Year Released: 2012

Available on Amazon and Hulu

It’s always fun to see a Master of the Universe meet his comeuppance. Hedge fund magnate Robert Miller (Richard Gere) is in big trouble. After an investment loss, he cooked the fund’s financials and borrowed $412 million in order to make the fund appear solvent to a buyer. Fraud is the least of his troubles. He has a dead mistress, a suspicious daughter and a relentless detective to deal with. Melodrama aside, “Arbitrage” offers some valuable lessons in how not to manage chaos of your own making.

Awards: Golden Globe Award for Best Actor (Gere).

Quotes:

► “World events all revolved around five things… M.O.N.E.Y.”

► “Confidence equals contracts.”

Lessons:

► Understand the gap between perception and reality.

► The coverup is worse than the crime.

► Listen to your lawyer.

► Don’t implicate family members in your fraud. 

Year Released: 2019

Available on Hulu

If money talk turns you on, this German-Luxemburg miniseries is for you. “Bad Banks” is filled with highly technical financial jargon spoken in a seamless polyglot of German, French and a delightfully off-kilter English. The action of season one starts and ends in Frankfurt. Jana Liekam, a young structurer, is explaining the investment deal at hand, putting her unprepared supervisor in bad light. Soon Jana is bluffing her way to a job at an investment bank called Deutsche Global Invest by promising to deliver a deal the bank has abandoned as impossible. That deal and all the deals that follow are described in highly technical and highly amoral terms. Unlike a Hollywood production, “Bad Banks” locates the financial shenanigans at the center of the drama. There are no good guys here. Even Jana, the protagonist, is not above spying for a competitor to get ahead and is revealed to be motivated by naked ambition untethered from any purpose.

Quotes:

► “Don’t expect 90% from me. I can only do 100.” 

► “It’s a job, just a bloody job.”  

Lessons

► Avoid upstaging your supervisor in front of clients.

► A team is only as good as its weakest member.

► Don’t burn bridges with colleagues.

Year Released: 2015

Available on Netflix

Years after the financial crisis of 2007-2008, people still didn’t have a good understanding of what went wrong. “The Big Short,” based on Michael Lewis’ 2010 book The Big Short: Inside the Doomsday Machine, tells the story of how a housing bubble triggered the worst financial crisis since the Great Depression. The film’s narrative is irreverent and unconventional. The story emerges from the gradual realization of actual investors, such as Michael Burry (Christian Bale), who perceived that real estate was getting overheated and made the unprecedented decision to bet against the housing market. The big banks, too big to fail, and clueless of their exposure, gleefully accept the wager. Because explaining the basics of subprime mortgages, credit default swaps and collateralized debt obligations would be dramatically deadly, the filmmakers occasionally break the fourth wall by cutting to celebrities, such as Margot Robbie (in a bubble bath), chef Anthony Bourdain, and economist Richard Thaler, who put the concepts in terms that moviegoers can understand.

Awards:

Won for Best Adapted Screenplay.

Nominated for Best Picture, Best Director, Best Supporting Actor (Christian Bale) and Best Film Editing.

Quotes:

► "No one can see a bubble. That's what makes it a bubble."

► "Tell me the difference between stupid and illegal, and I'll have my wife's brother arrested."

Lessons:

► Your theory may be sound, but if your timing is off you can get stuck with big losses

► When you’re right, stick to your guns.

► Don’t bet the farm on the efficient market hypothesis. 

► Ratings from the agencies do not measure risk.    

► Stay away from illiquid markets.

Year Released: 2000

Available on Netflix and other platforms

“Boiler Room” grew out of a job the screenwriter had with brokerage firm Sterling Foster, renamed in the movie as J.T. Marlin, a cold calling, dialing for dollars brokerage based far from Wall Street on the outlands of Queens. Our hero, Seth,  joins the firm as a stockbroker trainee. His first task is to close 40 accounts. The firm, he soon learns, operates mostly by pumping and dumping, using its brokers to create artificial demand in the stock of expired or fake companies and speculative penny stocks. When the firm is done pumping the stock, the firm founders sell and trade for record profits. Soon, Seth is in the crosshairs of the FBI, which hopes to flip him as an informant. Seth embarks on an elaborate IPO scheme designed to bring his firm down. The FBI runs out of patience and arrests Seth for violating 26 SEC and NASD regulations. The movie ends with federal agents raiding the brokerage.

Quotes:

► “Either you sell the client some stock or he sells you a reason he can’t. Either way a sale is made, the only question is who is gonna close? You or him?”

► “We don’t hire brokers here; we train new ones.”

► “Fine! I'll take you off my list of successful people today!”

Lessons: 

► Fake it till you make it as a powerful mantra.

► When you hire a team, first create a new value system.

► Inexperienced minds are the best for innovation.

► Moving forward often involves sacrifice.

► Sometimes to succeed, it’s tempting to keep blinders on.

► A narrow path can only hold so many people.

Year Released: 2011

Available on Hulu, Vimeo

“Margin Call” was written by the son of an investment banker, and it shows. Few Hollywood movies get the little details as right as “Margin Call.” The action of the movie takes place over an intense 24 hours in the life of an unnamed investment bank on the verge of implosion. The existing volatility in the firm's portfolio of overleveraged mortgage-backed securities exceeds the firm’s thresholds. It seems the loss may be greater than the total value of the firm. The drama centers on the sales team’s desperate attempts to dump all of the toxic assets before the market learns of their worthlessness. That doing so will destroy the firm’s partnerships with its counterparties is of no consequence. “Margin Call” is a painfully accurate drama about the moral compromises required of investment bankers to create and trade complex derivative instruments they themselves barely understood.

Awards:

Academy Award for Best Screenplay

Quotes:

► “There are three ways to make a living in this business. Be first, be smarter or cheat.”

Lessons:

► Don’t invest in something you don’t understand.

► If you can’t explain it so a two-year old can understand it, you have no business selling it.

► If you borrow to invest, you can end up owing more than you’re worth.

► Stay clear of buying assets sold at a discount.

Year Released: 2011

Available on Amazon Prime

The text is baseball. The subtext is investment. The story is really about what value is, how to recognize it, and how to exploit it when others don’t. Based on Michael Lewis' book: Moneyball: The Art of Winning an Unfair Game, this film charts the education of Billy Beane (Brad Pitt), manager of the Oakland Athletics baseball team as he rejects years of recruiting tradition in favor of a statistics-based approach to recognize undervalued talent.  The analogy to investing couldn’t be clearer.  Baseball scouts have no better success knowing which players will succeed than traders have in knowing which stocks will go up. The quants prevail.  Aaron Sorkin, the screenwriter, deftly describes the mathematical underpinnings of the winning strategy. 

Quotes:

► “There are rich teams and there are poor teams. Then, there's fifty feet of crap. Then there's us.”

► “People who run ball clubs, they think in terms of buying players. Your goal shouldn't be to buy players, your goal should be to buy wins. And in order to buy wins, you need to buy runs.”

► “Adapt or die.”

► “When your enemy's making mistakes, don't interrupt them.”

► “You get on base, we win. You don’t, we lose. And I hate losing, I hate it. I hate losing more than I even wanna win.”

Lessons:

► Different is not always better, but better is always different.

► Success is predetermined by the metrics used.

► Success often depends on forgetting what you know.

► Believe in using new technologies.

► Changing the game requires changing entrenched beliefs.

Year Released: 1991

Available on Amazon Prime

The specter of Nobel Prize winning economist Milton Friedman informs “Other People’s Money.” Lawrence “Larry the Liquidator” Garfield (Danny DeVito) is a corporate raider who has become rich buying up struggling companies and stripping their parts. He is up against the benevolent CEO of a besieged company that makes wire products. It’s a battle between the proposition that the purpose of a corporation is to maximize profits for shareholders and a triple bottom line model that embraces the interests of employees, the environment and the community.  The drama culminates at the annual shareholder’s meeting, where the antagonists make their case about the takeover. The financial debate is thrilling to watch; the script does a good job of laying out the timeworn arguments. The CEO makes an impassioned plea to save the company. The movie ends with the shareholders voting.    

Quotes:

► “I love money. I love money more than the things it can buy. There's only one thing I love more than money. You know what that is? Other people's money.”

► “I take from the rich and I give to the middle class. ... Well, the upper middle class.”

► “I don't take money from widows or orphans, I make them money!”

► “You invested in a business, and this business is dead. Let's have the intelligence—let's have the decency—to sign the death certificate, collect the insurance and invest in something with a future.”

Lessons:

► It’s always preferable to bet other people’s money. 

► Don’t waste resources on fighting off a takeover. Get top dollar and move on. 

► Creative destruction is never pretty.

► There are more winners than losers when capital and labor are put to their highest and best use.

► The distinction between illegal and immoral matters.

Year Released: 1999

Available on Amazon Prime

Hollywood loves biopics about individuals destroying the financial system. “Rogue Trader” dramatizes how Nick Leeson single-handedly caused the downfall of Barings Bank. The film is based on Leeson's 1996 book, Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World. Narrated by Ewan McGregor, this British production starts with Leeson in Singapore working as General Manager of the Trading Floor on the SIMEX exchange. While he appears to thrive as a trader, Leeson is actually hiding over £800 million in losses, twice Baring’s total trading capital. Before he is sentenced to six and a half years in jail,  the film offers a key lesson about how insufficient compliance, governance and risk management allowed losses to go undetected for so long.    

Quotes:

► I've discovered it's not actually terribly difficult to make money in the securities business.”

► “A futures contract is like if I agree to sell you this cup of cappuccino, which I don't yet own, at 45 cents a month from now; if I can buy the cappuccino at say, 43 cents, I make a profit. If the price goes the other way, I have to pay more and I lose.”

► “He doesn't do things by the book. He just doesn't respect the rules. Is he really the kind of person we should be employing at Barings?”

► “I therefore have to inform you that Barings is insolvent and will go into immediate liquidation.”

► “That's what you get for hiring the wrong sort of person.”

Lessons:

► Breaking small rules usually leads to breaking big rules.

► Don’t be too proud to ask for help when you are in over your head.

► Don’t confuse brains with a bull market.

► Sometimes, the best strategy is to take the loss.

Year Released: 1987

Available on Amazon Prime

“Wall Street” is the prototype of all finance movies. No list of finance movies would be complete without it. The movie introduces the archetype of greed in the character Gordon Gekko (Michael Douglas). Directed by Oliver Stone as a tribute to his stockbroker father, the character of Gekko is said to be a composite of a lineup of rogues, including Ivan Boesky, Carl Icahn, Asher Edelman and Michael Milken. A critical mass of people working in finance today admit the movie influenced them to become traders. Bud Fox (Charlie Sheen) is a junior stockbroker who is determined to work with the legendary Gekko. Under Gekko’s dubious tutelage, Fox becomes more and more compromised. When Gekko’s criminality becomes too much, Fox devises a plan to stop his mentor. Here the financial machinations become complex, but it’s a tribute to the storytelling that it all makes sense because the motive behind everything is so consistent: greed. 

Awards:

Academy Award for Best Actor (Douglas).

Quotes:

► “The point is, ladies and gentleman, that greed, for lack of a better word, is good.”

► “Money never sleeps, pal.”

► “You've got that killer instinct. Stick around pal, I've still got a lot to teach you.”

► “If you need a friend, get a dog.”

► “Money's only something you need in case you don’t die tomorrow.”

► “This is your wake-up call, pal. Go to work.”

► “I'm tapped out. American Express' got a hit man lookin' for me.”

Lessons:

► Greed may be legal, but it corrodes character. 

► High-pressure tactics damage both salespeople and customers.

► Instant gratification is no long-term solution.

► Heed the time value of money.

► In every transaction, there are winners and losers.

Year Released: 2015

Available on Amazon Prime

Another Wall Street movie based on an actual trader, “The Wolf of Wall Street” chronicles the rise and fall of infamous stock scammer Jordan Belfort (Leonardo DiCaprio). The action centers on the real-life events in and around Stratton Oakmont, the notorious over-the-counter brokerage firm that feasted on clueless investors through unrelenting pump and dump schemes. The technical detail is overwhelmed only by depictions of depravity of Wall Street traders in the pre #MeToo 1980s. The film still holds a Guinness World Record for the most instances of profanity in a Hollywood motion picture.

Awards:

Nominated for Best Picture, Best Director (Martin Scorsese), Best Adapted Screenplay, Best Actor (Leonardo DiCaprio) and Best Supporting Actor (Jonah Hill).

Quotes:

► “Was all this legal? Absolutely not.”

► “Without action, the best intentions in the world are nothing more than that: intentions.”

► “There’s no nobility in poverty.”

► “I want you to back yourself into a corner. Give yourself no choice but to succeed. Let the consequences of failure become so dire and so unthinkable that you’ll have no choice but to do whatever it takes to succeed.”

Lessons

► When you socialize with employees and treat them well, they will do anything asked of them.

► Do not avoid hiring someone because of past issues.

► Be careful about what you are sacrificing for money or success.

► Quit while you are ahead.

► Keep the sales message simple.

► Be your own best salesman.