The Making of the Big Short (the Movie That Is.)

Michael Lewis' book, The Big Short: Inside the Doomsday Machine is one of the best on the financial crisis.  No one writes about finance like Lewis, the journalist who started as a bond trader with Salomon Brothers.   His book chronicles the outsiders who bet against the housing bubble. It short be read with Gillian Tett's book, Fools Gold, which follows the tribe of geeks who invented the credit default swaps in the first place. My favorite moment in the book is when Paulson's analysts are at a Deutsche Bank conference.  They are baffled at why the bankers are so ready to sell them credit default swaps after he had been pulling teeth to buy them months earlier. 

Adam McKay directed the movie based on the book.  Here is a Wall Street Journal Cafe interview with him: 



Oddly enough, John Paulson, who made the biggest killing–the biggest short–is not in the movie.  Richard Thaler is.  He is the Ralph and Dorothy Keller Distinguished Service Professor of Behavioral Science and Economics at the University of Chicago Booth School of Business.  He presented a paper at the 1985 FMA meetings in New York which presented evidence against the efficient market hypothesis.  That was my first professional finance meeting and I had the pleasure of discussing the paper.  I sympathized with his difficulty at the time publishing such heresy.  Times change.  Now you can see he is at the pinnacle of the profession. Thomas Kuhn taught us that a scientific orthodoxy is finally finished only when the last member of that school dies.    

David versus Goliath: Bollywood's new challange

India has one of the world's fastest growing economies and its second largest population, a population projected to overtake China in the not too distant future. Bollywood's produces far more movies, though less revenue, than Hollywood and is known for its fantasy feeding extravaganzas. Now it is experiencing a new genre facilitated by the digital revolution.

Short films in India are attracting investors and established Bollywood players, spoiling audiences for choice. On October 6, 2015, the FT's Jyotsna Singh reported from Mumbai on how the explosion of digital access has fueled their popularity:

Will Netflix Make Movies Now?

The media mogul, Rupert Murdock's mantra is "Content is King." NetFlix seems to have taken that to heart with series like "House of Cards" and now with its "Marco Polo" and "Crouching Tigers, Hidden Dragon 2." NetFlix chief content officer Ted Sarandos tells Matt Garrahan, the FT's Global Media Editor, talks about the video streaming service's plans and reasoning in this Dec 3rd, 2014 video (4:56 minutes.) 








The movie industry's business model has been evolving rapidly driven by the digital technology revolution.

Will This Movie on Fracing Light Your Fire?

Ann McElhinney and Phelim McAleer have directed a new documentary about hydraulic fracturing that gives a very different picture from that portrayed in the Acadamy Award nominated documentary, "Gasland."  McElhinney is a bit of a fiery journalist, perhaps because of the attempt to muzzle the Irish pair (see below.)  Telling an Irishman or Irishwoman to shut up is hazardous.  Here are some things she has to say about what they found in researching "FrackNation: A Journalist's Search for the Fracking Truth:"




She is certainly right that the first hydraulic fracturing was done here in Kansas in 1947.  It was in the Hugoton field in southwest Kansas.  I doubt that that conventional well was in a shale formation since the field is "mostly Permian limestone and dolomite."

Video journalist Phelim McAleer questioned Josh Fox, the producer of the anti-hydraulic fracturing documentary "Gasland," about why he failed to disclose that methane has been present in Colorado water for decades and thus flammable at the tap:



In the New York Post, McAleer wrote last spring, "One of the most dramatic images in 'Gasland' is footage of a resident lighting his tap water with flames shooting out of the faucet.

"As a journalist, I wanted to learn more, so I went to a Q&A with Gasland director Josh Fox. As I questioned him, Fox eventually admitted that he knew people could light their tap water in these areas decades before fracking came on the scene.

"But he did not include the fact in his documentary because, he said, 'It was not relevant.'"

He then went on to tell of Fox's attempts to get the above video removed from YouTube and other internet sites.

Unlike "Gasland" and "Promised Land," Matt Damon's anti-fracing movie FrackNation is not financed by big Hollywood money.   It took a much more democratic route to finance itself.  Christopher Toto tells us "FrackNation, like many independent films of late, went the Kickstarter route to help bring its story to the masses."

According to the director's statement, "'FrackNation' was funded through the crowdsourcing website Kickstarter. The filmmakers raised $212,265 from 3,305 backers on Kickstarter on April 6, 2012. It was one of the most successful documentary campaigns in the history of Kickstarter."

John R. Hays, Jr., an eminent Texas attorney with an extensive practice in the oil and gas industry, tells me that the proper way to shorten "hydraulic fracturing" is "fracing" not "fracking," given industry practice.  I am afraid the industry is losing the spelling war: it is not the geologists and the petroleum engineers who are winning.