The Big Short (not a film review)

[Insidious Von]

I left the theater depressed, the next financial meltdown is only a matter of when.

And when it happens the Federal Reserve will not be able to print money fast enough. That's the Achilles Heel of a monetary system based on debt. Since the turn of the 20th Century there have been three financial meltdown: 1907, 1929, 2008. 1929 is the aberration since neither the US Government nor the carpetbaggers chose to intervene. The 1907 crisis destroyed J.P Morgan's health, currently Hank Paulson looks like he has Parkinson's and appears heavily medicated. President Obama appeared overwhelmed when he assumed the office, he made a financially fatal error by not prosecuting the worst offenders. James Cayne, Dick Gregory and Joseph Cassano should all be in jail for crimes against taxpayers.

Collateralized Debt Obligations are still in use today, they've only been given a fancy new name.

http://knowledge.wharton.upenn.edu/article/cdos-are-back-will-they-lead-to-another-financial-crisis/

 

[Yoga Face]

each bubble will get bigger, according to some, until world wide depression with no end in sight

yes, capitalism is based on debt and with debt pretend money and that is the problem

 

[danmand]

I left the theater depressed, the next financial meltdown is only a matter of when.

It will get ugly.

 

[Insidious Von]

Michael Burry, hedge fund manager and Statistics genius. Also a disciple of Benjamin Graham's value investing.

Foresaw the subprime bubble three years in advance. He persuaded Goldman Sachs to sell him credit default swaps on subprime deals he considered vulnerable. he also has Asperger's Syndrome.

Portrayed in the film by Christian Bale.

 

[Insidious Von]

Spoiler alert. Nothing on Mark Baum is available on YouTube.

Mark Baum a shadowy hedge fund manager and doomsday advocate. Shorted the Synthetic CDO market after conducting an extensive investigation on the state of subprime mortgages. After meeting a high living subprime investor in Las Vegas said these famous words to his team:

"short everything he touches".

Portrayed by Steve Carrell - potential Best Actor winner.

 

[benstt]

I thought the movie was hilarious at points, and fairly accurate insight into what happened.

Unless regulators keep an eye on the banks, they will find new ways to take unsustainable profits while passing the downside risk ultimately to the last-resort guarantor, the government and taxpayer. Too big to fail!

 

[Born2Star]

Burry's right. We live in a culture with zero accountability.

Btw, excellent performance by Carrell.

 

[onthebottom]

Very faithful to the book I thought, classic Michael Lewis. Interesting that it was foreseen by oddballs and those outside the system.

Rode with a Toronto taxi driver about a year ago that pointed out a new building where he was buying his second investment condo, I started laughing, when you are in it you can't see it.

 

[eldoguy]

In Canada our sec.38 bankruptcy law is allows a big door for sham trusts to take place. An individule can pledge assets get financing! Then establish trusts in other names, go bankrupt meantime controlling the assets ! Then fuck the banks.

 

[hemorid]

They changed his name for the film, for some reason. Steve Eisman is who Mark Baum was based on. https://en.wikipedia.org/wiki/Steve_Eisman

I thought it was a very good movie. I am more worried about climate change and the attendant mass famine and upheaval that will result than I am worried about economic collapse. Lots to worry about, but no sense letting it paralyze you.

 

[Insidious Von]

That explains it. The only Mark Baum I came up with was the stronzo who leveraged the AIDS drug and recently got indicted.

Not that the Academy agrees with me but the front runners for the Best Actor Oscar are Steve Carrell and Oscar Isaac for Ex-Machina - even though he deserves it I doubt Tom Hardy will get a nom for Legend.

Carrell has made an effortless transition to serious roles. He's achieved what Adam Sandler and Jim Carrey couldn't, he's on his way to becoming the Jack Lemmon of the 21st Century.

 

[JackBurton]

I read the book, really looking forward to the movie. It should provide a cautionary tale to people who know nothing about investing. But it won't, the same people they suckered back then will invest in real estate again thinking they are smarter than the ones pulling the strings. I admit I'm somewhat conflicted. I had a few friends in Florida that had bought homes in 2006 who shouldnt have been able to due to low income and poor credit, but here they were with nice homes in decent (not affluent but decent) suburbs where the wife could stay home and Look after the kids. They bought the dream and got fucked a few years later. I'm just glad it seemed too suspicious to me to invest. I saved myself a lot of heartache and $ by not following the trendy crowd.

Btw it will happen again. Invest carefully

 

[glamphotographer]

I seen the movie. The USA is doomed yet again for another financial collapse, seems to be part of the economic cycle these days now. Better save your money for rainy day. I should stop hobbying. Depressing indeed. But I'm glad such a movie has been made.

 

[glamphotographer]

Michael Burry, hedge fund manager and Statistics genius. Also a disciple of Benjamin Graham's value investing.

Foresaw the subprime bubble three years in advance. He persuaded Goldman Sachs to sell him credit default swaps on subprime deals he considered vulnerable. he also has Asperger's Syndrome.

Portrayed in the film by Christian Bale.

He now is investing in Water. Is he on to something?

 

[bestman007]

In Canada our sec.38 bankruptcy law is allows a big door for sham trusts to take place. An individule can pledge assets get financing! Then establish trusts in other names, go bankrupt meantime controlling the assets ! Then fuck the banks.

I know of a very wealthy lady who declared bankruptcy after her husband's death here in Canada.

I don't know how she pulled it off though I know that the primary residence was transferred to one of her sons. I have remained mum on this subject and not told a soul since I have working for the bank and cannot discuss specifics due to privacy laws. However, I wonder how common this is. When I say this lady is very wealthy, I know for a fact that the family easily has more than $20 million abroad.

Her kids are not slouches either. They all have professional careers that pay 6 figures and have sent their 3+ kids (on average) to the best of private schools in Toronto or abroad.

 

[onthebottom]

I seen the movie. The USA is doomed yet again for another financial collapse, seems to be part of the economic cycle these days now. Better save your money for rainy day. I should stop hobbying. Depressing indeed. But I'm glad such a movie has been made.

Look at the Toronto housing market and tell me what you see....

 

[Butler1000]

Look at the Toronto housing market and tell me what you see....

As I mentioned I think the demographics of the buyers are different. We are getting foreign buyers who are paying cash for the properties. There are no sub prime mortgages in Canada.

I also think that many of them while bought for investment are also bought as an anchor to allow them to come here. We have a lot of Chinese investors, several European and many Middle East, North African ones. All wealthy. And all buying and leaving some money here in case something goes wrong where they are.

I don't see the bottom dropping out at all of houses. And while a slow down and possible small correction in condos I'm not sure about that either. As I stated in another thread there are 20-30 new properties scheduled for the core. Large ones.

We continue to see the "Manhattanization" of Toronto. I believe due to our political stability and proximity to the USA this will continue and we will become a larger(albet quieter) force in the tech/information sectors as well as the financial sectors.

Thankfully either way I'm recession proof pretty much. But I think there is a lot of foreign money quietly hidden here, and the more the world goes to shit the more that will arrive and be used.