Margin Call Directed by JC Chandor - Movie Review Example

Margin Call was written and directed by J.C Chandor. It is an American drama film. The film depicts the early stages of the financial crisis as it happened in the year of 2008. It covers a 24 hour period story at an investment bank and focuses the decisions and actions taken by a group of key players at an investment firm during the intense financial collapse the company faces. The movie as set in the high stake world of the financial industry moves around the theme of capitalism, greed and investment fraud. As the film opens, a respected financial company is downsizing and is conducting mass layoffs on the trading floor because it is already aware of the situation that may arise in the near future. Among those victims is a senior risk-management executive, who was working on a major analysis just when he was let go. As the person is leaving he hands a USB drive to an analyst who works late in the night. The data on the usb disturbs him and turns out to be first rumbling of the storm. He unlocks information that could prove to be the downfall of the firm and further finds out that both the market and the company are about to crash. On this he calls his seniors and colleagues in and informs them about the companys financial disaster which follows an emergency meeting and a long panicked night until dawn when the owner of the company John Tuld arrives. The owner is informed of the financial crisis which the company was facing over the past 40 months the company have packaged a series Mortgage Backed Securities (Mbs) into one tradable commodity. The idea was quite profitable but it requires a month to layer the products that is, they have to hold the products for a longer time than desired and they are based on mortgages and risk is elevated. The company’s (MBS) have decreased by 25%, and that was the rate at which the losses will exceed even the current value of the company. The company based on historic patterns, had exceeded their levels of volatility that is their historic volatility has exceeded the limits. They were already facing the crisis as the company has broken through for the past 5 days. The owner was told it will take weeks to clear the problem and if they stop buying it will be noticed and they were left with 60 traders only. The owner inquires how bad the situation was and he was told that the company was already in a crisis, the young analyst also informs him that him if the assets were to be decrease by just 25%, it will exceed the value of the company. The decision made by the owner was to liquidate their assets. They decided to sell all the “toxic” securities. many employees were not in favor of this idea, especially the sales executive, as the idea was to lose the trust of their customers and sell them junk, many employees will lose their jobs and over all reputation of the company would also be ruined but the owner was convinced to do so in order to cope this crisis. The market is open and assets are sold and the Sales executive is offered a deal, and offered to accept the decision in action as this was their only option, hence, waving away his concerns. "Margin Call" is a tightly scripted film about the beginning of the financial crisis. Where an investment bank lets a lot of workers go to the "fire sale" that takes place and goes to work to see how they can solve the problem which they only solve by making it better for them. It depicts the last night of good times on an investment firm Wall Street, as a result of a disastrous speculation in the mortgage markets which is leading to the company’s collapse. This film was inspired by the collapse of investment bank Lehman Brothers in 2008, as the surname of the CEO John Tuld rhymes with Richard Fuld, that of the one-time head of Lehman who also made half a billion salary and bonuses in the five years before the firm went down. This movie is a well depicted story of the economic collapse from the perspective of one companys employees specially. It gives an insight of human and financial meltdown as it is based on the lives of the bankers who discovered the fall of the economy in 2007-8. This film depicts a storyline where consequences are given no conscious and how the line between good and evil in terms of ethics is blurred. It represents the depths of moral and ethical corruption at western capitalist society and provides food for thought for all of us who live in a capitalist society. Greed no matter how it comes and when it comes, whenever it comes it mat do temporary good but it will always come with a cost. This film is a must watch for all business students and specially those related with finance. It teaches business students like us that there are ethical dilemmas faced in work place and how we should learn to deal with them. This movie involves decision making at each stage of the hierarchy of the firm. The dilemma faced in this movie was whether to save the company or unethically sell waste securities to customers. It shows the functioning of financial markets. It gives insights of investment firms as it is based on a true story it depicts true working of investment firms and also shows how unpredictable these firms can be. One night can change the fate of a firm. It shows how a respectable big firm can get into critical financial crisis and get bankrupt within few days and gives the audience an understanding of how these firms run and of what and who these people care about most. How overnight firms broke and employees lose their jobs. This movie is an authentic portrayal of not only the financial industry but also how their decisions shape our global future. Read More