Forget Gordon Gekko BS...here's the real thing. Watch all 6 trailers- "Inside Job." Mishkin is embarrassing.
The movie's thesis seems to be that the whole housing crisis/meltdown was engineered. This, I believe, is way off base. Were a lot of people stupid? Sure. Were there a lot of bad/illegal things done? Surely.
But was there a gigantic conspiracy? Hardly. Consider this:
The new owners loaded up with so much debt—$2.9 billion from Wachovia, $1.4 billion from Merrill Lynch (BAC)—that there was no room for error. They didn't expect the property to be cash-flow positive until 2011, according a private placement memorandum. Until then, they planned to cover interest payments—$262 million in the first year alone—from a reserve fund Verrone had arranged. Source: The Ballad of "Large Loan Verrone," Bloomberg/BusinessWeek.
Note that one of the owners was BlackRock--a huge player in the capital markets. The problem was the age-old problem of excessive arrogance, hubris, and greed. It wasn't a case of an elite group deliberately setting out to bring the system down.
At least, that's my take.
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