Sam Bankman-Fried's $16B Fortune Is Eviscerated in Days

At an abstract level this is true for all capital assets to some extent. The price level correlated with the velocity of exchange for the asset class, if everyone in Boston tried to sell their house tomorrow the market would crash, even though on paper the real estate value of Boston is around 100 billion. On the other end, you can sell 100 billion in treasuries without a problem (fingers-crossed). On a day to day basis the trading volume relative to the size of the asset is minuscule.

Economists track money locked into different tiers of static assets as different money supply tiers. M0 is the money that gets used to buy your morning coffee, M4 is things like government bonds and housing. There are different tiers in between for things like your car, an assembly line, or a stock.

The reason the rampant money printing of the last decade didn’t effect inflation was due to the money being locked up in the low velocity tiers which have ballooned in size over the last decade. Any event which causes people to liquidate these assets such as war, supply disruption, energy crises, or disease moves inflation higher as the asset battery gets deployed to fight the crises.

Biggest historical example of this was the WW2 where all sides had to adopt measures to counter inflation.

Yup, if your "money" is in the form of tokens.

Many stock prices actually go UP when all of them are sold, at least to a single buyer. Most famously in recent history, TWTR. The amount they go up even has a name on the balance sheet: Goodwill.

The other big example is IPO's. Timed well, an IPO sees shares appreciate from their private valuation into a higher amount as they hit the public market.

But yes, once already public, when being sold to multiple buyers, typically you're correct, a sudden increase in supply while demand stays constant does result in prices dropping.

I don't know about you, but I'm pretty sure I could sell all my shares of stocks without tanking their prices.

Bezos sells tens of billions of dollars of amazon shares some years.

Money is fake. All money is fake.

I think it's just sampling bias? OTPP is one of the world's largest institutional investors, quarter trillion under management. Their investment into FTX represents like... 0.002% of available capital.

https://www.otpp.com/en-ca/investments/our-investments/teach...

(EDIT: 0.2% not 0.002%)

They are one of the best run pension funds in The world.

They manage billions, their bc portfolio is a small part of their holdings but it’s been a bit money maker for them.

I am guessing because they have over 200-250B in assets, they will have some occasional risky bets here and there that seems like a lot, but is only a small percentage of their overall portfolio.

"have earned an annual total-fund net return of 9.6% since the plan's founding in 1990"

9.6% sounds pretty stellar to me. This is much better than many funds.

Calpers' 30 year return is 7.7% annualized.

My Favorite Ontario Teachers Pension Plan fun fact is that they own the Bristol, UK Airport: https://en.wikipedia.org/wiki/Bristol_Airport

How many teachers are there in Ontario?!

I thought the same but the article rounds to 1.

  That leaves SBF’s net worth at about $1 billion,
  down from $15.6 billion heading into Tuesday. The
  94% loss is the biggest one-day collapse ever
  among billionaires tracked by Bloomberg.

SBF was 1 year old Wu-Tang debuted

Dumping your money into three-fund Boglehead portfolio and HODLing it requires approximately zero management or distraction.