Inside Job (2010)

Henry Paulson (in Feb 2008): We're gonna keep growing. Okay? And, obviously, I'll say it: 'If you're growing, you're not in recession, right? I mean, we all know that.'

I have always hated documentaries with a self-serving purpose and a data selection bias that pretend to say, post-crisis, "Oh, we already knew this. How didn't you?" When a friend first suggested this documentary, Inside Job, I was quite predictably dismissive of it as I knew what it would have to say - blame it all on the bankers. However, I watched this today for the second time, and I can quite confidently say I haven't watched a better, well-researched documentary that exposes the conflicts of interest of the academics in their association with the financial services firms.

Inside Job presents a series of interviews with some of the big shots at the banks and business school professors and also mentions all those who declined to be interviewed for very obvious reasons. Presented by Matt Damon and directed by Charles Ferguson, the documentary is divided into four parts that details the history of deregulation and where it has got us all today. It starts with the deregulation process started by the government in Iceland that led to the privatization of Iceland's 3 largest banks and goes on to contrast Iceland's GDP of $13 billion against the bank losses of over $100 billion. As one Iceland film maker says, "Nothing comes without consequences".

We see a series of reactions from various people, most notable being Singapore's Prime Minister, Lee Hsien Loong who remarks, "When you start creating something out of nothing, it's very difficult to resist", an obvious reference to derivatives. When NYU Professor Nouriel Roubini is asked why hasn't there been a more systematic investigation into the 2008 financial crisis, his response, "because then you'll find the culprits", will leave you slightly disturbed.

Some of the funniest scenes include a Goldman Sachs top executive saying, "That's very unfortunate to have on email", when he is quizzed on why a particular security was sold to a client when their analysts called it "crap" on email. Until then I was still a little skeptical since it was portraying Alan Greenspan in a particular light and I personally feel he is a man whose integrity can't be questioned. The issue Alan had against regulation was more from an ideological perspective as he is so famously known to be from the Ayn Rand school of thought. However, the icing on the cake is the interview with former Fed Reserve governor and current Columbia Business School professor, Frederic Mishkin. When he is quizzed by Matt Damon on why he resigned in August of 2008 (a month before Lehman's collapse) when there were so many issues to be taken care of, he very nonchalantly mentions he had to revise a text book he was writing. Even better, he is first asked about an academic paper that he wrote about Iceland, "Financial Stability in Iceland", and was paid $124,000 by the Iceland govt. to write it. Very conveniently, his current resume mentions the title of the published paper to be "Financial Instability in Iceland" and he justifies the error by calling it a "typo". Awesome.

With the trial of Fabrice Tourre recently coming to an end, I'd agree with what a columnist had described the trial as - "They just got the foot soldier. The big fish are still out there". Charles Ferguson doesn't recommend how these financial crimes can be stopped but suggests more underlings should come forward and expose the truth. The documentary is very informative and I'd highly recommend this to anyone with an interest on this subject. And guess what, the full version is freely available on Youtube!

Rating: 9/10