John Tuld: Let me tell you something, Mr. Sullivan. Do you care to know why I'm in this chair with you all? I mean, why I earn the big bucks.
Peter Sullivan: Yes.
John Tuld: I'm here for one reason and one reason alone. I'm here to guess what the music might do a week, a month, a year from now. That's it. Nothing more. And standing here tonight, I'm afraid that I don't hear - a - thing. Just... silence.
I agree. Margin Call and The Big Short (the book is sooo good even if you've seen the movie!) are the best two movies that came out of that entire debacle. That scene was enjoyable. They really nailed the casting and conversations.
The part that bothered me is that, as I recall, there was no actual margin call in the movie. I guess it all was done in advance of a margin call? I don't recall exactly.
By dumping all their portfolio, they avoided the margin call which would have destroyed the company. Their early and bold actions saved the firm. Sadly for the folks on the other end of the trades, it probably crushed them.
Margin call is by far the best movie about the financial crisis of 2008 that I've ever seen. I was working in the biz at that time and it all just rang so true. 7 AM pre-market meetings, lots of folks crunching data, Wall Street people actually living in Brooklyn and so much more.
Sadly, the movie is so esoteric that it never had a mainstream success. Such a shame because it had great actors and a fantastic script.
The plot centers around the possibility of going bankrupt given the high amount of leverage being used on volatile mortgage securities that were starting to fail IIRC. The scheme they cook up to offload their as much of their position as possible the next morning.
It pretty much happened to Knight Trading. They turned on a dev trading algo and wound up acquiring a massive amount of positions (and thus risk). Their clearing firm forced them to close all those positions and the cost of crossing the bid-ask spread wiped them out.
You could also say it happens to small banks. If you fail some sort of FDIC testing, you're classified as at-risk and they force you to sell to a larger bank so as not to risk depositor funds.
I think an even better quote for this situation is the one where the same character says “there are 3 ways to make money - be first, be smarter, or cheat. And the easiest is always to be first.”
It's a quote from the 2006 film "Kingdom of Heaven". I choose to interpret it as a comment on the pointlessness of posting a line of dialog from a movie as a response to an ongoing news story with no other commentary.
Yes, the person who was just briefed on what was happening, and in very simple terms because he doesn't understand the technical language of complex financial instruments - that's the person who's guessing what "the music" is going to do?
That whole movie is so shallow when you think about it for more than 2 seconds.
You have to watch it a bit closer. He didn't ask for the problem to be explained in simple terms because he didn't understand what was going on. Instead he wanted to make sure his subordinates understood the problem and didn't try to hide their ignorance behind needless complexity. This is a strategy used by all of the most effective managers in the real world ("pretend that I'm stupid", "explain it to me like I'm five"). It was clear from the get go that he was the smartest person in the room in every scene he was in.
The movie also makes clear multiple times that the only people who were surprised by what was going on were the little guys – risk analysts and middle management. People at the top got the news and were simply like "ok guess it's finally happening".
If you ask around people who do this stuff for a living, all of them will tell you that out of the dozens of movies about the financial crisis, Margin Call was conceptually the closest one to how things actually work in the industry (obviously disregarding the Hollywood-esque dialog and characters).
The portrayal of that character didn't work for me. I just didn't find him plausible as a high-level finance executive. It's like a portrayal of a CEO for people who have never interacted with such a person in their life. If that character works for you, then it makes sense that you can interpret things in a more generous way.
That's funny because he is literally based on two real people – Richard Fuld and John Thain (who were CEOs of Lehman Brothers and Merrill Lynch respectively at the time of the crisis).
You haven’t interacted with a lot of ceos outside of tech then. I’d say irons and especially bettany’s low level desk director portrayals are exactly spot on. In some way toned down even
I think you’re assuming a little too much about what Irons character does/doesn’t know about the overall state of financial system. He may had other analysts/industry insiders briefing him on various things for months by that point.
I wasn’t the one making the original claim bc sorkin didn’t include 10 mins of exposition explaining the ceo’s logic there which btw is completely irrelevant to the theme of this movie.
Peter Sullivan: Yes.
John Tuld: I'm here for one reason and one reason alone. I'm here to guess what the music might do a week, a month, a year from now. That's it. Nothing more. And standing here tonight, I'm afraid that I don't hear - a - thing. Just... silence.
https://youtube.com/watch?v=K05sxfa4zdM