A Little Backpedaling

... and the day after I self-sabotage, I usually find articles like this one, or this one, that I use as a sober backpedaling, hangoverish, apologetic plea to the folks who have just blocked me or determined not to listen to me any more. So many things in the world are highly complicated! The Covid 19 thing is just one of them.

I wasn't the only one who had doubts about such a seemingly impossibly fast transition from discovering a new virus to jabbing people with a vaccine that was being called completely safe and fully tested. The previous record, as both articles above state, had been 4 years. We got the Covid 19 vax in eight months! What the hell, bro?!?!

It turns out that the above articles are what the hell, bro. While it is hard information not to doubt when you consider things like this, it IS better than, "Just get your jab, stupid." Still, in a culture where we've been socialized to "just say no" to some drugs, we're now being told to trust an industry that is not to be trusted and just say yes to its seemingly fast-tracked (and as pointed out before, highly profitable) vaccines. And as if this isn't already confusing enough - I shit thee not - joints for jabs. 

A year and a half after I first heard about Covid 19, back when it was being called the Wuhan Flu, member?, ten months after the release of the lightning fast vaccine, I am just now hearing about why it was so lightning fast. This odd confluence of events makes me wonder why the news wasn't available earlier. But maybe it was. Maybe another phenomenon is coming into play here. One I admit to, and I think if we're honest (which we aren't) we could ALL admit to, 

Here is a great article that a friend posted on Facebook that I, being within my weekly limit of free New Yorker browsing, was able to read. The remarkable lengths and breadths of human reason may be more about winning arguments than the thirsts for knowledge and human advancement, it turns out. And "once formed, impressions are remarkably perseverant." Even when presented with facts which prove us wrong, it seems to be in our nature to cling at least a little bit longer to cherished beliefs. Some of us cling longer than others. Some never let them go. This has been termed "confirmation bias." In the above example, I presented myself with the explanations of how the Covid 19 vaccine had materialized so mysteriously fast, which was that in actuality, it hadn't. It was possible to use data from studies on previous corona viruses, some which had taken years to compile, to sort of reshape the virus and make it easier to combat. I have little understanding of how the mRNA encodes a key protein of the Covid 19 virus and causes our bodies to produce the protein that acts as an antigen. It's all Greek to me. But evidently it works! The vaccines have been a huge success! So why do I then start hemming and hawing about how it took so long for this information to be released? That'd be yer confirmation bias methinks. I'm still clinging to my cherished premise in the argument to defend the doubters of the vaccines, the postulation that these vaccines were rushed. Which is wrong. But I still like. Because of how serviceable, even in its wrongness, the use of this gem had been in past writing, and, yes, arguing for me. 

Confirmation bias. That's a useful way of summarizing how sometimes when we realize we've lost the point, we carry on hoping to still win the argument. Occasionally we're all like lawyers who continue to jealously defend our clients even after they have informed us they're guilty as sin without an ounce of remorse. A lawyer's reputation, and that of his/her firm, could sustain damage due to a guilty verdict, so even though it's the right one, the lawyer fights for what is wrong. Honestly, can you say you've never found yourself doing that? What are we thinking in these moments? Are we thinking of our careers as arguers? Are we worried our win/loss stats can't take the hit? Somehow our status will be diminished and we will lose our reputations as formidable foes in conversational disagreement? Just who do we think we are?

Well, according to that New Yorker article, because of the "myside bias," we DON'T think about who we think we are. We're too busy poking holes in other people's arguments (and adept through practice at doing so) to be able to poke holes in, or even see, the holes in our own. And with readily accessible heaps of information, real and fake, on the internet, twitter, TV, Youtube, etc., etc., it has become so much easier to maintain false perceptions of "rightness" and bolster them with legitimate sounding fiction, and attack opponents' arguments with false perceptions of "wrongness" bolstered by that same legitimate sounding fiction! We can, in a word, find plausible support for any dumb arguments we'd like to cling to. In a society with constantly increasing population that will inevitably lead to necessities like coping skills, conflict resolution, compromise, cooperation and problem solving, our evolution seems to be swift - but in the wrong direction. It's likely to be our undoing. This has been known for some time. 

I chose the above quote carefully knowing, as few would dare think, that Carl Sagan is most likely speaking from experience. 

Not only is the vast amount of information available to us that can support our biases, but there are no shortages of fraudsters, foxes and fiends out there who will exploit our biases and beliefs for their own gain. Life ain't no picnic folks! We've gotta keep our heads on swivels and our sticks on the ice. Take this article for example. It's about something called "affinity fraud." People who find something you have a liking or sympathy for, and through similar affinity (sometimes they even believe it's genuine!) they gain your confidence and abuse it. Ephren Taylor is an example given in the above article. He used a con I have particular distaste for, the "gospel of prosperity," you know, "God wants you to be rich," to fleece similar believers out of about 16 million dollars in the US. 

"Investing wisely is a Biblical principle. God wants us to be prosperous and help further the Kingdom." That's essentially what Anita Dorito (or whatever) said even after her and her husband lost 1.3 million bucks to Ephren Taylor's Ponzi scheme. When religious believers crash hard after trying to insinuate human greed into the teachings of Jesus and refusing to acknowledge the gaping holes in the philosophy, they tend to just blame it on the Devil. The Dorios might have even forgiven Ephren Taylor, who knows? It'd probably be easier than admitting THEY had anything to do with what happened to them, and/or are a perfect object lesson for the hardships wealth can bring and why one shouldn't obsess about building up riches or getting too attached to property here on earth, but, through good deeds, should store up gold in heaven. But, whatever. Most would rather hear it from Yoda than Jesus.

I know of a guy closer to home who is an example on a whole other scale! A guy named Hwang Sung Gook. A Korean dude. Ever hoid of him? Probably not. How about Bill Hwang? Archegos? Well, settle in for a tale of woe for a Tiger Cub who probably lost more money, and lost it faster than anyone. Probably ever. Estimates range anywhere from 20 to 100 Billion, most or all of that in TWO DAYS! Intrigued? What if I tell you he is a devout Christian who believes he was using capitalism to do God's good work raising all that money in highly questionable ways? And what if I tell you he plead guilty to insider trading of Chinese bank stocks in 2012, was fined 44 million and was banned from trading in Hong Kong for 4 years? 

I don't know how many times I've said that a guy could make millions in Korea as an evangelist. The Korean idea of Christianity includes some of the most highly motivated people you will ever see and an adherence to the gospel of prosperity that makes the whole flock of them seem like a giant cartel to me. But OH the riches to be made from those sheep! If I were an amoral, capitalist Korean, I would have jumped on that. But I'm not, and it turns out I was wrong. There weren't millions to be made, there were BILLIONS.

Bill Hwang moved from Korea to the US when he was of McDonald's working age. The story goes, he took a job there to improve his English. I don't know if it was flipping burgers that improved his English or the prospect of becoming filthy rich in the world of stocks, hedge funds and derivatives, but he speaks English like a native now. His dad died and he and his mother moved to California where he worked as a salesman for Hyundai Securities till he was 33. He caught the eye of Julian Robertson and was recruited into his Tiger Management firm, which instantly made him. Hwang introduced Robertson to the Korean markets and Tiger bought a huge stake in SK Telecom among other Asian stocks. Hwang became known for investing "deep" and dangerous, but being successful at it. Almost as if God were on his side. He got annual returns of around 40%, which is HUGE! Who wouldn't invest with a guy who could get you 40% return on your investment?

Things were going gangbusters for Hwang until 2007 when he bet big against Volkswagen. Porsche bought lots of VW stock and its value soared 348% in 2 days. That absolutely killed investors who had "shorted" it! This mistake caused Tiger Asia to end its year DOWN 23%. Then in 2012, the insider trading with Hong Kong hedge funds sort of forced Hwang out of Tiger and into a new venture on his own. This would be Archegos. His ban from HK meant he was shut out of the hedge fund market, so he opened what is called a "family office." In this capacity, he mostly dealt with his own money, colleagues from his days in Tiger and friends (and possibly even family) all of whom shared his zeal for God, capitalism and the Church. 

The SEC doesn't make "family offices" disclose holdings, so it's a more private way of investing. Family offices are also exempt from Dodd/Frank regulation that resulted from the 2008 meltdown. While nobody was really watching him, Hwang bought "total return swaps" through Archegos. These are derivatives that give investors exposure to losses and gains with the anonymity of doing it under the banks' names. And even though all Archegos' investments were in banks' names, the various banks were unable to trace other investments by Archegos since they were undisclosed. None of the banks knew how much Hwang was borrowing from other banks. This allowed him to "leverage" his loans to the hilt! Instead of investing something normal like 20-50% of money borrowed, Hwang leveraged 5 fold or even higher. In other words, he bought 5 times the stocks than the amount of money he had borrowed. Oh, I forgot to mention this: because he was such a nice guy, banks and the stock market just allowed him to do this! He took advantage of the confidence of the banks, the markets and Archegos' customers. 

Because nobody really knows, it's estimated that Archegos started with about 200 million and got investments of about 30 billion, which was used to buy about 100 billion in stock. Or something like that. Then the banks noticed. It was something to do with Viacom making a business decision that lost them money and needing to pay stock holders for shares they were selling because of it. They asked for payment and because everything was bought on credit, Archegos defaulted. Big time. Then other stocks followed suit in domino effect. NOW the banks knew what Bill Hwang had been doing. But they couldn't dump their faulty loans onto other banks because they had the same faulty loans. It wasn't long before the banks started eating each other alive trying to be the ones to lose the least. The banks were Credit Suisse, Nomura (Japan), Deutsche Bank, Goldman Sachs, Morgan Stanley and UBS (another Swiss bank). Some of the stocks he invested in were Viacom CBS, Baidu, VIPShop, Farfetch, and Discovery Inc.

He was the son of a church pastor. He was a hugely successful investor with a Wall Street giant. He donated to a lot of Christian and Korean causes. People found a lot of "affinity" with him, and he totally used that against them. He is a greedy shadow trader and a lot of people are calling for changes in investment transparency laws because of him. In these days when private citizens, not countries, are flying into space, private citizens, not banks, are crashing stock markets, I'd say that might be a good idea, no? At any rate, even though he probably should be in prison, even though the financial damage he caused was exponentially greater than Ephren Taylor's, even though he was spanked harder than anyone in history by Mammon, the god of money, do you think he'll question his Christian capitalism? I don't either.

Archegos means one who leads the way" and it was used to describe Jesus as a leader of lives. This is probably why that name was chosen for Hwang's firm. However, he will likely be known as a leader in the category of the most epic stock market loser ever. There are few holes even his biggest fans could find in that argument. Yet, could he be convinced of that?

I wish I could tell you what has happened with Bill Hwang since March of this year, but I can't find anything. He's dropped off the face of the internet. Wisely so since about a million investors in the companies he single-handedly devalued would probably like to hasten his ultimate meeting with the God he loves so much. 

At any rate, and at long last, my point here today was not to be like people with confirmation bias or myside bias or one of Sagan's bamboozled, or especially not take advantage of any affinities we might share to mislead you. I printed that I thought the vaccines were rushed. I now know they weren't. So this is my backpedaling. I'd prefer to think of it as a retraction although the readership of this publication hardly qualifies it as one, so it may be inaccurate to use that term. That will be all.