Inside Job

Year: 2010

Grade: A

Country: USA

Director: Ferguson

Review

great documentary that mows over everyone who helped contribute to the financial meltdown. they throw academics and politicians under the bus just as quickly as they indict big banks. barney frank and chris dodd seemed to get off a bit easy as i think they were part of the problem was well, so maybe there was a bit of partisanship there.

here’s a blow by blow of the financial crisis of 2008, as told by the movie and as summarized by me. they didn’t get everything. there are a million great stories in this meltdown. stuff about magnetar, the big short, the conversations in the room between paulson et al, the madoff story that came later, and much more. we’re going to be picking this one apart for many years and we’ll probably never learn from it because some forces are extremely good at painting this as a failure not of the market, but of overregulation. 2+2=5.

securitization
lenders no longer on the hook for loans. the deconstruction of intelligent reforms begins.
pushed toward suprime mortgages
    -higher interest, higher yield
    -incentivize predatory lending. because people need more motivation to be selfish and evil.
once unable to speculate with savings, that ended.
investment banks
    -board/partners put up money in past, that ended.
deregulation of savings and loan associations, under reagan. who else?
    –keating, hired by alan greenspan. match made in heaven.
income disparity spikes in 1928 and 2008 (my note)
2004, paulson lobbies sec to lift limits on leverage. because he’s really smart.
    -bear stearns and morgan/stanley leverage more than 30:1. great idea.
no regulation of credit default swaps. de facto insurance. multiple people insuring same properties/securities. genius at work.
front loading compensation for investments. high bonuses for short-term payoffs. long-term? not my problem. i’m rich, bitch.
magnetar. movie just mentions them. pro-publica wins pulitzer for their reporting on shiesty ass company.
many see collapse coming.
fbi in 2004 say they see epidemic mortgage fraud
imf, roubini, raghuram rajan, and allan sloan all write about impending doom between 2005 and 2008.
3/16/08. bear stearns bought by chase. $2/share
9/7/08. freddie and fannie taken over by govt.
9/9/08. lehman stock collapses
sept. 2008. mishkin jumps ship like a douche.
sept. 2008. b of a acquires merrill lynch
9/16? lehman brothers allowed to go bankrupt. international markets seize
9/17 aig taken over by government. we pay 100% of stock value because we’re chumps.
9/18. $700 billion tarp bill proposed. paulson says “trust me,” republicans don’t fall for it. i thank republicans for the first time in my life.