Wick's Review

Summary - Barely OK 2.0

The NY Times’ take on the banking crisis endgame gets reenacted in this made-for-HBO docudrama. Notwithstanding the Big Lie told in the middle, the movie otherwise seems to competently essay the mechanics of the fall of Lehman Brothers, AIG and the imposition of TARP.

The Big Lie comes when the characters playing the senior staff of the US Treasury blame the subprime mortgage crisis 100% on Wall Street, asserting that Washington’s only fault was too little regulation. In fact the push for subprime mortgages came directly from Washington regulations, ultimately morphing into a torrent of financial heroin being pushed by Fannie Mae and Freddie Mac. The banks were hardly blameless, but any analysis that ignores the federal government’s seminal and ongoing role is poppycock.

The movie does prove mildly fascinating by reenacting the mandatory meetings that Treasury Secretary Hank Paulson had with the CEOs of the major banks, along with some other machinations of our humbled financial titans. Those of us who followed every twitch of this debacle as it happened find such fly-on-the wall views transfixing, even if the mendacious Left Wing politics that are interspersed make it hard to recommend for the unsophisticated.

Acting - Good 3.0

The Public Officials

• William Hurt as Henry Paulson, Secretary of the Treasury, comes across as a defanged titan trying to do the right thing in unprecedented circumstances, which is how he came across at the time.
• Paul Giamatti as Ben Bernanke, Chairman of the Federal Reserve, comes across as weak and befuddled, notwithstanding his being a scholar of financial crises. Why did President Obama reappoint this guy in ‘09? Said another way, what’s it take for one of these guys to get fired?
• Billy Crudup as Timothy Geithner, then president of the Federal Reserve Bank of New York, now Treasury Secretary, comes across as less insipid than in his real life media appearances, though hardly a figure of genius, gravitas or wisdom. Why did this suit subsequently get put into the corner office of the Treasury Building? He’s the very personification of too-big-to-fail.
• Cynthia Nixon as Paulson’s press secretary serves as the audience’s proxy. Her query about the roots of the financial crisis triggers the Big Lie described in the Summary.

The Bank Presidents

• James Woods as Richard Fuld, CEO of the doomed Lehman Brothers. Woods’ trademark edginess works well playing a profane financial shark.
• Bill Pullman as Jamie Dimon, CEO of JP Morgan Chase, comes across as a supremely composed executive player.
• Evan Handler as Lloyd Blankfein, CEO of Goldman Sachs, comes across as an ultra-brainy operator.
• Tony Shalhoub as John Mack, CEO of Morgan Stanley, comes across as more tough than brilliant.
• Matthew Modine as John Thain, CEO of Merrill Lynch, comes across as sharply bland, if that’s possible.
• Ajay Mehta as Vikram Pandit, CEO of Citigroup, comes across as smart but clueless.

Then there’s Edward Asner as an ultra folksy Warren Buffett. Aw shucks.

Film - Barely OK 2.0

Seriously bad editorializing mars what otherwise appears to be a competent retelling of an important story.

Edge - Tame 1.3

Reality - Glib 1.5

The movie’s political animus skews its CircoReality by hiding Fannie Mae and Freddie Mac off screen, when in fact they were seminal and central to the crisis.

• Fannie and Freddie are far and away the largest recipients of bailout funds according to Propublica. Together they’re into us for $169 billion, making second place AIG look like a piker at only $51 billion. Other than AIG, the banks vilified in the movie have repaid their bailouts.
• Fannie Mae went heavily into subprime mortgages and pushed banks to lower their credit standards starting in 1999, as reported by the NY Times at the time. Unfortunately the banks and Wall Street were only too happy to comply.
• Paul Volcker, widely acknowledged as the most credible voice on public finance, was just quoted in the NY Times saying “We simply should not countenance a residential mortgage market, the largest part of our capital market, dominated by so-called government-sponsored enterprises.” The GSEs he refers to are Fannie and Freddie.
• Rep. Barney Frank is shown as being shocked – shocked – that such a crisis is happening, a curious display of ignorance for the then Chairman of the House Financial Services Committee. Of course this is the same guy who infamously said on July 14, 2008 “I think this is a case where Freddie Mac and Fannie Mae are fundamentally sound.” Two months later they failed and the government put them into conservatorship. From that point onward it is as if thousand dollar bills get torched in their parking lots every hour of every day, bonfires of the nation’s wealth.

The argument can be made that Frank’s reassuring statement was an attempt to calm the market. However I recall him also making a statement that Fannie and Freddie could help rescue other stricken institutions, which is really gilding the lily.

In any case, Barney Frank is probably tickled with his depiction in Too Big To Fail. Shame on him.

One other thing: The movie makes much of the deregulation that allowed commercial and investment banks to combine. Conventional wisdom has it that Glass-Steagall’s demise during Bill Clinton’s presidency was something close to the original sin behind Too-Big-To-Fail. However, it’s striking that the failed institutions ended up being the investment banks that didn’t combine with depositary institutions, plus AIG’s disastrous mortgage insurance business.

Those that did combine were mostly hurt by taking on failed investment and mortgage banks, BofA’s disastrous absorptions of Merrill Lynch and Countrywide being Exhibits A & B.

I’m no finance guy nor an economist (for whatever they’re worth), but the diatribes against Glass-Steagall seem to miss the point, as does this movie at anything more than the superficial.

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