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I watched it yesterday. I think in terms of terminology I think this kind of films tends to always have a compromise between appealing to audience who knows the industry and also the layman. There are 3-4 parts of the film where they actually explain with analogies terms like Credit Default Swap or Collateralized Debt Obligation.
It definitely felt realistic in the way people were portrayed. Most importantly to me by comparing it to the Frontline PBS documentary Video Money, Power and Wall Street where the 2007/08 crash was documented in-depth there are many many parallels.
I liked the film in short (no pun intended), highly recommended.
I liked it. Was well done. Watched it with people who couldn't understand mortgage securities. Was very well explained to them in the movie. Especially the Jenga tiles.
The name of the main characters are changed from the real ones. I'm sure there will be some 'artistic license' as well.
But they do on occasion break the fourth wall and explain that certain things in reality happened differently from how they are portrayed, for example that two guys found out about the housing bubble in a different way from what the film shows.
But I'd say the main themes, i.e.
the high level mechanism for CDSs and CDOs
everybody was betting on the housing market
everybody was way overleveraged
nobody (or very very few) really undestood the risk and ramifications (or did not want to)
subprime had become reckless
the regulators were asleep at the wheel
main street lost and banking won, nobody being held accountable
little has changed since the crash in terms of reforms
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Interesting that you didn't list the two things, that when I read the book I thought was the most egregious, and crucial key's to the whole process. Specifically the bond rating agencies (S&P, Moody's) and insurers (AIG).
The borrowers (why does nobody ever blame the person who took out a mortgage they themselves knew they could never repay? why is that somebody else's fault?) , mortgage brokers, and banks where all guilty of greed, negligence and maybe some more things. But the bond rating agencies where the most guilty of committing fraud, and the level of risk AIG took is mind numbing. Without the ratings and insurance the banks would never have been able to sell off the more toxic tranche's and the whole process would have ground to a halt.
Who do people (not aiming that specifically @xplorer) think should have been 'held' accountable and what do you think 'accountable' should have been?
Regarding not listing the rating agencies, my bad. I mistakenly wrote 'the regulators' but I really had in mind the scene where those guys go to the rating agency. So yes I actually meant rating agencies not regulators.
Regarding insurers, to me they are actually part of the whole deal, so I'm not excluding them not excusing them.
As to who do I personally think should have been held accountable? Difficult for me to say, but the fact that the government decided to bail out the banks/insurers virtually with no strings attached does not sound right.
I don't know, perhaps get one or two CEO's fired. Fire some of the regulators/rating agencies management.
And I get it some of this may have started at the very top, with Clinton repealing Glass-Steagall and what not.
After the whole turmoil subsided I remember hearing about Obama going to Wall Street for a speech and most of the top CEO's didn't even bother turning up. It was no longer their problem, they had been bailed out.
I bet if the government let a couple of heads roll they may have paid a bit more attention.
Also, you make a good point about people being irresponsible and borrowing more than they can repay. If a financial system collapses it will take down responsible and irresponsible people. That's why financial regulation should be there also for this. That's my view anyway.
This is a good article that names some names. Perhaps we should start there.
Ratings agencies should not be for profit companies because greed will triumph good judgment and fair opinion.
I hope buyers since then have learned the lesson that ratings agencies are worthless and do their own homework.
Because the banks used ARMs and probably never told buyers what their payments would be when the mortgage hit full rate (stripper in movie). They wanted every buyer they could find.
Don't forget, Congress FORCED banks to make subprime loans under threat of criminal action for discrimination..(Community re-investment act)...
Banks, after being forced to make garbage loans, packaged them and dumped them as fast as they could, since they knew most would fail... can't really blame them for that ..
It still comes down to personal responsibility for taking out a mortgage they couldn't afford, if they didn't understand what they were doing, they should have brought someone, friend, attorney etc. to explain it to them...
We don't need a "nanny state" watching over us.
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Blame can be place at so many turns it incredible. A systemic failure. Reckless abandon. Intoxicated with greed. Immaturity of unspeakable proportions. Monstrous lack of love of ones follow man. Etc etc.
Ron
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...My calamity is My providence, outwardly it is fire and vengeance, but inwardly it is light and mercy...
The steed of this Valley is pain; and if there be no pain this journey will never end.
Buy Low And Sell High (read left to right or right to left....lol)
