Gorka

ai, markets, tech, internet weirdness.

researching what’s changing, what’s overhyped, and where the edge actually is.

[Gorka @gorkath]

CLAVICULAR posting up on the sidewalk and making two strangers stand there and hear him out. 😭🔥

[Gorka @gorkath]

CLAVICULAR stopping in the middle of the street and instantly pulling a girl into the conversation while bro just stands there watching. 😭

[Gorka @gorkath]

CLAVICULAR in a packed red-lit club talking right in a girl’s face while her friend films and the whole circle leans in. 😭
"He had the whole section locked on him"

[Gorka @gorkath]

CLAVICULAR in the middle of the club locking in with a blonde and her friend just watching it happen. 😭🔥

[Gorka @gorkath]

CLAVICULAR walking into the club and ending up surrounded by girls so tight the camera can’t even find his face. 😭
"You only see the crowd he pulled"

[Gorka @gorkath]

CLAVICULAR posted up on a rooftop couch with a girl locked under his arm and two others sitting right next to it. 😭🔥

[Gorka @gorkath]

CLAVICULAR in the middle of a club circle, looking up at one girl like the whole night already went his way. 😭🔥

[Gorka @gorkath]

Clavicular pulled up in the party bus and it was already stacked with girls 😭

[Gorka @gorkath]

CLAVICULAR pulled up and got swallowed by a wall of girls 😭

[Gorka @gorkath]

IN 1995 A 28 YEAR OLD TRADER EVERYONE CALLED A GENIUS HID ONE GROWING LOSS UNTIL IT TURNED A 233 YEAR OLD BANK INTO A SINGLE POUND

By 1995 he was the star. In Singapore he seemed to print money for one of the oldest banks in the world, and London let him run the desk with almost no one watching.

His name is Nick Leeson, and he was 28. What nobody knew was that every loss he made was quietly disappearing into a secret account, number 88888.

The bet was simple. He needed the Japanese market to stay calm.

Leeson ran both sides of his own trades, the buying and the checking. So when he lost, he buried it in 88888 and doubled down to win it back, and the hole grew in the dark.

Then on 17 January 1995 an earthquake hit Kobe. The Japanese market dropped, his hidden bet exploded, and the loss ran past 800 million pounds, more than the whole bank was worth.

On 23 February he ran, leaving a note on his desk.

"I'm sorry."

Days later Barings, founded in 1762, was sold to a Dutch bank for one pound.

No bank is too old to die. It only takes one person allowed to mark his own homework.

Watch the trader who broke a 233-year-old bank explain, in his own words, how easy it was to hide the losses that no one thought to check.

[Gorka @gorkath]

IN 1985 THE WORLD MOVED A BILLION DOLLARS IN A DAY, AND ONE 24 YEAR OLD UNLOADED A 20 MILLION POUND POSITION WITHOUT A SINGLE RIVAL SEEING IT

4 June 1985. In 24 hours the world's traders moved more than a billion dollars, and a BBC crew was filming every second of it.

In Hong Kong the camera found the youngest man on the floor, 24-year-old William Wong, sitting on a 20 million pound position he had to escape before the pound dropped again.

Selling it all at once would scream to the whole market that he was running. So he did something almost nobody has the nerve to do.

He didn't dump it. He quietly got other dealers to sell small pieces at the very same moment, so his 20 million disappeared into everyone else's noise. Then, with one casual wave of five fingers, he gave the signal. The market never saw the size leave, and Wong walked out with his profit whole.

That is the part they never teach beginners. The money is not only in being right, it is in getting out without letting the market feel you move.

Around him London and New York were running the same billion-dollar dance, three cities passing the same currencies back and forth as the pound slid.

"I'm here to make money. If the pound is falling, I'll profit from it."

Everyone watches the traders who shout. The ones who keep the money are the ones you never notice leaving.

Watch a 24-year-old empty a 20 million pound position with one flick of his fingers, in what might be the most quietly ruthless minute ever filmed on a trading floor.

[Gorka @gorkath]

WALL STREET'S RICHEST TRADER BUILT AN $8 BILLION FORTUNE ON ONE WORD, AND HIS FUND RAN THE MOST PROFITABLE INSIDER TRADING SCHEME EVER PROSECUTED

By 2008 he was worth 8 billion dollars, and he took half of every profit his traders made while the rest of Wall Street took a fifth.

His name is Steven Cohen, and his fund SAC Capital was the most feared trading desk in the world. Everyone wanted to know how he was always on the right side of the trade.

It came down to a single word traders chase every day, legal or not.

That word is edge. On Wall Street edge means you know something the other side doesn't, and SAC chased it harder than anyone. The fund paid banks 30 to 50 million dollars a year in commissions just to be the first phone call when news broke, and it used middlemen who pulled secrets straight out of companies before the public ever saw them.

Then one of his managers got the results of an Alzheimer drug trial from the doctor running it, days before they went public. SAC made an estimated 275 million dollars on that one trade, the most profitable insider bet ever prosecuted.

The manager got nine years. The firm pleaded guilty and paid a record 1.8 billion dollar fine.

Cohen was never charged. Under oath, asked to explain the rules he traded by, he said:

"The way I understand the rules on trading on inside information, it's very vague."

Everyone chasing edge remembers the profits. Almost nobody remembers it was the people below the boss who paid for them.

Watch the man worth 8 billion dollars try to explain, under oath, why the rules he traded by were, to him, too vague to break.

[Gorka @gorkath]

TWO NOBEL PRIZE WINNERS BUILT A TRADING MODEL THEY SWORE COULD NOT LOSE, AND IT BURNED $4.6 BILLION IN UNDER FOUR MONTHS

In 1997 they won the Nobel Prize in economics. A year later their own fund was gone.

Their names are Myron Scholes and Robert Merton, the men whose formula taught the whole world how to price risk. Every big bank on Wall Street lined up to pour money in.

For three straight years the fund returned more than 40% a year, and not once did it post a losing quarter.

Then the math they trusted with a trillion dollars did the one thing it had told them was impossible.

The fund had borrowed $125 billion against $4.7 billion of its own, and on top of that it held positions worth more than a trillion dollars. Here is that part in words your grandmother would follow:

"If I have $100 billion of a position and I lose one percent, I've lost a billion dollars. And if all I have to start out with is three billion dollars, if I lose three percent, in aggregate I'm going to be wiped out."

They were borrowing 25 dollars for every real dollar they had. At that size a market that moves 4% against you does not hurt you. It ends you.

In August 1998 Russia defaulted. The models said the fund could never lose more than 50 million in a day. Four days later it lost 500 million in a single day. Then it did it again, and again.

The smartest men who ever priced a market forgot the one thing the market never does: leverage does not care how right you are on average.

Watch the two Nobel laureates explain, in their own words, how a formula that could not lose erased 4.6 billion dollars in weeks, and why the biggest brains in the room are the ones the market breaks.