Welcome to Pablo Torre Finds Out. I am Pablo Torre. Today, we're going to find out what this sound is.

He should have said, Tom, I paid you for 20 hours. Get down here and give me a pep talk, because I'm facing a really tough challenge right now.

Right after this ad. You're listening to Girof Kings Network. Okay, so I just got to dive right in here because I believe that today's story has been incredibly under covered in the world of sports, specifically, which is criminal, as it were. This is the story of Sam Bankman-Fried. Sam Bankman-Fried is the founder of a company, a crypto exchange, named FTX. And FTX made Sam the richest person under the age of 30 on the planet. It put him on the cover of Fortune as the next Warren Buffett and Forbes as the next Mark Zuckerberg. And it put him all over sports itself. You may remember this. Ftx had a Super Bowl commercial. Sam was famously endorsed by Tom braided, Steph Curry, and Shohay O'Tany, and many of the best athletes in America. All of which turned out to be an enormous problem. One of the most powerful people in the cryptocurrency industry, Sam Bankman-Fried, arrested overnight in the Bahamas. The federal charges just unsealed. They include eight counts, including wire fraud, securities fraud, and intent to defraud the United States government. The government also contends that Bankman-Fried was using these customer deposits to both cover bad bets that he made at his crypto hedge fund Alameda Research, and to make $100 million in campaign contributions.

All in, we're talking about more than $8 billion worth of FTX customer money that went missing. Bankman-fried has pleaded not guilty to all charges. This is always a gamble, right? The defendant taking the stand in their own.

Trial.

The defense putting him up there. How is he doing so far?

Poorly to really poorly.

A jury has found FTX.

Founder Sam Bankman-Fried guilty.

Guilty. Guilty on all seven counts against him. Yeah, fucking insane. That trial was this month, by the way, not so far from our office here in New York. And it did feel like one minute, Sam Bankman-Fried was the good guy in charge of our entire technological future. And the next minute, he was in jail. And all of this was humiliating for sports for many reasons, like this next video, which I just had to show to producer Ryan Cortez, which is from June 2021.

It's official. The home of the Miami Heat is now FTX Arena.

The name was formally converted at an event at the arena just a short time ago.

The name will stick around for the next 19 years. Officials with FTX say today.

Marks the.

Start of a.

New era. A new era. What an era? Do you remember that era? It looked like the celebration for the big three with the Heat. I don't know why there was so much confetti. Yeah, it was them saying not '17, not 18, 19 years. It lasted 19 months, dude. Well, they got one number right. You got to get to get to that, bro. So FTX, that crypto exchange is Sam Bankman-Fried's company, right? This was Mr. Ftx. This was Mr. Miami Heat. And that deal was supposed to be worth $135 million over the 19-year span between Sam Bankman-Fried and FTX and Miami-Dade County. Yeah, make that clarification. It was the county, not the Heat. Except the Heat also annually, we're going to be making two million dollars a year. And so all of the optimism of that confetti, it made me think about who we know who might have been there when all of this was going down. And of course, we found someone. Dude, of course, I watch every single Heat game. And my boy, Will Manso, my boy, one of the best reporters in the country, I remember he interviewed Sam Bankman-Fried one time on a game.

Yes. Will Manso, in arena reporter for the Miami Heat, was right there at Courtside with the man in question.

That morning I get up as normal, my producer sends me an email for the heat show that night and says, Hey, you're interviewing this guy, Sam Bankman-Fried. He's the founder, the owner, the CEO, whatever you want to call it, of FTX. And the arena being FTX tonight's a big opening night. It's going to be all in Miami shirts everywhere. Everybody's going to be excited. So you need to interview this guy. So I get there and I get to the seat and I see him standing there. But what I see is this man in a dark T-shirt, a black T-shirt, cargo shorts. His hair is much more disheveled than I saw in the pictures. I knew he had big hair, but I mean, it's everywhere, and it just looks like it hasn't combed in two weeks. I walk over and the handler comes, Hey, Will, how are you? I'm like, okay, this is really him. He's standing there and he's unassuming quiet. He goes, Hey, how are you? I shake his hand. He's hand-banked for food. I said, Hey, Will, man. I'm like, kitchen. The first thing I notice is right here on his shirt, along the shirt is what appears to be the world's largest toothpaste stain.

He was brushing his teeth in the morning. A big chunk of toothpaste fell. He didn't know what to do, so he blabbed it on and scribbed. That's the way he kept the shirt on. His shorts look like they're never been washed or iron fixed. I mean, he looked like he just got out of bed.

That's insane to leave the house like that, bro. Well, this is where Will Manso ends up being not just.

A.

Good reporter, but a good guy because he has a solution to this completely incomprehensible problem.

So by luck that day, or by luck or by chance, by whatever, that day, every seating the arena had a, You in Miami, the FTX slogan, T-shirt on the seat. So we go back to them and not to tell them that, Hey, you look like a bag ofon, and you look terrible with this on your shirt. We say like, Hey, these are so cool. They're everywhere. Everybody's wearing them. Why don't you wear it? You're the CEO of the company. He was like, Oh, awesome. That's a great idea. They come to me, Hey, Will Manso is standing by with the CEO of FTX who's so excited to be here, courtside for his first Heat Game. We're here at courtside with the CEO of FTX, Sam Bankman-Free. Cain looks to join us here on this opening night. You will notice that he has the shirt and you can see the outline of another shirt under. That's the original toothpaste shirt. You're here watching the Heat in a big game opening night with an arena with your company name on it.

What's that like? It's really cool. I mean, just seeing everything from the courtside logo and the logos ever, the flames coming out, being right next to the players, it's really exciting.

In the moment, he seemed like the sweet, unassuming like you almost liked him because he was just so not like Joe Cool or trying to be like, whatever, I do this all the time.

I mean, it's unbelievably cool and exciting. Just the enthusiasm and support that we've gotten from the team, from the club, from the fans, and from the city here has just been great. And we're really excited to work with him.

That shirt is immense. I can't believe how big this shirt is. And the shame is immense. Will Betso is a good reporter. This is not the clip I would submit to the Pulitzer Committee because I have been texting this photo of Will and Sam Beckman-Fried in giant ass shirt. Do you know how bad that is? To laugh at him? The stain has to be for him to agree to wear a 4x shirt? Absolutely. It has to be a huge fucking stain, bro. It's a stain that is only rivaled by the stain upon the entire institution of Miami and the Heat. How dare you. The only defense I can offer you here as the Minister of Heat Propaganda is that you guys, it turned out, were not alone in this shame. Because, Cortez, I have spent weeks now. You've seen walk around this office with two books. I spent weeks studying this story. And my theory, after all of this, is that this whole thing is actually a sports story. As much as we talk about the Saudi Arabian government using soccer and golf and FIFA, all of these sports to hide its morally reputable behavior, sportswashing.

To me, the ultimate example of a foreign entity using sports to hide and to normalize its behavior is actually Sam Bankman-Frieden and FTX. I believe that this is a sportswashing story. And so what I did, I've been reading these two books by Zeke Fox and Michael Lewis, respectively, Number Go Up and Going Infinity, all about Sam Bankman-Frieden and FTX. And there are people, authors who got access to him who were around while all of this was happening. And what I wanted to do on today's show is actually pressure test my theory that this story is a sportswashing story. This is a sports story to the core. And I needed both Zeke Fox and Michael Lewis to tell me whether they approve of my logic here. And also, who else beyond just you should be absolutely humiliated by this entire thing. I was shaking my head that entire time because it hit me again about the recent episode. Because of the guilt that you have, clearly. No, I have zero guilt about the dark triad about how you're a narcissist because you turned this entire fascinating episode into about Pablo Torre and Pablo Torre's theory. Well, it is my show.

And also, I want to find out if I'm the one person who might be right about a scandal that pretty much everybody else missed. Okay, great. Hey. Hello. Are you in Miami? I'm in New York. I'm in New York. A satellite of the Dan Levitard Empire. But I want to say, Michael, first off, I have some specific questions that may feel disjointed in a sense, but I promise that they are targeted to things in your book that I just found really fascinating as regards sports. So thank you for doing this.

This is just one big trust fall. I'm in your hands. Let's do what you want to do.

Okay, so I do want to explain what I want to do here because that is Michael Lewis, maybe the most successful non-fiction author of our time, the author of Moneyball and The Big Short, and now Going Infinity, the rise and fall of a new tycoon. No writer spent more time over about two years getting to know Sam Bankman-Fried than Michael. And this generated some amount of controversy because Sam Bankman-Fried is in jail. I got lots of one-on-one questions for Michael about all of that. But what I also wanted to do here was consult the other writer who was all over this story, a really smart investigative reporter named Zeke Fox.

This is the most legit podcast that I've been on.

Not quite a Bahamas conference with Tony Blaire. Zeke's book about Sam Bankman-Fried, which is called Number Go Up inside Crypto's wild rise and staggering fall, which mentions that conference with Tony Blaire, by the way, is also really good, in my opinion. It's different from Michael's book. It's competitor to Michael's book, but it's quite good. And Zeke first became fascinated by Sam because Sam had principles, meaning that he believed in the greatest good for the greatest number of people. And so what Sam first told Zeke in the pages of Bloomberg Business Week was that he was going to give all of his billions away.

We had this conversation, me and Sam, really early on when he was explaining utilitarianism to me. My specialty is scammers. Yes. And I've actually always had this idea that there should be a scammer who steals the money and gives it away. Sam explained utilitarianism to me, and I was like, oh, you could be my guy.

Of course, Sam never gave all of his money away. In fact, allegedly, he stole his customer's money at FTX, and he spent it strategically to enrich himself and his business, his crypto exchange, which like a stock exchange, you could go to and bet money on various cryptocurrencies rising or falling in price, these coins. And so much of what Sam spent with those allegedly stolen funds, well, under the nine figures easily, went directly to sports. And so I wanted to ask both Zeke and Michael a pretty simple question. Why?

Sam was, you got to remember, he's a Martian. He's trying to figure out people the way an AI would figure out people. Had no social interaction as a kid, never thought of himself as the person who could run a business with customers. So he's groping, figuring out how do you get attention for this crypto exchange. Sam, when are you going to go to sleep tonight?

Oh, Jeez. I've got some time from 8:30 or 9:00 AM.

I think.

I've got back.

To back. You crack me.

Up, man.

This was a kid who when he was 19, when by the way, he's at MIT. He has a Nate Silverish blog where writes about baseball stats, genuinely does like sports. Oh, I didn't know that. Yeah. You might have thought he was just like a nerd who doesn't like sports and does it cynically, but he actually he was a fan.

And he starts to just, from first principles, look at what people care about. And he saw that in Europe, when you put the names of companies on the jerseys of players, everybody noticed the name of the company and no one cared about the names that were on the stadiums. But in the United States, all the announcements, every time they talk about a stadium, they mention the Mercedes-Benz Superdome.

And again.

Welcome back to the Mercedes-Benz Superdome. He just picked it up. It was like what people cared about. He would never try to make an argument about why people were this way because he had no idea. It was just, I'm looking at these strange creatures called human beings, and this is what they do here in America.

Look, where are the places that have huge amounts of following that have lots of people care about that are universal and that are excited to partner with us. And I think that we're open to a lot of areas, but in practice, sports has been a lot of that.

He said, It had been my impression that the names of stadiums of professional sports teams in America, particularly baseball, football, and basketball teams, were very widely known. I, as a somewhat average level sports fan, could name dozens of stadium names, almost all of which I had never been to.

Once Sam has decided that what they need to do is stick FTX's name on a stadium, they go looking for a stadium to stick its name on. And he got rejected by the New Orleans Saints and the Kansas City Chiefs. And I think it was because crypto just generally made some people uncomfortable rightly. The Kansas City Royals offered him their stadium and he said he didn't want to be the.

Kansas City Royals of crypto. No offense to the Kansas City Royals.

Finally, this thing with the heat breaks and he doesn't want to be the Miami Heat of crypto. And the twist to the heat deal that was so appealing to him and the small circle of people trying to figure out how you get inside of the minds of ordinary people.

Was.

That it required government approval. The Miami-Dade County had to approve the deal. It wasn't just, Oh, you go right to the Miami Heat. And the fact that a government was going to sign off on it and rubber stamp them and say the government approves of FTX, they thought that gave them... That was really valuable because it would just create trust. That's what they're doing. They're trying to create trust.

It may have been an easy pitch because the mayor was all about crypto back then. Actually, he had promoted something called Miami Coin, which fell 99.

Percent Francis Suarez.

Suarez.

Yes. The most Miami man that's ever Miami.

He was at this crypto conference where I first met Sam and gave a speech about how we should all get in on crypto.

It's just wonderful to be here in the Bahamas, which is like the Hamptons of Miami. Only Sam and FTX can do something like this and convene this incredible collection of talented people in the crypto space. I had to be here.

In no way will any of us regret this. It was basically, I think, the tenor of that speech. But just speaking to the oddness of him, it's the idea of on the one hand, this guy is an alien who does not understand anything about our customs. But on the other hand, he's savvy.

Ftx is making history again, this time becoming the first company to work out a new partnership with the MLB. Major League Baseball, they put a patch on every umpire.

That was my favorite one.

A great idea. I don't think they had patches before.

You see the logic in all of these choices, right? With Major League Baseball, Sam Bankman-Fried is right that do people really give a shit about the sponsor on anyone's jersey? No, it's forgettable. But beyond naming rights of stadiums, we are just going to be seeing on a baseball broadcast, The Empire all of.

The time. They're one of the organizations with absolute massive reach and a cool hatch on every Empire, which I think is pretty creative. But I think beyond that, we were excited about how excited they were about this. And I think that's really important for us.

It was perfect because what is an umpire? Umpire is someone who's there judging everything and making sure it's fair. And you're watching the television and you see the batter and you see the catcher and you see the pitcher and you see this logo on the Empire. It took my breath away how quickly, how easily, how cheaply they were able to get that real estate. Almost every shot, basically constantly on TV on this human being is this thing that says FTX. So what they figured out, I mean, I figured this out in my own way. I have written sports books to get at things other than sports because this whole society is so sports-obsessed that you can take them to... If you start with sports, you can get them to places they wouldn't think they would want to go. They're not going to want to read a book about data and analytics. They might want to read a book about, well, data and analytics in baseball. And business people are constantly looking for sports metaphors for what they're doing. You give them a sports metaphor, or combined with a lesson, the lesson is more likely to be absorbed.

This is a version of what Sam.

Bankman-friedberg was doing. There was a line that you had in your book from I believe, FTX's lawyer, Dan Friedberg, about the difference in vetting between the NBA and Major League Baseball. Do you recall what he said?

You're picking up on all this stuff that nobody has picked up on. But yes, they were worried, of course, crypto has got a sketchy reputation in most people's minds. Lots of bad things that happen in crypto. Getting people to take your money, they thought was going to be a big problem. And it was a problem, obviously, in football with the institutions, with the stadiums. The basketball, the deal with the Heat, they had to jump through hoops. They did go give presentations to the Miami-Dade board of supervisors or whatever that government body is. Baseball just took the money. They couldn't believe how easy it was. And this probably tells you something about the hand that baseball feels it's playing. It's like the lesser venture capitalist. It's worried about being left out. So it will allow others to just do their vetting for them. And if it's okay for basketball, it's got to be okay for us. Just please give us some two.

Which is hilarious. Which is hilarious and speaks to the ego and the ecosystem of ego inside of sports as well. But as for that ecosystem in sports, I found it fascinating in your reporting, which establishes Sam Bank and Freed, yes, a Martian, but also is discerning about who matters and who does not. I mean, he has opinions. You quote, if you could remind us of the stuff that he wrote to employees about the difference between Baker Mayfield or Doug Prescott and Tom that you're talking about?

Again, it's the Martian view. He notices this indiscriminate use of quarterbacks, especially, but athletes to pitch stuff. And he says, I've seen Doug Prescott in this mattress commercial 7,000 times. And I don't believe a single person has bought a mattress because Doug Prescott was in the mattress commercial. I think in his mind that had zero effect. He said, On the other hand, Tom braided has changed our life. That the braided matters more than everything combined. The best ever, right?

But he's not thinking.

About being the best.

He wants to be better.

So you know he's going to invest better, too. Ftx, that's the crypto app, right? Now it's for all kinds of investing. It's better.

I've got some numbers. Can we go over the numbers? Please. Okay. Because a lot of this has come out now that FTX is bankrupt. Spoiler alert. Yes. The story ends badly. So his biggest name celebrity was Tom braided. Tom got $55 million credit to rival Crypto book author Michael Lewis on this. He had the detail, which was that, braided committed to do 20 hours a year of work for FTX for three years to get the 55 million.

Doing the math on that, that's.

Yeah, it's $916,000 an hour.

What do you think? Are you in? You know what? I'm in. I mean, I do think everybody FTX hired to endorse it was being paid more money per minute than they'd ever been paid. I mean, it wasn't just braided, but if you ask Sam, braided was cheap at that price. This is going to sound strange. You hear that number and you think, Oh, braided just let himself be bought. I don't actually think that's what happened. I think braided actually was interested. And this was an FTX was the most interesting crypto place. Braided had a genuine curiosity fascination with crypto and a genuine curiosity fascination with Sam. The money in a way clouds the reality of the situation. It wasn't just the money. As much money as it was.

What's up, guys? I'm here with my boy, Sam.

From FTX. We're at Crypto Bahamas Conference. We're going to start the day. We're going to do some TikToks for you guys. And it's going to be an amazing day. We'll get started. We'll do a.

Get ready with me.

Sam, where.

Are you going, bro?

For Sam's point of view, it might have just been just the effect braided had. Although I think it probably tickled him that he was on the sidelines when braided was playing football.

There is undeniable, now that you phrase it in these terms, there's this cinematic archetype, this odd couple of two archetypes, as you would see in a movie, options of the spectrum getting together to... I mean, braided was putting the red laser eyes in his avatars on social media.

Most people who met Sam felt oddly admiring and protective of him. He was nothing but this roly-poly, super bright nerd. He wasn't pretending to be a former athlete. A lot of times you see people who are cozying up to athletes and the athletes smell it, right? They're jocks different. Sam, he didn't pretend to know which way the football was supposed to go when you had it. He was just his own person and so different that he interested people like braided. It was like a weird friendship struck up on the playground by the kid who was all alone in the corner who nobody wanted to play with and the most popular kid in the school. That's what it felt like. Sam could not believe the effect of the role that braided played in the culture. And the drop off from braided to Baker Mayfield or Dave Prescott is just huge. But he was also saying there's a relationship between the product that's being pitched and the person who's doing the pitching. So, for example, Steph Curry's operation at first said no, he didn't want to endorse FTX. But then after braided in the stadium, and he came on board.

Steph Curry got 35 million, the same 20 hours a year deal. And it seemingly didn't do as much. He hadn't put in his hours yet. Although he did appear in one embarrassing FTX ad where he is carving an ice sculpture of a bored rape NFT.

This is Steph Curry, the world's leading expert on cryptocurrency.

Definitely not.

I'm not an expert and I don't need to be. With FTX, I have everything I need to.

Buy.

Sell, and trade crypto safely.

Sam Bankman-Fried, again, to your point, I don't want to be the Royals of sports podcast host either. He's picking some of the greats who also are known to be credible and safe.

Yes. So he also, Davidortiz.

Did an ad. Yeah, super well liked, of course. You're getting into crypto? We FTX?

Steph and Tom are in?

Oh, I'm.

In, boy.

Naomi, Osaka.

Yep.

I'm Naomi, Osaka, and I'm proud to.

Partner with FTX.

Ohtani from the Angels.

What about the great Crypto Tani? Maybe. That's the way he trades on FTX, the platform that does it all. There's no due diligence. And in this case, there was no due diligence done even by the venture capitalist who invested in the company. So it was a little hard to blame the athletes for not doing it too. Sort of like, Oh, everybody's all in on this. What could be wrong with it? But what it says is, what you're getting when you buy an athlete is you're a blind faith. The deal the athletes thought they were doing was, Well, I'm famous and they're buying them a little bit of my fame and there's no cost to me and nobody's really going to do anything because I said do it. What Sam Beck and Free showed is yes, people will actually do things because you said to do it. And so there's some responsibility there.

Zeke, I want to get to who the audience was for these ads. To me, I'm thinking about bros, dudes, who love sports. And I imagine that that would be an audience, of course, that would overlap with the crypto customer demo.

Yes, but it's pretty inefficient because you're advertising to a lot of people who may not already have any desire to trade crypto. You have to convince them it's like a two step thing. You want to trade crypto, and then you should do it with us. So your conversion rate on that is going to be pretty low. And in fact, it was, Sam told me. They weren't signing up a lot of customers from these ads. If you remember the Super Bowl ad with Larry David? Like I was saying, it's FTX.

It's a safe and easy way.

To get into crypto.

I don't think so.

Or the series of Tom braided ads. The message was like, all regular people, basically, if you don't go to trade crypto right now, you're missing out and you're a loser. And the successful people like Tom braided are doing it.

Yes, the winning the champions that he signed up, they're all doing it. And by the way, it also seems like the undercurrent also in those ads is, and we're the good guys.

Yes. And this is where even in the moment I had developed my own theory of why he was doing this. I mean, he's in the Bahamas, right? This whole thing is questionably legal at best. The reason he's in the Bahamas is because he would definitely get sued by the Securities and Exchange Commission if he was in the US. And the biggest risk to his business would be that the government would basically say, You know what? We've thought about this a little more. Even though you're on that island, this is actually all super illegal and we're going to arrest you. Setting aside any potential fraud, they might just be like, You're running this crazy exchange. The people in the US are getting onto it somehow, and this has got to stop. And if that happened, that could be the end for him. Anything that would lower the odds of that happening would be valuable. And so he gave away almost $100 million to people in Congress. Right. So that... I mean, that helps maybe.

Sure. They're going to use- Yeah, you're lobbying the lawmakers, paying them.

But I think it also helps to have Tom braided on your side.

Sam said, When I go to Capitol Hill and I go meet the senators, the first thing they want to talk about is Tom braided. So the senators were feeling that warm glow towards Sam because of this perceived relationship with braided.

And Zeke, now that I hear it, there is this theory that this entire time, Sam Bankman-Fried was hiring influencers, but with a specific target as to who he wanted to influence, the people who might existential threaten him the most.

Yes. And... I mean, he had just raised venture capital at a $32 billion valuation. And they were hoping that maybe next time they go back to the venture capitalists, they could get $100 billion. Could it potentially help if one of these venture capitalists went out to dinner with Sam and Tom braided? Yes, that might help. And so if that gives you like, he loved odds. He thought of everything in terms of odds. So maybe he said in his mind, having Tom braided available for dinner improves my chances of getting a hundred billion dollars by one %. I actually would pay Tom braided $500 billion. It's a bargain at 55 million.

It was actually brilliant. It actually worked. It was exactly the way to go about it. And whatever dollars he forked over, he got much more in return in terms of just social credibility. If he had actually run this place the way it should have been run, he might have become the world's first trillion dollar company. That was growing unbelievably fast. The name recognition went from zero to like everybody has heard of this place in about two seconds. And it felt okay because all these people who you admire and these institutions you admire said it's okay. Very big.

Names in the world of.

Sports.

And entertainment. Is that expensive or are they really playing for the.

Dollars that are going.

To come as a part of the business.

Down the road?

You know, it's expensive on some scales, but we're in a really fortunate position as a company to be able to afford it. We're spending a pretty small fraction of our revenue this year on that. We're still going to be net profitable after that. And so, it's somethingwhich we are fortunately able to afford, and which while expensive, we think really helps tell our story and grab people's attention in a way that few other things do.

We love checking in with you too, Sam. Such a good spokesperson for the industry, and we.

Look forward.

To seeing what you've seen. Well, it points to the very reason why he spent all of this money on the trappings of sports, on the ads, on the famous friends, on the patches on an Empire's fucking jersey is because without it, it was an emperor without maybe any clothes. Tonight, the cryptocurrency world is reeling after the meltdown.

Of one of.

Its most popular trading platforms. The exchange FTX filed for bankruptcy protection today has fallen Crypto King Sam Bankman-Fried step down as CEO.

After FTX failed, I was like, Oh, should I go down there and try and meet him again? I'm thinking to myself, Definitely a fraud. He's going to get arrested soon. This could be my last chance to talk with him, and he might be willing to reveal secrets that he wasn't willing to reveal before because he knows the end is here.

Smash cut two, you're in the Bahamas again.

Sam, he didn't like to show off his apartment because it was like a $30 million penthouse at the nicest resort in the Bahamas.

Rumpled cargo shorts, toothpaste stained shirt, frizzy, out-of-control hair, $30.

Million penthouse. Yes. And it's at Albany, which Tiger Woods often parks his mega.

Yacht there. Naturally.

I don't know what to expect because I'm thinking Sam might be all alone here. He might be despondent. Could he even be suicidal? I don't know. His life is ruined. He answers the door, he shuffles out of the elevator in his crew socks, cacky shorts and T-shirt just like always. He's just like, Weird week, huh? I'm like, Yeah. What I was most struck by was when the elevator doors open or in this landing room and there are just tons of shoes, like dozens and dozens of shoes. It was a big apartment with five bedrooms. And what I realized was that all the people who worked at FTX, they all ran away and they left their shoes. They were like, Let me get off this island.

That is haunting. It's like Jurassic Park after the dinosaurs have... After the T-Rex has screamed to the giant banner.

So he led me down the marble hallway to the most modest room, I'm sure, in this apartment. And we spent just hours and hours talking about what had happened. He really tried to make this case that he had screwed up because the money is gone, right? The exchange failed. The customers all went to go cash in their chips to the casino. And the FTX casino was like, Sorry, we don't have any money.

Right. Because Word had gotten out that actually he was taking the money that people had put with FTX, the exchange, and he'd been using it to trade to gamble on himself secretly with his research fund, his hedge fund.

Right. Which is not- -legal. -legal at all. Yeah. The great thing about Sam is that even though his answers were lies, he would listen to your questions and he would answer them. I'm sure you've interviewed people who just give you the talking points.

Athletes all of the time are just giving you the cliches to keep him moving. Yeah.

He would give you a custom lie just that directly addressed your question. A bespoke lie. -addressed your question.

A little origami crane of a lie for you.

I'm like, Sam, are you saying? And you couldn't offend him. I was like, Sam, are you saying... This sounds ridiculous. You're saying that you lost $8 billion, you misplaced it, and he's misaccounted. And he thinks that he's played this Trump card, and I'm going to be like, Oh, yeah. He was delusional. He was still hoping that someone would give him $10 billion and he could just run it all back again and give it another try.

A comeback. A Tom braided come back in the fourth quarter. Two minutes left is what he was planning on.

He should have said, Tom, I paid you for 20 hours. Get down here and give me a pep talk because I'm facing a really tough challenge right now.

Sam Bankman-Fried, guilty. Prosecutors laid out a case showing how Bankman-Fried stole billions in customer funds from FTX to make up for bad bets at Alameda, buy luxury real estate in the Bahamas, and secure celebrity endorsement. The jury found him guilty of seven counts of fraud and conspiracy for.

His role in the.

Collapse.

Of the cryptocurrency exchange he.

Created FTX. Sbf, as.

He has become known.

Could be looking at.

Spending more than.

100.

Years in prison.

What we learned at the trial is that it was a lot closer to a fraud from the beginning, and that as soon as customers started sending in money to FTX to buy their Dogecoin or whatever, Sam treated that as his piggy bank and was gambling with it. I think no matter how much he thought that he didn't care about risk and that he would do anything in the pursuit of trillions, that it must feel horrible that the game is over and that he's coming to terms with the idea that he won't get another try. But I think that purely guessing on my part, I think he's doing the math and he's thinking, All right, good behavior. I could be out in 10 years, and maybe I could start a new crypto thing. Probably not the same people would invest. But listen, if Sam Bankman-Fried came to you in 10 years, it was like, Listen, last one was a fraud, but I'm starting something new. Do you want to get in on the ground floor?

Right. I got me. I got Tyler Hero. I got Bam out of bio. We're all hanging out again. What do you think?

So.

Zeke Fox just gave us a nice capper on how leagues and teams and athletes all carry significant responsibility for the sportswashing of Sam Bankman-Fried's multibillion dollar fraud. But I also needed to acknowledge the elephant in the studio here. Our other author, Michael Lewis, if you didn't know, has also been accused of being a celebrity who got used by Sam. And nobody had better access to Sam than Michael, yes. And Michael, of course, is the author of Moneyball, most famously, the best-selling story of how Billy Beans, Oakland Athletics, ushered in a statistical revolution in baseball. But when I actually read Going Infinity, Michael's on Sam. I realized that Michael did not take it easy on him at all. It is full of damning stories like the ones you just heard in this episode. What it does not spotlight, however, is a certain detail that Zeke mentioned to me earlier in the show about what Sam was doing as.

A teen. He's at MIT. He has a Nate Silverish blog where he writes about baseball stats.

And that detail got me wondering about a different way maybe, that Michael Lewis might actually carry responsibility for the rise of Sam Bankman-Fried and this whole story. And I just needed to ask Michael about it at the end here, one on one.

My connection to Sam, I think in the beginning why he was even interested in sitting down with me, was he'd read Moneyball when he was 13 years old.

I was.

Going to ask. And it completely confirms his approach to life, which is he's this kid who's undoubt with a normal range of human feeling, and he substitutes emotion and feeling for emotion and feeling, mathematical calculation to make every decision in his life. Every decision. I mean, when he gets older, whether he get married and have kids, it's an expected value calculation. He's taking the idea of the hard money ball that experience doesn't matter, that a nerd with a computer can actually make better decisions about baseball players than some guy who played for 20 years. He's taking that to an extreme and taking it out into the world and applying it to everything. And it becomes preposterous. He takes it to just like this Moneyball on steroids gone wrong. That phenomenon, the Moneyball phenomenon was in a way, I think, a bridge for him to see... A bridge for him, his mind into the world, into real-world problems that you might otherwise think has no ability to solve or even think about.

Yeah. I think that's. I think that's fucking fascinating, Michael. And it is funny because the conversation around your book by people I think who largely did not read the book, it was wrong, not least because there are many inditing stories and bits of reporting in your book about Sam. But I feel like what you just explained is a far more interesting way that you are connected to the story. And I ask you this now in terms of the pendulum of our willingness to trust, quants and nerds versus the old scouts who felt evicted from this conversation by you, by Moneyball. How do you grade how we have swung in that direction?

You put it well. The nerds evict the scouts. The scouts are still around, but they just their status is lower than it was. And the nerds all of a sudden have a place at the head of the table. And Sam was very oddly doing the same thing in other sectors of the economy. He didn't let anybody over the age of 35 into his company. So the nerd was evicting the old experienced people in finance, basically, or political analysis. He was meddling in American politics. It was him and three 28-year-olds thinking about how you manipulate a Republican primary using analytics as their touchstone. So the moneyballing of everything, I mean, it's a phenomenon of the last 20 years, right? No doubt. And Sam is just like taking it to an extreme. I think, what do I think about this? It bothers me a little bit. This is the truth. And it may bother me for unintelligent reasons. What bothered me at the time when I wrote Moneyball was that there were a club of people who were insensible to new ideas and new approaches. They just shut out this other way of thinking about the problem and were smug in their ability to make their own judgments.

I thought that was bad. This clubby approach to thinking about the world or thinking about problems or dealing with uncertainty. We've replaced one smug club with another smug club. It's just the smug club are these nerds. And they are undeniably better at putting debt together a baseball team than the old smug club. It is a better way of thinking about the problem, but it is not a perfect way of thinking about the problem. And I think whenever you create the smug club, what you do is you shut out other ways of thinking about the problem, things that are threatening or alien to you.

Yeah. It pains me to say this as somebody who, again, full disclosure here, my favorite sports book of all time is Moneyball. I'm somebody who did reporting on the Philadelphia 76ers and Sam Hinkie and quoted trust the process at ESPN in a way that then became a meme. And what I'm hearing you say now, Michael, is the problem of being too trusting of your process.

Intellectual monoculture. Intellectual group think, we know that there isn't a different way to think about this problem. I think the of the people who are at the vangard of Moneyball are aware of this.

I agree.

I agree. But there is that... We're talking about the pendulum swinging, and I just have felt it's I've sensed it's swinging too far in the other direction. And Sam Beck-Mifried is oddly an example of that.

Yeah. And also just the other dimension of this, just to put the final cherry on top of this introspective Sunday, is the question of how the audience, how, by the way, journalists, authors, the public, how we trust the quant now, too. And there is the wisdom of not just the people inside the room where it happens, trusting their process in a monoculturally, blinkered way, but also now the outsiders, assuming that that is where the credibility is, is with the people who are the most fluent in numbers to the exclusion of the experience, the old scouts, the old farts that we evicted.

Here's the problem. Where you allow your mind to come to rest. That someone once said, an explanation is where the mind comes to rest. And the mind used to come to rest with, oh, Bill Parcells knows what he's doing on defense. We're doing this because Parcells knows defense or we know the player is good because this scout says he's good. Without examining the mechanisms by which this judgment is rendered. And my point and the point on Moneyball is don't allow your mind to come.

To rest. Exactly. This is the grand irony of this story, Michael. Yes. I just think about this, and I totally understand the multiplicity of interpretations here. My point is about the underrated aspect to which Sam Bankman-Fried and FTX not only embodies the sequel to Moneyball, however unconsciously this was happening.

I was very aware of this. I was very aware of this.

The sequel to Moneyball while also being a case study in how domestically sportswashing also exists. The use of sports to launder the moral repprehensibility of the people behind the doors that are now locked to the outsiders.

That's an interesting way of putting it. Yes, if you can connect it up to sports, people are blind to everything else. This is absolutely true. It legitimizes. Sports is used to legitimize great fortunes in this country, that you buy a sports team and your money becomes a different money.

Yes.

It's one of the reasons people buy sports teams, whether they're conscious of it or not. They want however they made this pile of money. They might have made it by raping middle class investors in the stock market, but now they're the owner of some franchise and people see them differently and.

Like them more. Sure. Not merely a mortgage lender, now the owner of your favorite childhood obsession.

That's right. And what I loved about Sam Beck and Freed as a character was that he was figuring all this out as if no one had ever thought any of these thoughts before. He was figuring out all by himself the role of sports in the American imagination. When you approach life this way, when you approach life, your working assumption is nobody knows what they're talking about, especially older people have no idea. You only trust your friends with their computers and their analytics. You end up first making some wild errors. But second, stumbling upon cliches that everybody who's been in this world and paid attention to it understand. But third, sometimes you get these blazing insights. You actually do get this fresh look at a thing.

Totally.

And the way he parsed sports generated, I've never heard anybody say, Oh, the stadium matters. The player doesn't matter. I never heard anybody say, Tom braided is not just a different by degree than Doug Prescott. It's like a different species. They figured this stuff out. It was interesting to hear it.

Absolutely. Michael Lewis, thank you for at least temporarily allowing my mind finally to come to something resembling rest.

Totally fun. Great talking to you.

This has been Pablo Torre, Finds out. A Metallark Media production. I'll talk to you next time.