Anybody catch the “Too Big to Fail” on HBO. It is about the pressure and problems that Paulson, Geithner and his staff had trying to save the banking system. It has lots of big name actors.
Their problem was trying to find a way to save the system in the face of bankers who did not comprehend the problems they caused and refused to help. They acted selfishly through the whole crisis.
If the solution Paulson came up with was the only possible fix, the bankers nearly derailed it several times. We could have been even worse off.
At the end, the unstated promise was to begin lending again to get the economy humming . We know how well that worked out. The bankers seemed oblivious to the damage and the poor press they kept creating. They just wanted the big checks and bonuses to keep rolling on.
I watched it last night and really enjoyed it. I thought that it was very well acted with a very tight script that was able to use just 90 minutes to capture the situation extremely well.
It looks good (as usual; HBO puts out consistently good product) however like with “Recount,” I can’t bring myself to watch it because I’ll just get really angry.
I felt more sickened than angry because the situation can not be fixed unless some pols have the nerve to perp walk a few bankers to take away their sense of entitlement.
When Paulson had them at the table to force them to take cash injections, the bankers were concerned about their bonuses. They had brought the world economy to its knees, but they might have refused to fix it if it cost them money.
At the end it was pointed out 10 banks control 77 percent of the industry. They were too big to fail and have gotten bigger.
They have to be broken up but it would be political suicide for a politician to try that now.
The portrayal of banker ego was done quite well, especially the way Fuld’s arrogance screwed each plan to buy Lehman Brothers.
The bankers made the mess, but they did not have any idea how bad it was. Paulson could not make them aware. He reached the politicians, with the exception of many Republicans, who just would not approve TARP. They were wedded to some philosophy that would not permit them to vote for it.
Paulson was knee deep as a banker in helping cause the banking failure. Geithner did not do his job of regulation. The movie makes it seem they were just trying to fix the mess. They become some kind of heroes.
I watched this last night and thought that it did a very effective job of tackling a complicated storyline in an understandable manner. It hit all of the major high points of the crises and was well acted. Some scattershooting thoughts are as follows.
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William Hurt does an excellent job as Hank Paulson. It is hard not to sympathize with him considering the difficulty of the job; regardless of whether you think he was partially responsible or if he did a good job in the crises.
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James Woods was a little hard for me to watch as Dick Fuld, Lehman CEO. First, his is probably the least sympathetic character in the movie. Second, James Woods just seems to be himself in the role; I don’t see any acting.
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The Michele Davis part (Treasury PR person) played by Cynthia Nixon was a little annoying. I thought she did a fine job, but the role seemed to partially be designed to educate the audience on what was going on. It was a little insulting that her character had to have such a prominent role.
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I don’t see how I missed this, but I had no idea that Timothy Geithner was pushing for mergers between JPMorgan Chase and Morgan Stanley as well as Citibank and Goldman Sachs. It seems so stupid in retrospect. My understanding is that Morgan Stanley was able to handle a private solution pretty easily. Also, if they seriously feared that a domino effect of failures in investment banks would ultimately endanger Goldman Sachs then combining it with a horrendous situation like that of Citibank’s seems like the worst possible solution. Did Geithner really think that Citibank was more stable than Goldman Sachs? That’s absurd.
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I’ve heard Jamie Dimon speak before and he essentially stated that when he came out of meetings with Paulson, Geithner, etc, even though he may not have liked what they were forcing on them (requiring even the good banks like JPMorgan to take TARP for example), he felt like he was doing something patriotic. That comes across in this movie. I would expect that most people would come out of this with a fairly positive view of Dimon (at least compared to the other bankers).
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I had a hard time buying Paul Giamatti as Ben Bernanke. In fairness to Giamatti, Bernanke’s beard looks ridiculous in real life, but it just looked so unnatural.
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It was a very short moment that most probably didn’t really focus on, but it basically painted Wells Fargo in a good light. At the TARP meeting with the banks, Dick Kovacevich (Wells CEO who I think is uncredited in the movie) is upset that his bank that isn’t mixed up in the Wall Street securities game is being forced to take TARP. Paulson then makes his statement that even the healthy banks have to participate or else the unhealthy ones will be susceptible to a run on them. This seems like acknowledgement that Wells was in fact healthy and a conservative bank. Of course that all changed with their acquisition of Wachovia shortly afterwards.
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John McCain is made to look like a complete fool as he makes his big announcement to suspend his campaign and head back to Washington to help only to derail the process. At the time, while it seemed like a political stunt to me, I did think there was some validity to McCain and Obama heading to Washington to present a united front in support of TARP. McCain, being clueless on the economy, likely did do nothing but screw up a process that was nearly complete.
Obviously you are talking about the scene when Thain questions whether the government will put in place compensation restrictions. The scene obviously does make Thain look bad, but the point about losing out on the talented employees to companies without compensation restrictions is a valid one. Didn’t Deutsche Bank poach some of the best Bank of America / Merrill Lynch bankers during the time when they had their compensation restrictions in place? Thain is a big target on the subject because of his ill-advised Merrill bonus payments, so he deserves criticism; however, the concept of how much control the government was going to have was a valid one to bring up, and the scene actually showed the bankers almost immediately agreeing to Paulson’s plan. Your statement that the bankers were concerned about their bonuses just doesn’t fit with the scene in the movie since Thain is the only one who brings up the topic.
Don’t you at least think it is worth mentioning that it was the government (especially Geithner) that was pushing for the banks to get bigger in contrast to the banks that were reluctant to? Which would you rather have had, Morgan Stanley swallowed up by JPMorgan like government wanted or Morgan Stanley raising money from Mitsubishi like it wanted and did?
Fuld looked like an absolute fool turning down the Buffett deal. He looked even more ridiculous barging into the meeting with the Koreans.
Apparently you missed the point of the Chris Flowers character who makes it clear that the government had no clue what was going on when he is the one who first makes them aware of how bad the AIG situation was days before their collapse. AIG wasn’t even on Paulson’s or Geithner’s radar screens. Further, how about how inept they made Chris Cox look as the head of the SEC. Sheila Bair, head of the FDIC, is made to look so useless that her only purpose is to serve as a prop by Paulson in his TARP meeting. What about the botching of the Barclay’s deal for Lehman by Paulson and Geithner by not even bothering to talk to their British regulators to see if they could get approval for the transaction?