Movie Review—The Big Short

by Peter J. O'Connell

The Big Short. Released: Dec. 2015. Runtime: 130 mins. Rated: R for pervasive language and some sexuality/nudity.

A “short” is an investment technique in which the investor makes money when his/her investment goes down in value rather than up. The Big Short, directed and co-written by Adam McKay, is a “dramedy,” loosely based on Michael Lewis' factual account in a book of the same name. The film deals with three different groups of investors who made money from the financial crisis that followed the bursting of the real estate bubble in 2007-2008.

The first of these is Scion Capital, a hedge fund managed by Michael Burry (brilliantly played by Christian Bale), a seriously eccentric quondam physician in California. Burry's office attire is shorts, bare feet and a cheap haircut, and he relaxes by frenziedly playing a drum set. He has, however, determined mathematically that the seemingly inevitably rising U.S. housing market is just a bubble that will burst in the near future. So he bets against that market.

Jared Vennett (Ryan Gosling, hard to recognize in the haircut and suit that the movie gives him) works for a big bank. He gets wind of what Burry is doing and decides to do likewise. A mix-up leads to his linking up with Mark Baum (Steve Carell) and some of Baum's colleagues. Baum works for a large investment house but is becoming seriously discontented with the ethics of the financial industry. Nevertheless, he and his group and Vennett start “shorting” after a tour of some of the bizarre goings-on in the real estate market around the country. 

The last group of “shorters” depicted in the movie is that of Charlie Geller (John Magaro) and Jamie Shipley (Finn Witrock), partners in a start-up company. They hear of what Vennett is doing and call on a laid-back retired banker (Brad Pitt) to help them do the same.

All three of these groups of shorters work on the premise that they will prosper because the greed, lack of foresight and cronyism of the big banks, investment houses and rating agencies will cause the broader economy to collapse. The fact that ordinary investors who trust these institutions will suffer doesn't sit well with Baum, but he shorts anyway. 

The film, with its one-liners and sight gags and quick and frequent cuts among different characters, time frames and locations, has an almost kaleidoscopic quality that well conveys the excitement of the years of the bubble's peak—and the shock (except to the shorters) of its bursting. To clarify some of the financial arcana and add to the somewhat surreal quality of the movie, McKay interjects several “explanatory episodes” using celebrities as themselves: Margot Robbie, the gorgeous blonde from 2013's The Wolf of Wall Street (another film about financial shenanigans) in a bubble bath; 20-something songbird Selena Gomez at a gambling table in Las Vegas with up-in-years Nobel laureate economist Richard Thaler; superchef Michael Bourdain in a kitchen.

Some of the explanatory episodes fail to explain much, however. Robbie's gorgeousness is a distraction from her explanation as is the age-disparate pairing of Gomez and Thaler. Bourdain's comparison of the securitization of subprime mortgages to a fresh-on-Friday fish dumped with other ingredients into a stew on Sunday works well, though. And when the Jared Vennett character builds a tower of blocks, with ones labeled “AAA” on the top and ones labeled “BBB” on the bottom and pulls out one of the BBBs, the point is well made. 

Though McKay with his talented cast touches cleverly on a lot of things, he doesn't touch on one key factor in the financial meltdown—the role of government. In the 1990s the government, responding to liberals and pressure groups, put the squeeze on banks to make loans to many folks hitherto not considered creditworthy. The banks resisted this strong-arming for a time, but eventually had to give in. Desirous of ridding themselves of dubious loans, they turned to investment houses to make up those financial “Sunday stews.” Any one “stew” was not necessarily harmful, but a slew of such “stews” over time eventually made the system sick. 

The Big Short describes itself as a “true story,” but it's not “the whole story.” We'll have to wait for Hollywood to tell that full story—but we probably shouldn't hold our breath while we wait.