Welcome to a monstrously huge Dark Markets scams n’ frauds roundup. I’m David Z. Morris, longtime finance reporter and fraud investigator.
We aren’t taking a Christmas break - the grift don’t stop, so we don’t either.
In This Edition: Book Roundup: The Death of Twitter; Scams are 10% of Meta’s Revenue; Tesla is Still Dying; The Option Selling Scam; DEI and White Men’s “Lost Decade”; Sam Bankman-Fried, Jailhouse Lawyer; Why Young People Are Gambling So Much.
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I could write a whole, whole lot about the past year, which has been a real roller-coaster ride. In a synecdoche for the larger whole, it wrapped up with, on the one hand, a nerve-shattering business dispute (which has thankfully resolved); and on the other hand, with a glowing review of my first book.
In sum, I think that this year - now more than two years after I last held a “job” in journalism! - was a big Level Up Moment. 2026 will be about making the most of that new profile, including by continuing to promote Stealing the Future, starting a new book, and building on what I do here. That will include more livestreams like this one I did regarding Do Kwon’s incredible clemency letter, which was so narcissistic it probably helped add years to his sentence.
So be sure to follow my YouTube channel, lots more there next year!
The Wall Street Journal has a new piece on the rise of financial nihilism and gambling of all sorts. The piece shares the basic conclusion that memecoins and sports betting have risen as faith in the traditional path to success has faded. I think it’s worth considering the other angle, though: That if we made all this gambling less accessible, young men would have to find something productive to do with their time, instead of getting constantly extracted.
Subscribe
This is a slightly older thread by the inimitable Benn Eifert, explaining a grift I wasn’t super familiar with: Apparently a lot of YouTube finance influencers pitch retail stock owners on selling options on their own holdings. Benn breaks down why that’s a bad idea:
2:15 PM · Aug 14, 2025 · 755K Views
107 Replies · 249 Reposts · 2.55K Likes
The nut of it, I think, is: “If you own a stock, and you're considering selling a call against it: selling that call is just a trade. You're going to lose money on that trade if the stock goes up enough. And if the stock is volatile -- goes up a lot and then down a lot -- you're going to get hosed.”
Even trading options, to be blunt, is a bad idea for most people. I’m certainly far too stupid to try it, and I think about this stuff all the time. The added complexity of selling your own options seems, frankly, like a pitch for someone with a hole in their headl
In 2026 I’ll also be trying to do more quick book reviews/previews, since I’ve really gotten back to plowing through the suckers since my 2023 manifesto on Resurrecting Focus.
I’ve remained a holdout on Twitter/X over the two years since Elon Musk’s purchase of the platform, partly because FinTwit and Crypto Twitter (CT) are still more or less alive and well. But the massive decline in the platform’s utility, relevance, and even basic services has become too drastic to ignore. Since long-running group chats are another major reason I’m still there, the shambolic rollout of supposedly encrypted messaging over the past few weeks was very close to a break point for me.
But what has finally really pushed me towards posting more actively on BlueSky and here on Substack has been reading three recent books detailing Elon Musk’s management of Twitter/X over the past two years (Full transparency - I usually consume straightforward business narratives, including these, as audiobooks). The level of incompetence they detail finally helped me understand that Twitter is truly dead, and that the X remaining behind is on, at best, life support.
My favorite has been Character Limit by Kat Conger and Ryan Mac, which depicts in excruciating detail just how embarrassingly, proudly ignorant and thoughtlessly cruel Musk is in his management of a social media company. While it’s a fine book, I didn’t find Zoe Schiffer’s Extremely Hardcore added much to the story, and Schiffer is a bit too Millenial-flippant in her dismissive tone, instead of letting Musk’s spectacular self-destruction speak for itself. Finally, I’m currently tackling Jacob Silverman’s Gilded Rage, in which Musk is a central but not sole figure. Silverman’s book, which was recently reviewed alongside mine, is a deeper materialist analysis of the straight-ahead business narrative, in particular offering some new (and very grim) insights into the stake in the New Twitter owned by the state-backed murderer Muhammed Bin Salman.
Subscribe
Santa came a little early this year, because Sam Bankman-Fried is giving legal advice to his fellow inmates.
A truly laugh-out-loud passage instantly gets the reality across: Sam is compulsively conning his fellow inmates into thinking his advice is good, when it is predictably terrible.
Bankman-Fried, of course, notoriously made horrendous mistakes throughout his own criminal proceeding - starting before he was even arrested by giving extensive interviews. He also got dinged for witness tampering in pretrial and recently got thrown in solitary and relocated for a verboten interview.
The climax of these fuckups was, of course, taking the stand in his own defense, a tactic that Judge Lewis Kaplan explictly told the court added years to SBF’s sentence, because Bankman-Fried perjured himself, in Kaplan’s words, “more times than are worth counting.”
Sam, luckily, seems to be sharing his insights with some real pieces of shit. On top of the former drug cartel collaborator, Sam also supposedly gave legal advice to Diddy, and to Carmine Simpson, a pedophile police officer who coerced children into giving him nude photos. Simpson previously wrote a clemency letter on SBF’s behalf.
·
March 11, 2024
The real goal of the jailhouse lawyering becomes clear when you see the drivel being spat out by SBF’s old Twitter account: fulsome praise for Donald Trump’s pardon of that drug trafficker above - former Honduran president Juan Orlando Hernandez. SBF is now taking the line that Biden’s Department of Justice was “corrupt,” with pretty impeccable timing given Pam Bondi’s Epstein problems.
It’s all quite transparently and cravenly, in other words, tailored to get SBF a Trump pardon. But I still don’t think that will ever happen.
Notably, this New York Times writeup is not by the Times’ longtime SBF beat reporter, David Yaffe-Bellany. As I’ve detailed in these pages, Yaffe-Bellany has an uncomfortable family connection to the Bankman-Frieds. Perhaps following SBF’s catastrophic appeal hearing, the Times was willing to put someone less palpably motivated on the beat.
·
May 28, 2024
Documents leaked to Reuters show that Meta (Facebook) is perhaps the single biggest vector for scammers in the United States - and the company has taken no action.
The news spread on Twitter (in a dynamic that’s worth paying attention to) thanks to a summary of a segment of a podcast about the reporting, posted by another podcast host, Rob Wiblin. I’ll just lift directly from Wiblin’s good bullet-pointed summary of this absolute horror show:
• 10% of all Meta revenue comes from ads for scams & banned goods ($16B/year)
• Meta estimates it's involved in 1/3 of all successful scams in the US
• That suggests they drive $50B in scam losses for US consumers alone each year
• Meta earns ~$3B annually from scam/banned goods ads run by Chinese operations alone• Fraud earns 10% of all [Meta] revenue, but anti-fraud teams were blocked from any action costing >0.15%, so they couldn't effectively do anything.
• Meta charged higher rates for suspected fraudulent ads — a "scam tax."
• Their algorithm naturally identifies people vulnerable to frauds and feeds them more and more.• Meta anticipated up to $1B in regulatory fines for this
• But they make $3.5B every 6 months from high-risk ads
• They view these fines as just "cost of doing business"
Ironically, Wiblin is the host of the 80,000 Hours podcast, a project on “effective careers” previously associated with - you guessed it - Effective Altruism. At a short glance, nearly all mention of that movement has been scrubbed from their website, aside from a long apology for helping enable Sam Bankman-Fried.
And even these people thing Mark Zuckerberg is basically Satan.
Subscribe
A piece in Compact Magazine went viral last week with its recounting of the story of several young-ish white males who were denied prestigious jobs from roughly 2010-2024, and blame “DEI” diversity initiatives for that shortfall.
I found this claim laughable, not just because I believe organizations have a legitimate strategic business case for pursuing diversity initiatives, but also because my personal experience debunks the claims being made. Not only was I a thirtysomething white male when I won multiple academic fellowships in 2010-2013, I was also still just barely a thirtysomething white male when I was hired at a major cultural institution, Fortune Magazine, in 2019.
Matt Breunig had a more systematic response, pulling census data that showed pretty objectively that the declines in earnings or under-representation in cultural industries the Compact piece implied from anecdotes didn’t really happen.
Instead, Breunig floats a compelling non-materialist reading: That the signalling around DEI, from the likes of Hillary Clinton, primed less successful white men to resent ‘reverse discrimination’ - but in practice, DEI was barely anything other than signalling. Just liberal performativity that didn’t actually make anything different or better. So we get the right-wing backlash, without any actual progress in the first place.
Will Lockett has produced a string of great analyses of the unwind scenario for Elon Musk’s extremely leveraged universe, which leads from tanking worldwide Tesla sales to Elon’s heavily encumbered equity stake.
Lockett, much like me, called Tesla’s decline entering the endgame nearly a year ago, and obviously the crash we both saw coming hasn’t quite happened yet. But that’s largely because Musk has kicked various cans down the road by borrowing heavily against his own equity stake in Tesla. That means he’s subject to a margin call/death spiral when things do finally catch up with him.
In his latest missive, Lockett details some of the operational screwups that, on top of Musk’s personal work to annihilate good will in the brand, have led to sales in some countries dropping by a staggering 50% or more in just two years. Most notable, and unpacked with appropriate dirision by Lockett, is that Tesla mothballed its affordable “Model 2” project, to instead focus resources on Robotaxis.
Predictably for anyone who has been watching Musk’s efforts in self-driving over the last decade, the Robotaxis are not doing well. There have been 8 injury collisions involving them in Austin - and that’s with safety monitors (read: human drivers) in every vehicle. This is because Musk wanted to save a few bucks on LIDAR units a decade ago, and was positive, despite expert advice, that self-driving could be achieved with cameras alone. Turns out, Elon Musk was very wrong about this!
Meanwhile, without an affordable vehicle in the lineup, Tesla is getting ravaged by competition globally, including in Europe by a fucking Renault, if you can believe that.
This is all very, very bad, specifically because Musk has massive loans against his (inflated, incredibly fragile, possibly fraudulent) Tesla stock.
Let me just quote Lockett directly for the kicker here:
”Musk has also used his Tesla stock as collateral for SpaceX, Twitter, and Tesla loans. Before he bought Twitter, over half of his shares were collateralised; now, that figure is far, far higher. Again, let’s be generous and assume only 70% of his 12.8% stake in Tesla is collateralised in this way, with a third of these loans for Tesla. That would mean Musk has $71.68 billion in personal loans, with $23.89 billion for Tesla.
These loans aren’t accounted towards the company’s liabilities, as they are technically part of the debt owner’s — in this case, Musk’s — personal liabilities.
In other words, Tesla actually has $72.28 billion in debt. That is more than the company is realistically worth!”
Dark Markets is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.
Subscribe
Welcome to a monstrously huge Dark Markets scams n’ frauds roundup. I’m David Z. Morris, longtime finance reporter and fraud investigator.
We aren’t taking a Christmas break - the grift don’t stop, so we don’t either.
In This Edition: Book Roundup: The Death of Twitter; Scams are 10% of Meta’s Revenue; Tesla is Still Dying; The Option Selling Scam; DEI and White Men’s “Lost Decade”; Sam Bankman-Fried, Jailhouse Lawyer; Why Young People Are Gambling So Much.
Subscribe
I could write a whole, whole lot about the past year, which has been a real roller-coaster ride. In a synecdoche for the larger whole, it wrapped up with, on the one hand, a nerve-shattering business dispute (which has thankfully resolved); and on the other hand, with a glowing review of my first book.
In sum, I think that this year - now more than two years after I last held a “job” in journalism! - was a big Level Up Moment. 2026 will be about making the most of that new profile, including by continuing to promote Stealing the Future, starting a new book, and building on what I do here. That will include more livestreams like this one I did regarding Do Kwon’s incredible clemency letter, which was so narcissistic it probably helped add years to his sentence.
So be sure to follow my YouTube channel, lots more there next year!
The Wall Street Journal has a new piece on the rise of financial nihilism and gambling of all sorts. The piece shares the basic conclusion that memecoins and sports betting have risen as faith in the traditional path to success has faded. I think it’s worth considering the other angle, though: That if we made all this gambling less accessible, young men would have to find something productive to do with their time, instead of getting constantly extracted.
Subscribe
This is a slightly older thread by the inimitable Benn Eifert, explaining a grift I wasn’t super familiar with: Apparently a lot of YouTube finance influencers pitch retail stock owners on selling options on their own holdings. Benn breaks down why that’s a bad idea:
2:15 PM · Aug 14, 2025 · 755K Views
107 Replies · 249 Reposts · 2.55K Likes
The nut of it, I think, is: “If you own a stock, and you're considering selling a call against it: selling that call is just a trade. You're going to lose money on that trade if the stock goes up enough. And if the stock is volatile -- goes up a lot and then down a lot -- you're going to get hosed.”
Even trading options, to be blunt, is a bad idea for most people. I’m certainly far too stupid to try it, and I think about this stuff all the time. The added complexity of selling your own options seems, frankly, like a pitch for someone with a hole in their headl
In 2026 I’ll also be trying to do more quick book reviews/previews, since I’ve really gotten back to plowing through the suckers since my 2023 manifesto on Resurrecting Focus.
I’ve remained a holdout on Twitter/X over the two years since Elon Musk’s purchase of the platform, partly because FinTwit and Crypto Twitter (CT) are still more or less alive and well. But the massive decline in the platform’s utility, relevance, and even basic services has become too drastic to ignore. Since long-running group chats are another major reason I’m still there, the shambolic rollout of supposedly encrypted messaging over the past few weeks was very close to a break point for me.
But what has finally really pushed me towards posting more actively on BlueSky and here on Substack has been reading three recent books detailing Elon Musk’s management of Twitter/X over the past two years (Full transparency - I usually consume straightforward business narratives, including these, as audiobooks). The level of incompetence they detail finally helped me understand that Twitter is truly dead, and that the X remaining behind is on, at best, life support.
My favorite has been Character Limit by Kat Conger and Ryan Mac, which depicts in excruciating detail just how embarrassingly, proudly ignorant and thoughtlessly cruel Musk is in his management of a social media company. While it’s a fine book, I didn’t find Zoe Schiffer’s Extremely Hardcore added much to the story, and Schiffer is a bit too Millenial-flippant in her dismissive tone, instead of letting Musk’s spectacular self-destruction speak for itself. Finally, I’m currently tackling Jacob Silverman’s Gilded Rage, in which Musk is a central but not sole figure. Silverman’s book, which was recently reviewed alongside mine, is a deeper materialist analysis of the straight-ahead business narrative, in particular offering some new (and very grim) insights into the stake in the New Twitter owned by the state-backed murderer Muhammed Bin Salman.
Subscribe
Santa came a little early this year, because Sam Bankman-Fried is giving legal advice to his fellow inmates.
A truly laugh-out-loud passage instantly gets the reality across: Sam is compulsively conning his fellow inmates into thinking his advice is good, when it is predictably terrible.
Bankman-Fried, of course, notoriously made horrendous mistakes throughout his own criminal proceeding - starting before he was even arrested by giving extensive interviews. He also got dinged for witness tampering in pretrial and recently got thrown in solitary and relocated for a verboten interview.
The climax of these fuckups was, of course, taking the stand in his own defense, a tactic that Judge Lewis Kaplan explictly told the court added years to SBF’s sentence, because Bankman-Fried perjured himself, in Kaplan’s words, “more times than are worth counting.”
Sam, luckily, seems to be sharing his insights with some real pieces of shit. On top of the former drug cartel collaborator, Sam also supposedly gave legal advice to Diddy, and to Carmine Simpson, a pedophile police officer who coerced children into giving him nude photos. Simpson previously wrote a clemency letter on SBF’s behalf.
·
March 11, 2024
The real goal of the jailhouse lawyering becomes clear when you see the drivel being spat out by SBF’s old Twitter account: fulsome praise for Donald Trump’s pardon of that drug trafficker above - former Honduran president Juan Orlando Hernandez. SBF is now taking the line that Biden’s Department of Justice was “corrupt,” with pretty impeccable timing given Pam Bondi’s Epstein problems.
It’s all quite transparently and cravenly, in other words, tailored to get SBF a Trump pardon. But I still don’t think that will ever happen.
Notably, this New York Times writeup is not by the Times’ longtime SBF beat reporter, David Yaffe-Bellany. As I’ve detailed in these pages, Yaffe-Bellany has an uncomfortable family connection to the Bankman-Frieds. Perhaps following SBF’s catastrophic appeal hearing, the Times was willing to put someone less palpably motivated on the beat.
·
May 28, 2024
Documents leaked to Reuters show that Meta (Facebook) is perhaps the single biggest vector for scammers in the United States - and the company has taken no action.
The news spread on Twitter (in a dynamic that’s worth paying attention to) thanks to a summary of a segment of a podcast about the reporting, posted by another podcast host, Rob Wiblin. I’ll just lift directly from Wiblin’s good bullet-pointed summary of this absolute horror show:
• 10% of all Meta revenue comes from ads for scams & banned goods ($16B/year)
• Meta estimates it's involved in 1/3 of all successful scams in the US
• That suggests they drive $50B in scam losses for US consumers alone each year
• Meta earns ~$3B annually from scam/banned goods ads run by Chinese operations alone• Fraud earns 10% of all [Meta] revenue, but anti-fraud teams were blocked from any action costing >0.15%, so they couldn't effectively do anything.
• Meta charged higher rates for suspected fraudulent ads — a "scam tax."
• Their algorithm naturally identifies people vulnerable to frauds and feeds them more and more.• Meta anticipated up to $1B in regulatory fines for this
• But they make $3.5B every 6 months from high-risk ads
• They view these fines as just "cost of doing business"
Ironically, Wiblin is the host of the 80,000 Hours podcast, a project on “effective careers” previously associated with - you guessed it - Effective Altruism. At a short glance, nearly all mention of that movement has been scrubbed from their website, aside from a long apology for helping enable Sam Bankman-Fried.
And even these people thing Mark Zuckerberg is basically Satan.
Subscribe
A piece in Compact Magazine went viral last week with its recounting of the story of several young-ish white males who were denied prestigious jobs from roughly 2010-2024, and blame “DEI” diversity initiatives for that shortfall.
I found this claim laughable, not just because I believe organizations have a legitimate strategic business case for pursuing diversity initiatives, but also because my personal experience debunks the claims being made. Not only was I a thirtysomething white male when I won multiple academic fellowships in 2010-2013, I was also still just barely a thirtysomething white male when I was hired at a major cultural institution, Fortune Magazine, in 2019.
Matt Breunig had a more systematic response, pulling census data that showed pretty objectively that the declines in earnings or under-representation in cultural industries the Compact piece implied from anecdotes didn’t really happen.
Instead, Breunig floats a compelling non-materialist reading: That the signalling around DEI, from the likes of Hillary Clinton, primed less successful white men to resent ‘reverse discrimination’ - but in practice, DEI was barely anything other than signalling. Just liberal performativity that didn’t actually make anything different or better. So we get the right-wing backlash, without any actual progress in the first place.
Will Lockett has produced a string of great analyses of the unwind scenario for Elon Musk’s extremely leveraged universe, which leads from tanking worldwide Tesla sales to Elon’s heavily encumbered equity stake.
Lockett, much like me, called Tesla’s decline entering the endgame nearly a year ago, and obviously the crash we both saw coming hasn’t quite happened yet. But that’s largely because Musk has kicked various cans down the road by borrowing heavily against his own equity stake in Tesla. That means he’s subject to a margin call/death spiral when things do finally catch up with him.
In his latest missive, Lockett details some of the operational screwups that, on top of Musk’s personal work to annihilate good will in the brand, have led to sales in some countries dropping by a staggering 50% or more in just two years. Most notable, and unpacked with appropriate dirision by Lockett, is that Tesla mothballed its affordable “Model 2” project, to instead focus resources on Robotaxis.
Predictably for anyone who has been watching Musk’s efforts in self-driving over the last decade, the Robotaxis are not doing well. There have been 8 injury collisions involving them in Austin - and that’s with safety monitors (read: human drivers) in every vehicle. This is because Musk wanted to save a few bucks on LIDAR units a decade ago, and was positive, despite expert advice, that self-driving could be achieved with cameras alone. Turns out, Elon Musk was very wrong about this!
Meanwhile, without an affordable vehicle in the lineup, Tesla is getting ravaged by competition globally, including in Europe by a fucking Renault, if you can believe that.
This is all very, very bad, specifically because Musk has massive loans against his (inflated, incredibly fragile, possibly fraudulent) Tesla stock.
Let me just quote Lockett directly for the kicker here:
”Musk has also used his Tesla stock as collateral for SpaceX, Twitter, and Tesla loans. Before he bought Twitter, over half of his shares were collateralised; now, that figure is far, far higher. Again, let’s be generous and assume only 70% of his 12.8% stake in Tesla is collateralised in this way, with a third of these loans for Tesla. That would mean Musk has $71.68 billion in personal loans, with $23.89 billion for Tesla.
These loans aren’t accounted towards the company’s liabilities, as they are technically part of the debt owner’s — in this case, Musk’s — personal liabilities.
In other words, Tesla actually has $72.28 billion in debt. That is more than the company is realistically worth!”
Dark Markets is a reader-supported publication. To receive new posts and support my work, consider becoming a free or paid subscriber.
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