THE BIG SHORT: FILM REVIEW
The Big Short (2015) is a film that follows “three separate but parallel stories of the U.S. mortgage housing crisis in 2005. The two main stories include, Actor Christian Bale, who plays the role of Michael Burry, a hedge fund manager that believes the U.S. Housing market is built on a bubble, which is about to burst. He bets against the housing market and banks, who are happy to accept his proposal for something that has never happened in American History. Jarred Vennett, played by Ryan Gossling, catches wind of what Burry is doing and makes a call to Mark Baum, played by Steve Carrell, who is an idealist that is fed up with the corruption in the financial industry. Together, they discover most mortgages are being overrated by the bond agencies, with banks collating all the sub-prime mortgages under AAA packages. All three stories were betting against the U.S. housing market under the premise that the banks were too stupid to know what was going on, while for them to win, the general economy has to lose, which means the suffering of the general investor who trusts the financial institutions” (Hugo, IMbd). While the film focuses on the investors gain by betting against the market, there are many contributing factors that led up to the fall of the U.S. housing market.
Reem Heakal with Investopedia notes that, “in 1933, in the wake of the 1929 stock market crash, during a nationwide commercial bank failure and the Great Depression, two members of
The mortgage crisis of 2007 marked catastrophe for millions of homeowners who suffered from foreclosure and short sales. Most of the problems involving the foreclosing of families’ homes could boil down to risky borrowing and lending. Lenders were pushed to ensure families would be eligible for a loan, when in previous years the same families would have been deemed too high-risk to obtain any kind of loan. With the increase in high-risk families obtaining loans, there was a huge increase in home buyers and subsequently a rapid increase in home prices. As a result, prices peaked and then began falling just as fast as they rose. Soon after families began to default on their mortgages forcing them either into foreclosure or short sales. Who was to blame for the risky lending and borrowing that caused the mortgage meltdown? Many might blame the company Fannie Mae and Freddie Mac, but in reality the entire system of buying and selling and free market failed home owners and the housing economy.
On October 29, 1929, the stock market crashed. Not only did millions of investors lose their money but banks lost all of the money they had invested that their customers had given to them. To make the problem worse is that the people who had remaining money in the banks tried
In the movie the big short, Lewis Ranieri, who is a banker of the Wall Street, created an idea that companies packed thousands of mortgage all bundled together to sell, which is the AAA credit-rating bond, and can obtain high yields with low risk because everyone should pay for their mortgage. The concept of Lewis Ranieri is called mortgage-backed securities (MBS). However, the demand of buying MBS is more than MBS supply. Therefore, when the risk of MBS is high, Collateralized Debt Obligation (CDO) is a way to change subprime loans to high- rating bonds and it can be sold again. Although CDO is full of subprime loans, it still can get AAA rating because
Document two explains what happened when the banks went out of business. Black Tuesday was in October 29, 1929 and it was the day that the stock market crashed most deeply. This hinted to the start of the Great Depression. The stock market crashed because people did not have enough money to pay back the people who they borrowed money from. Due to this process the market started to fall. With prices falling, brokers asked investors to pay back what they owed. Investors then sold their stock to repay their loans. A panic quickly set in. Between October 24 and October 29, desperate people tried to unload millions of shares. As a result, stock prices dropped even further. Banks were also running out of
Mortgage fraud is one of the costliest, yet seldom prosecuted crimes in the criminal world. CoreLogic estimates approximately $13 billion in fraud losses occurred in 2012, according to the latest available data in the 2012 Mortgage Fraud Trends Report (Gerding, 2013). While these numbers may seem high, the approximate $13 billion in losses is only a fraction of what it would be if every case were to be prosecuted. Mortgage fraud was also a major contributing factor towards a national, and nearly global economic collapse in 2008 when the United States economy saw the worst recession it has seen since the great depression. Anyone that has seen the films “99 homes” starring Andrew Garfield and Michael Shannon or “The Big Short” starring Christian Bale and Ryan Gosling has seen a largely realistic glimpse of mortgage fraud and how devastating it can be.
Some background: In the wake of the 1929 stock market crash and the subsequent Great Depression, Congress was concerned that commercial banking operations and the payments system were incurring
In the lead up to the current recession, when the real estate market began to fall, there were so many investors shorting stocks and securitized mortgage packages that were already falling, that the market simply fell further. There were no buyers at the bottom, and the professional investors made millions off of the losses of others. Beyond this, there was no real federal regulation for securitized mortgages, since there was no real way to gauge the mathematical risk of any given package. This allowed the investors to take advantage of the system and to short loans on real people’s homes. Once these securities were worthless, many of the homebuyer’s defaulted on their mortgages and were left penniless. No matter from which angle this crisis is looked at, the blame rests squarely with the managers who began the entire cycle, the ones who pursued the securitization of mortgages. Their incompetence not only led to the losses of Americans who have never invested in the stock market, but to losses for their shareholders.
By 1933 nearly half of the banks in the United States had bankrupted and locked their doors for good.
The movie was an overview of the life of a quirky doctor, Michael Burry, who analyzed the mortgage practices and exposed the fraud of subprime mortgages that allowed people with shaky credit to borrow money. The movie also highlighted two other investors in Burry’s theory, Mark Baum’s group and Charlie Geller, that invested millions to gamble against home loans and short the market by buying credit defaults. All of these people made billions of dollars by betting against the economy, but all three groups realized they were betting for a failing economy. Their win was the world's loss, leading into something similar to the Great Depression of 1929 when millions lost their jobs and were no longer able to keep up with their mortgage.
The Meltdown is a PBS special on the events of the financial crisis of 2008, in a timeline format, revealing the thinking behind decisions made during the fateful months before the stock market crash in August of that year. Some financial gurus on Wall Street devised a plan to bundle several mortgages together into a group, and then selling that bundle to another group of investors looking to invest in securities. The lender did not need to earn money from the loans he was giving out, he merely gained enough of a profit from the bundling operation that billions were being made on Wall Street from 2005-2008. The problem is that these bundles were risky, and as credit unworthy individuals defaulted on their mortgages, the entire system crumbled into what is now known as the Stock Market Crash of 2008, and have subsequently lived during the Great Recession.
I have watched a considerable number of movies this semester so it was hard to choose which one to analyze. It came down to “Remember the Titans” or “Good Will Hunting”. However, the movie that I will be analyzing is “Good Will Hunting”. The reason I chose this movie is that it can be analyzed in many different ways. I will be analyzing different scenes of the movie and analyze them from different angles. I will be analyzing about the symbolism that is happening in the movie. I will be analyzing many different things about the movie. The first thing I will analyze in this movie is the symbolism of things, objects, colors, and
“By 1929, 2 out of every 5 dollars a bank loaned [to people] were used to purchase stocks.”( Suddath) The days that transpired are infamous and will live on through the history of America.
In this paper, I will compare my real world experiences at local Alcohol Anonymous’ (AA) meetings, which I attended while enrolled in this course with that in the movie, Thanks for Sharing. Both are based on the lives and experiences of recovering addicts of either substance abuse or sexual activity. This paper will cover the stories and lives of the characters involved. Stuart Blumberg directed the movie in 2012. All movie character references in this paper are taken directly from the actual movie.
It’s the mid-2000’s, the economy is booming, housing prices are sky-high, the financial bubble is at its peak, when a motley crew of unlikely characters see behind the shades of deceit, bet against the American economy and take-on the banks.
The two movies I decided to do a film review on was Money Monster and The Big Short. Money Monster released on May 13th, 2016 was directed by Jodie Foster an award winning American actress () . Foster has been a successful actress ever since she was young,at age 12 she received an Oscar nomination for the film Taxi driver eventually leading to her winning a Golden Globe and being named as one of the best actresses of her generation(). The movie Money Monster is about a frustrated investor by the name of Kyle Budwell who lost $60,000,as a result of investing in a company called IBIS. The company had an unexpected glitch to the system during a trading algorithm, which led to a loss of $800 million for IBIS investors. Due to the unexpected financial loss Kyle faces he decides to make an unexpected