October 26, 2011

Zachary Quinto and Penn Badgley

Zachary Quinto and Penn Badgley

Among this season’s intelligent movies about smart people doing complex jobs, the Wall Street film Margin Call ranks ahead of Contagion and The Ides of March and behind only Moneyball.

Unlike Moneyball, which is so engagingly written that it had my wife asking me insightful questions the next day about on-base percentage, Margin Call doesn’t attempt to teach you how quants think. While the dialogue is stuffed with references to the “VaR” of the unnamed financial firm’s “MBS,” acronyms go unexplained. Indeed, the word “subprime” is never mentioned. (Neither is the ominous phrase “Margin Call.” Perhaps the title was chosen because it rhymes with “Moneyball.”) 

One subtle message is that the most lucrative jobs in today’s economy are open only to those few individuals comfortable—intellectually, emotionally, and morally—working at stratospheric levels of abstraction. As happened during the mortgage bubble, these elites lose contact with what’s happening at ground level.

“A running joke in Margin Call is that each higher-up understands the statistics less than his underling.”

Movie reviewers love topicality, but the modern film industry is too cumbersome to deliver it. Thus, Margin Call is not about Occupy Wall Street. On the contrary, writer-director J. C. Chandor, an upper-crust kid, is exceedingly sympathetic to banksters. He drew upon his father’s decades at Merrill Lynch to craft a stagy but effective screenplay that attracted numerous famous names to his low-budget movie. 

And although reviewers insist the film must be about Lehman Brothers’ epochal bankruptcy 37 months ago, Chandor warns, “This is not a Lehman Brothers situation.” It’s more of a Goldman Sachs question: Are you in business to help your clients prosper (the old Goldman model) or to pillage your “counterparties” (the new Goldman)? 

The generic nature of the disaster that plays out over the story’s 24 hours means that the script could easily be adapted to the stage and then dusted off during future financial crises. 


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