From profiles of famous and infamous traders to sprawling economic oeuvres, here is our list of the best nonfiction must-sees for traders, investors, and other market observers.
MINYANVILLE ORIGINAL We've all seen Michael Douglas deliver Gordon Gekko's classic "Greed is good" monologue in the 1987 film Wall Street. But how would you like to see one of the best hedge fund managers in history present his case for the impending end of a 200-year bear market? Or to look into the sociopathic psychology of a rogue trader?
Here are a few thought-provoking financial and economic documentaries that you can watch free online for insight into the world of money.
The story of Paul Tudor Jones.
This film shows a wizard of a trader at his best, on good days and bad. The movie contains plenty of advice for individual investors and traders. Watching Jones' prediction of the 1987 downturn, based largely on intuition and Elliott Wave graphs, is especially fascinating in hindsight. Jones is extremely intelligent, but also superstitious. (About half an hour into the film, you see him put on his lucky sneakers that were once owned by Bruce Willis.) As erudite (and often right) as Tudor's analysis is, he says that he would rather have an emotionally invested money manager rather than a cerebrally detached one.
The film also shows the hedge fund manager donating his time and money to help New York City children graduate from high school and attend college on his dime. Jones wrote about the mission of his charity, the Robin Hood Foundation, in Hedge Fund Intelligence last year.
Poverty is an enemy that comes in many forms. But the worst form of poverty facing America today is the poverty of opportunity. Ironically, it was this poverty of opportunity that drove so many of our ancestors to flee their homelands for America. The promise of opportunity was so important that it became the first founding principle in the Declaration of Independence — “All men are created equal” and implicit in that is a promise of equal opportunity. But go tell that to the 20,000 New York City children -- children, mind you -- who will sleep in a homeless shelter tonight in this fair city. Where is their opportunity?
Watch this one now. Jones apparently requested that the film go out of circulation — possibly because of the embarrassing technology and fashion statements that were in vogue on Wall Street in the 1980s.
Takeaways: Get up early. And be aggressive.
25 Million Pounds
Interview with rogue trader Nick Leeson.
This is the true story of Nick Leeson, a British trader that went from a Morgan Stanley (MS) clerk, to a rogue trader that brought down Barings, a smug old bank that even held the Queen's money. This story inspired the film Rogue Trader in which Ewan McGregor starred as Leeson. Through interviews with Leeson, this documentary from the early nineties helps us understand the psychology behind dishonest traders like Kweku Adoboli, who managed to relieve UBS (UBS) of $2 billion. Or impulsive gamblers.
Breaking the Bank
Bank of America's Terrible, Horrible, No Good, Very Bad Year.
Psychology also applies to CEOs and corporations. Are you still wondering why Bank of America (BAC) made those disastrous acquisitions of Merrill Lynch and Countrywide? Taking a look at the bank's history and Ken Lewis's Napoleonic drive to build the biggest bank in the nation in the South to get some light shed on this.
The definitive financial crisis documentary.
This Oscar-winning documentary is perfect if you are want to explain the financial crisis to an English-speaking extraterrestrial that hasn't read any of our newspapers for the last six years. Even savvy investors can benefit from this concise, cogent, well-executed documentary. A-list sources like Christine Lagard, Barney Frank, George Soros, Dominique Strauss-Kahn (pre-disgrace), and Eliot Spitzer (post-disgrace) give you a front-row seat to the central story of this generation.
The Ascent of Money
Niall Ferguson's financial history of the world.
Most documentaries that explain the origins of the financial crisis go back all the way to the mid '90s. Or maybe Regan's first few years in office. This is all well and good, but Professor Niall Ferguson takes you all the way back to ancient Babylonian futures contracts etched onto clay tablets and Fracisco Pizzaro's exploitation of the Cerro Rico at Potosí, which is the mine that flooded Europe with silver. Ferguson's exploration of human history shows the enormous influence that money has on the rise and fall of empires, all the way up to today.
Commanding Heights -- The Battle for the World Economy
The birth of globalization.
Though dated, this five-hour exploration of economic globalization's origins in the fall of the Iron Curtain is still very informative. This was made in the dusk of the 20th century, when deregulation was gospel.
Life and Debt
How indebtedness makes bad situations worse for the small countries.
One of the issues explored in Commanding Heights was the IMF and World Bank's response to crises like the 1997 Asian Financial Crisis. Though the lenders have since corrected their ways to some extent, Life and Debt is food for thought for Europe's rescuee countries like Greece and Portugal. This film looks at the effects of national indebtedness and IMF policy prescriptions on ordinary citizens and local businesses in Jamaica.
Inside the Meltdown and Money Power and Wall Street
Instant expertise on the biggest financial crisis since the Great Depression
If you want to dig deeper than Inside Job, these two PBS documentaries are just the ticket. Though there is some information overlap between the two, they are both worth a look. See them on a rainy day.
The crisis didn't need have to happen.
Did the meltdown of the entire financial system truly blindside us all? Brooksley Born, the head of the Commodity Futures Trading Commission, wasn't surprised at all. She urged tighter regulation of over-the-counter derivatives in the 1990s, but was unheeded. A Washington Post profile compared Born to Cassandra, the mythical character that was blessed with the gift of prophesy, but cursed by Apollo so that no one would believe her.
"I was very concerned about the dark nature of these markets," Born said in the profile. "I didn't think we knew enough about them. I was concerned about the lack of transparency and the lack of any tools for enforcement and the lack of prohibitions against fraud and manipulation."
Eventually, despite pooh-poohing from Alan Greenspan and Larry Summers, Born presented her concept paper on regulating derivatives such as credit default swaps. She was swiftly decried. The Wall Street Journal claimed that "the nation's top financial regulators wish Brooksley Born would just shut up." And just a few months later, Long Term Capital Management found itself sunk by those very derivatives.
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