I was writing about knows nothing about the he never asked me like what's the book going to look like nothing so it was all one way he he sounds like it's so interesting because he's this odd combination and we'll talk about this
in A moment too and I don't want to get to ahead of myself incredible um an incredible desire to do good without without any emotional intelligence yeah that's true like this strange combination yes one of his colleagues this didn't even end up in the book but one of his close colleagues who dealt with all the emotional Fallout from Sam's lack of interest in emotions so all the employees are always upset especially the ones who were reporting To him because he's not paying any attention to their feelings and uh he said but Sam's gotten much better
in the last year or two he said um he's outsourced some of his IQ to EQ that he's somehow sort of like manufactured some EQ in there so it's gotten a little better if you'd known him 5 years ago you wouldn't have believed how emotionally uninterested he was and how emotionally clueless but you're right it's this combination of like this Massive brain able to do really interesting things with a total deadness to human feeling is including it's not hypocritical including his own like that he he he was quite open about the fact that he had
all he sensed that other people felt all these things he didn't feel and he felt cut off from from the experience of being human because he he couldn't feel them just born that way uh well let's talk about his childhood as you mentioned his parents were two Stanford law professors who I guess are having their own legal problems right now right I mean they've been sued for their involvement in this whole Enterprise but tell us about where he grew up what his life was like and you know I'm curious about the nurture nature aspect of
him help us understand understand him his parents both tax law professors at Stanford um that sounds boring yeah well unless unless that's your cup of tea right guess and the kind Of person for whom that's like a cup of tea is a different kind of person they like to live in their head and tax law does get to kind of like structure of society questions like how you distribute wealth and it it's not just it isn't just like what numbers it wasn't just isn't just numbers it's ideas they they're two people who live for ideas
to all the tax lawyers out there I deeply apologize I do I need to too I mean okay No you you're defending them and saying it's ideas but they sat in the middle of actually a pretty active interesting Social Circle they were very social people at um their dinner parties on Sunday nights were famous on the Stanford campus uh their son struck even their friends as peculiar right from the beginning like and one comment that stuck with me is one of the distinguished guests at the dinner Sunday night dinner party said he always Thought that
uh the parents were afraid for and of Sam like they didn't they were worried about where he was going to end up in the world CU he didn't have make social connections he was so isolated as a kid Barbara the mother uh said there were a couple moments where she realized he was just couldn't be parented like a normal kid the first was she took him to like an amusement park like that's what you're supposed to do and they're going from ride to ride and She notices that he's not taking any obvious pleasure in it
but she's looking at him and he looks up and he says so Mom are you having fun yet and she realized that he was just there cuz he thought she needed to be there and so she kind of cut off the the second thing was she BR she handed him at one point again little kid one of her abstruse academic papers and he read it and started asking her questions that she said were better than the questions she Got from the peer review process how old was he like 10 I in the tell me he's
young and she said uh at that point she just gave up it's like like he's just going to be and the feeling of his childhood to me talking to him and to those around him was that he was just waiting for it to end that he was waiting for everybody else to grow up around him so that he would have people to talk to because he did not ever connect to peers he was he had one Friend one friend and the one friend was a child of their his parents friend so they were kind of
put together that way and they were connected through this game they played called Magic the Gathering which is a complicated cha it's AA it's a messy chaos but matthy uh card game uh and they didn't really have to talk about much because they just played cards together the whole time um so it's a he's it's an unusual childhood I mean I asked doesn't sound necessarily Unhappy just different you know it's keep that kept coming back to this it sounds sad but he's not sad it sounds almost tragic he didn't feel tragic he felt like he
was living in his own head make and trying to make sense of the world around him in his own peculiar way so let's talk about was he ever diagnosed with autism I mean it it just was screaming out to me when I saw him in that 60 Minutes profile I thought clearly he is on the Spectrum now I'm Not an expert in autism and I also don't want to be insensitive because I'm not you know I don't know a ton about autism but clearly to me uh the shuffling of cards constantly that he always has
the deck of cards in his hands and the way he moves his feet the way there there was a lack of eye contact UM never diagnosed with any kind of no I mean he I find that really hard to believe well I can understand why you find it hard to believe but he didn't you you must have Well you know what's funny about him everything you described is kind of textbook on the Spectrum kind of stuff he he's a package that I've never seen before like I think there needs to be another Spectrum uh and
it's it's um for for example incredibly acute at picking up on on your emotions like seeing what you're thinking and where you're feeling which in my experience that's not what you get usually from the condition so um So so verbally fasil and so interesting in the world around him that and yet never asked you a question so that doesn't really J yeah no it doesn't J but it's but he's interested in ideas uh and and so he he doesn't so he he really reads as like I've never seen someone like this before rather than oh
he's in a box with this with other people like this it it almost I didn't never use any Kind of word I didn't use the word autism or Asbergers or anything like that in the book because I didn't want to put him in that even suggest to the reader's mind that box because I felt it was a whole other box he needed to be in um never asked him about it or never talked to his parents about it it just surprises me it came up once and it came I didn't ask um he asked me
whether I thought it was wise for him to get himself diagnosed as Autistic and uh wise my well like he was thinking about doing it before his trial and uh and what to gain sympathy I don't know I said I just I didn't know what he was and I said to him my I blurred it out I don't think you are I think you're something else I think that it's not as it's not simple that way what did he say he just listened he he it's interesting I had several conversations with him over the 18
months I spent with him where he would ask seem to ask my advice He was so it was asking me a question was about myself but he'd be ask my advice about something or ask my view of something uh and afterwards I always had the feeling that he actually didn't care what my view was that he was he was like you notice what it felt like it felt like more like I was part of a poll that that he was going to ask 100 people this question and then he was going to take those answers
and he was going to calculate what the right answer was but He didn't really value he didn't value my particular opinion so I didn't he just took it in and that was it so I mean it's so fascinating and and let's talk about his sort of raise on Detra so he had a dream and that was to make a shitload of money and give it away something that's called effective altruism which actually I hadn't heard of before I mean I know the idea of it you know but i' never heard of that F yeah movement
is fascinating and well Tell me tell me about the movement and how he got sucked into it right so there's a whole intellectual prehistory we don't need to get into the modern version of it is Oxford professors 2008 or so um start to make an argument that very little cost to yourself you middle class English person could uh give away money very so effectively that you know what what might cost you a cup of coffee saves a life in Africa and so how can you possibly buy that cup of Coffee for yourself if you could
save a life in Africa with with that same money and they actually start to make the calculations on their own salaries like if we take everything but we what we absolutely need to live live on what over our lifetimes could we could we accomplish and it was like we save 880,000 African children from blindness some numbers like that and they start to kind of put these ideas out to young people actually kind of almost like you Build a religion or a cult they give talks on college campuses where there are a lot of mathy nerdy
Spectrum kids who hear this like you can make them you can turn the problem of what you do with your life into a math problem it's you're going to maximize the number of lives you save with the actions you take the basically philanthropic actions when does it when does this whole movement start about 2008 2009 but by 2012 when one of these philosophers names will Mcal gives a talk that Sam here is at MIT it's in Cambridge at Harvard but he was at MIT uh mcal is morph a little bit the movement morphs a few
times but this big morph was the idea was um all right you kid um you you could devote you could go become a doctor and uh go to Africa and in your lifetime you would save 200 people's lives or you could go work at a highfrequency trading firm on Wall Street and make lots of money and pay 50 doctors to go to Africa And save 50 times the number of lives so idea is earn to give and that's the idea that animates Sam it's it's like I should up to that point money's not on his
radar screen it's not like I don't really care about it doesn't think about it he's a he's a kid of two professors at Stanford who probably thinks he's going to become a professor uh has no kind of Direction this gives him Direction and purpose and a way to count with how his life is going so he sets That so yes I'm gonna make as much money as possible and give it away to save lives now where the movement gets really a little out there is right after he gets into it it morphs again and it
ceases to be and they start to argue about like the math of saving lives and yeah you could give your dollars to save that kid's life in Africa but those same dollars could be given to reduce certain existential risks to humanity a pandemic that wipes Out the species AI out of control uh climate change nucle risk of nuclear war and if you can do anything to tilt the odds against all future human human beings being wiped out the math suggests you should do that rather than save living breathing ones now and so it it swings
to prevention to prevention that's to prevention of a thing it's going to be very hard to know whether you succeeded or not you know because what you're trying to do is stop Something from happening right but uh but it also it also becomes very grandiose that the sums of money required to build I don't know an a global disease pred system that's better than what we have because no government's doing right now is hundreds of billions of dollars so all of a sudden there's a reason not to make just a few million uh that this
is like unlimited sums of money infinite money is what we need and that's the climate In which Sam comes of age and develops his own life ambition so he wants more and more and more and more for good yeah and and let me one more point is that more more more more not just more more more more but the the 20 billionth dollar or the trillionth is as valuable as the 999 billionth dollar that it's just like there's no diminishing returns it's sort of like that it's you know most rich people you know well they
don't he he Didn't even care about returns no that's right at all no that's right right diminishing or otherwise that's right that's true so uh anyway so that's that's sort of like that's the air he was breathing so that that captures his attention gives him purpose and he settles on two causes pandemic prevention which you mentioned and then protecting democracy or you know so he ex so that's controversial right he has this these effective altruist it is a Movement there are thousands of people involved in it it has certain cult-like qualities but it's also kind
of like an anticult because they're all into argument and reason so the movement can change like someone makes a better argument and it goes a different direction and Sam makes a new argument that actually irritates all the effective altruist it's that in addition to climate change AI pandemics asteroid whatever Donald Trump should be on that List right well basically his argument is that you need government government is essential and this is of course arguable and debatable but government is essential to solve some of the most intractable societal problems so we have to protect government we
have to protect de democracy and that means basically neutralizing Donald Trump at any cost yeah that's exactly right yes yes it's sort of like democracy if American democracy fails democracy is going to Fail and democ Y is the best tool for addressing these problems and so Donald Trump has has he's G his name has been added to this list of existential risk to humanity and he in fact offers $50 billion to five oh sorry he in fact offers five billion yeah 50 billion would be pretty hard to resist wouldn't it but billion dollar to Donald
Trump to not run for president of the United States which apparently gets some traction but then everything falls apart Yeah so I was on a plane with Sam bankman free he was on his way to Washington to have dinner with Mitch McConnell which is hilarious in and of itself but yeah go ahead and I thought he was coming out of his mouth was just fiction that and it was coming out of his mouth was we have a line into the Trump people uh and we're trying to get a number about what what it would take
what we have to pay Donald Trump not to Run for president now he said at the same time we have the lawyers figure out whether this is even legal can you pay someone not to run for president is a bribe you know whatever and my first reaction was how on Earth are you going to enforce this contract if I'm Donald Trump I say sure I'll take your $5 billion and then I change my mind the next day and I go run for president I just I couldn't see how it was going to work but at
the at the same time I Thought how real is this like is he re is there really a line into Donald Trump like he did have pretty serious Republican operative Sam did but I just thought I just couldn't believe this conversation but in the same conversation he says we're worried about this Missouri Senate race and in the race it was a primary a Republican primary at the time there were two Republicans who were look like they were kind of could win one was named Eric gon The other was named Eric Schmidt Eric gron was a
clear real Trumper like tear it down the elections rigged all that Eric Schmidt was clearly a phony Trumper he would say nice things about Donald Trump and maybe he'd say the elections we got to look into it but he was Republican go or at least a Mitch McConnell Republican and Sam said our people have been thinking we've been thinking about how we neutralize Trump in this election Because if he comes out and he says he's for gon like gron could win and they come up with he's telling me all this we've come up with this
idea he says we're going to tell Trump all you care about is you want to be associated with the winter uh so just say you're for Eric they're both named Eric and nobody and you never say which Eric you're for and he said Trump will love this uh it'll be a meme whichever Eric wins he can claim he did it and I'm thinking This sc's Preposterous too two days later Trump comes out on true social and says I'm for Eric and did he ever meet with him did he ever meet never met with him personally
who did he meet with people high up in his Circle Sam his so s so the way Sam's best I can tell political operation worked is it essentially had two almost identical Parts one Republican one Democrat he hired a bunch of Republicans in one Silo and a bunch of Democrats in the other And funded them both and in the Republican Silo I do know that the people there met with people very close to Trump that I do know that happened but the idea that that was getting into Trump's head and he was taking action on
it that when I thought well maybe he is going to pay him $5 billion and he's not going to remember president I I mean it that was proof of concept he told me it was going to happen or might happen it happened so Everyone thinks this kid who is how old now Michael he's uh 31 31 now that sounds right anyway everyone thinks he's going to be the world's first trillionaire let's break down what he was doing for the Bitcoin challenged I among them uh which I Now understand more having read your book and read
a lot of articles about this but think of this as cryptocurrency for dummies what is exactly is cryptocurrency it's a it's made up money it's it's it's a um so it Is an idea that is hatched by someone we don't know who he is but this his suse name was Satoshi Nakamoto in 2008 and the idea is um a for a means of exchange a form of payment a a store value that has is not sourced by the government doesn't come out of the government it's just like this thing we're going to it's it's digital
currenc digital currency it's bit it's just some a string of digits and we're going to say this is valuable And if and it's valuable if people believe it's valuable and when it starts it seems Preposterous like why would anybody want a Bitcoin would it turns out it's not Preposterous why would people want a Bitcoin ends up being there ends up being an answer to the question people who were kind of suspicious of governments of institutions of banks people who want to hold wealth in ways that are hard to detect people who want To who want
to make payments without anybody knowing what they've done uh that Bitcoin catches on with a kind of a smallish group of people who have got a religious feror about it and it's mostly kind of libertarian types when Bitcoin starts to go up in price and bit first place there's only one one digital currency it's just Bitcoin in the end there now thousands of them right but uh it just tracks a different kind of person when it starts To go up it's the person who's the first into the Tulip bubble graze right and and and it
goes from you know it goes from zero it didn't exist to at some point all the Bitcoin in the world is worth a trillion dollars and so and the price of a single Bitcoin gets to almost $60,000 and the I mean it's just air right it still could be just nothing but if you happen to believe it or get into it because you think the Tulips bubbles are going to go up that you people got Extremely rich like people made tens of billions of dollars I mean totally a trillion dollars in holding Bitcoin he I
just don't understand how can you I I'm I'm really dumb when it comes to financial stuff Michael but so you buy it and then can you sell it how do you make money off it well so it doesn't it's not like I don't know a bond that pays you a rate of interest mostly the way you make money on bitcoin is to buy Bitcoin and Hope the price of Bitcoin goes up because other people want to pay you more for it than you paid for it that's it uh there are complicated ways to make money
on bitcoin and that's what Sam was interested in he he had worked for a couple years at a Wall Street firm called Jane Street a high frequency trading firm we don't have to get into what that is but what you can think of it is is as a machine for making markets really radically efficient like they get If there's any information that's going to affect the value of any security they get it into the market in milliseconds it's there it's a job for it's sort of like making sure price are where they're meant to be
and Bitcoin cryptocurrency didn't have this force in it you could at one point buy a Bitcoin in the United States for $800 and sell it at the same time for $1,000 in Japan which is crazy right and Sam saw this and he said I can apply these Same techniques that are used in the stock market to to trade the cryptocurrencies where the prices are all goofy that uh for for reasons the so he's basically spreading the word about value to all the people investing in this so in the beginning it looks like he's he's making
money trading Bitcoin riskless like it isn't buying Bitcoin hoping Bitcoin goes up because Bitcoin might just go down it's buying Bitcoin in Japan or selling Bitcoin in Japan for $1,000 at the same time you buy in the United States for $800 and taking out $200 without taking any risk that was his original idea versions of that there were a lot of versions of that that's not how he ends up making his fortune that's how he starts into cryptocurrency and to he starts as an investor and then figures out there's you know there's got to be
a way to build a better mouse trap so he creates a platform called FTX right that you can think of that as the Cryptocurrency casino right and just to sort of ease your anxiety about all this he didn't know about cryptocurrency he didn't care about it I mean there's a technology underneath it that would take a long time to explain and I every time I think I understand it I come back and I think I actually didn't understand that as well as I should he didn't care about any of that it was just a thing
that it was a thing that went up and down like tulip bulbs in price and then He could buy and sell that's how he gets in and he never really has to understand a whole lot more but what he does see when he gets in is that the exchanges like the New York Stock Exchange but they versions of the New York Stock Exchange for cryptocurrencies where you can go and buy and sell cryptocurrencies um and those exchanges were were a lot of them were kind of flawed they they just they were risky to trade on
sometimes they lost everybody's Money and he realized that if you created a better exchange you you could own the casino right and if you own the casino the way you get paid is every time someone comes and makes a bet you take a little piece of it you get a little you get a you get you get a fee for every bet that gets made and so if you're if you're as a ultimately they're $250 billion do a month being traded on F on his exchange FTX and he takes out a tiny percentage but it
ends up being a Lot of money right so much money that in 2021 he's they have they have a billion dollars in revenues $400 million in profits and Venture capitalists are investing in him at a at a at a a rate that suggests the company's worth $40 billion and this this happens in a matter of 18 months uh from the time he creates it in early 2019 but he had two companies so he establishes FTX but the first company he built was called Alama Alam research Alama research and that's Where the trouble began because Alam
was the I again forgive my financial ignorance but it was the kind of the holding company for people who were investing on the platform on the FTX platform right it shouldn't it but but it was and and so basically it had to go through this one company to then be invested in the second company I guess my question is why did he do that and could he have done some kind of system within FTX that it didn't have to be First parked at Alam yes so let's let me can I just restate that I did
it wrong you you didn't so he starts this his own little trading firm Alam then he starts out of that this exchange and Alam is just one of the Traders on the exchange the problem was when he started FTX he couldn't get bank accounts like dollar bank accounts uh for FTX so if you Katie wanted to put your money on FTX to start to buy cryptocurrencies There Was You couldn't just there was no account at FTX you could watch your dollars to or bring your dollars to that would hold the dollars that could then be
turned into cryptocurrency why could I just straight out buy cryptocurrency without you could send them well that's interesting but the reason you're going to The Exchange is to buy the cryptocurrency right they make it easy for you so so the he you need to you you want to wire some dollars on the exchange oh I see what you're saying There was no kind of um so the banks the banks were just like to do the what do you call it when you go to a bank and you do a trans transaction yeah there was no
infrastructure to actually facilitate a transaction is that right so if I brought money and said I want to buy crypto you can't even yeah I mean you physically couldn't turn up right you go find in Hong Kong you got to wire some money into account and the money is government money it's Euros or it's Dollars or it's Yen it starts that way and so people wanted to wire their money onto FTX FTX didn't have any bank accounts because Banks didn't want to bank crypto exchanges but they would B Sam's original trading business and so in
the beginning you would wire your money to Alam in order to get it to FTX and that which should have happened I mean that was already bulky like that's weird and it's amazing that people did $8.8 billion turn up that way and nobody Ask any questions and I've seen the like the statements says you think you're wiring to FTX but it actually says Alam on it or some other Alam subsidiary but what should have happened is once FTX got bank accounts or once it got turned into crypto that it beh held in either crypto wallets
or in FTX bank accounts and be completely separate from Sam's trading fund and it never was so that's that's not the only way the customer's money ended up in Alama but it's the Main way and um one can speculate about how and why it didn't ever get moved over like that that chunk of money uh I you know I have my theories but they're unfounded uh and what Sam's Theory Sam Sam's story is and it's it sounds it sounds a bit more Preposterous than it actually is but it is still a stretch uh is that
by the T by the time they got bank accounts for FTX the money that had the kind of pool of money that had piled up Inside of alamaa was so such a small fraction of what was in Alam billion dollars eight out of a hundred so there you know so it so that he didn't that it was just sort of like he wasn't even thinking about it that's his story my sense if I if I if it were me not Sam the other thing is Sam is different and so he's capable of thinking things that
I wouldn't think and he was capable of a radical sloppiness with money that I just Wouldn't be capable of but if it were me and I was thinking I have sin intent or I just don't care about my customer uh I would think well I'm essentially they'll never know and it's a free loan uh that's but that because that's how it functioned right it's sort of like the customer's money is in the is in the Private Hedge Fund and no one's paying interest on it it's a Freel loan it's a free loan um so and
that's how it looks to most people when it all falls apart How much money was was just vanished Into Thin Air this is a great question um when the customers all come from their money at once there's a run on the platform there's a run on the on Sam's world it's there's about $1 155 billion dollar that should have been there when they stopped paying people back there's about1 billion do that's still missing uh so five billion people $5 billion got paid back and then so there customers are out 10 there was then some what
we now know is it was actually so the the bankruptcy people have announced these numbers there's now $8.6 billion do of customers deposits like customers are waiting to get their 8.6 billion back but against that the bankruptcy people have already found 7.3 billion dollar in liquid assets so the whole right there is 1.3 billion that looks like just went poof however in addition in Sam's World there were all These Investments made that are not liquid assets they Investments in weird companies uh startup companies and at least one of those Investments is clearly worth more than
a billion dollars one out of a pile of 300 it's investment in an artificial intelligence company called anthropic so it is conceivable that nothing went poof it's conceivable that the customers will all get 100 cents on the dollar bag and that what they will have suffered was the Inconvenience of waiting for it that it and it may be years it may be two or three years I was going to say conceivable but likely I mean who knows well look if it's 8.6 and they found 7.3 and there's a there's one investment in a pile of
Investments is worth a billion uh then it's just question how much the bankruptcy lawyers charge charge for the service uh but I I talked to there's a market there's a market in claims so if you are I am a I'm a depositor I had I Had a little account because I wanted to see how it all worked um how much $2,000 and I I bought some crypto and I bought some Swiss Franks I didn't have it all in crypto but it's all it's you know in theory that's there and if I wanted to go out
right now I could get $700 for that claim uh someone would pay me because they think it's going to be worth more and I've interviewed people who bought who trade in these claims and they think likely maybe too strong a Word but quite possible that it's it's going to be 100 cents on the dollar is that like distress crypto I don't know is it what is it it's it's it's not even crypto anymore because it's all been dollarized it's all which your claim is not in Bitcoin your claim even if you had Bitcoin you're if
you had a Bitcoin and it was worth $10,000 when it all collapsed you owed $10,000 um so it's uh I I I so it seems POS very possible very possible that People will all get their money back which would be very Sam bankman afraid it's sort of like this huge mess this huge drama this huge like you know social uh convulsion and in the end it's a Shaggy dog story but meanwhile he could spend the rest of his life in prison he could right I mean whether people get their money back or not right Michael
so what is What charges is he facing you know I've had this explained to me by lawyers I'm not me talking About the laws like maybe you talking about Finance but I will do my best here this is what I've been told by a former prosecutor who uh who now is a defense attorney but she worked in this offic is Prosecuting him that so everybody's going may be a little stupid for what I'm about to say I'm sorry if that's true but I'm told oddly that there no federal statutes about theft you can't just charge
them with stealing people's money So the charges are Char the charges that the laws that do exist are about using the federal males to using the using the internet to facilitate a theft so he's charged with wire fraud with money laundering with bank fraud he's not charged with theft which is what really is it the problem is here uh so they're complicated charges there's seven of them I think they tried to throw in some more but they weren't able to do it and when you add up all the charges and the Kind of sentences that
attach to those charges he facing 120 years in jail that's the but then but then so first the jury will decide convict or acquit if they acit he's off but if they convict the judge decides the sentence and the judge can do anything from just let him go I mean like a day of house arrest or something to 120 years in jail and and I suspect this judge who has become so irritated with Sam he can seem seeming they can't even look at him he's Sam in under house arrest has not been the best behaved
defendant uh that that that the sentence was going to be heavy um I I talked to some lawyers about if they were representing him what would they be happy to settle for now and they said anything kind of 10 years or less would be great that and unlikely but they would take take 10 years in jail um so I don't know I I think he he's very likely going to go to jail it's possible you never know what a jury's going to do Uh that he won't but he's very likely go to jail and um
and what happens to him then I don't know I he he's I really I said this on 60 Minutes and I it was a joke kind of but I think but I heard you said he'd be happier in in prison with the internet than in a beautiful house with no Wi-Fi without exactly and he apparently saw the 60 Minutes show in jail and he apparently told his lur that's true so well I I you can understand that I mean he as you said he Lives in his own mind he lives for essentially a information is
food to him the flood of information is what he needs and uh and his you know I talked I I his psychiatrist his therapist was an important person to me in the writing of the book book and the psychiatrist said what will kill Sam is not having internet access uh so if they so J what jail means for Sam I don't know you know he was surrounded by a lot of it people nothing says I want to be your friend Like someone with a lot of money right I mean you talked about Anna wior doing
a zoom he got Tom Brady to you know to promote FTX Steph Curry Shaquille O'Neal Larry David got paid $10 million to do that Super Bowl commercial they spent what $25 million on that commercial great ad yeah it was it it was it was yeah it was a funny ad uh anything Larry David does is funny to me but do they have any culpability you know they're they're promoting this unregulated Platform they're they're vouching in essence for this kid and what he's created um and and and a lot of people admire them and listen to
them and then invested in crypto I mean I'm just curious what do you think I I I don't think they will but I wonder if they should everybody was so Allin on Sam bankman freed it would have been unusual for someone not to take the money that it wasn't and it wasn't just that's when You need Warren Buffett right yes that's right but it and it wasn't I Pro this is going to sound odd it wasn't just the money I mean many of these people could get their money from a lot of different places a
bit more money than they might have got from other places but they really liked him they really liked him and now can you understand that yes after spending all that time with him because he's so different from anything anyone they knew and he didn't behave The way people behave around celebrities but such a one-way relationship like do you think he ever asked Tom Brady a question no I tell you tell you a story um this is this is going back to Super Bowl of 20122 last year Super Bowl uh I go I I'm I am
with Sam bankman freed we are wandering around Los Angeles he has these various social obligations he's got weird invitations and one of the weird invitations is to a party that's Being hosted by someone neither one of us knows named Michael keas and Michael keas uh he says and he didn't even know pronounce his name I don't know if it's kives or KES or and he says but I hear they're going to be some PE like fancy people there and it be kind of fun to meet him and his his Sam's Associates who were with us
said you don't you don't know who this person is you don't know what they want from you they might be trying to kidnap you and and so they Follow and actually kind of Provide support and we're going to rush in and get you if this is like the Russian mafia trying to abduct you because everybody's afraid of Sam being kidnapped because crypto is so easy to as Ransom and right so they're really worried about it so I walk into this house with Sam and in the backyard is Hillary Clinton uh Chris Rock Leo DiCaprio the
owner of the Dallas Cowboys Katie Perry Kate Hudson Orlando Bloom uh it goes uh kamla Harris's husband Doug M off off yeah uh like EV every like the density of celebrity I've never seen before and I've been to some fancy o Oscar parties and within about 45 minutes all the Clusters were around Sam bankman freed and everybody just wanted to hear what he had to say at after the party Miss man Michael keas who I'd never met before says you really ought to meet Hillary Clinton I said sure I'd Love to meet Hillary Clinton and
she was on her way out delightful person you've met her I'm sure lovely to talk to you haven't met her before never met her before lovely person uh and I'm on the front lawn and she says oh you love your books or whatever and I said nice to meet you and we're chitchatting she goes but then she looks at me she looks around she goes what are you doing here did you say what are you doing here no I said but I mean there was her crowd Right there were four Kardashians too by the way
that was the great part there were four Kardashians so I she says she says what are you doing here and I said this sounds odd but there's someone here who I I'm thinking about writing a book about and I'm just following around and she says the guy with the hair and I said how did you know and she said I met him and I thought he's just like one of your characters that's genius she was Absolutely right there are 80 people there she picked out my character uh and this was like wherever he went he
people wanted to hear what he had to say and he was the new new he was the new thing he was the new thing and it wasn't that this money was falling off him that was part of it but it wasn't just that uh and it was like it was also that he understood this world that nobody else did in a way that's true he was explaining crypto but tell what the Other thing was um he is the response if you look about the look at the rise of Sam be freed and what what are
the ingredients the decline of institutional Authority in the world the decline of government's ability to do anything about anything people are so sick of it like why can't we address climate change why can't these problems be and people are defaulting to looking to people and uh and he seemed actually sincere in his desire to fix these problems and people Wanted him to exist that that that people wanted there to be a Sam and you saw that it was palpable it was not just greed it was more than that it was complicated one of your former
subjects Billy Bean M he once said you have a horse this is a funny quote a horseshoe in your underwear when it comes to finding a good story I mean you do seem to really be able to I'm sorry Katie that's not a [Laughter] Horseshoe are you just is glad to see me anyway okay how do you find these good stories Michael I just wonder it's not there's no science to it I just wonder I mean Sam B mrey collides with me right I mean talk about being at the right place at the right time
it's insane but here's what helps not thinking you know what the story is not prejudging not trying to impose or order too early on what you're saying just feeling like this is Interesting and I want more of it I and I want to see what happens and having the luxury to be honest with you to spend two years but then there's a risk I mean I got to November of early November of last year and I wasn't sure I had a book I I had I was having arguments with friends about whether this they were
arguing with me like you should do it and I was say I'm not sure I don't know where it's going and that that is happened to me that I get stuck In something for a while and it doesn't yield anything but I've marinated it for a year and where did that year go uh but that is it is it's just sort of like if I'm interested genuinely interested not trying to like force some idea upon the world and I let that interest just flow over me it eventually leads somewhere good and what's going on is
if I'm interested really interested the reader will be interested and if I'm not interested the reader is going to be Bored but I think also you're able to marry personality right with complicated topics with sort of social impact and you're able to weave them all together in a way that's understandable and entertaining and I think that's your gift Michael but but what do you think of this whole Blindside controversy I'm having a hard time like keeping up with it but Michael or Sue Sean and lean tuy the subjects of your book uh the couple who
invited him to live with them as a Teenager all right so I kind of I don't know just from what I know I'm sort of taking the twoy side on this yeah well so here's what you need to know here are these am I wrong no here are the facts the fact facts it's really simple facts he filed a lawsuit saying that they had stolen his millions of dollars in movie money from them and the money they got for the movie I mean it was my money that normally what happens is the author sells the
book to the movies and keeps The money and I split the money with my subjects that was very nice of you by way I thought so too I thought so too but I also thought like I felt guilty just keeping the money well I don't blame you I mean it's their story it's their story but like no one would no one would have heard of the story like no one car it I cared about it and uh so I knew that exactly how much money they got they got half as a family half of what
I got the total pot was before Agents fees and taxes over the life of the movie which has made a half a billion dollars is $760,000 so their half after agents fees like $350,000 split five ways among the tues so that's how much money he would have gotten and um and I knew that and and now this is a story about Hollywood accounting yeah I was gonna say he must think the tues made all that money when the movie company made and I I explain this to him he didn't believe me I think he must
not Have believed me I had a funny it's funny because then I also had an interaction with him he called me a couple years ago I really like him uh and he he liked the book it was the movie and the movie gave him some he had issues with the movie and he wanted to go on the road and make money talking about The Blindside me and him and I was game to do it but it's a little late you know it's 16 years later or whatever there was a big market for it at a
time And he wasn't that interested when the market was hot and um and I I I just wondered I I wondered if he was having money frustration or something I don't know what was going on well that's what some people suggested he kind of had run out of money right I think but I don't think he had I don't know he made $40 million $38 million in the NFL I just don't know what's going on but it's heartbreaking I mean it's heartbreaking they loved him they loved him like a Child like a their own child
what I wish he' done I wish he'd sue the movie company because that would have been interesting right you know right I feel like they made billions and billions you got you you sold it for too little well but I you know got to remember when I sell it the idea they're going to make a movie of my book seem Preposterous I'd sold a bunch of stuff no one ever made any movies for my books that and they never make it they buy it and that was The first one that had turned into movie that
was the first one that was ever turned into a movie and it only got made into a movie in a very for freakish reasons like no Hollywood studio wanted to make it so uh it the whole whole story is a little odd I love talking to you you're such a fun interview and um you're you're heading out but I just want to say one thing before you leave I just want you to know that you and Tabitha and your family have been in my Thoughts so much thanks since you lost your daughter Dixie and her
boyfriend in a car accident I I read that m and I was honestly it was from afar crushing I know that you know what pain is I do but losing a child I think is Indescribable and unparallel pain and um you know I know Tabitha a little bit from when she was on MBC and always really liked her and uh I'm just so sorry for your loss and and I I'm I'm glad that you are moving forward because you know I always Think we're all terminal like we just have to make the most of the
time we have and uh I just I just wanted you to know that you and your family your two other kids Quinn and Walker right right yep um I've just been holding you all in my heart thank you she she's she's alive in me she's with me so she's in this book in a funny way so yeah thank you
