Jane Street Boss Says He Was Duped into Funding AK-47s for Coup | Hacker News Reader

Jane Street Boss Says He Was Duped into Funding AK-47s for Coup

bloomberg.com

98 pointsironyman70 comments

A Jane Street article on HN not mentioning OCaml. A true miracle!

Regrettably, the same cannot be said about the comment section [1].

[1] https://news.ycombinator.com/item?id=44376256

I wouldn't be too surprised. Peter Ajak [0] (the Belfer Center fellow indicted by the DoJ for attempting the coup) is a fairly slick and well spoken guy.

Westerners seem to underestimate how mercenary and brass knuckled politics in the developing world is (no, politics in insert_OECD_country_here is not to the same degree), and assume every bleeding heart activist will become the next Gandhi. Ironically this is how Orban's political career got started as well as an pro-Democracy campaigner in the 1980s and 1990s.

This isn't to undermine activists and NGOs working in these countries, but the default assumption in due dilligence should be that everyone is a crook and then validate.

That said, I definetly saw plenty of glazing of questionable developing country politicians during my time when I was much more HKS adjacent, but this is common for just about every pmajor policy program - it's the only way you can attract big names, and non-Westerners know how to take advantage of that Western naivete (I've definitely used it on occasion despite being raised in North America).

[0] - https://www.belfercenter.org/person/peter-ajak

He's been trying to participate in opposition politics in South Sudan and imprisoned for it, likely because he's a real threat to power. I think it's too much to label him a crook, he's just fighting corruption by actual crooks with tactics others will obviously disagree with. He's definitely a radical activist.

https://en.m.wikipedia.org/wiki/Peter_Biar_Ajak

I'm not denying that South Sudan's leadership aren't crooks, but the only way you can climb up in these kinds of environments is to be a crook yourself - reformists do not survive in political environments where violence and criminalization is normalized. And this is part of that naïveté I mentioned earlier.

And if a coup were to happen, would stuff even get any better? Countries run on institutions, and a coup by default undermine institutions by normalizing violence as a short circuit to consensus building. This weak institution building due to the power of the gun is what lead both Argentina and Pakistan to stagnate despite being economic darlings in the early and mid 20th century respectively.

And more critically - we in the US do not want to normalize private citizens fundraising armed movements en masse in the 21st century. This is a bad precedent.

Finally, the Wikipedia article has clearly had some PR panache attached to it based on the edit history, and it's silence about Ajak's case despite having been going on for over a year now.

Sudan exports about one ton of gold per week to the UAE. That's how the conflict is funded.

Even the most modern country (South Africa) is an economic basket case. 42% unemployment. Stealing from the electric utility costs hundreds of millions per year. The most senior elected person in the legislature was charged with corruption and is pending trial.

Pretty wild story. And not going to lie, as someone who did an economics degree myself (never worked as an "economist" though) I have a bit of sympathy. No one listens to economists, then blames them for not being able to fix things (since no one listens to them), it's a cycle that makes you cynical enough to want to simply overthrow everyone else and become a dictator lol...

"I was lied to" — Jane Street Boss.

This sounds very suspicious.

So Jane Street, a large commodity derivatives trader has no interest in an oil rich South Sudan?

They just wanted to finance the "human rights"

I don't think the Patriot Act has an exception for that.

Aren't they supposed to be the smartest of all quant firms?

There’s a pretty narrow band of intelligences in quant: any dumber and you can’t make 400k a year playing games for children, any smarter and you start to be able to make 400k a year curing disease or building a reusable rocket or any number of other actually interesting jobs.

> any smarter and you start to be able to make 400k a year curing disease or building a reusable rocket or any number of other actually interesting jobs.

A co-founder of something like Jane Street must be making a great deal more than $400k/year. Its probably small change for him.

You cannot make that much money doing those "interesting jobs". You might by financing and employing the people doing them.

A smart person going into finance will definitely make a lot more money than that same person going into another field. Going into finance from an "interesting" field has made a lot people rich: https://en.wikipedia.org/wiki/Jim_Simons

You might get paid $100M from Meta to not work on LLMs for OpenAI!

Yes, a co-founder. Not your average quant

I am pretty sure the average quant also makes a multiple of what the average person in something like science or engineering research.

I interpreted the comment as saying someone sufficiently smart would really that maximizing income isn't the optimal path in life, and instead would apply their brains towards higher pursuits. But perhaps I'm wrong.

Did not read that way to me.

I do agree that maximising income is not the optimal path. I sacrificed a lot of income for time with my kids and it was definitely the right decision.

It's pretty sad that this is something that many people consider "wrong". There is always some sort of nonsense about being able to do more with money because it gives you power or something like that.

And of course, we keep hearing "greed is good". We are very fortunate that some people could see beyond that in the past because we are resting on their financial "sacrifice". Thankfully there are still people who still think that way today, but it is always infuriating to hear people pretend some are stupid for not choosing the path that would maximize their earnings.

I think it is a sort of projection from "small minded" people who cannot see anything beyond what they would do, precisely because they are intellectually limited and thus cannot properly reason about those "issues".

I don't think anything hardware related is reliably 400k out of college unless you're self-employed.

https://www.levels.fyi/companies/spacex/salaries

big unless!

If we're going to talk about it in terms like these, what does it say about the evolution of this our own field since that was colonized by finance beginning around 2000?

Facebook, palantir and bitcoin, pretty dire tbh

Which people curing diseases are making 400k a year? If you're talking about academic research I'd expect around 300k to be the high end.

It's not hard to get above 400k TC in big pharma

I think it is? I have an uncle who made his career in it, he only started hitting 400k+ when he hit the director and C suite level. Meanwhile I started making 400 when I was 28 and that’s considered late for SWEs - it’s less than what Jane Street pays out of college.

> Meanwhile I started making 400 when I was 28 and that’s considered late for SWEs

Well, for FAANG and the second tier.

Meanwhile, I don't know if you've looked around lately but I see security startups that are well funded offering <200K for Senior ICs.

Any smarter and you have moral problems with social cannibalism.

There is a band, but whats termed intelligence.

Man can we do sway with the notion that competence in one area translates to another?

Being able to identify market arbitrage has little to do with biology and rocket science, and smart people are already working on such problems with the limitations of current fields well known. Throwing "smart” people at solving cancer isn't going to magically solve cancer.

What's with the anti-intellectualism? Not having people work on cancer definitely isn't going to solve it, and given the choice, we probably want smart people working on cancer vs having dumb people do it. It might take a decade for someone to go back to school and retrain to a different field, but if that's what they want to do, who are we to stop them?

it's not even about intelligence as much as it is about the background of these people. A lot of them are gifted kids coming out of academic households, prep schools and ivy league colleges and quite a few are on the spectrum.

When people were confused why Sam Bankman Fried behaved as stupidly as he did and thought this was all an act, no they genuinely are like overgrown kids who don't know what guile is, they couldn't survive in a rough neighborhood of New York let alone deal with South Sudanese arms dealers.

So I hear. And we all know smart/rich people can never be duped or make a mistake outside their areas of expertise. /s

Smart people can be deceived too. Without devolving the conversation into semantics, Garry Kasparov is also someone we would consider to be “smart” by many definitions.

I'm missing something, what's wrong with Kasparov? I've done some searching but didn't find much I'd consider significant...

EDIT: My bad, I didn't realize he was part of the article, didn't take the time to deal with the paywall.

> The lawyers accused authorities of selectively prosecuting two Black men, even though support also came from Granieri and Garry Kasparov, the chess champion and prominent Russian dissident. The US hasn’t accused either of them of wrongdoing.

From TFA (emphasis mine)

Read the article, he's involved in this...

If you feel you're missing something in a discussion centered around a news article, skimming the news article often helps.

No, that’s what headlines are for!

IIRC He believes in this quack theory of history: https://en.m.wikipedia.org/wiki/New_chronology_(Fomenko)

Smart people can have delusions too.

Wow, gotta admire the epic ambition of this conspiracy theory, they just went for it :)

> The new chronology is a pseudohistorical theory proposed by Anatoly Fomenko who argues that events of antiquity generally attributed to the ancient civilizations of Rome, Greece and Egypt actually occurred during the Middle Ages, more than a thousand years later.

> The theory further proposes that world history prior to AD 1600 has been widely falsified to suit the interests of a number of different conspirators, including the Vatican, the Holy Roman Empire, and the Russian House of Romanov, all working to obscure the "true" history of the world centered around a global empire called the "Russian Horde".

Smart in chess.

But he said and did lots of embarassing things.

I guess that's part of the definition of genius.

You're thinking of RenTec.

https://en.wikipedia.org/wiki/Renaissance_Technologies

well, normal stupid doesn't get duped into funding AK47s for a coup. It takes brilliance to be this stupid.

Being competent in one specialty does not mean you're competent outside of that specialty.

Jane Street was caught manipulating the India derivates market recently.

source?

JS is being investigated.

https://www.reuters.com/sustainability/boards-policy-regulat...

SEBI’s investigation into Jane Street is ongoing.

Sources:

https://www.reuters.com/sustainability/boards-policy-regulat...

https://www.business-standard.com/finance/news/explained-jan...

https://www.outlookbusiness.com/markets/jane-street-under-se...

https://www.rediff.com/business/report/why-is-sebi-probing-a...

Allegedly. And if you read anything about the case its clearly in a very gray area.

Their actions are what you'd expect any firm to do to hedge their exposure. Its just that they were so large and the Indian stock market is relatively so small that they're hedging moved the market.

So the question is, was their market moving hedging actual market manipulation or was it just the same thing every other quant firm would do in the same situation to hedge out their option exposure?

https://libgen.li/edition.php?id=151275376

Here's a decent description of the issue.

Thank you, this makes much more sense and it's a classic issue Matt Levine's readers will be familiar with.

Allegedly being investigated is also quite far from "been manipulating markets", I appreciate the clarification.

Your comment doesn't make a whole lot of sense to me. By definition, doesn't hedging the market ALWAYS move the market? The indian market was so small the movement was perceptible, but hedging the US market would also move the market, albeit imperceptibly, right?

If you want to go down that path, buying a single share of literally anything will also move the market, albeit usually imperceptibly.

> Their actions are what you'd expect any firm to do to hedge their exposure

No, their actions were the opposite.

They were pushing the price in the same direction as their derivatives holding. A hedge would push it in the opposite direction. (Eg: If you're long calls, you would hedge by selling the underlying, bringing its price down.)

Also, the absolutely hilarious fact that Jane Street lawyers were instructed not to say the country's name out loud in court to protect trade secrets, yet they utterly failed to do so on multiple occasions.

This and what the article refers to are just two examples of the kind of thing this company considers to be their "business". For another example, Sam Bankman-Fried and his helper Caroline Ellison came from there. They're always looking for schemes to add billions to their accounts, morality be damned.

This sort of behaviour is okay if it's the CIA, but if a private citizen tries the same, direct to prison!

There's probably a lot of things where that's the case and it kind of makes sense tbh

There are, at least in theory, methods by which the citizens of the United States control the CIA. (The president and senate nominate and confirm the Director of the Central Intelligence Agency, for instance)

This isn’t perfect but it’s better than randos choosing what to manipulate abroad

" Harvard Fellow and another activist allegedly wanted to buy AK-47s, Stinger missiles and grenades to topple South Sudan’s government."

Reminds me of:

"In every disaster throughout American history, there always seems to be a man from Harvard in the middle of it."

I find it strange that one would come to the US to buy AK-47s. There’s only one party in the US that has those in quantity. I think these guys knew they were buying from the US government, they just thought they were buying with permission.

Happens to the best of us.

paywall: https://archive.is/lowX3

These are cheap and arent really known for being accurate. Pretty much spray and pray.

so, the rich guy version of a nigerian prince scam?

Based

Ah yes the journo definition of "AK-47": It has wood furniture.

In the bottom right image, the top right do appear to be AKs with the stock removed. The top center could be as well but it's hard to tell with that angle and they might be RPKs as well.

At least correctly differentiating between western and combloc weaponry is pretty impressive for two finance reporters.

"AKs with the stock removed"

I am going to become the Joker.

(They are AKS-74U)

Well don’t go Joker on us yet. They appear to be AKMSs with one being perhaps a Chinese type 56-1.

Pretty sure they are the biggest Ocaml company.

Reply on news.ycombinator.com