Margin Call (2011) - Review

By focusing on one late-night scramble, we find the emotional heartbeat of the economic crisis

January 14, 2020

This is the film that The Big Short aspired to be. Not that that isn't also a great film. But Margin Call is the Titanic of finance films, by which I mean this: We intensely follow one firm's all-night scramble to survive the financial crisis. And because of that, we are emotionally invested in the breaking tragedy more than we could be for any birds-eye analysis.

The margin call, in so many words: The bank teeters on the brink of bankruptcy because its holdings have plummeted in value while over-leveraged. Amid rounds of layoffs, risk analyst Peter Sullivan (Zachary Quinto) burns the midnight oil and figures this out. All the cavalry is called, no matter the hour. When the creditors come calling at dawn, as a lawyer once told me, "you lose the farm."

What brilliant casting. Everyone, from Paul Bettany to Demi Moore to Stanley Tucci, nails it. Kevin Spacey as sales director presages his House of Cards ruthlessness but has more conscience than anyone else here. Salesmen may hawk anything, especially on Wall Street, but some actually do believe the best client is a repeat client. Only a few actors have the pedigree to be his CEO; Jeremy Irons is one. "How do you get to the top?" he asks the board. "By being first, by being better, or by cheating."

At that moment we are weighing which of the three his solution to this crisis will be. By the end we could make the case for either of two. As everyone debates what is right, what is possible given the timeframe, and what will save the company, the greatest drama emerges from Spacey's and Irons' differing perspectives on the relationships they've created with their clients and the market as a whole.

Should they unload these worthless holdings in a fire sale, the suckers at Citi and Deutsche, the traders with whom Spacey's spent thirty-five years developing relationships, would never trust him again. Moreover he'd have to ask his sales force to betray their clients as well. Irons, of course, doesn't need to hear it firsthand---like Liar's Poker's fleeced German investor, "Vat do you haff up your sleef, Michael?"---but Spacey correctly argues the Street will turn its back on him too. The alternative might be a corporate death sentence, but doesn't having zero clients amount to the same?

Smartly and smoothly, the film never really attempts to explain the intricate details that doom the firm. Sure, Quinto gives his speech about volatility and leverage. From that, I could glean only so much, mostly because I read Michael Lewis. And I work in finance. The Big Short teaches us entertainingly so that we can arm ourselves against Wall Street. But Margin Call creates such an alarm, the actors perform so urgently, that we care only about the impending disaster---it must be catastrophic, if they are acting this way. The major players don't even try to understand it all fully. For most that would be impossible, and they need only the big picture to function in their roles. As the CEO says, "Explain it to me as if I were a child."

This doubly thrills me. Esoteric financial products aren't the focus; the characters' decisions under fire are. It also removes the need for so much expository dialogue that could have sunk a great story. We are right in the boardroom like a fly on the wall.

That dismissal of fully understanding the instruments also cements another point, as The Big Short does. Disaster beckons again if the banks themselves won't do their due diligence. And how can they when their products are so labyrinthine?

J.C. Chandor hasn't directed before; I cannot wait to see his future work. His photography is crisp and clean. That may be his strategy for suit-clad New Yorkers in glassy, longitudinal scrapers, but I have a feeling that style will extend beyond here. More importantly, he assumes we are smart enough, if not to understand the intricacies of mortgage-backed securities, then at least to know what's important and piece it together for ourselves.

We don't have to see the dire implications on screen to know they're there. Indeed, they have more weight because we are so emotionally invested in this one company. All these people on the street are about to be carrying cardboard boxes. Your house, your job, the world's economy can hinge on the specific decisions these bankers make. On the whole they make them with considerable thought, but with the aloofness of generals in the bunker. You might find it loathsome to sympathize with the prodigal cads, or with the execs with "it-better-be-a-good-deal" golden parachutes, making $150k an hour during the crisis. But not every banker here is that simple. And in their pallor you foresee the millions of third-class passengers who will suffer for their decisions.

Non-one-percenters may feel their plight arises from a lack of resources. And rightly so. But why does Spacey say he needs the money? The last scene tells us. Margin Call reminds us that there are craters in which only piles of money can bury you.

4 of 4 basis points