Too Big to Fail, written by Peter Gould, based on the book by Andrew Ross Sorkin, directed by Curtis Hanson, 9 out of 10

Too Big to Fail, written by Peter Gould, based on the book by Andrew Ross Sorkin, directed by Curtis Hanson, 9 out of 10

Notes and thoughts on other books are available at:

-              https://www.youtube.com/playlist?list=PLEVa4_CsRStSBBDo4uJWT8BSWtTTn0N1E and   http://realini.blogspot.ro/

Too Big to Fail is one of the best films I know.

It is about the most dramatic events in recent history- and if The Donald and the other lunatic, the Korean leader will not decide to blow millions of people away it will stay at number one for decades- the financial meltdown of 2008.

I have noted a few days ago on an exceptional documentary about the same subject, Inside Job, here: http://realini.blogspot.ro/2017/08/note-on-inside-job-written-and-directed.html

This motion picture has an all-star cast and furthermore, the protagonists of the film had been the most powerful men in finance, on Wall Street, at the Treasury and hence some of the Rulers of the World…

Big egos, narcissistic personalities- much like the egotistic man in the White House today-macho men, alpha males are walking around in this film.

From the failed Chairman and CEO of The Lehman Brothers, Richard “Dick” Fuld, portrayed by James Woods to Ben Bernanke played by the outstanding Paul Giamatti, all these personages are fascinating, if most are outrageous.

Henry Paulson aka the great William Hurt has been criticized for his activity and richness accumulated prior to his role as Secretary of the Treasury, but the image we get from the film is that of a man doing the right thing under pressure.

Timothy Geithner played by a talented Billy Crudup was president of the New York Fed and part of the team that was trying to persuade the head of the major banks to take the official offer, together with Ben Bernanke and Hank Paulson.

In the first part of the this incandescent drama, frantic efforts are made to convince a British or Chinese bank to salvage one of the Too Big to Fail, but this attempt fails and it looks like a possible domino effect.

Jamie Dimon, chairman, president and CEO of JPMorgan Chase aka Bill Pullman, John Mack, at the time chairman and CEO of Morgan Stanley, John Thain, the last chairman and CEO of Merrill Lynch, played by Matthew Modine, Vikram Pandit, the then CEO of Citigroup, Jeffrey Immelt, leader of GE, Lloyd Blankfein, CEO and chairman of Goldman Sachs, Christine Lagarde, the then finance minister in the French government and today head of the IMF, Warren Buffett all have a presence in this End of the (financial) World epic.

Some are trying to hide the extent to which their banks are exposed or outright bankrupt, while others are reluctant or totally opposed to getting involved since their operations are running smoothly…

“Ben Bernanke: I don't really understand why there needs to be so much tension about this. The country is facing the worst economy since the Great Depression. If the financial system collapses, it will take every one of you down.”

Still, some saw this intervention as a helping hand for their competitors, while John Thain for instance was hoping that Bank of America would offer the best terms and he will get ahead of Dick Fuld who was also in the race to save Lehman.

Richard Fuld: [on the housing crisis] You know, people act like we're crack dealers. Nobody put a gun to anybody's head and said, "Hey, nimrod, buy a house you can't afford, and you know what? While you're at it, put a line of credit on that baby and buy yourself a boat."

Some felt the need for pause and approval from Congress, while others saw the emergency, there were critics who said- why save AIG when Lehman Brothers was allowed to sink, invoking the “Moral Hazard”

“If we do not act, boldly and immediately, we will replay the depression of the 1930s, only this time it will be far, far worse. We don't do this now, we won't have an economy on Monday”

And the dialogue is brilliant throughout, with some involuntary, absurd or dark humor included and possibly the best explanation for the whole collapse that has affected almost everyone, including the undersigned, who has never gone out of the city ever since and still has not recovered financially, albeit in the meantime, with the help of positive psychology I understood that other aspects are much more important than material things, which anyway are offering only brief periods of satisfaction, after which the hedonic adaptation phenomenon takes place and we get used with whatever object we bought:

-          Jim Wilkinson: Okay, here's how you explain it. Wall Street started bundling home loans together - mortgage-backed securities - and selling slices of those bundles to investors, and they were making big money. So they started pushing the lenders saying, come on, we need more loans.

-          Henry Paulson: The lenders had already given loans to borrowers with good credit, so they go bottom feeding, they lower their criteria.

-          Neel Kashkari: Before, you needed a credit score of 620 and a down payment of 20%; now they'll settle for 500, no money down.

-          Jim Wilkinson: And the buyer, the regular guy on the street assumes that the experts know what they're doing. He's saying to himself, if the bank's willing to loan me money, I must be able to afford it. So he reaches for the American Dream, he buys that house.

-          Neel Kashkari: The banks knew securities based on shitbag mortgages were risky...so to control their downside, the banks started buying a kind of insurance. If mortgages default, insurance company pays. Default swap. The banks insure their potential losses to move the risk off their books, so they can invest more, make more money.

-          Henry Paulson: And while a lot of companies insured their stuff, one was dumb enough to take on an almost unbelievable amount of risk…Michele Davis: AIG.

-          Michele Davis: And when they ask me why they did that?...Jim Wilkinson: Fees!

-          Neel Kashkari: Hundreds of millions in fees.

-          Henry Paulson: AIG figures the housing market would just keep going up. But then the unexpected happens…Jim Wilkinson: Housing prices go down.

-          Neel Kashkari: Poor bastard who bought his dream house? The teaser rate on his mortgage runs out, his payments go up, he defaults.

-          Henry Paulson: Mortgage-backed securities tank. AIG has to pay off the swaps. All of them. All over the world. At the same time.

-          Neel Kashkari: AIG can't pay. AIG goes under. Every bank they insure books massive losses on the same day. And then they all go under. It all comes down.

-          Michele Davis: [horrified] The *whole* financial system? And what do I say when they ask me why it wasn't regulated?

-          Henry Paulson: No one wanted to. We were making too much money.