Investment Analyst Explains Margin Call

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Жыл бұрын

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CORRECTION: I misidentified a classical song in the movie as The Funeral March, and viewers corrected me to indicate that it's actually Chopin's Raindrop Prelude. Apologies! The error has been cropped out of the video.
Margin Call is a movie on how investment banks reacted to the impending collapse of the US real estate market in 2008, but like other finance films, it can get a bit convoluted. I watch through some clips and provide some context.
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This channel is for education purposes only and does not constitute financial advice - Richard is not responsible for investment actions taken by viewers. Please seek out a registered advisor if you require assistance (while Richard is a registered portfolio manager at WDS Investment Management, he does not provide advice through The Plain Bagel, which is not affiliated with his employer).

Пікірлер: 928

@ThePlainBagel Жыл бұрын

CORRECTION: I misidentified a classical song in the movie as The Funeral March, and viewers corrected me to indicate that it's actually Chopin's Raindrop Prelude. Apologies! The error has been cropped out of the video.

@seospider Жыл бұрын

The best scene in the movie for me is when Zachary Quinto asks Kevin Spacey if he has mentioned the impending doomsday in the market to his son, who works at another firm. The look on Spacey's face when he realizes the thought of protecting his son from the crash never even occurred to him is priceless, and tragic.

@jealva Жыл бұрын

One of the most realistic lines in the movie was at the end when Kevin Spacey agreed to stay at the firm when asked by the CEO and said it was hard to believe but after 37 years, he still needed the money. In my 25+ years on Wall Street (investment banking and private credit), I have found that most people on the Street pretend to be rich but spend everything they make and barely own any assets. In fact, most of their net worth ends up being the stock of their employers and if something goes wrong with their employer’s business, then their annual comp and their net worth take big hits. That plus the rented city apartment, the summer Hamptons rental and their jet cards and pricey lifestyles lead to personal financial catastrophies.

@roakes1956 Жыл бұрын

1. The events of the film describes what actually happened at Goldman Sachs in early 2007.

@USM3C Жыл бұрын

Regarding the last scene with Sam burying his dog - Sam also mentions to Tuld in the end that if he dug ditches for a living he'd at least have something to show for his life's work. So, there's much symbolism in that last scene with Sam digging that ditch.

@KingUnKaged Жыл бұрын

One of the great things about this movie was showing how the hyper financialization of the economy draws people away from more productive areas. Peter and Eric, the only people who see the crash coming, are people who had jobs as a rocket scientist and engineer respectively, but got into finance for the money (something Eric admits he deeply regrets). The people whose jobs are purely money focused like Sam and John openly admit that they don't even know how the company makes money, and mostly seem to get ahead by behaving badly and leaning on people like Peter and Eric.

@BigHenFor Жыл бұрын

Margin Call is really a good movie, both educationally and dramatically. It's not flash, or gimmicky, but it tells it as it is. Thanks for the synopsis. Congratulations on the birth of your second rugrat!

@ScottieMacF Жыл бұрын

I was pretty well versed in the housing crisis back when it started, as many of us who were worried about our jobs were. What was enjoyable about Margin Call was that they didn't tell us what was going on and assumed we were intelligent enough to figure it all out without explaining what VAR or a CDO is. Even if we didn't know, what we did know what that they had a lot of securities on hand that they had to get rid of before it ruined the company. That's easy enough to figure out.

@GubeTube19 Жыл бұрын

I'm at school doing my masters in quantitative finance right now. I asked my professor who served as a quant at TD bank in Canada about the film. He told me the firm depicted in the film is actually Goldman Sachs (as they were first to dump and are typically first to move). A lot of people think its based on Lehman because the CEOs name was Dick in the film (Lehmans CEO was named Dick Fuld), but the film is actually inspired by Goldman.

@sifridbassoon Жыл бұрын

I love Margin Call. I watch it once or twice a year, even though I already know the ending. It reminds me of a Greek tragedy, especially with the Aristotelian unity of time (you mentioned that the action takes over the span of a single day). Wonderful cast.

@davidgab4448 Жыл бұрын

I really liked the scene, where they discuss the situation, while riding in a car to get Dale.

@reydion1648 Жыл бұрын

Anyone interested in watching movies about the 2008 financial crisis I would recommend:

@launchsquid Жыл бұрын

I literally know nothing about financial markets but love this film, it doesn't try too hard to water down the jargon and it blazes through things quickly, all things that you might think would hirt it for me, but through context and the emotions portrayed by the top notch cast, it had me riveted.

@MrSupernova111 Жыл бұрын

Margin Call is possibly my favorite finance film. This film is one of the reasons I'll soon make a transition from finance to data science. At the heart of the industry there are very complex financial and mathematical models that drive the industry. Great recap of this phenomenal film. Cheers!

@ddude27 Жыл бұрын

Richard also forgot to mention how the profession of the intermediate analyst majored in rocket science. It's very common for people of incredible talent in a different field to be recruited in wall street.

@10ark Жыл бұрын

Congratulations on your new baby! Thank you for posting this video. I really enjoyed the additional information and the "dog" part especially as I was really confused by this ending when I first saw this movie. Keep up the good work!

@programmerontheloose Жыл бұрын

I’ve probably watched this movie 100 times. The sense of impending disaster, the slightly vague but intense dialog gives it such a real world vibe.

@the_primal_instinct Жыл бұрын

Most funny thing for me in the movie was how the higher was somebody in the chain of command the less they understood about the market and technical details. And they all stated that directly to their subordibates. Peter's boss said that to him. Then Peter's bosses' boss said that to Peter's boss (who understood more than him but less, than Peter). And finally the CEO who interrupted Peter's explanaition with "is the music playing?"

@dyingearth Жыл бұрын

The company is Goldman Sachs. As for Margin Call, the Will Emerson explained

@HudsonStillwater Жыл бұрын

Good analysis and explanation. I thought the analyst got it wrong at the very end, where he dismisses the dog scene as analogous to a "dog" investment. While I think you could look at it that way, I think the scene where Sam buries his beloved dog is actually intended to evoke his sense of loss regarding life choices, as the dog is symbolic of virtues such as honesty and loyalty.