I believe it was very simple.
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Korios — 13 years ago(August 28, 2012 02:39 AM)
This was indeed a huge plot fault yet it was clearly a deliberate plot fault, a "plot device" as they call them. It is quite simple : you cannot make a film out of charts or numbers on a computers screen or sheets of printed text. You have to use dialog. And you have to use an average Joe dialog, one that can be understood by everyone but really dumb ones. So they made the top heads economics illiterate so that we could make sense of what was taking place via the dialog. However a deliberate plot fault is still a plot fault, so your points are valid.
signature start:
The term "suspension of disbelief" was coined by LOLW, the League of Lazy Writers. -
Ace_101 — 13 years ago(September 24, 2012 05:58 AM)
Dude, I'm a Finance student myself (2nd year of my MBA) and while I agree that the CEO or the HOD must understand the situation, they are not really required to really delve into it. At that higher post, you are not really supposed to know the tiny details but rather managing the people under you and making sure everyone is achieving the targets.
BTW, I'm 25 and I'm considering giving the first level of CFA next June. Have you given it?
RISE -
sexualbanana — 13 years ago(September 30, 2012 10:00 PM)
It's fairly simple:
- The average audience member doesn't know the terminology or the industry, so some exposition needs to occur, otherwise the audience is just going to waste 2 hours listening to people speak gibberish.
- If you can explain a complex concept in simple language, then you actually understand the concept. It's a way to filter out the BSers and the competent people.
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matt605 — 12 years ago(April 07, 2013 03:21 PM)
I saw their ignorance as a necessary plot device. Someone has to be stupid so that the theater audience can keep up to speed on what is happening. When the CEO wants things explained as if to a three year old, he's doing it for the benefit of those in the meeting and for the benefit of those in the audience. The writers don't stop there though. The CEO continues on to use analogies that people can understand, with the music stopping in musical chairs. The managers do the same thing as they escalate the problem.
What I found unrealistic was the way the company came to life between midnight and six a.m. I'd expect under normal conditions it would take 24 hours to implement a fire sale like that. Incidentally, most people talk about Lehman, but I recall that one big firm did liquidate its holdings in one day by surprise in Spring 2008. Just can't recall who it was. -
ehalotte — 9 years ago(June 14, 2016 04:50 AM)
this film is not about Lehman, but more about Goldman Sachs the only company not affected directly by these ABS.
These scene's are not only for the audience but are also very realistic as in hearings later on most CEO's declared to have no clue on what they were selling. The only knew it made them very rich (in the short term). -
silentman01 — 12 years ago(April 12, 2013 02:32 PM)
To be honest I don't think your point has much weight because if you remember that in a scene with Irons and Spacey they refer to each other as salesmen. I have worked in a financial firm before as a consultant and in our training, I remember our division head posed us with a question which strikes me to this day. He asked what was the most important thing about being a consultant/salesmen, I replied in the class that the most important thing is the ability to be able to ANALYZE the market. He told me (the division chief) that it was the LEAST important thing to know, the most important thing is building relationships.Consultants/Brokers build the relationships and the analysts are left with the job of analyzing packages suited to the client's specific needs. Very few brokers have a CFA, I would estimate probably 10% (if that) have it. The people you mentioned specifically (Tuld, Will and Sam) are people who follow into the first Category while it is the job of Sara Robertson and people like Eric whose job is to decipher the patterns and draw projections on these packages they sell. I practiced in Canada where if you passed the CSC (Canadian Securities Course) and held a job at a financial firm (such as Investor's Group), you were authorized to sell these packages if you received the proper registration from the MFDA and other organizations (depending on how many types of products you wanted to sell), for futures and options you would have to pass the DFC(Derivatives Fundamentals Course) to sell them. None of these courses are even 5% as hard as the CFA which is more popular among analysts. Thus, the movie actually seemed very realistic to me having worked in the business for a year. You also pointed out that the Head Engineer obviously knows and fully understands engineering, but engineers don't usually become the CEO of a construction company. I loved the movie but I also understand your concerns regarding the flaws that may make it implausible.
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di1an — 12 years ago(May 23, 2013 09:38 AM)
It wasn't just exposition - remember, Tuld (Irons) says "I didn't get here by being the smartest". My dad was a risk manager (EMBA, Cranfield) at Citigroup, London from 1984 right up until the crash in 2008, I watched this film with him and he said it was unbelievably accurate. I have a cousin (LSE, MFE) at RBS who said the same. Essentially the very senior people got their by means other than technical skills.
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Kiers77 — 12 years ago(August 17, 2013 02:11 PM)
I disagree somewhat with your point:
"The HEADS of a trading floor are going to understand the business"
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The problem was discovered by Risk Management. And their numbers and methodologies (eg, VaR) (RAROC) (Basel III Risk wtd capital) keep changing for different these kinds of reporting requirements: (US, Internal Performance, and BIS).
Plus, banking's a daily numbers game. I wouldn't expect the higher ups to know the intricate details of every spreadsheet that goes through every department. Yes, upper management get daily back office reports from each area, but I don't think the "keep it simple" remark is off base at all.
Not at all like say engineering or physics or the "hard sciences" where the theory is written in stone and empirical. Finance is all about variable human behavior.
Would you expect managers to know about the algorithms in HFT today? -
stant6 — 12 years ago(August 30, 2013 02:30 PM)
I don't know if others have said this, (but I agree that the heads would understand the data and its implications), but it was how the writers let the audience not get lost in the complicated jargon, so they used the "dumb" heads as their proxy.
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Bluefishtank2012 — 12 years ago(November 30, 2013 12:16 PM)
Well said
He was trying to get everyone on the lowest common denominator so he could take charge and tell him to sell.
It's easier to screw people over if ur dumb and don't have the brains to show heart -
gtbarker — 12 years ago(January 27, 2014 08:21 PM)
You have to remember this is a movie and they have devices to help introduce new or complex information to the layperson audience. What you have described is what they did here. Yes it was very clumsy, but that is why they do it and you see it in all sorts of films where doctors might be discussing treatment and one might say we need to get them on something to thin their blood right away and the other one will say something really dumb like why? And the reply will come back because if we don't they could have another stroke and this time it could be fatal. This is just a dumb example I made up, but I have heard pretty similar in the past and it makes me want to start eating my own face. But there you have it - that's why the bosses had to act dumb in this film too.
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federal_rider — 12 years ago(February 10, 2014 06:03 AM)
I think you may have missed one of the points of the film. They want to hear things "in plain English" because they don't care about the particulars. Good or bad is all they want to know. Will and Sam would have come up in a different time, probably through family connections or people they knew. They could conceivably run a floor without knowing all about complex derivatives, CDS's, the quality of sub primes. These guys only care about money, not the nitty gritty of what they are doing. This reflects the real guys at the top of these firms, I bet the head of Lehman brothers didn't have much of a clue what was going on around him. He just went round by million dollar+ pieces of art. Not to say these guys aren't fully aware of the consequences of their recklessness though
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irivas9 — 11 years ago(November 07, 2014 08:55 PM)
Like so many others have said here, this seemed to me more like a plot device to let the audience in on what was happening and why there was such a big crisis going on even if they didn't have a finance background so they could understand the movie.
Also, it seems very realistic to me that a CEO would ask one of the rank and file people to explain in "plain English" to explain something like this, they wouldn't really care about the nitty gritty of how the analyst came up with that conclusion (as the previous scene showed, a couple of executives had already sat down and agreed with the numbers the analyst came up with). At that point the CEO would be more concerned about what the problem is and how to deal with it. -
makingmovies — 11 years ago(February 09, 2015 06:53 PM)
Well, first, you are still a student, so, with all due respect, what do you know about real life? Models?
Second, you are so right to say THEY know what they are doing: : we have seen - in real life - how good they were in 2008, giving birth to a WORLD FINANCIAL CRISIS everyone is still paying with undue inflation, hard times, ruin, misery if not starvation in some countries, and wars.
Wake up, little piggy !
Don't tell me you want to be part of it because of your lust for power (riches, booze, drugs,whores,whatever?) and you want to stay blind. You should listen more closely to some discreet items of this film like the metaphor of the bridge, 3O minutes before the end.
Wake up.. -
BlindMan-11 — 11 years ago(February 09, 2015 09:00 PM)
There is a very very simple reason for saying'give it to me in simple English et al.'
Remember that the movie is being shown to people who would not know what Risk Management or all of the other more technical terms would mean.
So they have to find a way of being able to keep the audience engaged and understand what is going on without 'breaking the 4th wall' and looking at the camera and explaining as they go along.
Don't be so nit-picky on such an easy reason for moving the story along and still not having all but other CFA's etc. understand what is going on.
This comment was typed before a live studio audience.