Films for Business Studies: The 2008 Financial Crisis 15 years on
When you're at university, learning to study when you're not studying is an art. Here, we take a look at three films which can help us think about economics, business ethics, and the world of finance.
The 2008 Financial Crisis may seem like a long time ago for some of us.
Back in 2008, a credit lines froze due to the over-exposure of investment banks to complex financial derivatives called “Mortgage Backed Securities”. Banks needed to retain cash, and get these toxic Mortgage Back Securities off their books, leaving business around the world struggling to finance their day-to-day operations.
Most of us think the main result of the 2008 Financial Crisis was the bankruptcy of Lehman Brothers, Northern Rock, and other financial companies. These were symptoms of a much greater problem. Not the problem itself.
Yet, the consequences are still directly impacting us today, in ways we may not be aware.
So the 2008 Financial Crisis is an important event to understand.
The question then becomes, how can we learn about the financial crisis in a way that might be…..fun.
Fortunately, we have a way. By watching films.
There are a number of films which explore this seismic event from a range of different perspectives.
Here’s THREE films which should be high on any business student’s watchlist:
Inside Job (2010) - Full Film available on Youtube
Charles Ferguson’s epic documentary provides an accessible entry point for understanding the 2008 Financial Crisis. Narrated by Matt Damon, Inside Job discusses the background that allowed greed, stupidity and moral hazard to develop into a full-blown crisis that threatened to destroy the US economy. the documentary does a particularly good job of explaining mortgage-backed securities, including Collateralized Debt Obligations (CDOs), and Credit Default Swaps (CDSs).
Too Big to Fail (2011) - Full Film available on MoviesToWatch (Use the UpCloud Server)
The story told in Inside Job gets the HBO treatment here. Focusing on the “Lehman moment” and the resulting crisis enveloping Wall Street, this excellent film follows the efforts of US Treasury Secretary and former Goldman Sachs President Hank Paulson as he attempts to prevent the greatest economic disaster since the Great Depression. A really superb drama that shows the battle between Wall Street bankers, the US government, and the Federal Reserve and their effrots to avert financial devastation.
The Big Short (2015) - Available on Netflix UK (Subscription required)
Based on the book by financial journalist Michael Lewis, The Big Short takes a look at traders who figured out - before anyone else - that the US mortgage market was heading for disaster. The title refers to these traders taking “short” positions against Mortgage Backed Securities - gambling that they would fall in value. At the time they were considered to be, for want of a better word, insane - and investment banks, who had “long” positions expecting these securities to keep rising in value, were only too happy to take their bets. You don’t have to be a genius to figure out what happened next. A great cast including Steve Carelll, Brad Pitt, Christian Bale, Ryan Gosling, Margot Robbie, and Jeremy Strong all star in a tale of the immorality and greed on display. Not everyone lost in the financial crisis of 2008…
These films together tell a story that, even today, makes us wonder how this crisis was allowed to happen. It raises questions of the morality of bankers, traders, financial institutions, regulators, governments, ratings agencies, and mortgage providers. How collective greed blinded them all, and how this led to a near catastrophic financial event which is still affecting us all fifteen years later.