Someone I respect pointed me to the All-In Podcast a few weeks ago. I listen on Saturday mornings at 1.5x because the four-square merry banter reminds me of Entourage. You know, Vinny, Eric, Drama, and Turtle…
Vinny made an interesting point in E118 on March 3 2023, humble bragging that Credit Suisse offered him 6.5% interest on 3 month bills! (Well, the offer was to all private banking customers). He goes on trying to make some other point.
Fourteen minutes later when Brad Gerstner (Altimeter capital, a VC for 14yrs) finally gets a chance to talk, he reminds us that the 3y T-bill is 4.7 (Brad probably meant the 2-yr note sold on 02/28 at 4.67) and Vinny might be a bit “goosy goosy on the 6.5,” i.e., that he might be “super special”—a comment that so delights Chamath that he can barely contain his Vinny-sized grin.
See my edited clip here to catch the precious facial reactions.
The first explanation
Was he just fibbing with his 6.5 to impress us, or just Prince-Charles out of touch with numbers like interest ? In the few episodes I’ve seen, the statements he makes are often backed with data and charts. So far, when he talks, he is usually on point with smart reasons or observations.
The better explanation
What does a bank do when it needs to raise short term without pulling an SVB fumble? It quietly offers its 0.1% a special deal. Nobody has to know until its all done.
A famous example is when Goldman gave Warren a sweet deal for 5 yards when it really needed it in 2008: cash for preferred shares with a guaranteed dividend, and also warrants to acquire more shares at a low strike.
So like a pro, and several weeks before the public storm, Credit was offering all of its liquid billy customers a sweetener to move some over.
Chamath has explained some of his clever trades, such as his 1-day Gamestop position.
I wonder if he was short CS as soon as he learned they were offering the sweetener? Or did he have too many relations with that bank. (He is one of their private clients). Or did he miss the trade entirely? (like I did)
What I learned from this
I’ve taught a computer security course for several years at Northeastern, and one of the anecdotal topics is operational security. Famously, the number of pizzas delivers at the Pentagon may have been a signal, as explained in this Chicago Tribune article. According to this source, even CNN’s Wolf Blitzer, a Pentagon correspondent at the time, supposedly remarked, “Bottom line for journalists: Always monitor the pizzas.”
The All-In podcast is a similar source of operational intelligence, essentially private details about deals that these four may haphazardly leak. I’d like to find a way to mine this info faster.