The Big Short

In the mid-2000s, a few finance experts observe the instability in the US housing market and predict its collapse. Through their research, they discover the flaws and corruption in the system.

The Big Short describes several of the main players in the creation of the credit default swap market who sought to bet against the collateralized debt obligation (CDO) bubble and thus ended up profiting from the financial crisis of 2007–08.

Mark Baum, based on Steve Eisman, earned $1 billion from the market crash depicted in the film. Jared Vennett, based on Greg Lippmann, made $47 million from swap sales as shown in the movie.

Michael Burry is an investor who profited from the subprime mortgage crisis by shorting the 2007 mortgage bond market, making $100 million for himself and $700 million for his investors.

It is based on the book of the same name by financial journalist Michael Lewis. Its mostly about collateralized debt obligations, subprime mortgages, credit default swaps and bundling.It is more entertaining than most of the movies playing in theaters this holiday season. Even if you don't know much about the subprime mortgage crisis of 2007-2008, you'll enjoy this quality film and by the end of it, you'll want to know more about the global economic collapse.

Movies use a variety of techniques to tell a story. There are monologues that break the fourth wall, a model explaining the economy while taking a bubble bath, and a singing idol and celebrity chef explaining the economic crisis using cooking and gambling metaphors. There are jump cuts, slow motion, foreshadowing, and flashbacks. The filmmakers use all their tricks to explain complex financial machinations to help the audience understand.

Banks, mortgage brokers, credit bureaus and governments manipulate people across the country and around the world to invest in bundles of worthless bonds, and director and screenwriter Adam McKay must use every cinematic trick to explain and solve the financial corruption. The miracle is that the movie interprets the economic collapse well while entertaining the audience.

The acting is excellent, from the stars to the bit players. They don't just play roles, they embody characters from important periods in history. My mom thinks Steve Carell is the best actor in movies. At first she didn't even recognize him. He was playing against character and she loved it. But my mother has never seen Carrel on The Office.

His character, Mark Baum, is very similar to the boss from this TV series. But in The Big Short he plays it straight. He runs funds under Morgan Stanley (but, as his team likes to point out, it's not Morgan Stanley), and his job is to break up and expose banks and prove he was right about financial warning signs. He's betting against Morgan Stanley, the hand that feeds him.

I preferred Christian Bale's performance as Michael Burry, an unselfconscious, manic math genius. I haven't seen that frightening look in Bale's eyes since American Psycho, but this time he's only killing the mortgage backed securities market. Meanwhile, Brad Pitt, under  playing another disaffected former banker, Brad Rickert, helps two friends make millions while they bet against terrible investments, or play short the mortgage market.

His backstory is revealed steadily and in a way that makes us wonder why he briefly got back into the investment game."Even Ryan Gosling makes his mark in this star-studded cast playing the prescient Jared Vennett. Remember, all the characters in the film are based on real people. And that is what makes it so remarkable.

The other major players in the film are Bear Stearns, Morgan Stanley, and a slew of investment houses who at best ignore the coming financial crisis or at worst, colluded in its creation. From the realtors selling the mortgages, to the banks loaning at subprime, to the banks bundling the worthless packages, they were all making too much money to want to stop. This is exactly the kind of over-exuberance that occurred in the 1920s stock market crash, but few payed attention then or in 2007.

It is a dramatized film of true events. And to make sure we understand, the actors break the fourth wall several times to tell us what part is true to the detail and what part is fictionalized to make it more dramatic. But if you still doubt it, read the book. Unfortunately, the whole incident is true and we are still paying the price for it.

You'll need to watch this movie at least twice to understand half of what it has to offer. This is just entertaining, educational, and relatable.