The ongoing public drama surrounding Sam Bankman-Fried (SBF) and FTX is still unfolding, and there's been excellent coverage of many aspects of the story. Here's a short note on one piece of the puzzle we think is quite important, but so far has remained somewhat under the radar.

The S&P 500 is down 15% over the past year, so you’d think this would have been a great time to own some protection on your portfolio. Unfortunately, that’s not how things have turned out.

The year 2022 sure has felt like a pretty bad one so far: interest rates and consumer prices have spiked up, and stock prices are sharply down. But, in terms of what really matters, many investors are better off than they were at the end of 2021–almost 5% better off for an investor in a diversified balanced portfolio.

What are we to make of the near-total wipeout of the stablecoin Terra and its companion coin Luna, in which around $50B in value vaporized in less than a week?