I don't get it

The Clinton administration and banks fucked the economy with the mortgage crisis and those autists made billions.

Big banks make bad boo boo and don't get in trouble for it. Big bank make lot of money

>>85739351
I wish I understood the film but it was still interesting to watch

poor retards fell for the mortgage meme and made smart jews a lot of money.

And people say /pol/ is dumb

It's about a bunch of midgets on Wall Street who think they're bigger than they are and team up to fight a bunch of lanklets in a pickup game of basketball.

>>85739478
>I wish I understood the film
The film literally explains itself

>>85739528
The film gives you the basic of basic of what happened

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>>85739398
>The Clinton administration
Holy fuck that's hilarious. You don't actually believe this do you?

>>85739351
The economy is made up and some people are playing games with it but everyone is retarded (some more than others) so sometimes those games blow up and everyone gets fucked.

>>85739594
But its true. In 1996 Bill ended the bill that was in place after the Great Depression. Ending that bill created 2008 crisis.
Do you even history?

I wanna make big money

>>85739594

He removed Glass-Stegall you literal brainlet LMAO kys

It pretty good

Can anyone explain CDS to me? How are you able to make millions from them, since all they do is reimburse what you lose if ever your stocks default? Wouldn't you have won that sum anyways had they not defaulted?

Or does the CDS make you win more than you would've won from your bond?...

Anyone good luck on your CFAs gents and congrats on those who just passed.

This movie is in my top 10 favorite movies ever now.

>>85739594
Maybe if you weren't underaged, you might remember Clinton's National Homeownership Strategy, and his "everyone should be able to have a home whether they can afford it or not!" spiel. All well and good for his administration, those balloon mortgages wouldn't become due until LONG after he was out of office while people paid minimum interest payments and $0 toward principal.

http://www.zerohedge.com/news/2015-06-10/20-years-later-bill-clintons-home-ownership-dream-america-dead

Watch the video.
>help moderate families who haven't been able to save a down payment
>help low income families held back by mortgage costs
>to help families who have historically been excluded from home ownership
>couples that are just started out

And so, we had bank loans given out without collateral to people we knew couldn't pay them because that was tomorrow's problem. By the time the Bush administration had taken over the events of the movie were already in effect. The banks were lying about the quality of the loans and the new government was unaware of the insane damage done by the previous.

>>85739351
People with money and power blindly fucked things up just like always. Lovable autists bet against them and won. Everyone else lost just like always.

>>85739814
This

I find it comfy too

>>85739773
Just think of cds as insurance on a bond default. All this shit was made more complicated and the movie does a terrible job of explaining it

>>85739904
>Lovable autists
Jaime Mai was /ourChad/ though.

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>>85739858
That chart is pretty damning for the Clinton years.
>steadyish home ownership rate
>Clinton gets in office at 93
>BOOM at 94
>bad mortgage collapse in 08 well after he's gone

>>85739773
They bet against the stock. Basically, somebody loans them stock, they sell it, and after the crash they but it back up to pay back their now worthless loan.

>>85739980
Yeah but I don't understand how you'd win money from them, more than if the bond has not defaulted?

Maybe it's my understanding of american bonds that's fucked up, but here goes how I think about it.

>bond does not default
>you get 7 years of interest usually until homeowners are going to resale their house because retail estate prices grew
>and payment of the initial loan around that time
>say your bond was worth 1 M when you bought it, it's now won you ~ 1,2 M or so

>bond does default
>you get around 3 years of interests paid to you since you took out your CDS in 2005, or at least Burry did
>you get the sum of the bond paid back to you by AIG or Deutsche or whichever retards would sell the CDS
>you won approx. ~1,25 M

So if anything, aren't you losing money when you bet against a subprime with a CDS?

For some reason I've watched it like 10 times

>>85740113
Hmm but that's shorting and I think betting with a CDS is different. But again, I'm very willing to accept that I'm retarded and that this isn't how it goes.

>>85739351
IT WAS DA JOOS FAULT

>>85740211
1,15 M*
Typo fucking shit.

>the big short
>all of the main stars are roughly 6ft

6ft confirmed king of manlets

>>85740393
>Steve Carell: 5'8
>Christian Bale: 5'11
>Brad Pitt: 5'10
>Ryan Gosling: 5'11

>>85739984
Its ok he did nafta as well

>>85740211
When the bond is issued it has a credit rating. The buyer can then buy insurance on the risk of default. What you are doing is guaranteeing your income. You have the general idea correct but not simplified. The cds is just a hedge to ensure you make money. So yes money is made on a normal bond. But you can also make money if there is a default. You completely erase your upside though.
The only thing is people can speculate instead of hedge and take on unlimited risk for unlimited gain instead of hedging.

>>85740323
No, you're right here. Basically they took out insurance on the mortgage accounts. Because the bankers were convinced these mortgages would not fail they offered incredible insurance packages at what they thought were a very stupid rate. If the accounts lasted, the banks would make a killing on the fees for the insurance. If the accounts failed, the insurance pays out. The banks let them insure the accounts for ludicrous amounts of money.

I don't understand. There were clear ties to the government with the mortgage crisis and the movie specifically never mentioned it once. Why didn't they, in 2015 as Hillary prepped for her presidential bid, expose her husband's administration for its role? Surely the actors in the movie would've still appeared in it?

>>85739351
The gist of the movie is that greedy bankers pushing financial assets based upon sub prime shitty mortgages is the blame of everything that happened in 2008 (well mostly). The danger right now though, is probably algorithmic trading platforms fucking up and tanking the market suddenly.


I felt like they didn't focus too much on loan sharks and intermediaries, the greedy house flippers with no income, the regulators who also benefited from this scam, the Bush and Clinton administrations' role in fueling the growth of sub prime mortgages, and finally the federal reserve which should have deflated the bubble long before 2007/2008.

>>85740680
Forgot to add the latter is what they do in the movie. They aren't hedging their own positions they are taking out insurance policies on those shitty subprime mortgage bundles. The banks sell them because the periodic payments seem a sure thing and they had no understanding of the bubble. So they the banks take on what seems to be low risk, but really the defaults were already happening

>>85740680
>The buyer can then buy insurance on the risk of default. What you are doing is guaranteeing your income.
Alright that was pretty helpful! Now what I don't get though is, if Burry was able to pick through the mortgage bonds he knew would default, why didn't he do the reverse and search out the bonds he thought were going to end up a-ok?

It would've cut the need to pay for his CDS along the way. I mean, I assume if you can detect which ones are definitely going to default, couldn't you do the contrary and bet on the ones you think won't?

>>85740785
Definitely algo trading it already happened in 87 or 89 I forget

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>>85739351
I've started watching this film three (3) times
I could not help but feel uninterested at some point
I simply cant do it, this film was not made for me

This movie was so tryhard. Trying to be hip and funny. It was painful to watch.

>>85739659
>>85739679

He's not king a you know. The republican congress wrote a bill and he signed it. Also it wouldn't have changed the '08 housing crash. All the big banks had gotten around the regulation at that point by creating shell banks, which is part of why they did away with it.

>>85740712
>The banks let them insure the accounts for ludicrous amounts of money.
Right this what I think I needed to hear thanks!

>>85740934
Alot of political talking points revolves around the 2008 crisis, if you care about getting past the bullshit then the movie is more interesting. Though the movie doesn't properly emphasize every fault like I said here >>85740785


They tried their best ass and titties - that's commendable.

>>85740211
As far as I understood, the bonds were just something to make the bet on, weren't they? The CDS was just a bet made between 2 parties (like Bale and the banks) that depended on the bonds but didn't actually interact with them, like how people make bets on all sorts of shit that neither party has control over. So the CDS became a contract with such and such terms (regular payments from Bale's fund to banks while bonds bet on don't fail, in exchange banks will owe Bale X amount if bonds bet on fail) based on the mortgage bonds and its value for trading became dependent on potential payouts from the contracted parties just like values of bonds. But Bale wasn't buying the bonds themselves or doing anything with them.

>>85740840
I don't remember how they were doing business. Wasn't he just seeing default trends or did he have specific mortgage bundles he bought insurance on? Didn't he just go to the bank and attempt to bet against the market?

>>85740840
Sure, but that isn't going to payout nearly as much. The thing about credit default swaps is that you can purchase them without even owning an insurable interest in the account that you're insuring.

So what these people did was go around buying as many insurance policies on the falling bonds as they could. They might have had those bonds insured for 1000% if their market value if they had the funds to afford the few months of premiums.

>>85739858
You are completely incorrect. The ninja loans and volatile adjustable rate mortgages weren't a thing when Clinton was in office. Also Fannie and Freddie had a minority share in the more exotic risk mortgages, and were only spurred on by the Bush administration's desire to have them compete with the private sector defeating the entire reason of their existence.

>>85741061
>Clinton dindu nuffin!

Uhh... try again sweetie. Actually read the thing first.

http://www.globalurban.org/National_Homeownership_Strategy.pdf

>>85740840
lower return to actually buy bonds. The cds was cheap because if it didn't work out he'd just be out of pocket the payments he had to make till the insurance on the bond expired.

>one set of people discussing the movie
>one set arguing about Clinton
Fucking never change

>>85741200
To be accurate, it was incredibly risky, because those premiums would probably empty their funds.

>>85741007
>But Bale wasn't buying the bonds themselves or doing anything with them.
So he was insured on something he didn't even own? That would make the most aense as to why he was able to make such a killing profits-wise.

>>85741046
Yah, essentially he'd get bogged in the legal paperwork of each bond to try to weed out which were going to go bust, ie, what parts of town they concerned, who'd took them out, etc..:

>>85741046
Bale gave the banks specific bonds he wanted to insure, he had books for different banks (BoA in one meeting, Bear Sterns in another, some others as well I think). Rewatching the scenes now, the first one is at Goldman Sachs and the book he gives them has Goldman Sachs written on it so I'm assuming he insured bonds with each bank that each bank actually owned.

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>>85741243
>political movie about Civil War and how it happened
>movies doesn't mention Lincoln
>thread on /tv/ partially discussing why Lincoln was purposefully left out
>>You: "REEEEE POLITICS!"

>>85741060
>that you can purchase them without even owning an insurable interest in the account that you're insuring.
Fug...
Like I've told the other anon, I feel like this was the explanation I was searching for all along. At least to me, it explains how his profits were that insane, since the 1 million he would've been paying for his CDS could've multiplied into fifty times that if the Bon defaulted.

goose and christian bale were hilarious in this

very funny comedy

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>>85741304
Yeah rewatching the little montage now and he gives a book at each meeting that corresponds to that bank. First is Goldman with a Goldman book. Then Deutsch but you can't see the book cover. The Bank of America meeting has a BoA book, next meeting he shows a Bear Sterns book but the bank that the meeting is at isn't named/has no establishing shot and the last one has him sliding a book that has CreditSeusse written on it, but also no establishing shot for the meeting.

This was a very overrated movie.

The HBO Film "Too Big to Fail" was much better.

In "The Big Short", it was numerous different stories doing the exact same thing.

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>>85741475
So I guess he got the banks to insure their own bonds for him. I wonder if that was necessary or somehow benefited his terms?

>>85741495
Well the point was to depict how it was hilarious that so many people were blind to the bubble since so many others figured it out:

>Burry figured it out by reviewing the paperwork of the bonds
>Lippmann figured it out because Goldman half-figured it out and Deutsche wanted to copy them
>Eisman figured it out because they went on the ground and saw how shitty things were
>Jaime and Charlie figured it out because Jaime was a Chad

>>85741290
You don't need to own anything to do a credit default swaps.

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TRY GETTING A RESERVATION AT DORSIA NOW YOU FUCKING STUPID BASTARD