By Nathan Lee, Finance and Politics Correspondent
Martin Scorsese’s Wolf of Wall Street rubs salt in the wounds of those most affected by the financial crisis and massages the ego of the bankers who allowed it all to happen.
Five years on from the greatest financial crisis in history and it all seems rather like a pantomime. The mountains of sub-prime debt, spiralling consumerism and fragile economics are staged as the audience screams; IT’S BEHIND YOU!
The trouble is, it isn’t behind us.
Martin Scorsese’s Wolf of Wall Street documents the debauched life of Jordan R. Belfort, a former stockbroker famed for market manipulation and running a penny stock boiler room for which he spent 22 months in prison. The film takes the lavish parties, sex and drugs lifestyle and reckless professions and glamorises a life without limits, afforded by the misfortune of countless investors who parted with their money because of high-pressure sales tactics tantamount to outright fraud.
The days of Ponzi schemes and Boiler Room tactics are said to be over, and with it have gone the lax consumer lending habits, reckless bonuses schemes and the artificial economy which was created as a result. But wait, “OH NO THEY HAVEN’T!”
Too little has changed since the financial crisis. Underwriting continues to have little or no practical relevance in the financial sector which remains largely unregulated and unsupervised. Banker’s bonuses exceed 100 per cent of their salaries and a system that was built on sand is now slowly eroding as government-backed (or tax paying support) withdraws.
As we explore the lavish life of Belfort we must remember that another collapse of banks ‘too big to fail’ isn’t just a possibility, it is becoming a distinct reality. The question is; how many times does the boy cry wolf before his cries fall on deaf ears?
Bolly is back on the agenda in the City. Financial markets have recovered, the housing market is booming and jobs in the finance sector have recovered, rising for the first time in almost two years in December 2013.
CityAM reported that City firms have been queuing up to get a glimpse of the rare financial markets film, with a number of enquiries for large corporate bookings registered. The Barbican has reportedly had a handful of group bookings from financial institutions and the Greenwich Picture House (a stone’s throw from JP Morgan, Citi and Barclays in Canary Wharf) has an entire screen booked out, joining West India Quay’s Cineworld in cashing in on corporate appetite for Scorsese’s dark comedy.
It may be a shocking indictment of the industry, but it’s a jolly good reminder of the good times that have passed and the better times to come! The Guardian’s Peter Bradshaw said of the film: “The sheer sustained blitz of bad taste is spectacular,” adding that it is “entertainingly outrageous”. Alex von Tunzelmann of the same publication took a more negative account, however, saying the portrayal of bad-behaving bankers sticks so slavishly to Jordan Belfort’s memoir that it squanders its satiric ambitions.
Outside the Financial Sector
But beyond the red carpets, Oscar nominations and film critics there is a harsh reality to the great financial crisis that seems to be going unreported. The reckless gambles and, in this case, outright fraud hit people outside the financial sector the hardest, and continue to do so.
As financial institutions marvel at the way they managed to dupe the world, we should spare a thought for everybody else and consider the cost of being nonchalant in the face of an ugly beast that may well rear its ugly head again.
The reckless pantomime that is the financial crisis has had long-lasting implications far beyond it’s immediate sector and there’s a growing suspicion that if the boy cries wolf again, he may not be saved.