My VP at work is an ex-Goldman Sachs investment banker and recommended this Frontline series on the recent financial crisis. I have watched most of the parts that have come out and it is extremely good. It is available to stream for free on the Frontline website. Each part is an hour, and parts one and two have currently come out and are available on PBS’ Frontline site. Parts three and four are scheduled to be released on May 1st. I highly recommend that anyone interested in finance watch this, especially those of you who are still students and want to work on Wall Street. At least when I was going through the interview process a few years ago, questions on the financial crisis were common.
I am a big fan of the documentary Inside Job, which explains the financial crisis in a simple and easy to understand way. However, it is still fairly high level and glosses over a lot of the details. Furthermore, it took a very anti-finance view and was quite biased in some of the reporting. I’m not saying the reporting was wrong, but some of it was designed to make the people who work in finance look bad as a generalization (when only a small portion of those people had anything to do with the financial crisis) and much of it belittled finance as a whole. When operating correctly within the right safeguards, the financial system is an extremely vital driver of economic growth. This Frontline documentary does a great job of getting into the details, having secured a lot of interviews with the people most directly involved. It also takes much more of a “reporting” point of view rather than the more inflammatory “crusading” point of view that Inside Job took.
I no longer work in finance, but my own personal view is that the government gave the financial industry some medicine that cured the symptoms of the financial crisis but did nothing for the underlying disease. True, regulations have tightened and we probably are sufficiently safeguarded against any meltdown of significant size for the foreseeable future. But, as many of the documentaries point out, the cause of the problem is still out there. The leadership of the finance industry is still comprised of the same type of people: greedy, irresponsible, and worst of all immoral. They don’t seem to care when they rip off some pension fund in Mississippi so long as they make a massive windfall. The worst part is that they still have the ear of the government and the industry is so powerful as a whole, with incredible lobbying power. The intersection of finance and politics is a continuous conflict of interest time bomb, especially as people in the industry go and become regulators. It is a fuck show, and I don’t foresee any real changes. The government would have to fundamentally change the institutional culture on Wall Street at the top levels, and those guys making the real money are so out of touch with reality anyway that its just not going to happen. After all, according to Lloyd Blankfein of Goldman, they are “doing God’s work.”