"Margin Call" Film Review, and Life Imitates Art at MF Global

Kevin Spacey as Sam Rogers
Kevin Spacey as Sam Rogers | Source
Jeremy Irons as John Tuld
Jeremy Irons as John Tuld | Source
Stanley Tucci as Eric Dale
Stanley Tucci as Eric Dale | Source
Paul Bettany, Will Emerson
Paul Bettany, Will Emerson | Source
Zachary Quinto and Penn Badgley
Zachary Quinto and Penn Badgley | Source
Demi Moore as Sarah Robertson
Demi Moore as Sarah Robertson | Source
Simon Baker as Jared Cohen
Simon Baker as Jared Cohen | Source

Margin Call, Lehman, MFGlobal

Margin Call is a not-so-thinly disguised fictionalized movie story of the 2008 demise of 100-year-old investment bank, Lehman Brothers, which was the second (after Bear Stearns) Wall Street casualty of the subprime mortgage fiasco.

The New Yorker reviewer, David Denby, called it "one of the strongest American films of the year and easily the best Wall Street movie ever made" and said the "writing and acting are so good that we get completely caught up." He also compared the movie favorably to Glengarry Glen Ross, citing David Mamet's influence on the young writer-director, David Chandor. That's high praise for Chandor's first feature film. The script and acting were indeed good, but in my opinion, the movie was not better than Oliver Stone's 1987 Wall Street for which Michael Douglas won an Oscar as the legendary Gordon "greed is good" Gekko. Nor is it in the same league with the powerful Glengarry Glen Ross.

The movie covers 24 hours of the crisis that led to the bankruptcy of Lehman Brothers. The all-star cast includes Kevin Spacey, Jeremy Irons, Stanley Tucci, Demi Moore and Simon Baker. Spacey plays the number three man at Lehman, a decent man who agonized over the morality of dumping the "greatest pile of odoriferous excrement" (subprime mortgage securities) on Lehman's unsuspecting customers.

Spacey's bosses, Jeremy Irons, the firm's CEO John Tuld (Lehman's CEO was Dick Fuld) and Simon Baker exhibit zero moral compunctions over dumping the toxic securities. The audience's first clue to Spacey's decency is one of the opening scenes in which Spacey is grieving over having to euthanize his pet dog. Later in the day we find him attempting to rationalize the morality of dumping the firms toxic securities on its customers as ordered by Irons' character, John Tuld.

Demi Moore who played the firm's chief risk assessment officer takes the fall for the disaster despite having warned Tuld of the excessive leverage and risk the firm was taking on. Stanley Tucci is outstanding as the subordinate risk officer who discovered that the firm's highly leveraged position combined with the decline in the subprime securities had put the firm in a negative net worth position, i.e. bankrupt. Zachary Quinto convincingly played Tucci's assistant, a Phd rocket scientist from M.I.T. who came to Wall Street for the money. After Tucci was fired Quinto explained the peril faced by the firm to Jeremy Irons. Without giving any more of the plot away, suffice it to say that the film didn't have a happy ending.

LEHMAN BROS., MARGIN CALL REDUX AT MF GLOBAL

MF Global's meltdown in October could as easily as Lehman Brothers have provided the basis for the scenario in Margin Call with the added feature of Jon Corzine, a Horatio Alger CEO who came out of nowhere in Illinois and rose to CEO of Goldman, a seat in the U.S. Senate and governor of New Jersey. MF Global could easily have provided fodder for a Greek or Shakesperian tragedy or perhaps a dark play by Eugene O'Neill or Arthur Miller.


“Margin Call” is rated R (Under 17 requires accompanying parent or adult guardian). Obscene language and obscene sums of money.


John Corzine, CEO of MF Global
John Corzine, CEO of MF Global | Source

Jon S. Corzine's MF Global Meltdown Could Provide Fodder for a Sequel Movie Called "Return of Margin Call" or "Margin Call II"

The Jon Corzine's MF Global meltdown which followed the release of Margin Call by a few weeks could easily provide food for a sequel, The Return of Margin Call. Former head of Goldman Sachs, Democratic US Senator and NJ Governor, Corzine's actions at MF Global followed the Margin Call scenario: 40:1 leveraged bets on risky bonds (high yielding Spanish and Italian sovereign debt rather than toxic sub-prime mortgages in Margin Call/Lehman Brothers.)

The MF case has an added interesting element of apparent mixing the firm's clients' money with the firm's risky investments of it's own funds.

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Comments 48 comments

MikeSyrSutton profile image

MikeSyrSutton 5 years ago from An uncharted galaxy

This is one i have to see! great hub!


Jools99 profile image

Jools99 5 years ago from North-East UK

Good review. It will be interesting to see if Margin Call does as well at the cinema as Glengarry Glenross and Wall Street. I'm looking forward to seeing it.


mortimerjackson profile image

mortimerjackson 5 years ago from California

This movie was pretty bad. None of the characters came off as convincing (at all), and there is the added issue of the plot itself. For this company not to have seen the consequences of their actions coming would entail that they were incredibly stupid. In reality, they're not. They saw this downfall coming, and the only reason they didn't do anything about it was because they were more interested in making short term cash than they were about creating a sustainable company.

Bad film overall, but the director does excellent work with the camera. The cinematography really adds a sense of atmosphere to the story, and for that this movie deserves some praise.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Thanks for your comments.


Wizard Of Whimsy profile image

Wizard Of Whimsy 5 years ago from The Sapphire City

Thanks Ralph!

"Society is like a stew. If you don't stir it up every once in a while then a layer of scum floats to the top." [Edward Abbey]


skear profile image

skear 5 years ago from Kansas City

Nice review Ralph, I'm looking forward to watching it, I love Wall Street movies!


kartika damon profile image

kartika damon 5 years ago from Fairfield, Iowa

Will check it out! Thanks for the review, Ralph!


nicomp profile image

nicomp 5 years ago from Ohio, USA

This does look fascinating. I read The Big Short recently and Lehman was touched on in that book.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

The Jon Corzine's MF Global meltdown which followed the release of Margin Call by a few weeks could easily provide food for a sequel, The Return of Margin Call. Former head of Goldman Sachs, Democratic US Senator and NJ Governor, Corzine's actions at MF Global followed the Margin Call scenario: 40:1 leveraged bets on risky bonds (high yielding Spanish and Italian sovereign debt rather than toxic sub-prime mortgages in Margin Call/Lehman Brothers.)


Harvey Stelman 5 years ago

Ralph, Good job, but I will still see it (he jokes). Very good cast, and you made it sound intriguing.

My mother's father was hit big in '29. An immigrant with two men's clothing stores. In those days you only had to put 10 cents down on a dollar. On paper he had a million dollars invested. Boom, the market drops. He looses the stoes, and everything the family had. He had a heart attack a few years later from it. I coulda been, I shoulda been but I never was. H


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Thanks, Harvey.


DJ 5 years ago

For such a great cast the movie was less than inspiring, and the ending was, well, ridiculous.

BTW - the first casualty of the meltdown was Bear Stearns. Lehman came after. Only difference was Bear was sold at a forced $2.00 share, later revised to $10.00 to Paulson's angst, and Lehman is still in bankruptcy. But Bear died first.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

DJ, thanks for your comment and the reminder that Bear Stearns was the first investment bank to fail. I incorporated your suggestion.


barranca profile image

barranca 5 years ago

Looks like a good movie. I will try to catch it. I saw Martha, Marcy, May, Marlene recently. It is worth the ticket. Tense psychodrama.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Our Reckless Meritocracy - NYTimes.com

Corzine's is a story of the promise of America. A boy from rural Ill, grandson of a farmer who lost it all in the Depression. He goes to his small-town high school and makes Phi Bete at his state U, an HBS MBA and on to CEO of Goldman and the Senate.


jiberish profile image

jiberish 5 years ago from florida

I was a corp trainer for one of the Mega banks, and they allow affiliates to market their goods but have a fine print that the bank itself is not liable for any misinformation. Worse part of it is that they require the customer service dept to make offers and actually have quotas. Trust NO One, nothing is free!..Good Info Ralph.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Thanks, Jiberish. Good to hear from you. I know what you mean. Here's a quote from a recent hub I did:

Preacquired account marketing is a sales practice that allows companies to charge consumers for services they do not know they ordered and do not use. The practice depends on a seller’s ability to access a consumer’s financial account without the consumer directly providing her account number and other access information to that seller. This flips the power dynamic in the solicitation

process by shifting the burden to the consumer to stop the seller from accessing her account, rather than requiring the seller to ask the consumer for her account information before her account can be charged. This is possible because the seller has paid a financial institution, such as a bank, or another seller who retains consumer account numbers for the right to charge the consumer’s account. Tens of millions of consumers have been affected by this sales practice. (Card MemberServices Comments and complaints Crook Alert!)


Genna East profile image

Genna East 5 years ago from Massachusetts, USA

Excellent film and superb review. I thought the writing was excellent; the performances and the pacing of the scenes were perfectly nuanced.

Jeremy Iron's character was also a take on Citi's CEO who talked about "Dancing until the music stops."

Well done!


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Genna, thanks for your kind comment.


AP 5 years ago

Enjoyed the film, though I wouldn't say the company portrayed is Lehman or Bear Stearns - the company in the film survived! It dumped the assets it knew were worthless on others before anyone else realized they were worthless. That's Goldman's thing.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Well, all the reviews I read said the movie was patterned after Lehman. Perhaps I misinterpreted the movie's conclusion, but my impression was that the company was headed for failure as was the case with Lehman. Perhaps it wasn't clear or I jumped to the wrong conclusion.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

As one of the reviewers pointed out, it wasn't a coincidence that the movie firm's CEO was John Tuld and Lehman's CEO was Dick Fuld.


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

MF Global improperly diverted customers’ cash for its own use in the days before its bankruptcy, an act that regulators believe may help explain why $600 million of customer funds remains missing, people briefed on the investigation say.

Investigators have now zeroed in on hundreds of millions of dollars in suspect borrowing at the commodities and derivatives brokerage firm, which at the time of its collapse was run by Jon S. Corzine, the former Democratic governor of New Jersey. At least some of that money was used to cover trading losses at MF Global, regulators suspect, meaning the money may no longer be simply missing. It may be gone.

http://dealbook.nytimes.com/2011/11/17/mf-global-i...


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

Too bad Jon Corzine didn't subscribe to Bernard Connolly's advisory service!

http://www.nytimes.com/2011/11/18/business/global/...


Ralph Deeds profile image

Ralph Deeds 5 years ago Author

About $200 million in customer money that vanished from MF Global is believed to have surfaced at JPMorgan Chase in Britain, according to people briefed on the matter. Just a little help among friends!

http://dealbook.nytimes.com/2011/11/28/money-found...


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Surprise! Witnesses say Corzine knew of misuse of customer funds.

WASHINGTON (Reuters) - The regulatory arm of CME Group has turned over interviews to the Justice Department that allege former MF Global chief Jon Corzine knew that the now-bankrupt brokerage firm used customer funds improperly.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Corzine Replaced MF Global Risk Officer Who Argued with Him with a More Compliant Risk Officer

A new risk officer at MF Global was not allowed to weigh in on the broader implications that trades might have on the firm, including whether they might undermine investor confidence.

MF Global is sounding more and more like "Margin Call" every day.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Leland Faust provides 10 reasons why Wall Street is a raw deal for "the 100 percent."

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/12/29/EDQN1MHHJI.DTL


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

MF Global Scrutinized on Money Move - NYTimes.com

New findings strengthen the belief that the company was improperly used customer money to make up for losses on highly leveraged ((40:1)bets on European bonds.

Corzine must not have seen the movie "Margin Call!"

http://dealbook.nytimes.com/2011/12/28/mf-global-s...


James A Watkins profile image

James A Watkins 4 years ago from Chicago

Your review is very good. I watched this movie a few days ago and I thought it was excellent. I always love the acting work of Jeremy Irons. And Tucci delivered an exceptional performance, I thought.

Of course, it is not Glengarry Glen Ross—and probably not as good as Wall Street. But hey, few films are.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

James, thanks for your comment. Happy New year!


linda mcguire 4 years ago

original movie script had firm's dept's name as GS MBS. GS was one of the first ones to get out.

The character of john tuld represents head of a firm, which gets out and not get trapped in. lehman was trapped in.

very limited homework.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Linda, thanks for your cryptic comment. Not sure what your point is.


Kylion Nathan profile image

Kylion Nathan 4 years ago

Funny awkward re-cut of Margin Call

https://www.youtube.com/watch?v=9MRoF25gPAg


Wizard Of Whimsy profile image

Wizard Of Whimsy 4 years ago from The Sapphire City

Hey Ralph, we saw this tonight on pay-per-view and thought they did a brilliant job. Thanks for the rec.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

2-7-12NYTimes--"MF Global Investigator Sheds Light on Chaos at Firm"

MF Global Trustee Sheds New Light on Chaos at Firm - NYTimes.com

Underpinning the misuse of customer money was a state of utter chaos at the firm, investigators said, as it rushed to sell assets and unwind positions to stay afloat.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

MF Global Trustee Sees $1.6 Billion Customer Shortfall - NYTimes.com

The revised figure reflects growing concerns that the bankruptcy trustee cannot claw back $700 million in customer money trapped at MF Global's British arm. [Which shell is the pea under?]


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Is MF Global Getting a Free Pass?

Let’s not mince words here. These executives committed a crime. Virtually every knowing violation of the Commodities Exchange Act is a crime, but taking money from segregated customer accounts is at the top of the list. And for good reason. Customer money is supposed to be sacrosanct. If a broker-dealer goes bankrupt, the segregated accounts are supposed to remain safe, a little like the way bank deposits remain protected if a bank goes under. Indeed, customers need to be able to trust the fact that their money is segregated and protected at all times. Otherwise, the markets can’t function.


louromano profile image

louromano 4 years ago

Nice hub ! Thanks a lot for sharing.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Building a criminal case at MFGlobal

Whether criminal charges will be filed over transfers of customer funds in the final days before MF Global collapsed in October 2011 may hinge on what was said by executives at the firm trying to keep it alive.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

MF Global: "The check's in the mail!"

MF Global customers who closed their accounts in the brokerage firm’s final days have been fuming for months about how the firm mailed checks to them, instead of promptly transferring the money electronically as usual. Many of those checks arrived after the bankruptcy filing, and subsequently bounced.


nicomp profile image

nicomp 4 years ago from Ohio, USA

It's amazing. Jon Stevens Corzine goes before Congress and swears under oath that they "don't know where the money went."

poof.

It's also fascinating that his testimony was given before before a House Agricultural committee.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

6-9-12NYTimes--Trustee Sees Customers Trampled at MF Global

Trustee Suggests MF Global Misused Customers’ Money - NYTimes.com

A report on the collapse of MF Global reveals a questionable series of moves that indicate the firm failed in its duty to protect the assets of its clients.


kartika damon profile image

kartika damon 4 years ago from Fairfield, Iowa

Ralph, I must admit, I haven't seen this but I plan to. I'm sure it will be enlightening and will piss me off a the same time - another reminder of the financial industry's recklessness and corrupt behaviors.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

Kartika, thanks for your comment The movie is worth seeing.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

8-16-12NYTimes--"No Criminal Case is Likely in Loss at MFGlobal"

No Criminal Case Is Likely in Loss at MF Global - NYTimes.com

Investigators are expected to conclude that sloppiness, not criminal intent, was the main driver behind the disappearance of customer money.


Ralph Deeds profile image

Ralph Deeds 4 years ago Author

1-14-12NYTimes-"Congressional Report Blames Corzine for MF Global's Collapse"

Congressional Report Blames Corzine for MF Global's Collapse - NYTimes.com

Excerpts from a broader MF Global report to be released on Thursday outline a withering critique of Jon S. Corzine's 19-month tenure at the brokerage firm, which collapsed more than a year ago.


Ralph Deeds profile image

Ralph Deeds 3 years ago Author

The prosecutors and the S.E.C., for example, both focused on whether Lehman executives misled shareholders by offering upbeat assessments of the firm’s health, as little as five days before the firm collapsed. The authorities also scrutinized whether Lehman executives overvalued its commercial real estate portfolio.

But it was Lehman’s accounting practices that probably drew the most attention. In his report on Lehman’s failure, a rebuke that spanned more than 2,200 pages, Mr. Valukas, the bankruptcy-court examiner, outlined accounting maneuvers that he called “balance sheet manipulation.”

The practice allowed Lehman to transfer securities off its balance sheet, presenting them as collateral to an outside lender, which in turn offered Lehman a short-term loan. Lehman treated the transactions as sales rather than as debt, which meant the firm looked as if it had less debt than it actually did. “Unable to find a United States law firm” to approve the maneuver, Mr. Valukas said, Lehman hired a law firm in London to bless it.

One Lehman executive, in an e-mail to a colleague, declared that the practice was “another drug” they were on.

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