These Movies and Shows Can Help You Make Sense of Confusing Economic Concepts
At the beginning of 2021, Wall Street erupted in chaos when stocks for ailing video game retailer GameStop skyrocketed in price from $17.25 a share to $158.18 overnight. Short sellers on the online Reddit community WallStreetBets teamed up against hedge funds and focused their attention on buying GameStop shares. The stock prices continued to rise because other sellers were forced to keep buying options. Options, which give investors flexibility regarding the date on or price at which they can buy or sell the stock, became extremely popular among the 2 million members of WallStreetBets.
This short-selling caused large hedge funds to lose billions of dollars while Reddit users made money for themselves, and GameStop became one of the most-traded stocks on the market. But let’s back things up a little, because this process is undeniably complicated for those of us who aren’t too familiar with the stock market. A number of informative and entertaining movies and television shows can help illuminate a variety of financial concepts related to stocks, trading and the economy overall.
Boiler Room (2000)
Ben Younger’s Boiler Room not only boasts an incredible cast, but it’s also chock-full of relevant quotes regarding stock trading. The film follows a young trader who obtains a job as a broker for a small investment firm. But the sketchy company earns its employees millions in commission due to the sales of chop stocks, which involve creating artificial demand for expired or fake company stocks.
Although the story is fictional, the high-pressure environment in which making a sale feels like the only thing that matters is very real. Ben Affleck’s character Jim Young tells the recruits, “There is no such thing as a no-sale call during a training session. A sale is made on every call you make. Either you sell the client some stock, or he sells you a reason he can’t. Either way, a sale is made.” This speaks to the deeply transactional nature of the stock market and the idea that negotiations, whether they’re mental or collaborative, are at the root of its operations.
The Wolf of Wall Street (2013)
Matthew McConaughey’s scene in The Wolf of Wall Street is also one of the most memorable. Besides engaging in some famous chest pounding, McConaughey’s Mark Hanna brilliantly describes the stock market and the ultimate goal of a broker: “Name of the game? Move the money from your client’s pocket into your pocket.” He goes on to explain that nobody really knows what a stock is going to do because it’s “fairy dust.”
While stocks are a bit more lucrative and a lot less whimsical than fairy dust, there is a bit of magic to them — in a sense. Nothing tangible is being sold, and prices change largely based on mysterious-sounding “market forces” — namely supply and demand, but also the subjective likes and dislikes of investors and even good (or bad) PR. There’s a lot that isn’t concrete about the stock market, and Hanna’s diatribe is an effective reminder of that.
Billions (2016– )
There are almost too many quotes in Showtime’s drama Billions to choose from regarding the ins and outs of Wall Street — there’s an Observer article titled “‘Billions’ is the First Show That Gets Wall Street Right,” which is one major clue. In the article, reformed hedge fund manager James Altucher explains that the first episode is a brilliant show about a hedge fund manager and an attorney. That first episode alone delves deeply into essential Wall Street terminology, which “sets the stage for a good vs. evil epic where you don’t know what is good, what is evil, what the law should be, what capitalism is about [and] what is the psychology of money and success.” Beginning investors might feel the exact same way when they’re learning the ropes.
So why, according to Altucher’s expertise, is Billions “the first show that accurately describes what is going on on this tiny street”? It’s an excellent primer for anyone who doesn’t know much about trading primarily because of the wide variety of financial concepts it addresses. Binge a few episodes, and you can expect to learn about everything from hedge funds and shorts to insider trading and the U.S. Securities and Exchange Commission.
The Big Short (2015)
The Big Short is Adam McKay’s hilarious take on the 2008 market crash — a decidedly unfunny topic. The entire award-winning film navigates the world of hedge funds. In one scene, Margot Robbie explains subprime mortgages and shorting bonds in a bubble bath, illuminating the genesis of the 2008 financial crisis in a way that’s easier to understand. It’s not only memorable but extremely informative.
Robbie says, “They made billions and billions on their 2% fee they got for selling each of these bonds. But then, they started running out of mortgages to put in them. After all, there are only so many homes and so many people with good enough jobs to buy them… So, the banks started filling these bonds with riskier and riskier mortgages… These risky mortgages are called “subprime”… [The] mortgage bonds that were supposedly 65% AAA were actually just, mostly, full of s***, so now, he’s [Michael Burry, a hedge fund manager who foresaw the 2008 crisis] going to short the bonds, which means to bet against.”
Succession (2018– )
HBO’s Succession is a dark comedy that focuses on the owner of a successful Fox-Esque media conglomerate called Waystar Royco. Patriarch Logan Roy oversees his family’s operations, in addition to their behind-the-scenes power struggle over who’s next in line to run the company. Although the show doesn’t primarily focus on the stock market, it provides an honest glimpse into the psyche of so many wealthy elites, including Wall Street traders and hedge fund managers.
In one episode, Logan says, “Look, here’s the thing about being rich. It’s like being a superhero, only better. You get to do what you want. The authorities can’t really touch you.” Even son Kendall Roy drove home the point of profits over people when he explains, “You can’t put a value on a human life. Except in our case, you rather precisely can — because when trading opens tomorrow, we’re gonna drop like a stone.”