I’ve been doing well this week – first Stuart Fairney’s book arrived in the post, then an advance copy of a riveting DVD. ‘Inside Job’.

It genuinely is a riveting DVD; it’s well made, fast moving, informative, a thoroughly professional film as you would expect from an Oscar winning film maker – Charles Ferguson.

120 minutes, ‘as gripping as any thriller’ (did I just quote the Guardian!!!) it aims to impress as a ‘warts and all’ look at the disastrous financial tsunami which has swept over the world.

My gripe is that some of the warts only made an appearance when they could be shown in a favourable light, the opposing view, which a balanced documentary should have, sought recourse to a few foreign warts to pad out the scenes.

As a keen political observer, I found that I was screaming at the screen as often as I do at the news on the BBC.

The film is heavy on the ‘bash the bankers’ front. There is a longish section on the rewards available to bankers – the yachts, the private planes, the estates on the Hampton’s, are given the benefit of lingering salivating footage. The prostitution, the cocaine consumption is dealt with thoroughly; interviews, depositions, and the essential shot of supra-naturally high heels and comely ankles pounding a night time street.

The film starts with one of the ‘foreign warts’ – a ten minute section on how Iceland deregulated its banking system and the disasters that followed. Beyond that, deregulation barely gets a mention beyond being something that Ronald Reagan ‘started’- those damn Republicans – and Obama, now post apocalypse, is definitely in favour of!

It fails signally to mention that Obama, and Clinton, was only too happy to lobby for the relaxation of the Glass-Seagal Act which gave his voter base the opportunity to buy an all American home (one of my earliest posts!) for a mere handful of dollars down and no questions asked.

Once upon a time, banks were started by wealthy industrialists. They used their own money. Naturally they were rather keen to see that not only did they get their money back, but they made a profit on it. They took a long hard look at the people who wanted to borrow money and if they didn’t like what they saw, they didn’t lend them anything.

The banking industry had been seeking the repeal of the 1933 Glass–Steagall Act since the 1980s, if not earlier. Of course they were. Drug dealers have been seeking the repeal of Narcotics laws. Fishermen want the repeal of fishing quotas. It was Clinton who bowed to their demands with the Financial Services Modernization Act of 1999.

Neither bankers nor regulators ‘make’ the law, politicians do that. Whilst the film spent a long time exploring the ‘back story’ of the Regulators – surprise, surprise, they all turned out to have previously held high positions in the banking industry; what did they expect? Professional Fishermen? Deep Sea Divers? There was very little, seconds if that, of the role that Politicians played in all this.

No exploration of why they wanted deregulation – what was in it for them – Obama, Gordon Brown?

As far as this film was concerned, there was only one guilty party – the bankers, ably abetted by the regulators who were ex-bankers. As though they operated in a void.

If you get a job as a double glazing salesman, and you earn 10% of every sale you make – do you stop when you have reached what you think is a ‘moral level’ of remuneration? Do you reflect on the problems you may be storing up in the developing world when all those plastic windows end up in land fill? Do you Hell! You sell as much as you have the energy to do so, and enjoy your good fortune while it lasts.

Quite why it is so popular amongst a particular political persuasion to blame the salesmen and not the politicians who changed the law to permit the product to go on sale is beyond me. Bankers are salesmen; they will sell whatever they are allowed to sell.

None of which should take away from the fact that this is an excellent film, that will explain the complex financial instruments used in a most enjoyable and accessible way.

It went on sale yesterday at http://www.sonypictures.co.uk/ for £19.99. ‘Inside Job’.

No, I haven’t been paid for writing this, but since they were kind enough to send me a free copy, it seemed only polite to let them know what I thought of it.

So – who would like to watch it next? I have a copy sitting on my desk…..

Last commentator gets it….Dutch auction!

John BJune 15, 2011 at 10:57

Anna, your comment is slipping!

LivewireJune 15, 2011 at 12:03

That ‘end of page’ reply is a real hostage to fortune! Whatever is
written above it gets the seal of approval… Don’t ANYONE write “support
misogyny, you know it makes sense”
*heads for the hills*

Anna
RaccoonJune 15, 2011 at 13:09

It is hilarious watching this from behind the scenes…….!

John BJune 15, 2011 at 10:56

It is simply the elite getting on with their enrichment while promoting a
centralised consensus of control. Something along the lines of an elegant and
elitist, modernised Frankfurt School.
http://en.wikipedia.org/wiki/Frankfurt_School
This film,
of course, being part of the obfuscation/inversion. As is everything that gets
published in the consensus-controlled media.

LivewireJune 15, 2011 at 05:04

They came on to get all the freebies
It was better than watching
C-Beebies
Now it’s me on the thread
Which ‘oft kills it dead
I’ll win
if I cause heeby-jeebies

MichaelJune 14, 2011 at 22:39

I’ve worked in banking for a couple of years now. I’ve yet to see any
cocaine or prostitutes, but we did go out for a pub lunch once.

John BJune 14, 2011 at 20:42

Bankers and regulators are pretty much the same guys wearing different
hats.
Waving big sticks at themselves for being such greedy bankers while
their state/regulator personas nationalise large chunks of the
economy.
Tweedledum and Tweedledee.
I think if one looks at was has been
achieved (more state intervention, effective nationalisation of banks,
financial institutions, car manufacturers, impoverishment of middle and lower
middle class, devaluation of currency by printing zillions, enrichment of said
printers, etc, etc) one can get a fairly good idea of what it was all
about.

aaaaarghJune 14,
2011 at 20:31

There’s a really simple answer going forward.

Banks shouldn’t be allowed to sell on or in any way insure their lending.
So if someone defaults, the bank picks up the tab – that’d make the greedy
bastards a bit more careful …. especially if bonuses were reduced when losses
were incurred.

esmereldaJune 14, 2011 at 17:37

“Diamond Mortgages came round the door today” said my friend, on incapacity
benefit, living in a council house – I guess that was about four years ago,
maybe longer. “Don’t even think of it” I said. My friend is genuinely ill with
heart problems, diabetes, and a multitude of other ills. But like so many he
wanted to better himself, own a home rather than rent from the council.

I talked him out of it – although he protested that they had told him being
on benefits ws no problem and that they could deduct the payments from his
benefits.

Well, he didn’t go ahead – others on that council estate did (although I
have no idea whether it was with the same company.) All I know is that those
who bought their council homes on that estate have all been re-possessed –
evicted through being unable to keep up the payments, pushed even further into
debt than they probably already were. So much for helping the poor !

woodsy42June 14,
2011 at 16:46

In many cases a mortgage is no dearer than paying rent, so people will go
for that option. It’s worth a gamble because if it all crumbles to dust after
a few years they can walk away leaving the bank with the repossessed house,
they ‘lost’ their money but would have been paying it in rent anyhow.
(This
could be a very long thread)

SaulJune 14, 2011 at 16:05

Before we start to slag off the people who borrowed the money let’s
consider a few points.

The average person could be forgiven for putting their trust in bank
employees, after all thay are supposed to be the experts. If they say you can
have it, then why question it.
After years off not being able to get on the
housing ladder, here was a golden opportunity. Not everyone is a financial
expert, therefore you rely on people who are supposedly better placed to
advise you. In fact this works in most walks of life, whether it be, Doctors,
Lawyers, Mechanics etc.

john2gJune 14, 2011 at 15:52

+1

ShadesJune 14, 2011 at 14:46

Last commentator gets it?

This could run and run!

Psychonaut99
June 14, 2011 at 13:02

I also thought it was a good film, though again a bit incomplete. For
example, there is no mention of the thousands of people who actually took out
the mortgages that they were never, realistically, going to be able to repay.
Certainly, the banks shouldn’t have been lending them in the first place and
the assorted Governments shouldn’t have let the banks bundle them all up and
sell them on as if they were sound investments, but at the same time, you’ve
got to be a bit of a berk to borrow 6 or 7 times your income to fund 100% or
more of the purchase price of your house and think that everything is going to
be just groovy.

That being said, those people were just a bit dumb. The bankers were evil,
corrupt, greedy bastards, and I think that’s an important distinction. As far
a politicians letting them do it, I remember it being mentioned in the film a
bit more than you refer to it, but it was awful selective, and it didn’t
mention that governments all over the world were deregulating and not just the
US were doing it.

Anna
RaccoonJune 14, 2011 at 13:40

“no mention of the thousands of people who actually took out the
mortgages that they were never, realistically, going to be able to
repay”

Given what we know now regarding the calibre of those people, I think
they can be forgiven for not doing the maths.

I don’t happen to think that the bankers were ‘evil corrupt bastards’ –
any more than my illustration of the double glazing salesman. If you give a
salesman a commission structure, he’s going to sell according to it – what
is ‘evil and corrupt’ about that? The man who sells vaccines in the third
world is on commission, should he stop selling them just because he has
reached a certain salary level – don’t want anyone calling me ‘evil and
corrupt’!!!!

Psychonaut99
June 14, 2011 at 16:51

There’s nothing wrong with selling on commission. The corruption arises
if there are difficulties with the product. If the double-glazing salesman
sells windows that he knows will fall out 10 minutes after they’re
installed, or if the pharmaceutical rep sells sugar pills claiming they’ll
cure AIDS, then they’re being evil, corrupt bastards, no matter how
tempting their commission structure might be.

The banks took worthless mortgages, bundled them all up, and sold them
on as safe, reliable investments.

If the bankers genuinely thought that their products were good, then it
wouldn’t make them corrupt, just incompetent (and it would raise questions
about the “we need to attract the best people” justification for paying
them the equivalent of the GDP of a small country).

However, the banks KNEW that the products were rubbish. Their leaked
emails showed that. “Worthless junk” was the phrase quoted in the movie,
if I remember correctly. That wasn’t how they described them to investors,
obviously. They investors were told they were getting solid, proper
investments.

Now, that, on its own, would warrant the term “corrupt,” I think. And
if it was just a case of corrupt bankers ripping off foolhardy investors,
it wouldn’t warrant any more than that. The problem is, they did this on
such a scale that the economy of the entire world got fucked into a cocked
hat. And we all had to pay them a load of money on condition that they
looked slightly contrite for a couple for months before going to back to
behaving in much the same way as they did before.

So, yeah. Evil, corrupt bastards seems about right to me.

Anna
RaccoonJune 14, 2011 at
17:13

One e-mail, I heard that too.
So if the double glazing firm gets
one e-mail from a disgruntled employee saying the product is rubbish,
they should instantly stop selling them, and put everyone out of work –
in a perfect world yes.
It was just one e-mail – it makes a good
headline, it doesn’t prove that the entire banking system knew the
product was rubbish. nor that they deserve the ‘evil, corrupt bastards’
tag line.
You seem to be remarkably keen to keep the conversation
away from the politicians who deregulated – and blame the bankers?

Psychonaut99June
14, 2011 at 19:15

Well, fair do’s, Anna. You started by saying we should look at the
politicians and not blame the bankers so much. I never said we
shouldn’t blame the politicians. I even noted that the movie let
politicians other than US ones off the hook a bit by not mentioning
that governments all over the world were deregulating their financial
sectors.

I’m not saying we shouldn’t blame the politicians too, but I don’t
accept your characterisation of the bankers as innocent working-men
and -women simply taking logical advantage of a legitimate incentive
scheme.

In much the same way, it’s right that politicians let the financial
sector get itself into this mess, but it’s not like doing so was an
idea the politicians came up with on their own. The financial industry
spent gazillions of dollars lobbying governments in support of
deregulation.

Now, I accept that the politicians should have resisted the
lobbying better. Lobbyists are very good at persuading people of
things, and some of the might even do it through methods other than
bribery, but ultimately if you let a paedophile babysit your kids, he
still going to fuck them, no matter how many shrinks he pays to tell
you he’s safe (for the purposes of this analogy, the banks are the
paedophile, the lobbyists are the shrinks, the politicians are the
gullible parents and the economy is the bloodied corpse of a violated
child).

To continue the analogy a little further though, it is also fair to
say that as well as being gullible, the politicians were also rather
negligent parents. Previous government bailouts of failing
institutions (it might be argued) sent a a signal to the financial
industry that the risks they were taking would not ultimately be borne
by them. In terms of the economy-as-child analogy, this is roughly the
equivalent of dolling-up your six year old daughter in make-up, halter
top and stilettos, then sending her to play outside Ian Huntley’s
house.

Anna RaccoonJune 14, 2011 at 20:08

Agreed – a very fair analogy.

Fabian the
FabulousJune 14, 2011 at 13:47

“…you’ve got to be a bit of a berk to borrow 6 or 7 times your income to
fund 100% or more of the purchase price of your house…”
What would be a
better choice to make?
Most of us have to do our best in the financial
climate we are in, and if irresponsible lending and borrowing have pushed up
prices to the point where you can only buy by borrowing irresponsibly, you
have little coice but to go along with it.

Daz PearceJune 14, 2011 at 13:00

Presumably the DVD won’t go to this bunny but will make sure I watch it all
the same.

Nice little job that politicians did blaming the ‘financial crisis’ and
appealing to the politics of envy and a wish to blame bankers for all that
went wrong. Can’t blame them for doing what politicians do, but the
‘deregulation caused the crash’ line is more misplaced conventional
wisdom.

The reason the financial sector became utterly reckless is beacause
governments in the US and UK in particular egged them on and therefore tied
themselves into clearing up any resulting mess. If the banks had been told
that they were on their own in the event of a meltdown would they have started
to lend more responsibly? And would we be where we are now?

http://outspokenrabbit.blogspot.com/