Law is Law: DXYZ, MNGO, BLS

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Hello, and welcome to the Money Stuff Podcast, your weekly podcast where we talk about stuff related to money.

I'm Matt Levine.

I'm the Money Stuff columnist at Bloomberg Opinion.

And I'm Katie Greifelt.

I'm a reporter for Bloomberg News and an anchor for Bloomberg Television.

Katie, welcome to the best day of our lives, the very first Money Stuff podcast.

It is the best day of our lives, and every Friday will be the best day of our lives because that's only going up from here.

It's only going up.

We're going to talk about some stuff from your columns every single Friday, and it's going to be fun.

You made that sound like a threat.

In many ways, it is.

Those are our marching orders, and we're going to have fun.

What are we talking about this week, Katie?

What a great question.

We actually have a really strong first episode because we're going to be talking about the Destiny Tech 100 Fund.

Closed-end fund, publicly listed.

The stock has been going nuts, and there's a lot to say here.

Yes.

And then we're going to go from Destiny to Mango, specifically Mango markets, and we're going to talk about whether code actually is law.

Or is the law law?

A lot of big existential questions there.

And then we're going to talk about super users, this time related to inflation and also the nature of insider trading and the Bureau of Labor Statistics.

Indeed.

Matt, what is Destiny?

The Destiny Tech 100 is a publicly traded fund that invests in private tech companies.

So, right now, as of their last disclosure, they have about a $50 million portfolio of stakes in like 23 private companies.

A lot of it is SpaceX, some of it is like, you know, plaid and stripe and all of the other patterns that are also fintechs.

So they have this pot of stock, and they sold shares in the fund to the public.

They like did a direct listing last month.

And since then, the stock has just only gone up.

The stock has been very volatile, but it's way above where they listed it at.

And so right now, that $50 million pot of private stocks has a market value of something like $500 million,

which is 1,000% premium to the net asset value of the fund, which seems real high.

Aaron Powell, and you and I have both spoken to the CEO.

His name is Sohail Prasad.

What's remarkable is that he doesn't seem super stressed about the premium or the volatility of the stock.

I mean, I spoke to him on Thursday morning on TV, and his explanation was they're in a discovery phase.

They've only been public for about two weeks, which is fair, but I might be a little bit stressed out.

To me, it just seems like a disaster to do this thing and have it trade at 1,000% premium.

But others would disagree, apparently including him.

Because to me, like the thing you're marketing is like you can buy exposure to these these private tech companies.

Never before have you been able to buy shares of SpaceX and Stripe, and we are giving you that exposure, which is a great pitch, but it's just not true if you're trading at 1,000% premium.

If you're trading at 1,000% premium, retail investors can only buy the premium, right?

Like when they put their money in, they're getting like $5 worth of private tech stocks and like $50 worth of public market, volatile, frothy enthusiasm for the stock.

The product that he's selling is only that product if it trades like at around the net asset value.

Well, Well, you had a suggested solution for him in the form of issuing more shares, which I don't know if it would help the retail traders who are buying in right now at 1,000% premium, but it would theoretically, if they sold enough, help to collapse the premium a little bit.

Right.

You suggested that solution to him, didn't you?

Yeah, and he can't really talk about that, especially not on live television.

And

we can, we can theorize about it.

One way to think about what he has is he's got a $50 million venture fund, and there's like a $2 billion waiting list for that fund or whatever.

I made that number up, but like the market cap of the fund is so far above the net asset value of the fund that like a lot of people clearly want to put their money into a thing that gives them exposure to private tech stocks.

So what he can do is he can like take names off the waiting list.

He can sell a bunch of stock to the public at a huge premium to the current net asset value.

And he can take that money and invest it into.

private tech startups.

And if you do that over time, probably the premium compresses because you're selling a lot of stock, you're buying a lot of the underlying portfolio, and you end up with a fund that is much bigger by net asset value than it is today,

probably bigger by market cap.

But like instead of trading at a thousand percent premium, it trades at something that sort of reflects the value of the underlying private companies.

Aaron Powell, Jr.: The question of him deploying capital is also a really interesting one.

And first of all, how he's actually getting these shares in private companies.

He said that it's through a combination of private stakes, trading platforms, and investing directly.

But one of the interesting nuggets from the interview that I had with him was that he has these private companies calling him now, which is probably a result of the fact that we all keep talking about it.

It's brilliant.

I mean, you look at the disclosure of their portfolio and also like what he said about it.

Like it really, like he's like scraping sticks together to find private company stakes, right?

He's like calling employees and being like, hey, can you do a forward contract?

And they're like, no, we're not allowed to.

Our company won't let us.

And he's like, oh, you know, maybe we can do it under the table, right?

You know, he's finding things in the secondary market.

He's like piecing together this portfolio because he's just like a guy, you know, like, that's not true.

He's the founder of Forge.

Like he's got some experience in private markets, but these big tech companies can kind of choose their investors and it's not necessarily easy to get in.

But now he's a much higher profile because he's got this huge market cap to his fund.

There's like clear pent-up demand from retail investors.

He's getting a lot of press coverage.

And so, yeah, this is a marketing tool, not only to retail investors, but also to companies who might want to sell him some stock.

It's just really interesting that this is happening this week.

I'm really grateful because this is the first week that we're recording the Money Stuff podcast.

But also I feel like we're just at this moment in public equity markets where the public equity market has been shrinking.

You hear about all these hot, shiny startups that the average person can't get exposure to.

And again, an interesting week to be having this conversation because I actually also spoke to Kristen Olson from Goldman Sachs.

this week.

She is the global head of alternative capital markets.

And her pitch for why people should invest in private markets is because companies are staying private so much longer, you're missing out on all that growth.

You know, the company that goes public, you've already missed out on a ton of that growth, which makes sense if you're pitching private markets.

But I feel like all of this sort of ties into a general theme of there's been a dearth of IPOs, the public market is shrinking, and it feels like all the exciting stuff is happening.

outside of public markets.

Aaron Powell, Jr.: Yeah, I mean, that's what everyone thinks, which is why this thing is so popular.

But of course, it undermines the mechanics of this thing.

Because if you're like, oh, private companies grow so fast so we should get in before they go public, but you get in at 20 times their valuation and it doesn't work anymore, right?

It's fun to like imagine the sort of end case for this.

What if like everyone agrees with the thesis that you should get into private companies and you should do it through this fund?

Then that's going to bid up private valuations, right?

Yeah.

We talked earlier about how he is getting calls from companies, right?

Because like one, he's like in the news, companies who want to raise money, like, oh, here's a guy who has money.

But also, he has a lot of flexibility to pay up on valuations, right?

Because like people are already buying into his fund at 10 times net asset value.

Like, if he pays twice the last funding round for a company, like, that's fine.

That's easy.

Like, that's a, that's a good trade for him.

I mean, one reason that private companies are cheap is that they're young and they haven't grown yet.

But another reason is like, you know, you don't have liquidity.

You don't have the same number of investors that have access to private markets as you have in the public markets.

In one sense, it's a way to democratize private companies.

But another way, that's a way for private companies to access all those public investors and bid up their price.

Aaron Powell, it's interesting that he's in this position because this isn't a new pitch.

The Destiny Tech 100 Fund, this idea has been brought forward by ARC before.

They have the ARC Venture Fund, and it hasn't created this moment that this fund has.

And I find it interesting that, again, he is in this position.

Aaron Powell, I think they all have different structures, and I think the Archiventure Fund is not as exchange-treated.

Yes.

That really matters, right?

The weird thing about this fund is not that it's a way for public investors to put money into a fund that invests in private companies.

It's that it's a publicly traded way for them to do it.

So it has a market price.

And it turns out the market clearing price for that product, like at this point where the product is so small, is much, much, much higher than like the amount of money they have to put.

And that's kind of wild.

We live in a meme stock world.

Things like that just build on themselves because you attract attention to a stock because it's like gone way up and it's trading way over asset value.

And that just attracts attention and more people get into it.

Well, I feel like like we're going to be talking about this again because in declining to answer one of the questions I asked him, which is, has your net asset value changed materially since the end of 2023 when they last provided it?

He said, can't say anything about that.

Obviously, they calculated it on a quarterly basis, but they report earnings, I believe, at the end of April or the beginning of May.

So it's going to be really fun to see if it's changed from that $4.84 net asset value that they had.

Yeah, but you know, I mean, they own stakes in big private tech companies, right?

Like

has that market doubled in the last three months?

It has.

Has it ten timed?

We're going to find out.

Stay tuned.

I think I have a guess.

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I know, right?

But this guy blew it up in 2022, and he was arrested, and he's going on trial this week.

And

the question is, is it legal to blow up a DeFi trading market?

That's not really the question.

The question is, is code law or is law law?

Those are some big, heavy questions because crypto obviously would say code is law.

And I mean, you say that until your trading platform gets blown up and then you're like, wait a minute, that was fraud, right?

Yeah.

This is how it always works, right?

You're like, as long as you're the smart one, you're like, ah, anything goes.

We don't need regulators.

But then you get blown up and you're like, ah, where are the regulators?

Well, explain to me briefly what is the part of the code that he exploited.

Okay.

So Mango Markets is like a decentralized finance trading platform.

You can trade perpetual futures, like sort of derivatives on crypto tokens, right?

People love this.

There's all sorts of crypto trading platforms that allow you to speculate on other crypto tokens.

Mango Markets as a DeFi trading platform also had its own token called Mango or Mango, like M-N-G-O.

And so what the guy did was he set up two accounts on Mango Markets because everything's anonymous.

You know, it's not like the way DeFi works, like you're not like putting down your credit card and your driver's license.

You just set up a wallet, right?

For sure.

So he set up two accounts on Mango Markets.

In one of those accounts, he offered to sell a ton of futures on the Mango token.

And the other account, he offered to buy a ton of futures on the Mango token.

And like no one else was trading that minute, so they crossed.

And so he ended up long a bunch of futures in one account, short a bunch of futures in the other account.

And for these trades, you have to put up some collateral, right?

So, he had like he had some exposure to the Mango token, and he had to put up collateral on both sides of the trade.

And then he went out in a third market elsewhere, and he just bought the Mango token.

So, not futures, not a weird derivatives trade.

He just bought the Mango token.

And, like, it turns out there's not that many people want to buy that many Mango tokens.

And so, he really drove up the price a lot by like a thousand percent or more.

And

what this meant was that his derivatives contracts, his two accounts on the Mango trading platform, one of them had a huge profit, you know, hundreds of millions of dollars, and the other one had a huge loss, hundreds of millions of dollars.

And what happened is that he took the one with the profit and he went to like the Mango, you know, exchange platform and he said, I want to borrow against all this profit.

Basically, I want to withdraw some of my winnings.

And so he withdrew like $100 million of winnings.

Meanwhile, on the other side, he had hundreds of millions of dollars of losses.

And he didn't post any collateral for those, but there's like the moment in time where he could withdraw withdraw on the winning side and ignore the losing side.

And then everything collapses because he walks away with this $100 million.

The price of the token goes back down.

And

Mango Markets has lost $100 million of customer money and basically is blown up.

And then he calls them up and says, I'll give you back some of the money.

And they negotiate a sort of return of some of the money in exchange for them not pressing charges.

By the way, pressing charges is not really a thing.

If you commit a federal crime and your victim is like, I don't want to press charges, the federal government can still go ahead and prosecute you.

And that's what happened.

Good to know.

But anyway, it's great.

Cause like one, it's like it's just very like simple trade.

And it's like people do things that are sort of rhyme with this in like real financial markets.

This manipulation is like way too simple to do in the real financial markets.

But he managed it in a...

DeFi market where basically they were not careful about structuring how people could withdraw money and like how their token pricing worked.

Just like the mechanics of how they did this allowed him to do this exploit.

And when he was doing it, he was posting through it.

He was posting on Discord.

Actually, I think this is before he did it.

He posted on Discord being like, I've discovered an exploit.

And people are like, what is it?

Is it?

And then they sort of describe this.

And he's like, yes.

He said, you take a long position and then you make Numba go up.

Numba is N-U-M-B-A.

Of course.

You make Numba go up.

And like, that's what he did.

He took a long position, he made the Numba go up, and then he, you know, cashed out before anyone noticed that it was all kind of fake.

I love that because it sort of gets back to the code is law versus law is law like he wasn't secret about it he was very open and kind of proud about it which really speaks to the fact that like in his circles in his discords code is law i mean he went on twitter after doing it people are like oh my god there's a there's a hack of people people call it a hack it's a better word is like exploit or manipulation because he didn't like break into the computers he just did the thing that the market allowed that was bad but after he did it he went on twitter and and under his own name and

Unfortunately, the exchange this took place on mango markets became insolvent as a result, with the insurance fund being insufficient to cover all liquidations.

And he's not wrong about any of that.

Like, he used the protocol the way it was designed.

It was designed badly, and he extracted a lot of money for himself.

So, that's what I was thinking about when I was reading this.

If he had been like a little less ambitious, what if instead of what it was like $110 million,

it had been $10 million,

which is still a lot of money, but not collapsible money, maybe this wouldn't have happened.

Yeah, there's an assumption that like a lot of markets, like people are leaning a little bit into trades and like, you know, doing like a little bit of manipulation around the edges in a way that doesn't get them caught.

The problem is you can't like repeatedly repeatedly do that here.

You know, you're taking the risk both of going to prison and of losing money each time you do this trade.

So it kind of makes sense that if you're going to do this trade, you're going to do it for a big score.

And he did it for a big score.

I agree with you that it probably attracted him more attention than was good for him.

Yeah.

Or I don't know.

Obviously, he wanted attention, which is why he was posting about it.

Well, I think he probably wanted the money.

But yeah,

he was not averse to the attention.

I mean, attention is definitely a commodity.

Yeah, but $100 million

is better than the kind of attention that lands you in jail, right?

Yeah, perhaps.

Like, he should have had less.

Like, ordinarily, when you manipulate a market for $100 million, it's nice to not mention that on Twitter.

I don't know.

I don't know.

Maybe I would have tweeted about it once, done it for $110 million, and just walked away.

But we didn't get into your dream dichotomy world of nice versus fun markets.

I really liked that.

Yeah, I mean, I just think that we talked about crypto people saying code is law.

Like, that's not true.

Like, that's kind of true.

But a lot of crypto projects are about building some sort of future of finance or decentralized ownership or something.

And the people working on that are not necessarily like also anarchists, right?

Some of them might be, but they have nothing to do with each other.

You can believe that crypto enables something

special and new in like the economic world and also that it should be subject to regulation.

You shouldn't be able to like do fraud in it.

Right.

And a lot of people in crypto, I think, believe that.

And then a lot of people don't.

And a lot of people in crypto really believe code is law.

Regulatory interventions are generally bad and make things worse.

And you should just be careful.

You should design your protocol correctly.

And by the way, if you design it poorly and someone exploits it for $100 million and you go bankrupt, then like

there's an evolutionary process whereby everyone learns that lesson and the next protocol is more robust.

Whereas like regulation makes things worse because it makes people less careful, you know?

And I think like you see that playing out here where like, it's not like everyone in crypto thinks this is great, right?

Like a lot of people are like, like, this is bad.

Like he's manipulating a marketing.

He wouldn't say this, but like other people would say he was stealing money from other investors on that platform.

And it's a bad outcome that makes crypto less attractive to ordinary people and therefore makes crypto adoption harder, right?

Like I think a lot of people in crypto find all this anarchist stuff kind of distasteful.

But then a lot of people are like, look, like.

We're trying to build a system that works on its own.

We're trying to build a system of smart contracts where like you don't need to go to the court to enforce your contract.

You can just have the computer enforce your contract.

And we're undermining that when the Justice Department comes in to bail people out of badly designed protocols.

Yeah.

And then again, the people who would like to operate in the fun markets would probably say, we're finding bugs in the code.

Yeah.

Right.

They're white hat hackers.

Yeah.

They're getting a bug bounty.

I just liked those categories because I think all the time, and I joke with my family, that there should be like the doped versus the clean Olympics, where you have all the athletes taking drugs and they all race each other.

And it'd be really interesting to see who wins.

But then you should should also have the clean Olympics where all the athletes actually don't drug themselves.

Right.

And the reason you don't have the doped Olympics, I think,

is it's probably like not that healthy to encourage people to take a lot of dope.

But the nice thing about crypto is like Mango was just a marketplace for speculating on crypto tokens.

No one will die if Mango is a lawless market where you can manipulate it to your heart's content, right?

The problem here is that like some people on Mango thought it was like not manipulated and other people like, oh, what a fun place to manipulate.

But if everyone had known going in, like, hey, if there's any problem with this protocol that allows someone to take all of the money out of it, good for him.

That's your problem.

No guarantees of anything working.

No one will rescue you.

If everyone had had that expectation going in, and if you could sort of prove that everyone had that expectation, then like, yeah, it's fine.

Yeah.

Who's there like external harm?

No one died.

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All right, so we're two-thirds done.

You got some work.

No, we just got to bring it home.

You know,

the third act is the hardest, is what they say in playwriting.

Is that what they say?

I don't know.

Okay.

Super users.

Super users.

Of inflation.

Yeah.

I feel like that's a bad headline.

That's what the list was called.

I know.

That's what it's called.

Right.

It's a bad headline for the people who wrote it.

I think they have other worries right now.

Like, what?

Inflation.

No.

So the Bureau of Labor Statistics, which releases inflation data, released inflation data a while back, and there was was like a surprising change that was methodological, right?

It was a big deal.

Yeah.

But it was like nothing changed.

Like our calculations have changed and this is why, right?

And so a person at the BLS emailed a bunch of people, not at the BLS, to explain this change so that they didn't freak out and so that they could understand what was going on.

And the email, unfortunately, began, dear super users.

Yeah.

And then it got forwarded around Wall Street because like people are very interested in the inflation numbers.

And then it got forwarded to reporters and people were like, wait, there are super users of the Bureau of Labor Statistics?

Is there a higher tier of customer where the government tells them information about inflation that everyone else doesn't get?

And then it became a scandal.

How do I subscribe?

It became a scandal.

Great reporting from the New York Times.

And when you think about who was actually on the list.

Because the scandal came out a while ago and the Times last week.

broke the story that it was not a one-off.

There really was a group of super users.

There were people emailing the guy being like, hey, how do I get on the super users list?

It was a real thing.

Yeah, it seemed like there was a lot of engagement on that particular distribution list.

Yeah, so the New York Times submitted a FOIA request, and now we ended up with a good idea of who was on the list.

It was, you know, JP Morgan, BlackRock, and then you had a bunch of hedge funds on the list as well.

And in your column, you asked the question of,

How bad is this?

Like, is this insider trading?

I don't know.

Probably when it comes to what is material information, the bar has come way down.

If the story was that there's a list of super users and before

every like CPI data release, like the day before the BLS sends the super users the release to be like, hey, here's a preview, that would be really bad and people would be going to jail, right?

But that's not at all what happened, right?

Like what happened is that, as far as I can tell, they put out the data every, you know, periodically and people from all over the place email or call the people in charge of the data at the government saying, hey, can you explain this thing?

And

these people who work at the BLS work for the people, right?

Like they're government employees.

Like their job is to help people understand these statistics.

And so when people call them and say, hey, can you explain what's happening here?

They try to explain it.

And so there's this range of things where like giving people the data early would be really bad.

Yeah.

But like answering their legitimate questions seems very legitimate.

And when I wrote about this the other day, like I got a lot of reader email being like, this is fine and exactly what they should be doing.

Yeah.

Someone wrote to me saying, this this is very strange.

The BLS has people who are supposed to answer questions from the outside.

Literally anyone can email or call them and get answers.

It is not a scandal, but a public service, right?

Which I think is right.

Yeah.

No, there's definitely a sympathetic reading here.

And I mean, if you look at the statement that the BLS has given to different media organizations, I believe they gave this one to Bloomberg, was that, to your point, the BLS, it encourages people to ask questions and makes its staff available to engage with the public, but they strive to create equal access to the information for everyone, of course.

But also in the New York Times reporting, they spoke to someone who was actually on the

super user list, Omer Sharif.

He is the founder of Inflation Insights.

He also is a recipient.

He said that this was relatively new, and his best guess for why the super user list was created was just because they're getting so many more questions than they were previously about inflation.

And with the volumes of questions increasing so much, the staffing has not.

So maybe they just just created a master list.

Let's just answer everyone's questions at once and put them all in this list.

Aaron Powell, Jr.: Which, when you think about it, is like the better way to do it, right?

A thing you might worry about is that analysts at hedge funds,

one, can call the number at the BLS that anyone can call, but two, have better questions, right?

If they can ask really pointed questions about things that will move the market, they can get specific answers, and then they can go trade on it with everyone else not knowing it.

If you do it on an email list, it's a little bit fairer, right?

So like, you know, the hedge fund analyst emails the BLS and and says, can you explain this data point?

And instead of writing back and saying, yeah, sure, here you go, they can send out to the whole list that wants the same explanation.

And anyone, you know, arguably can get on the list.

It's really better than like the alternative of having one-on-one conversations about stuff that might be market moving.

But the whole problem here is if you're having any form of conversations about stuff that might be market moving and you're doing it in any way that is not public, people are going to get upset about that, right?

Because like it just is the case that some of these hedge fund analysts got information that was not broadly disseminated to the public and that they found useful, right?

That's already there.

I have a few silly thoughts.

The first thing that sprung into my mind as you were talking was they should have an earnings call.

That doesn't quite work because we're talking about a company.

No, but that's right.

I mean, like, right, like that's what companies do to partially address this problem.

It's like they put out the press release and the earnings release, and then they have a call where analysts can ask questions, but you can hear everyone can hear the questions, everyone can hear the answers.

And so it's a little bit more, you know, open access than the system of doing it by private email.

Perhaps they could have a subreddit.

A subreddit.

Yeah.

And this guy could be the moderator, this BLS economist who was described as not super high-ranking, but he had been there for...

I know, it was like a really mean nag in the time.

I know.

Someone suggested another approach that a lot of government agencies do use for other things, which is anyone can ask questions.

But instead of just answering the questions, they like collate the questions, write the answers, and then put all of that out publicly at the same time so everyone gets the answers to everyone's questions, and everyone gets to see the questions at once, which is sort of like using the super user list, only instead of just doing it in like a reply-all email, you do it online or something so everyone can see it.

Did you have any more reader comments?

I feel like you had a lot.

Oh, yeah.

No, I bet you people were all sort of in the camp of this is all fine.

Here, I'm going to read you another one.

Okay.

Why in the world can't anyone ask a question of their government about technical aspects of the report the government produced with their taxes?

Granted, there won't be many people with the ability to frame such questions, much less profit from the answers.

But the technique should be freely available to anyone, even big hedge funds.

Seems reasonable.

Yeah.

I mean, it's just good government service.

By the way, I think about this.

I'm like more of a stocks guy.

And I think about this by analogy to public company insider trading all the time, right?

I mean, like, if you're a public company and someone calls you up and is like, I'm a big investor in your company.

I'm a shareholder in your company.

You work for me.

I want you to explain something about your business.

Like

your instinct is going to be to explain your business to them, right?

Like your instinct is going to be, I work for you.

This is information that you legitimately want.

I'm going to tell it to you.

But, you know, there's also rules against insider trading and there's rules against selectively disclosing material non-public information.

And so companies are constantly walking this tightrope between like, we don't want to like be dismissive to our shareholders and not tell them anything, but we also don't want to tell them anything that will get us or them in trouble.

And there's a lot of thinking about that and a lot of people trying to get that right.

But it just always strikes me as kind of a weird balance where like people who know their insider trading rules are sometimes shocked to find out that companies talk to their investors all the time and try to explain their companies to them.

The Bureau of Labor Statistics has the same problems.

They could also be like the Fed.

I mean, maybe that's a better analogy than a corporate earnings call.

The Fed releases their decision at 2 p.m.

and then 2.30, Jerome Powell starts speaking and the entire knee-jerk reaction unravels.

Matt, are you on the super users list?

No.

It sounds like you could have just emailed them and asked to be added to the list and you could be on the list.

I guess one question is, does it still, like, is that still a possibility?

Like, I feel like it's kind of fraught now.

And if I were to email the BLS today and say, hey, guys, I'd love to be on the super user list.

I feel like that would be awkward, but maybe.

I feel like you'd only do that if you wanted to troll them.

That's true of me, but the reasons for the super user list haven't really gone away, right?

They still have to explain the stuff.

And so now that it's so well known, why shouldn't people be able to add themselves to it?

It's a fair question.

I do want to talk about one reader email I got this week.

Oh my God, great.

This is like the Money Stuff Podcast mailbag section.

Oh my gosh, let me bring it up.

So there's this great story in the FT about renewable investors at like DE Shaw hiring sheep to mow the lawns around their solar panels.

And it's great because it's just like, it's this image of like these hedgewood investors.

And like the way they hire the sheep, apparently, is often that a solar array is being built in some rural area, and a farmer, a neighboring farmer, kind of wanders over and says, Hey, could you use any sheep?

And I thought that was so funny.

And I wrote that the first scene of my Cormac McCarthy-influenced finance novel would involve a hedge fund manager leaning against the fence, chewing on a piece of straw, and a neighboring farmer wandering over to talk about sheep.

So a reader asked the Gemini AI model to write that scene and sent it to me and I'm going to read it to you.

The heat shimmered off the desolate field, distorting the rows of glass panels into an alien mirage.

Matt Levine, a hedge fund refugee transplanted to this forgotten corner of North Carolina, leaned against the rusting perimeter fence.

His city suit once a symbol of power and prestige, now hung on him like a molting carapace, ill-suited to the unforgiving sun

a plume of dust announced the arrival of silas the neighboring farmer his weathered face etched with the harsh lines of a life spent wrestling with the land held a deep well of suspicion silas stopped a good distance away the silence thick between them finally he spoke his voice a dry rasp carried on the hot wind

heard you needed your fancy heater contraptions mode Silas gestured towards the panels with a gnarled hand.

Sheep got restless with all that shade blocking their usual path.

It ends there, but I feel like you get the sense of it.

Oh my god, I was hoping it was getting going.

Yeah, yeah.

Well, someone's got to write it.

This person told me that he didn't ask Gemini to name the hedge fund character Matt Levine.

It just felt right to Gemini.

Yeah.

I love it.

I feel like we should keep going on this.

I think there's a lot of...

If the podcast doesn't work out, then we'll collaborate on a novel, maybe.

God, your readers are fun.

That is a lot.

And that was unprompted.

I mean, he prompted Gemini.

I know.

He didn't write all of those.

He didn't say, hey, intrepid reader, do this for me.

No.

Yeah.

No.

That's what I'm saying.

No.

I've got a lot of

people being like, I asked Chet GPT to write like you, and this is what it produced.

And I'm always like,

still safe.

But one day, like, GPT-7 will just, you know, just do the job.

But they can't do a podcast.

I'll be reduced to podcasting.

There we go.

And that was the Money Stuff Podcast.

I'm Matt Levine.

And I'm Katie Greife.

You can find my work by subscribing to the Money Stuff newsletter on Bloomberg.com.

And you can find me on Bloomberg TV every day between 10 and 11 a.m.

Eastern.

We'd love to hear from you.

You can send an email to moneypod at bloomberg.net.

Ask us a question.

or write us a short story, and we might answer it or quote it on air.

You can also subscribe to our show wherever you're listening right now and leave us a review.

It helps more people find the show.

The Money Stuff Podcast is produced by Anna Mazarakis and Moses Andam.

Our theme music was composed by Blake Maples.

Brendan Francis Noonam is our executive producer.

And Sage Bauman is Bloomberg's head of podcasts.

Thanks for listening to the Money Stuff Podcast.

We'll be back next week with more stuff.

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