Is the narrative of "The Big Short" the best explanation of the financial crisis?
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- เผยแพร่เมื่อ 27 ม.ค. 2016
- On January 27, the director of "The Big Short", Adam McKay (who also directed and co-wrote “Anchorman,” “Talladega Nights,” and “Step Brothers”), visited Washington for a screening of the film hosted by Economic Studies at Brookings. After the screening, Adam McKay joined a panel of financial experts and journalists to discuss whether the film’s narrative is the right one to explain the crisis to the public.
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My entire 20+ years in the financial sector has been non-stop crises and meltdowns, its a wonder I have any hair left. During the GFC I was working at the pointy end of my government's response to the GFC (doing a lot of work to see who was exposed and investigating collapses). The Big Short is an excellent depiction of the sub-prime mess, I remember reading many prospectuses as emergency research during this time and man, the signs were all there. I remember reporting up the line concerns I had with a suite of products filled with sub-prime CDOs being marketed to pensions and local small council and union funds. Got told not to worry about it.
I worked in the banking industry from 2012-2016 and the banks have already started, and continue to this day, offering the same mortgage "products" that, in part, contributed to the most recent recessation.
IMHO the HARP program was a failure because it merely pushed the "pain" down the road for borrowers who, as we all found, couldn't afford a home in the first place.
Secondly, both Dodd-Frank and the CFPB are a failure as they don't really hammer the banks but it DOES make things much more difficult for the borrower.
Lastly, if something like this happens again, if the banks/industry/business need to go into bankruptcy, they should go out of business! Yes, there will be pain in that scenario for a period of time but at the back end the financial industry may FINALLY behave honestly, ethically and with integrity.
Do you know about the push for Green climate push? That’ll provide a lot of liquidity.
"....but it DOES make things much more difficult for the borrower."
Congress making banks make it easier for the borrower (ie lowering loan standards, allowing subprime loans,..), not to mention reversing Glass-Steagall, is how the financial system collapsed in the first place.
@@jcgoogle1808 exactly, along with the community reinvestment act creating a shadow economy that is the real driver in creating, or rather diminishing, standards for lending is a big issue that needs to be addressed.
Very informative. Brings up a lot of interesting points. It's funny how white collar crime get's a total pass in this country. I've heard it said, "in this country it's better to be rich and guilty, than poor and innocent."
The Big Short was a great picture of what happened, but it's not complete. There are three other parts missing: 1. The dealing between the banks prior to TARP that Hank Paulson set up, excellently and accurately portrayed by the movie Too Big to Fail. 2. The experiences of the millions of Americans who lost their homes. Their stories should be made into a movie as well. 3. The role that bizarre government policies and subsidies played in incentivizing lenders and borrowers to open up mortgages on homes too expensive for these families to afford.
The problem that is often overlooked is the role government played in this and their bungling every step of the way. At least the markets had winners and losers, government just did everything wrong.
pegasi. I feel ofended by the point number 2. The millions of americans? and what about the millions of european people that suffers this huge american fail still nowadays?
Pegasi I agree completely. There’s a human tragedy playing out and unravelling across America and here in the UK even now. People living out of RVs and living in car parks, working for Amazon who abuse their position and take full advantage of thousands of unfortunate to name but one example.
@@thumper1747 1% unemployment = 40k deaths was one of the most chilling lines in that movie
Syndication allowed so called financial professionals to behave with impunity as each step of the process was handed over, rewarded and packaged until it (the bundled financial agreements) became an investment product that even worse professionals had stewardship over
I am one of those people who lost a lot of money leading up to and during the collapse in 2008. A valuable lesson learned while at the same time made me a better investor. The only part that irks me is that the people working for Bear Sterns, Fannie Mae etc. took bonuses from the bailout money.
I am curious about your thoughts about the film, and the feelings you had watching it ?
Well Claude had gone quiet. I lost my very lucrative contract working in Switzerland due to the collapse. The fact they got paid for fucking the rest of us over is disgusting. We generate the wealth and they made money on the way up and the way down. We lost is all. And on top of it our taxes paid them out.. cunts
You didn't learn anything. ALSO of note is that there are TWO replies to this comment but one of them is CENSORED. I wonder (read: KNOW) why.
The banks issued bad loans and hid them, stealing fixed value dollars. This time, the mortgages are a constant, but money will wildly change value. There are two ways to drown, fall under water or fill the room with water. In the end, how you drown matters little.
That is an excellent analogy to describe precisely how the Js have rigged the banking industry and colluded with governments to defraud the people.
What changed in the past 40 really 50 years in america is that the people common citizens by way of greed and desire, and the growth of the 1percent, began to worship the idea of classism. We went from a regulatory world which was far more fair to the working family, Wage fairness between the lowest and highest paid in a company and the moral foundation that kept those factors in place, to our facination with power and wealth being on display via movies films and television, to being something most people desired. It was no longer just about a decent job to supports one living, it turned into who has the biggest house on the block, who should your daughter be marrying a blue collar worker or a doctor. we put so much emphasis on the justification of rich and wealth that we were fine with the growth of the 1% we championed it believing we could be a member of that exclusive club. that in all that we worshiped in terms of Classism we a let our guard down, and let soft spoken robber barons to change laws and deregulate the system that kept their greed in place. All the while our nation in the 80's when into a season of boon. so no one faught against anything that came across as greed. The 1% acquisition of wealth, saw to many changes draining the wealth and the jobs away from the blue collar worker. Factories shut down domestically and reopened in tax incentive cheap labor nations like China or india. and much of the asian peninsula. we effectively allow the wealthy to sell the nation out for their own personal profit. and that kind of money making must always be fed on that level. So when one source of income began to waver, the banks saw to other schemes to make money. to the point of putting the world at risk. blind greed and stupidity because it was going on for so long. The big short, Too big to fail, Margin Call .. all these great films centering around the 08 crash, are all defined by one single theme.. Dont put your trust in those who have big names big positions and big titles, because they can very well be asleep at the wheel. A quote used in the film itself. It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.
What happened was our country's leadership was infiltrated by Js.
Read the book and saw the movie. Both are very accurate. For a different aspect of this read Chain of Title (2016) by David Dayen. It will make you very angry. It is hard to believe the courts looked the other way when the forging and fraud was right in front of them. The movie Margin Call is good as well.
the courts looked away because the government forced all these things to happen....
Community Reinvestment Act forced banks to make risky loans that they would not have previously made on their own, and we know they wouldn't because they never did, and thus we never had a massive housing bubble like this before.
when government forces banks to be risky, it should not come as a surprise when those risky loans result in massive amounts of defaults.
@@mannyfan165 beautifully said. I've been doing a deep dive into the CRA and I had no idea how destructive that set of laws is.
The movie is a lie. It is riddled with false information. If the book is anything like the movie, it is also a complete and utter LIE.
Very informative, and a great movie! Thanks for the great panel.
The movie is a lie. It is riddled with false information.
K, am I the only one that sees the guy on the left as the problem...?
It was really enjoyable listening to these intelligent and diverse folk.
"Dumbing it down" is definitely the only way I would have understood this!
...and you STILL don't understand it. Indeed, by listening to this drivel you have come out dumber than before you watched it.
Can we make another film for COVID finance esp for big Sharks and the hungry tiny fishes ?
Yes. We NEED an exposé of govt complicity in COVID
The sequel of The Big Short should be The Big Squeeze.
Jumped ahead to 12:00 : "Let's get started..."
17:20 - stories are important: we get crashes every 20-30 years because a generation of financiers have grown up not hearing stories about how it went tits-up last time round.
How times change! When I was starting out, the complaint against banks was you needed to prove you didn't need the money to borrow it.Then, their only way to get repaid was from the borrower. Now the Federal Government (taxpayers) gets stuck with the bill.
51:58 "In the book ('The Big Short'). we turned off CNBC. If you read the book, you realize that we turned it off 'cause it was too much. And I''m sure Greg and David both wrote pieces and there were workers people that work with them that also wrote pieces. It's easy to say that now. But from a behavioral finance perspective, nobody wanted to hear that the housing market was going to crash. You gonna go to a party and talk about that? You'll be drinking alone in a corner. So I think it's easy to look back now and say, 'Oh, that! That!', but you were a person alone on an island if you wanted to make that call."
- Danny
Home. BLEEPING. Run, Danny. Home. Bleeping. Run.
"Was it criminality or was it stupidity?" Really? How about Greed? How about good old fashioned greed which - until fairly recently - was considered a deadly sin?
Greed is not a real thing.
Where's Ben barnake?
Brookings Institute + NPR = Bernie Sanders.
I rank this financial conversation by one of my favorite Big Short movie as the core of the dialogue as the top FRUITFUL video for personal need. Will scrape this video and save in my YT library shelf forever......STF.....
No anguish toward to banking at all, on contrast this film enabled me to comprehend the banking business and system.........STF.............
As the man was talking in 24:30, I suddenly started pounding my tablespoon against my plate really hard to remove Korean paste. Don't read into it too much, guys.
Terrible questions period.
How could you buy a house without looking at the mortgage?
Read "Meltdown" by Thomas Woods. The real problem was not the "free market" or "greed" or "bankers". The problem was government policies and government policies and government policies.
I can see the arguement between stupidity (because it was stupid) and criminal. You can bring in low interest and macro factors into the discussion but at the end of the day if your caught speeding you cannot just say "I didn't see the speed limit"
Heh, they thought the fed had stopped having the back of markets. Boy has that changed.
Your profile picture indicates CLEARLY that you have absolute ZERO CLUE what is going on. By the way, PutinISTHEHERO, In REALITY that is.... a place you've never visited.
PLEASE MAKE A PAYDAY LENDING MOVIE! We can also have an actress playing Debbie Wasserman Shultz being bought by the industry as well
The idea that everyone thought that housing prices were going to continue to increase is the Kool Aid. I lived in LA and we knew our house wasn't worth as much as people were willing to pay. With everyone making lots of money anyone speaking up was dismissed.
This guy looks like Sam Hyde in 20 years
The guy lost me at, "I spoke with Paul Krugman." Paul Krugman is best known for being wrong 100% of the time. He is neck and neck with Tony Fauci...
Alien invasion would be a good for the economy
@@zeeski7454 They planted the seed for that this month. Those of us who are awake have been expecting it for a long time already. Look everywhere EXCEPT at the things causing people to fall over ded all the time.... or at the "research" that our illegitimate G has been conducting all over the world... Shatanik worshipers run everything now.
We need a guy like Paul Krugman. I have done very well investing by listening to him and doing the exact opposite.
End the Fed!!!
+Junior Aranton
Ron Paul for Dictator!!!!!!!!!!!!!!!!!!!!!!!!!!!!
I don't think that's going to help and this idea that ending the fed will fix things is a symptom of a trend that has been labeled "anti-politics"
Yeah but this guy is an occupy moron and they can't store more than 3 words in their short term memory.
Junior Aranton Bitcoin
@@obediencetoflow4653 not yet but one day.. the next crash will probably get crypto off the ground
15:37 Deregulation. And I know it's not the first time you've heard the correct answer.
The funny thing I found after the crash when I went looking for answers was the Mises mob. They were one of the groups that saw it coming years ahead. They based the prediction on the fact that government regulation (aka interference in the free market) was the cause.. I'm not saying regulation is bad but I'm not sure anymore. Regulatory capture is real problem..
Hahaha... FINALLY ONE Mr.Speaker brought up this very crucial important word "GAMBLING". Well said. Hahaha... it's a gambling in the other name of legal ways to "manage and invest" the whole lot of capitals, so as the banks. Or there will be no purpose of SURVIVAL at all.... Hahaha.... Totally agree.....STF.....
It was a great movie but they have overdone the 'dumbing down' bit.
God Bless EPOCH Times !!
Bunch of BSers. WHERE were you during the 2008 is built up? You were buying securities. You did not have any decency to see who is behind those securities
Body language screaming on this panel.
"I got Paul Krugman on the phone." Best against everything that man owns.
Painfully obvious that McKay has an agenda but I liked hearing from Danny and the other guy because they have a more objective view.
Agenda based on facts
Loved how the Q&A brought some of the commies out of the woodwork ... Gotta love Brookings in that regard...
African American woman saying 'oh us ethnics knew about it years ago.' Sterotypical😅 sure yall did
Read Das Capital by Karl Marx, and a lot of this stuff will make even more sense.
You'll also have about zero braincells left over after it. Might as well just drink paint thinner.