“The Big Short,” film by Adam McKay, 2015
Finally, a film that does a book justice. Like some weird convergence of Bertold Brecht and Michael Lewis, this film never lets you forget it’s a film by directly addressing the audience a great number of times, then actually being didactic and even polemical. It directly explains what short selling is, what a ‘tranche’ is, what a ‘credit default swap’ is, what a mortgage bond is, an adjustable rate mortgage, the internal structure of collaterized mortgage and debt obligations (CMOs and CDOs), even those of the ‘synthetic’ variety. If you are none too polite and like laughing at clueless authority figures – know-it-all equity bankers, SEC officials, Alan Greenspan, ratings-agency pooh-bahs, complacent billionaire investors, Wall Street Journal journalists – this film will provide the dark humor. It is sharply funny and cannot be missed.
In 2010, Michael Lewis wrote the book on which this film is based. It became a story of the biggest financial fraud ever perpetuated in the U.S. – a criminal fraud involving the whole power structure of the U.S., from Wall Street outward. This fraud has never been prosecuted because a system will not and cannot indict itself. While the ‘heroes’ are 3 groups of contrarian investors who short the mortgage bond market and make mega-millions and billions, their profit comes at a price. As they soon realize, millions of U.S. citizens will become unemployed, lose health insurance, go into foreclosure and become homeless – and that just in one country. The contagion, as we know, spread to the financial systems across the world, especially to Europe, which had produced and invested in U.S. mortgage bonds too. The effects are still with us.
For years Marxists have pointed out the fantasy role of finance capital at this stage of capital’s development and decay, and this film shows how it plays out in all its grubby, glitzy sub-reality. The film ignores the legal preparation for the collapse in the Bush and Clinton administrations, and instead focuses on Wall Street itself, reflecting the weaknesses of Lewis’ own book.
The film only lightly touches on the misery of millions, showing one family living in their van and a 'job-fair' of the unemployed. It acknowledges that the working people who were lured into these phony ARMs by slick real estate agents will be blamed by racists and classists, not the actual people who caused the crash. Of interest is the very tough attitudes of the short-sellers, who had the intelligence and odd fortitude to stand up to the whole financial system. People with a get along/go along method of life could not handle this situation. But of even more interest are the sleazy, weak, pompous blowhards and conformist individuals making up these institutions of power. We’ve all met them, or people like them. Power is ultimately based on living people. They are still with us.
Reviews of books “The Big Short” ,"Flash Boys" and "Liar's Poker,' all by Michael Lewis, below. Review of the film, “Wolf of Wall Street,” below. Many other books on the financial crisis have been reviewed below. Use blog search box, upper left.
December 27, 2015