Margin Call drops you into one crazy night at a Wall Street bank and I cannot lie, watching this whole thing unfold knowing what we know now about 2008 makes it hit different, I wont say it tells you with details what happen and why but makes you think how things play out, how they were smart and got out first even after destroying the market, a wise movie rather than getting out late and picking crumbs after the damage was done. The movie packs this entire financial meltdown into 24 hours which is wild because I doubt everything happen over night but it works for the story. Jeremy Irons shows up as the big boss John Tuld probably based on that Lehman Brothers CEO Dick Fuld and you can tell the movie wants you to see him as the bad guy but honestly I do not think he did anything wrong. The dude woke up in the middle of the night, got helicoptered into the office, some junior analyst told him their mortgage backed securities were about to tank hard and he made a call to sell everything before it got worse. Kevin Spacey plays this trader Sam Rogers who acts like they are committing some terrible crime by dumping their positions, but the truth aside from the consequences its just business. You can sell anything you want unless you got insider info and they did not have that, or at least thats not how the movie setup things, it was just a gut feeling things were going south. The whole vibe feels like people going to war and everyone looking miserable, when really it is just a bunch of suits making an investment decision. Sure the market crashed and people lost jobs and its a nasty reality that keeps happening every other amount of decades in different levels but tends to happen.
- IMDB: https://www.imdb.com/title/tt1615147/
- Platform: TUBI
Rottentomatoes Rating
Source
The way this movie starts is pretty dam brutal, you got human resources walking around the trading floor firing people left and right, they do not even pretend to care about what anyone has to say. Stanley Tucci plays Eric Dale who runs the risk management department and they fire him even though he is literally trying to warn them about something huge he found in the numbers but since everything is so black and white they have no clue how important he is because they all looking at is numbers, his salary, where to cut expenses. Before he leaves he hands this USB drive to Peter Sullivan who is this younger risk analyst played by Zachary Quinto, tells him to be careful and finish what he started working on, this is what I think is part of the "fantasy" aspect of the movie. Peter stays late that night while everyone else goes to the bar, works through all these calculations and models, and realizes the bank is completely screwed. Their mortgage backed securities are worth way less than they thought, the volatility models they been using are totally wrong and if things drop by just 25 percent the losses would be bigger than the entire companys value. This is where it gets interesting because Peter calls his boss Will Emerson back from the bar, then they call their boss Sam Rogers, then it keeps going up the chain until finally the CEO John Tuld gets called in at like 2 AM. The whole escalation thing feels crazy already, like you can feel the panic spreading as each level of management realizes how bad this actually is. By the time everyone is in the conference room in the middle of the night you got this tense energy where nobody wants to be the one to say what they all know, which is that the bank is about to go under unless they do something drastic and do it fast, dumping their entire position in a single day, they even consider it impossible and went as much as asking the traders to at least dump 93% and that was a lot to ask already, at least this is how the movie paints the scenario.
Source
John Tuld showing up to that meeting is one of the best parts of the movie, Jeremy Irons just owns every scene he is in. He sits down and tells Peter Sullivan to explain the whole situation to him like he is talking to a young child or a golden retriever, which I love because finance people always try to sound smarter than everyone else with all their fancy words and terms. Peter breaks it down pretty simple, the bank has been creating these mortgage packages, bundeling together a bunch of home loans into securities they can sell to investors as diversification and because mortages seemed super safe they borrowed a ton of money against them. The problem is those mortgages are filled with subprime loans to people who cannot actually afford to pay them back and now defaults are skyrocketing so the whole thing is collapsing. The banks risk model said they could handle some losses but what Eric Dale figured out before he got fired is that the real volatility is way higher than anyone calculated, meaning potential losses that would wipe out the entire firm. Tuld listens to all this, thinks for a minute and then makes his decision, they are selling everything in a day before the market figures out these assets are garbage, now in real life my understanding is that warning where flying for months and everybody knew way ahead but they kept this ultra high risk show going like they playing russian roulette every day until one of the big banks decides to dump everything as they did. Sam Rogers pushes back hard saying this will destroy their reputation and ruin relationships with every other bank they work with but Tuld does not care and the truth is that business is business its dirty because when everyone is on the mud together there is no difference its just who got first and who got out last, he says there are three ways to make money on Wall Street, be first be smarter or cheat, and its a hell of alot easier to just be first. That line is cold as hell but its also kind of the truth, he knows if they wait even one more day they will be holding worthles assets and the company goes bankrupt, so he orders them to liquidate their entire position before lunch time.
Source
The actual fire sale part where they are selling off everything to me felt a bit flat without much action, just a bunch of trading floor shots with voice overs, if they had put on scenes of actual traders with the same lines would have been different, you see Will Emerson and the other traders calling up buyers trying to of load these mortgage securities at whatever price they can get. They start the morning selling at 93 cents on the dollar, then it drops to 85 cents, then 70 cents, all the way down to 65 cents by the afternoon because word gets out that something is wrong and buyers start pulling back but in real life everybody knew about it. The bank offers every trader a massive bonus, 1.3 million dollars each if they can get their trades done by 11 AM, which is insane money but also shows how desperate the situation is. These traders know they are essentially burning every bridge they have in the industry, selling toxic crap to people who trusted them but they do it anyway because of the money and because the alternative is the whole company collapsing and everyone losing their jobs, I bet for many it was a get out of trading card and start fresh but for those starting in the business it was a death sentence. Its a realistic look at how these decisions get made, they are just trying to survive and making calculations about what they can live with. The movie does a good job showing both sides, like yeah the bank is saving itself but its also passing the risk onto other firms and investors who have no idea these assets are about to go to zero, the fact that they knew the reality is what makes Fuld "the bad guy". By the end of the day the firm survives but everyone reputations are shot and they immediately start laying people off again because they dont need all these traders anymore once they exited the market.
What I like about Margin Call is how it shows part of the brutal reality and how stone cold a CEO needs to be to dump such a massive position, when the time is right dont doubt to dump a bunch of money into others, at least I think this is something very close to what happened during the 2008 crisis. This is based on Goldman Sachs who did pretty much exactly this, they figured out early that mortgage backed securities were gonna crash and they sold their position before anyone else did. People were pissed at Goldman for doing it but from a business standpoint it was the right move, they protected their firm and their shareholders which is literaly their job. The movie tries to make it seem like this big moral dilemma but I just do not see it that way, these are willing buyers purchasing assets at market price, nobody is forcing them to buy anything but again I know many would argue they were selling shit assets to people who didnt know, that doesnt make it illegal but some people wont be able to sleep well knowing this, would you?. Now days its very common the "DYOR" do our own research, if you work in finance or investing into something you should know what you are buying, do your own research, understand the risks. The bank that buys these securities without doing proper due diligence, that is on them, sure it sucks that the financial system nearly collapsed and regular people lost their homes and retirement savings but that is a regulatory problem not a problem with one bank making smart trades and thats the basics of this movie. A the end Sam stays at the firm even though he is disgusted by what they did, mostly because he needs the money, which again feels very real and human, the truth is that not everyone gets to quit their job over principles when you got bills to pay and a family to support. Margin Call is definitely worth watching if you want to get an idea how Wall Street operates, yes there is fantasy aspects and adaptations because this is not a documentary, although its way more accurate than something like Wolf of Wall Street or even The Big Short in terms of showing the day to day reality. The cast is stacked with great performances, the pacing keeps you hooked even though its mostly just people in conference rooms talking and it explains complicated financial concepts in a way that makes sense. I would give it a solid 7/10, its not perfect but its probably the best movie about the 2008 crisis from the banks perspective.
#skiptvads, #inleo, #hive, #margincall, #wallstreet, #trading, #mortgage, #securities, #crisis, #banking, #finance, #investors, #leverage, #volatility, #liquidation, #firesale, #lehman, #goldman, #collapse, #recession, #subprime, #losses, #bankruptcy, #scandal, #economy, #market, #business, #money
Posted Using INLEO