Investors in Situational Awareness deserved to lose their shirts

I don't understand the point of this piece. There is nothing breaking or remotely interesting which we didn't already know.

Mind you I don't particularly care about Aschenbrenner or his fund but it feels to me like typical journalists reporting on hindsight without any sort of skin in the game. "Hhm, how could you be so dumb so as to trust your money to a 22 year old".

Peter Thiel did the same with Zuck and like him or hate him he did pretty well.

If you want to show how smart you are hash your predictions, post them publicly with a commitment to reveal by a certain date and then show the world how this was so obvious in hindsight.

> He reported returns of 439% for the first half of 2026

> which posted a loss of 67% in July

So it's still up 44% this year? The article notes this, but seems unnecessarily adversarial against an investor who is still wildly successful.

> By July this year he was said to be overseeing as much as $45bn

Does anyone know if this refers to AUM or the gross size of his positions after leverage?

The discourse on this is way too clearly schadenfreude. He's still up significantly YTD.

I'm not sure what the outrage is. It's still up pretty good for the year, but if you brought at the top, like any stock, you'd lose your shorts.

> Good for Mr Aschenbrenner for chancing his arm. The mystery is what on earth his investors were thinking. Perhaps they weren’t. In which case, that would be more worrying than anything about Situational Awareness’s humbling.

The Economist should change its name to The Populist with this type of screed.

Here's the reality:

1. Lots of money is invested willy-nilly for all sorts of reasons (or no reason at all) in all sorts of dubious and poorly-managed vehicles.

2. Except for the profile of the fund manager and that this was AI, this failure wasn't all that special. The seed capital for the fund is reported to have been around $225 million and it was highly leveraged on top of significant gains so there's a whole class of LPs who probably aren't even going to lose anything on this. It's the people who put capital in more recently who are going to lose.

3. The people who will lose money investing in this fund are the type of people who have a full wardrobe. It's going to be a very long time before they "lose their shirts".

This piece is smug, ageist, and clueless. It is building its bad argument upon the opposite of what the data show. I am surprised they printed it.

I don't like Aschenbrenner's type, personally. He was an arrogant little puke when he wrote the original mega-essay, and an arrogant little puke when he started this fund with the same presumptuous name. But he does his homework, and he has made his investors quite rich. The only sad investors would be anyone who just got into SALP this month, and they got what was coming to them for crowding into these trades so late in the game.

What's more, Aschenbrenner got himself out of this sticky spot in time to avoid total catastrophe. He gets credit for that, and so do his PBs for keeping a watchful eye and margin calling him in time. At least some of the adults here knew how to supervise.

In retrospect, it would have been good to have people inside the fund who knew more about market tactics, not just forecasting the AI tech tree, but he has now learned that lesson without too much damage.

And even if he had gone bust, it would have been a step forward, teaching his fellow EAs that it's possible to blow up a fund without doing crimes. Small steps!

Read the bio. Found it (emphasis mine):

> While at Columbia, he co-founded the university's effective altruism (EA) chapter.[5]

Just another smart, yet ethically challenged, individual. Nothing to see here.