Free Bill Hwang
In 2021, on the highs of a massive rally, Bill Hwang was doing some crazy stuff, but before we get to that, we need to go back a little. In 2012, Bill Hwang was convicted on some insider trading charges/wire fraud charges/some shady stuff. His hedge fund, Tiger Asia Management, shut down, and included in Billy’s deal, was a ban on managing any American’s money. Immediately following, this implosion, Billy started Archegos Capital, which roughly translates to leader. The term Archegos was used to describe Jesus, which brings us to the Christian point.
Bill Hwang is apparently, a hyper-devout Christian. His dad was a pastor who brought him and his family to America when Bill was 19, but his dad died, and Bill had to work his way up the rungs of society. Bill credits Jesus with his rise, and pointed to his Christian donations as reasons for his innocence, or at least a minimization of punishment.
Anyway, Bill started Archegos in 2013, shortly following the destruction of Tiger. Archegos Capital was a family office, meaning it invested to serve one family or one person. In this case, that one family was the Hwangs, or more specifically, Bill Hwang. Archegos did not violate the terms of Bill’s deal at all, and because he was investing as a company, he was the equivalent of a very wealthy hedge fund with tens of billions under management, meaning that he got specific privileges like relationships with banks that are not available to the general public. Bill did very well, over the following seven or eight years, pushing his net worth into the tens of billions.
By the time of the… ahem… incident, Bill/Archegos was managing $36 billion. That figure would make him around the 50th largest hedge fund in the world right now, but I would imagine he was probably top 30 three years ago, before the run-up we have experienced recently. By this point, banks were treating Billy very kindly, giving him whatever he wanted, whenever he wanted, with very little due diligence done. Now, is where we get to Billy’s errrm, aggressive strategy.
Billy really likes one word, prizes it above all else, leverage. I have never heard of a professional trade in the way he was trading. Bill had, at his peak, $36 billion in cash, if he sold everything. On this $36 billion, Bill was given another $160 billion, more than the GDP of the country of Hungary. He was so, so, so, so, so unbelievably levered. For Bill to not get margin called, the banks ask for their money back (which he did not have), Bill needed everything to go right, and it did for a while. Then, it did not, and the banks started calling.
Bill borrowed from quite a few banks, and they all wanted their money back from him, but he could not give it back because he did not have it. He did not have their money at all. It was gone. Credit Suisse lost about $6 billion alone, a truly startling number, seeing as their total revenue for 2022 was $15 billion. One man, ONE MAN, lost one of the biggest banks in the world 1/3 of their revenue. Credit Suisse could not handle the duress, people panicked and started pulling their money, and Credit Suisse had to sell itself to its arch-rival, UBS. Bill Hwang, by himself, wiped out $100 billion in market value, BY HIMSELF.
You may be wondering now, how is this criminal? All of these banks gave him money, stupidly, and they lost it. This is their fault, not his. Well, here is where his starts to get a little sticky for my dawg, in terms of defrauding banks. Bill did not disclose, as you are required to do, that he was lending from other banks. Banks were not aware that they were behind five other banks to get their money back. He also used some complicated financial tools that, to be honest, I do not really understand, allowed him to mask the leverage he was taking on.
The prosecution was asking for 21 years, and Bill was asking for zero, which is a request unlikely to occur. I believe no deal was offered to Bill because the case is so clear on his criminality. The judge gave Bill eighteen years, meaning that if Bill is still alive when he is 78, he can come out and do crazy stuff again.
I know a bunch of people lost their jobs, and quite a few people lost quite a bit of money as a consequence of his…flair, but this guy is so balla. You can call me cold, naive, young, etc…, but it does not matter. This was a freaking epic thing he did. I have already made and ordered a T-shirt that has a picture of him walking out of the courthouse with the caption: Beast mode, underneath it.
