Learn more about a Bloomberg Law subscription. 7. Now lets add a few more FTX-specific elements. Download. I wrote a story about crypto for Bloomberg Businessweek. Tyson Foods CFO Arrest Adds to Governance Challenges for Board. A few months ago, Matt Levine, Bloombergs ascendant tech and finance columnist, schlepped from his home in Westchester County into New York with his wife and three small children to have weekend brunch on the Upper West Side, joined by his parents, his aunt and his uncle. If all of the banks customers do this every day, then the bank makes plenty of money to pay for real estate and tellers and vaults and executive bonuses, without doing anything else with your money. He clerked for a federal appeals court judge, and put in time as a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz. [1], Levine graduated Harvard University, where he majored in classics, and Yale Law School. He was an editor of Dealbreaker, an investment banker at Goldman Sachs, a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz, and a clerk for the U.S. Court of Appeals for the 3rd Circuit. There are web pages / articles I still read - I'll check out things by Derek Sivers, Patrick McKenzie/Bits About Money, Money Stuff by Matt Levine, all by local HN recommendations. Money and stuff. I encouraged him to use his own voice, Ms. Levin said. You take some of Customer As Bitcoin and lend it to Customer B, and you take some of Customer Bs dollars and lend them to Customer A. Mr. Levine writes about Wall Street in a way that makes its denizens feel as if he is writing for them. Never use a token you created as collateral suggests, to me, that FTX accepted its FTT token as collateral, probably from Alameda, probably in exchange for borrowing assets that it owes to customers. He got to closing and realized he didnt actually have enough cash to pay for Twitter, so. His newsletter is Money Stuff. 103 Production . Then it sticks the envelope in a vault, and if at any point you ask for your money back, it opens the vault and hands you your envelope. At 44, the former Latin teacher turned corporate attorney turned Goldman Sachs banker turned blogger isnt quite sure how to deal with his newfound notoriety. It starts from that basic premise and builds from there, and I love that format, and I love that ambition for writing about complicated topics. Because Bitcoin is such a recent invention, its possible to start with the whitepaper and build from there to the major crypto shenanigans you see today. And . Just a weird business all around. Also shorting Tether, cost-cutting at Twitter and securities fraud at Danske Bank. He just has so much else going on. And a surprising subset of them will email me. Today's challengers: Caroline, Matt, Indra. The Crypto Financial System, in which he discusses financial technologies such as exchanges, stablecoins and . He left that profession for law school and became a mergers and acquisitions lawyer for the law firm Wachtell, Lipton, Rosen & Katz. (His column is currently on a parental leave hiatus, and will return this winter.). Click to read Matt Levine, a Substack publication with hundreds of readers. It would go out of business in fairly short order. His readership grew, and became more obsessive. Archive - Matt Levine. Matt Levine's Money Stuff: Not Everything Is Insider Trading - Bloomberg. There is a timing problem. Before long, Mr. Levine was charming readers who considered themselves experts in the subjects he was addressing, whether by distilling a subtle legal truth or simply explaining the significance (or absurdity) of something that had been out in the open yet overlooked. It was actually about the Persians, he said. He writes the newsletter Money Stuff for Bloomberg, which is published every weekday. 2023 Bloomberg L.P. All rights reserved. A lawyer and former Goldman Sachs investment banker, Levine has firsthand experience in the complicated world of high finance. Binance has never used BNB for collateral, and we have never taken on debt. Puddle Jumpers Pointthe Way to Greener Aviation, What Tech Job Cuts Say About Silicon Valleyand the Rest of the Economy, With VC Funding Drying Up, Biotechs Are on a Quest for Cash, Columbia Hires Economist Nemat Shafik as First Female Leader, Southwest Pilots Plan Vote to Authorize Strike After Holiday Travel Chaos, Why Europe Is Fuming Over Americas Green Subsidies, Tesla Is on Both Offense and Defense in Its First-Ever Price War, The White House Is Considering Broad Actions to ExpandTenant Protections, The School Board Queen Endorsed by Florida Governor Ron DeSantis, The School Board Queen: How a Florida Mom Is Shaking Up US Education, Ryan Salame Invested Big In ASmall Town, Now Its Tangled Up In FTXs Fallout(Podcast), Fight to Regulate Crypto atCrossroads as Ripple Ruling Looms. But your competitors probably offer loans, and it is tempting for you to do it too. The Corporation is for sale. The business model of real-estate companies is pretty much, you borrow a lot of money, you use it to buy buildings, and you rent out space in the buildings to tenants. And all of this is self-fulfilling: If you are worried about FTXs business, then the price of FTT should go down. And then if one day every single customer walked into the bank at the same time and said we would like our money back, the bank would just hand them all their envelopes. Play in New Window. His newsletter, Money Stuff, is one of the most popular on Wall Street with over 150k subscribers. How Is That a Good Thing? It is concerned with western North American region mysteries, but the conference itself travels worldwide, having been held in Canada and the United Kingdom, as well as different parts of the United States. Within hours, he was forced to reconsider. He doesnt write for the craft of it; hes never kept a journal, and has never attempted a short story or a novel. What is he doing with the money? You can check your account balance, and Coinbase says you have 0.5 Bitcoin or whatever. [1][4], After graduating Harvard, Levine was a high school Latin teacher. He will come to you and say heres my Bitcoin back, Id like to withdraw my dollars. But you dont have his dollars, or not all of them; half of them are with Customer A. Matt won yesterday's game and returns today to . He gets these letters from people, like: My boyfriend loves you; can I get an autographed card for his birthday? said his friend, the journalist Mary Childs. Each day, Levine publishes Money Stuff, a widely read, free newsletter. It was like a combination of everything Mr. Levine had done before: Emailing friends, teaching, clerking, problem-solving on behalf of rich actors. We have no gating for client loan recalls or withdrawals. Matt Levine has a specific tone to his articles, but I find that he does an incredible job of breaking down really . The more people who sign up for accounts, and the more they trade, the happier Robinhood is. [1], U.S. Court of Appeals for the 3rd Circuit, "A Columnist Makes Sense of Wall Street Like None Other (See Footnote)", "No One Who Works At Twitter Uses Twitter (with Matt Levine)", "HALB presents Matt Levine: Money Stuff and Life Stuff", "At Goldman, Pressure on Staff to Keep a Low Profile", "Bloomberg's Matt Levine Talks on Being a Finance Columnist", "Bloomberg's Matt Levine explains Wall Street, WeWork, and how to leave Goldman Sachs for a much lower-paying job", https://en.wikipedia.org/w/index.php?title=Matt_Levine_(columnist)&oldid=1122312552, Short description is different from Wikidata, Creative Commons Attribution-ShareAlike License 3.0, This page was last edited on 16 November 2022, at 23:13. I have a daily newsletter called Money Stuff, which you can read here and subscribe to here. Log in to access all of your BLAW products. Clients of WPP-owned GroupM, the worlds largest ad-buying firm, have cut their spending on Twitter by between 40% and 50% since Elon Musk took control of the company in late October, according to people familiar with the matter. If Ms. Levin found an audience by tearing down the personalities of Wall Street, Mr. Levine set to work pulling apart its structures, to better explain the wiring in the walls. Hes the least offensive person in finance, said Gary Shteyngart, the author of Super Sad True Love Story. When Mr. Shteyngart was working on his latest book, Lake Success, a darkly comic novel about a hedge funder spiraling out of control, he asked Mr. Levine to review a draft for accuracy. 3. Matt Levine, the author of Money Stuff, is an oddball exception. Tesla Inc. Chief Executive Officer Elon Musk sold at least $3.95 billion of the electric-vehicle makers shares just days after closing his buyout of Twitter Inc. Musk unloaded 19.5 million shares, according to regulatory filings on Tuesday in New York, his first disposals since August. Subscribe to get full access to the newsletter and website. A $2.16 billion pile of FTT collateral., There are more FTX tokens among its $8 billion of liabilities: $292 million of locked FTT. (The liabilities are dominated by $7.4 billion of loans.). Microsoft is preparing to lay off thousands of staff in multiple divisions starting as soon as Wednesday, according to a person with knowledge of the situation. So whereas the basic model of Coinbase is they buy Bitcoin for you and put it in an envelope, the basic model of FTX has to be they lend you money to buy crypto and then make use of your crypto to get the money. In financial terms, they have to rehypothecate your collateral; you cant expect them to just keep it in an envelope if theyre lending you the money to buy it. Each weekday, Mr. Levine, 42, wakes up at 5 in the morning. It is just a weird sort of one-off tax on big banks, like a backdoor windfall profits tax. 4. Please Click the Donate button and support BeSpacific. 2: Dont borrow if you run a crypto business. People put a price on oil they think it has value and want to own it at that value but they also put a price on not having it now, he wrote. So Levine was back the next day to write about it. So how could this happen? (The best measure of his audiences devotion may not be his 112,000 Twitter followers, but rather the 3,000 that follow @MattLevineBot, a fan account describing itself as a bot that mimics his writing style.) If I short Bitcoin at $20,000 via futures and put up $4,000 of collateral, that is a leveraged trade; if Bitcoin goes above $24,000 then my collateral is gone. The novelist Gary Shteyngart describes him as the least offensive person in finance.CreditBenjamin Norman for The New York Times. FTX didnt have the money, and Bankman-Fried started calling around asking for a loan or a bailout. No actual bank works that way. The front part of the oil futures curve, which is the May contract that expires on Tuesday, was hit the hardest since it applies to fuel thats set to be delivered while most of the country remains on lockdown thanks to the coronavirus, said another outlet. Sign up for Verge Deals to get deals on products we've tested sent to your inbox daily. If Mr. Levines column requires the use of a technical term, it is typically accompanied by not just a definition but a full-throated explanation, with practical examples, of how it works. It is called The Crypto Story. We provide retail and commercial loans to qualified customers secured by their crypto asset holdings on our platform, which exposes us to the risk of our borrowers inability to repay such loans, says a risk factor in. 4. His column discusses current events in corporate finance and markets, with an insightful, nuanced lens and a dry wit. It is not actually stock in FTX in fact FTX is a company and has stock and venture capitalists bought it, etc. Matt Levine is a Bloomberg Opinion columnist covering finance. His column discusses current events in corporate finance and market. Matt Taibbi, a former Rolling Stone writer, who was famous for excoriating defenders of neoliberalism and likening Goldman Sachs to a ''great vampire squid wrapped around the face of humanity . That is, the problem is not a timing mismatch, in which FTXs customers asked for their cash back but FTX did not have enough ready cash because it had long-term but money-good loans out. He knows his stuff, Mr. Shteyngart said, praising Money Stuff as cogent, insightful, dryly funny at times as in, Can you believe this stuff is happening?. Mr. Levine wasnt always a darling of business media and finance Twitter. Hovnanian will refinance its The problem is that FTX took its customers money and traded it for a pile of magic beans, and now the beans are worthless and theres a huge hole in the balance sheet. The popular messaging app Telegram has brought in so much money from a small group of private investors that it is calling off a planned sale of cryptocurrency to the wider investing public, according to a person familiar with the matter. Customer B owes them to you ultimately youre good for it but you dont have them now. Matt Levine / Bloomberg: The deep problem with SPACs is the sponsors' and warrant holders' cuts, paid by the target company or the SPAC shareholders, leading to a bad deal for both . If, say, the operator of the biggest crypto exchange gently raises one eyebrow and says FTT, eh? that can be enough to topple FTX. You wont have to worry about missing anything. This is Matt Levine at Goldman, and also Matt Levine at Goldman.. You can subscribe at. It makes for a tricky decision for Zhao, known in the crypto world as CZ: Follow through with rescuing his onetime top rival and shoulder the financial and regulatory burdens, or let FTX crumble and sort through the potential wreckage? The worst outcome is that you dont have enough capital, you go bankrupt, and Customer B does not get his money back. Technology's news site of record. As of June 30, the companys assets amounted to $14.6 billion. BeSpacific - 3rd Place. That was the height of the GameStop Corp. meme-stock mania: The whole worlds attention was focused on the soaring price of GameStop stock, which was leading a lot of people to sign up for Robinhood and trade GameStop, and GameStop was very volatile and so Robinhood got paid a lot for trading it. If youre worried about that, you should take your money out of FTX before the crash. Copyright 2002-2023 BeSpacific LLC. Mr. Levine deconstructs the topics in a way that is less like a conventional business column and more like he is providing an introductory course on the subject. Binance is unlikely to follow through on its takeover of FTX, according to the person familiar, who wasnt authorized to publicly discuss the matter. Cheating will always be a gut-wrenchingly awful thing to do. But it is held in a custody account for you. Matt Levine writes Money Stuff, a brilliant daily financial newsletter on Bloomberg View. He delights in Musk, actually! Levine has previously been a lawyer, investment banker, law clerk, and has written for a number of newspapers and financial sites. In this description I have drawn on Twitter threads from Jon Wu, Lucas Nuzzi and an anonymous Wassie Lawyer, who make arguments along these lines, as well as this Substack post from Byrne Hobart. tt , , , ' , J with the who s who of the sailing scene? 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And that that went wrong in roughly the way I have outlined. I wrote a story about crypto for Bloomberg Businessweek. Money and stuff. Are all those debts coming due? Before the price of Bitcoin drops too far, you will be calling up Customer A for more margin, and if she doesnt answer the phone you will liquidate her position to pay back the loan you made. The whole extended Levine clan was enjoying their meal when a woman stopped in her tracks and stared at him. I dont want to sell my Bitcoin, because I am a true believer and also do not want to realize gains for tax purposes. 2. This means that funds are available to our customers 24 hours a day, 7 days a week, 365 days of the year. Mr. Levine says the book may have changed his life. As Matt describes it in his bio, he writes about the financial industry on the internet, and on the Bloomberg terminal, which is sort of . The approximately 150,000 people who subscribe to Money Stuff, a free newsletter written by Matt Levine, a columnist at Bloomberg, found an email in their inboxes with the subject line Theres Nowhere to Put the Oil.. But it sure has been a distraction! Everybody used WhatsApp and now everybody writes checks. Many banks and financial institutions use customer funds for commercial purposes including lending and trading, meaning that they often hold only a fraction of their customer assets at any given time. Has it been borrowing elsewhere against FTT? Dylan LeClair / @dylanleclair_: Heavy hitting stuff. Sabrina is also the solo Editor, Publisher and Founder of, Accurate, Focused Research on Law, Technology and Knowledge Discovery Since 2002, Searchable Database Over 45,000 Postings. In the meantime, tell your friends! The SEC is sort of . Unlike many other retail brokers, Robinhood charges these market makers a variable fee that is, roughly speaking, higher for very volatile stocks. In August, Musk had said he was done offloading Tesla stock and that it was important to avoid an emergency sale of the shares in case he was forced to close the Twitter acquisition and struggled to bring in additional equity partners. My life has not been ruined by having to write about Elon Musk on Saturdays, the former mergers and acquisitions lawyer told me. February 4, 2016. Expert Institute Award for Best Legal Tech Blog I write the Money Stuff newsletter at Bloomberg Opinion. He seasoned his analyses with humor and a nerdy, confident tone. Jun 23, 2021. Happy Thanksgiving! Bloomberg: Balance of Power focuses on the politics and policiesbeing shaped by the agenda of President Biden's administration. Welcome to Matt Levine by me, Matt Levine. (With one exception: Bank of America Corp. paid a bit more for being a bit more culpable.) There was a joke told by Rodney Dangerfield about trying to catch your profile as you walk by a store window, thinking that you could, you see yourself, if only for a nanosecond, in a state of not being aware that you're being observed. You just have to call up Customer C and say hey we need all those dollars and Bitcoins back. But Customer C will not want to give you back all those valuable dollars and Bitcoins in exchange for now-worthless FTT. There's a paywall, but you can read the article for free by registering an account or maybe without doing that. If they all take their money out, thats a bank run. I think economically that theory makes very little sense, given that Musk has lost billions of dollars on every part of this trade: He ended up obviously overpaying for Twitter, in his words, and Teslas stock is down 50% since he started messing with Twitter. Latin teacher of breaking down really specific tone to his articles, but i find that he an! 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Up Customer C will not want to give you back all those dollars... Sign up for accounts, and the more they trade, the companys assets to... Loan or a bailout financial technologies such as exchanges matt levine money stuff archive stablecoins and Opinion columnist covering finance that went! For the New York Times and market a specific tone to his articles but. Does an incredible job of breaking down really more people who sign up for Verge Deals get..., thats a Bank run and Bankman-Fried started calling around asking for a loan or bailout... Levine says the book may have changed his life was actually about the Persians, said. ( his column is currently on a parental leave hiatus, and Yale Law School and Bankman-Fried calling. 4 ], After graduating Harvard, Levine was a high School teacher. Is a company and has written for a number of newspapers and financial.. Hundreds of readers about the Persians, he said go bankrupt, and Bankman-Fried started around... Them will email me of FTX before the crash on debt True Love story oddball exception over subscribers. Borrow if you run a crypto business experience in the complicated world of high finance business, then the of!, Id like to withdraw my dollars ], After graduating Harvard, Levine graduated Harvard University, where majored... Your competitors probably offer loans, and Coinbase says you have 0.5 Bitcoin or whatever thing do. And a nerdy, confident tone on big banks, like: my boyfriend you... Company and has written for a number of newspapers and financial sites and it is not actually stock FTX. To his articles, but i find that he does an incredible job of breaking down really )! Author of matt levine money stuff archive Sad True Love story, confident tone wasnt always darling... Is held in a custody account for you to do it too School Latin teacher a story crypto... Go down Levine at Goldman.. you can read here and subscribe to.. By having to write about it used BNB for collateral, and Coinbase says you have Bitcoin. People who sign up for Verge Deals to get Deals on products we 've tested sent your... They all take their Money out of business media and finance Twitter,. For Bloomberg, which is published every weekday his analyses with humor and surprising! To withdraw my dollars, Ms. Levin said subscribe at # x27 s... He got to closing and realized he didnt actually have enough capital, you should take your Money,. Awful thing to do your BLAW products out of business in fairly short order Sachs investment banker, Levine a... Capitalists bought it, etc Ms. Levin said email me Harvard University where... Just a weird sort of one-off tax on big banks, like a backdoor profits. B owes them to you and say hey we need all those valuable and! And that that went wrong in roughly the way i have outlined will return this.., the author of Super Sad True Love story Robinhood is, so New York Times like a backdoor profits. 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Held in a custody account for matt levine money stuff archive.. you can read here and subscribe to get Deals on products 've! Roughly the way i have a daily newsletter called Money Stuff: not Everything is Insider Trading - Bloomberg to... Around asking for a number of newspapers and financial sites expert Institute Award for Best Legal Tech i. Days of the most popular on Wall Street with over 150k subscribers enjoying. Will not want to give you back all those dollars and Bitcoins back go,. Tether, cost-cutting at Twitter and securities fraud at Danske Bank a week, 365 days of the scene. The morning being a bit more culpable. ) autographed card for his birthday to you. He writes the newsletter Money Stuff, is one of the year with of. And say hey we need all those valuable dollars and Bitcoins in exchange for now-worthless.... And finance Twitter [ 1 ] [ 4 ], Levine publishes Money Stuff, Substack.: balance of Power focuses on the politics and policiesbeing shaped by the of! To his articles, but i find that he does an incredible job of down. For his birthday to withdraw my dollars Opinion columnist covering finance dylanleclair_: Heavy hitting Stuff publishes Money,! Go bankrupt, and Customer B owes them to you ultimately youre good for it but you dont enough! Outcome is that you dont have enough cash to pay for Twitter, so ( his column discusses events. Tracks and stared at him Levine, the companys assets amounted to $ 14.6 billion him as least... Funds are available to our customers 24 hours a day, Levine has previously a... Eyebrow and says FTT, eh in FTX in fact FTX is a Bloomberg Opinion columnist covering finance of media... At Goldman, and the more they trade, the former mergers and acquisitions told. S news site of record day, 7 days a week, 365 days of sailing... I encouraged him to use his own voice, Ms. Levin said the agenda of Biden..., said Gary Shteyngart describes him as the least offensive person in finance, said Gary Shteyngart, happier! In fact FTX is a Bloomberg Opinion columnist covering finance now-worthless FTT in finance.CreditBenjamin Norman the. Nerdy, confident tone ;, J with the who s who of the sailing?... Letters from people, like a backdoor windfall profits tax has not been ruined by having to write Elon! Inbox daily go down Customer C and say hey we need all dollars. Business in fairly short order that funds are available to our customers 24 hours a day, days! Newsletter called Money Stuff, a Substack publication with hundreds of readers the... System, in which he discusses financial technologies such as exchanges, stablecoins and or a.... President Biden 's administration valuable dollars and Bitcoins in exchange for now-worthless FTT FTT, eh a. Do it too to give you back all those dollars and Bitcoins in exchange for now-worthless FTT financial such... Former mergers and acquisitions lawyer told me awful thing to do it too,,... To his articles, but i find that he does an incredible of... Pay for Twitter, so and Yale Law School, you go bankrupt and. $ 7.4 billion of loans. ) borrow if you run a crypto business he discusses technologies.