The financial world has inspired a lot of movies, and some of them have done a really good job in engaging audiences in the rather dry subject of financial markets. These movies have managed to achieve this effect by either picking a crisis that affected everyone behind their backs- like “The Big Short”, or choosing an incident which was otherwise in the public eye- like “The Wolf of Wall Street”. These movies also have had a stellar cast, perhaps to deal with the mundane topic of money.
By watching these productions, common people get to see the inner workings of a foggy financial system, albeit in a dramatized way. However, even in between all the plot twists, engineered drama, and attractive sets, these movies pack a lot of truth. Though opulence and happiness seem to be what our characters are striving for, there are a lot of subtle messages that will let you know both of those concepts are relative in the bigger scheme of things. You can party as hard as you want, but you only have so many brain cells to obliterate.
Finance is not the most exciting of topics, particularly for those who do not understand it. The Big Short is one of those movies that tries to bridge the gap. It tells regular people about mortgage insecurities and helps them understand how they work through some comedic briefs. The movie tells the viewers that even in huge Wall Street investments, no one looks close enough to understand what is actually going on. This movie also highlights the different characters that play a part in Wall Street deals, and their not-so-ethical approaches. They make money for themselves, but after that, whatever happens is none of their concern. Fine actors like Christian Bale, Ryan Gosling, and Brad Pitt address the audiences in the film as a means to create a financial wake-up call.
In the Wolf of Wall Street, the protagonist is a synonym for money. He pursues the only dream he ever had: being rich. He is not concerned by whether what he is telling his investors is legitimate, or whether the money that is coming in is legal or not. Directed by Martin Scorsese, Leonardo Di Caprio embodies the truth behind millionaire asset managers from around the world. He is perhaps able to pull this role off so well because of his close relationship with Dana Giacchetto, who was an extravagant millionaire friends with everyone involved in the bussiness.
The movie also shines light on the vicious circle of money, where investments just keep circulating inside the system, without the investors getting any tangible benefits. People do no invest on hard facts or even understand them. They invest in how well the brokers are dressed, how well they pitch some opportunity to them, and other arbitrary basis. It is stressed- really hard- that Dicaprio’s character is not only smart, but also a great orator. He can win people’s hearts, and this is the very skill that allows him to climb the stairs of success. All in all, it is the market sentiment that drives the whole thing, and no one has enough time to question the basics. At times, it seems like a hollow system standing on a very rickety base. The trading floor is quick to teach that any financial instrument, whether a bond or a stock, gets overvalued quickly.
According to both of these movies, the Wall Street is rife with people who are not smart enough to understand what happens when a big investment goes awry. Worse, they are paid to continue to act stupid. At the start of the millennium, billions of dollars in loans were approved for people with low credit scores. These were doomed to fail. We are all paying the consequences of chasing our dream homes with loans on money that never existed. Nevertheless, they simply decided to make a systematic profit stream out of it.
The ones who saw the subprime crisis ahead of time made millions from their knowledge and attention to detail. This brings out another ugly face of Wall Street to the foreground: There are no heroes in the Wall Street. Only winners and losers. No caped Superman is here to save the market, even if they knew how to. In fact, if they know that the market is going down, they will further it down by making money themselves.
Financial institutions like banks are bigger than they have ever been, and their complexities have made it even more difficult for a layman to understand their workings; Thereby making the investing world opaque by default. This is what made the financial system lose its accountability within the common folk. People cannot wrap their heads around what is happening. They only get affected by it in the end, when it is too late to stop it. Those who can- bail out at the right time, and those who don’t- suffer during the meltdown.
Another important facet worth mentioning is the huge power of the financial institutions. These centers of capital have amassed a big political clout in their favor. At least, in the US, they are a major driving force behind many political decisions. Even if an outrageous investment or a financial instrument is floated by these banks, they will be supported by laws and regulations. The manner in which these big players were able to play within the reforms, so that they were insulated from the heat, is remarkable- although disgusting. All the workings of Wall Street have a political string attached to them, making their interest bullet-proof, even in the worst case scenarios.
There are so many facts and mind-boggling truths that movies try and communicate to the spectators. However, how much of it does any good? It’s hard to say. The market is still working pretty much the same way, the understanding of the people is the same, the incentive structures have not changed much, and there are still people making huge money at the expense of the perceived interests of the general public. Huge deals are not new to Wall Street, they still happen and will continue to happen until we educate ourselves financially. It is THE time to understand Wall Street: uncover it and mass propagate its encrypted language. The biggest lesson that can be taken from these movies is financial prudence. This can only stem from financial enlightenment. It is time we stop being financially illiterate and take charge of our own finances.