Monday, June 27, 2011

The Inside Job - a review.

I finally got around to watching "The Inside Job" - the documentary about the causes of the financial crisis.  It was actually rather tedious - with relatively little technical detail and mostly lots of broad statements about who is to blame.  On the list: Presidents, Wall Street, The Fed, Rating Agencies, Derivatives and economists.  There was a bit of a bias in that several causes were ignored - for example congressional pressure to expand home ownership to lower income families, homeowners who actively engaged in speculative activities and the media that continually promoted housing as a no-lose investment.  But overall it covered most of the bases.

The basic format of the film was to try and skewer various individuals in interviews.  The smart folks declined to be interviewed, but some economists did agree and presumably thought that they were being interviewed for their expertise on the issue.  In fact they were being pilloried.  Case in point: Glenn Hubbard (Dean of Columbia Business School).

Overall - probably worth watching if you are interested in the topic, but don't treat it like a definitive explanation.  A recent article in the Washington Post sums up the movie perfectly.
 It was an excellent documentary for people who don’t want to understand the financial crisis but want to believe they would’ve seen it coming.