I’ve read this comment a few times, and my brain goes ”???” whenever I get to your last clause: “I also had quite a strong reaction that nobody seemed to be acting on all of these warning flags”
I just don’t get it in a way that connects to my reading of the article. What are “all these warning flags” and what counts as “inaction”? I don’t want to say your take is wrong because you are sort of sharing feelings, but like.… according to the article, ex-Alameda employees don’t seem to think that those flags were warning flags for the massive fraud and crash-and-burn failure that was to come. And re: inaction, the article says CEA did an internal investigation in 2019 (it drops the info kinda randomly. As you say, the article isn’t well-optimized to come away with an understanding of the details). And idk what new warning flags came after 2019, I’m not seeing any in the article.
I mostly like your comment, but I’m also left wondering… Do you know things not in the article? Did I miss something? [Is this just a “vibe” we will disagree on regardless?] I can’t quite reconcile your take.
[Edit: I had been thinking about asking this over DM for a couple days, but now that this post is no longer an active topic, I figured, “what the hay, ask it in thread”. However you can answer over DM if you prefer, or ignore cuz the post is giving dying breaths, np.]
I don’t want to say your take is wrong because you are sort of sharing feelings, but like.… according to the article, ex-Alameda employees don’t seem to think that those flags were warning flags for the massive fraud and crash-and-burn failure that was to come. And re: inaction, the article says CEA did an internal investigation in 2019 (it drops the info kinda randomly. As you say, the article isn’t well-optimized to come away with an understanding of the details). And idk what new warning flags came after 2019, I’m not seeing any in the article.
I don’t know what you mean by this. I’ve definitely talked to many ex-Alameda employees and they totally think this was a warning flag for the massive fraud. Nobody assigned huge probability to the specific scenario that happened but “Sam causes some kind of huge explosion, or does something pretty fradulent or at the very least builds a highly unethical organization” was totally the kind of thing many people were worried about (which is indeed why some of them went around warning others).
I’ve written about this in many of my other comments. Also, CEA doing an investigation in 2019 seems I think wrong, or at least I have never heard of this investigation, and if there was an investigation it seems like it was worse than useless by creating a sense that “something” had been done, but really without any actual consequences as far as I can tell.
(Sorry I took so long to come back) Thanks for clarifying. Hm I’m surprised then that it really seems like the journalist didn’t turn up such quotes about fraud. I do think you are right that many of them expected a crash-and-burn… of some sort. I feel like I should have written something more precise like “crash and burn 3 years later, after making 15B on paper” which comes with so many signals over the years that if I were such a person I’d end up discounting my early suspicions. If I were in their or CEA’s shoes I’d probably have expected something like what happened with Tara’s company, a crash and burn pretty soon after (2019?), so I’d be assuming something got fixed along the way if not. Especially given how an ex-employee(s?) talked about burning through the Asian arbitrage dollars with bad trade decisions.. they’d have had to fix it, right, or they’d have gone belly-up way sooner? I guess crypto was just that much of a gold rush and so few “adults in the room” that they could keep fudging their numbers for that long..?
Maybe the investigation was worse than useless in the end, but reasonably any action taken was going to start with an investigation. It depends the quality of the investigation, but for now I’m much more comfortable considering this a bug of the world than something to blame CEA for.
[Edit: This isn’t to say that I think no mistakes were made. But my complaints are not focused on EA leaders specifically (I’m hesitant to call out any single person til CEA’s commissioned investigation is complete), and are different from what the article discusses. I discuss that in shortform]
I’ve read this comment a few times, and my brain goes ”???” whenever I get to your last clause: “I also had quite a strong reaction that nobody seemed to be acting on all of these warning flags”
I just don’t get it in a way that connects to my reading of the article. What are “all these warning flags” and what counts as “inaction”? I don’t want to say your take is wrong because you are sort of sharing feelings, but like.… according to the article, ex-Alameda employees don’t seem to think that those flags were warning flags for the massive fraud and crash-and-burn failure that was to come. And re: inaction, the article says CEA did an internal investigation in 2019 (it drops the info kinda randomly. As you say, the article isn’t well-optimized to come away with an understanding of the details). And idk what new warning flags came after 2019, I’m not seeing any in the article.
I mostly like your comment, but I’m also left wondering… Do you know things not in the article? Did I miss something? [Is this just a “vibe” we will disagree on regardless?] I can’t quite reconcile your take.
[Edit: I had been thinking about asking this over DM for a couple days, but now that this post is no longer an active topic, I figured, “what the hay, ask it in thread”. However you can answer over DM if you prefer, or ignore cuz the post is giving dying breaths, np.]
I don’t know what you mean by this. I’ve definitely talked to many ex-Alameda employees and they totally think this was a warning flag for the massive fraud. Nobody assigned huge probability to the specific scenario that happened but “Sam causes some kind of huge explosion, or does something pretty fradulent or at the very least builds a highly unethical organization” was totally the kind of thing many people were worried about (which is indeed why some of them went around warning others).
I’ve written about this in many of my other comments. Also, CEA doing an investigation in 2019 seems I think wrong, or at least I have never heard of this investigation, and if there was an investigation it seems like it was worse than useless by creating a sense that “something” had been done, but really without any actual consequences as far as I can tell.
(Sorry I took so long to come back) Thanks for clarifying. Hm I’m surprised then that it really seems like the journalist didn’t turn up such quotes about fraud. I do think you are right that many of them expected a crash-and-burn… of some sort. I feel like I should have written something more precise like “crash and burn 3 years later, after making 15B on paper” which comes with so many signals over the years that if I were such a person I’d end up discounting my early suspicions. If I were in their or CEA’s shoes I’d probably have expected something like what happened with Tara’s company, a crash and burn pretty soon after (2019?), so I’d be assuming something got fixed along the way if not. Especially given how an ex-employee(s?) talked about burning through the Asian arbitrage dollars with bad trade decisions.. they’d have had to fix it, right, or they’d have gone belly-up way sooner? I guess crypto was just that much of a gold rush and so few “adults in the room” that they could keep fudging their numbers for that long..?
Maybe the investigation was worse than useless in the end, but reasonably any action taken was going to start with an investigation. It depends the quality of the investigation, but for now I’m much more comfortable considering this a bug of the world than something to blame CEA for.
[Edit: This isn’t to say that I think no mistakes were made. But my complaints are not focused on EA leaders specifically (I’m hesitant to call out any single person til CEA’s commissioned investigation is complete), and are different from what the article discusses. I discuss that in shortform]