101 mins, rated MA 15+, opens 15 March 2012.
By MICHELE ASPREY, Lawyer
(This is my review as published in
the March 2011 issue of The
NSW Law Society Journal)
Margin Call is a financial
thriller – a fairly recent genre in film, which includes Wall Street (1987), its sequel Money Never Sleeps (2010), The Company Men (also 2010) and Up in the Air (2009).
Margin Call shows us 36 hours in the life of a fictional Wall Street
investment firm on the brink of the global financial crisis. It begins
with a brutal exercise in “downsizing” at the firm, and ends after a
desperate attempt to avoid the financial meltdown, not just of the
firm, but of Wall Street and beyond.
First-time writer-director JC Chandor aims to be financially literate,
and makes a brave attempt to explain exactly what has gone wrong with
the firm’s investment strategy. In this, he has the valuable assistance
of brilliant actors such as Stanley Tucci as Eric Dale (a risk analyst
who begins to unravel the truth, but is peremptorily made redundant),
Paul Bettany as a middle-level executive, Kevin Spacey, head of the
trading floor, and Jeremy Irons, the CEO who arrives by helicopter to
sort things out. Australia’s Simon Baker is chilling, too, as a
duplicitous senior executive.
These men – and they are all men, apart from Demi Moore as the firm’s
Chief Risk Officer – are masters of the financial universe, and very
richly rewarded. But there’s a running joke that the higher up the
management chain, the less financially literate they are. Almost the
first thing Jeremy Irons’ character asks is to be spoken to in plain
English: “Speak to me as you might to a young child – or a golden
retriever,” he says. Irons’ CEO is called John Tuld (a not-so-subtle
reference to Lehman Brothers’ CEO Richard Fuld).
The only one with a handle on the problem is Peter, the young analyst
who finishes Eric’s detective work. He’s played by Zachary Quinto, who
was Spock in the 2009 Star Trek
remake, and co-produced Margin Call).
Director JC Chandor claims to understand the finance industry because
his father worked for Merrill Lynch for nearly 40 years. His characters
seem more human than bankers and executives normally do on film. There
are no monsters here, just hard-working people who have made the wrong
choices, probably through greed and misplaced loyalty to a firm with no
But the film’s authenticity is only skin-deep. For example, Peter
explains that the firm packages its products in several tranches, and
that it takes about a month to “layer” them, meaning they have to be
held on the books for some time, which normally wouldn’t be desirable.
But as they are “just mortgages”, the firm can break the rules and not
comply with prescribed “limits” (which I think the film calls
“historical volatility index limits”). Projecting forward, Peter says,
if these assets decrease by 25% and remain on the books, the loss would
be greater than the market capitalization of the whole firm. Result?
In fact, if you unpack the jargon, don’t those products sound like duds
from the start?
On the other hand, there are several cracking monologues (in
particular, two by Spacey and one by Irons) that really bring the
issues down to tin-tacks and lay out the arguments for and against the
Lawyers may be annoyed when they find that there is no actual margin
call in Margin Call. No
lender decides that shares provided as security for a loan have lost
value, requiring that their security be topped up in cash or in extra
shares. What actually happens by way of “margin call” is that there’s a
huge sell-off of the dud financial products over just one day, at
enormous risk to both the firm and the market itself. Against the odds,
it’s a tremendously suspenseful set piece.
For a film that was shot in 17 days on a low budget, it looks and
sounds very slick. Perhaps there are a few too many shots of the NYC
skyline, and some of the dialogue is clichéd: “It’s a long way
down,” says Paul Bettany’s character, as he goes to sit on a railing on
the roof of a skyscraper. Nevertheless, JC Chandor and his fabulous
cast give us a fresh look at what led to the (last) GFC, and some of
the people who took us to the brink.