Wall Street on Wall Street
Gordon Gekko returns to theaters today, but how will the movie play with Wall Street itself? Randall Lane, author of The Zeroes: My Misadventures in the Decade Wall Street Went Insane, recruits a roster of financial players—Jeffrey Leeds, Lawrence McDonald, and Nomi Prins—to analyze the good, the bad and the laughable.
Wall Street: Money Never Sleeps—better known as Wall Street 2, to most of America—opens today. The immediate reviews were mixed. Director Oliver Stone got credit for directing with some verve and action, but many found the plot wanting.
Film critics, however, generally don't know a bond from a stock, a call from a put. Besides the wonderfully villainous Gordon Gekko, Wall Street reached iconic status because it was embraced by the audience it meant to criticize. Everyone—truly everyone—on Wall Street has seen the original, and can recite dozens of lines—"Blue Horseshoe loves Anacott Steel"…"money itself isn't lost or made, it's simply transferred from one perception to another" far past "greed is good." That validity trickled down.
So with that in mind, The Daily Beast assembled a roster of Wall Street heavies and took them to a preview screening. Our panel of players:
• Jeffrey Leeds is president and co-founder of Leeds Equity Partners, a private-equity firm based in New York. He is a director of Education Management Corp., RealPage, and SeatonCorp, and a trustee on the United Federation of Teachers' Charter School Board in New York.
• Lawrence McDonald, a managing director of Pangea Capital Management who, until 2008, was vice president of distressed debt and convertible securities trading at Lehman Brothers, as well as the author of A Colossal Failure of Common Sense.
• Nomi Prins, a former managing director at Goldman Sachs and head of the analytics group at Bear Stearns in London, and author of It Takes a Pillage: Behind the Bonuses, Bailouts and Backroom Deals from Washington to Wall Street.
• The Moderator: Daily Beast editor-at-large Randall Lane, co-founder of Trader Monthly and Dealmaker and the author of The Zeroes: My Misadventures in the Decade Wall Street Went Insane.
Lane: Ok, did anyone like this movie?
Leeds: Early on, the screenwriter came to see me, because I know [producer] Ed Pressman, and said, "You know, I've just been given this [earlier draft], and I'm just throwing it away because Wall Street's changed." And he basically didn't know the difference between a hedge fund and a private equity fund.
It's as if a surgeon suddenly is a psychiatrist in the morning and in the afternoon he's a G.P.
We were talking about what the plot would look like. And I don't know this first-hand, but some people just have to do too much in too short a period of time. Next thing you know, you're filming. Next thing you know, you're editing.
Prins: I liked it until halfway through, and then it was a hodge-podge bunch of events. It lost its way. It felt like he was trying to hit all his points, and throw them into a pot.
McDonald: I liked it. Especially for a sequel. But yes, it was bipolar. The crowd was really into the first hour, and in the second hour it kinda just died down a little bit. It reminds me of some of the books that were written on the crisis—you can tell the moviemakers probably changed the direction of the movie as the crisis got more severe.
Leeds: It grabs parts of narratives that are familiar to people, even if they're confused. Which one was Goldman? Which one is Lehman? Which one was Bear Stearns? They're all merged and none of it makes sense.
• Randall Lane: Gordon Gekko’s Secret RevealedAt least in the first film, it tried to at least pull the covers back a little and give you the sense of how a deal might be made. Bud Fox has an idea to do a take-over, to do a friendly deal. Then you see Gekko and his guys going behind his back. You actually get, allegedly, to go behind the curtain. In the second film, there's none of that. They give you a little bit of the architecture, you see a little bit of the trading floors, but there's no sense of how any deal is or is not getting done. They do a little bit of this crazy side-plot with this energy company.
Lane: You mean that on Wall Street, twentysomething prop traders [Shia LaBeouf] don't also have side action funding giant private equity deals involving an energy idea so brilliant that no one else in the world wants to invest in it? [Laughter]
Leeds: Exactly. I mean, what is this guy? Is he an investment bank or he is a private equity guy? Is he a prop desk guy? It makes no sense. It'd be like if a surgeon suddenly is a psychiatrist in the morning and in the afternoon he's a G.P.
You could really make a fun board game identifying all the lack of continuities in this film. It seemed as if an older, tired Oliver Stone wasn't really interested in, you know, Wall Street and greed. He was interested in the clothing. The only scene he did with interest, it seemed to me, was when Michael Douglas gets a new wardrobe.
Prins: The whole mixing of [stocks] with subprime, the movie acted like it was the same thing. It was as if Stone was using his formula from Wall Street 1, and put that into today's more complicated world of leverage.
Lane: In fairness, I thought the Gekko speech describing what caused the meltdown was pretty brilliant.
McDonald: That was my favorite part. It was funny and educational. You know, I love this line he goes, "You're all fucked."
Leeds: There's no question that somebody got that narrative down. It's a narrative that everybody now knows. It's not completely accurate, but in terms of how the meltdown came along, sure. But it has nothing to do with the film.
Lane: Well, what other Wall Street details did the movie get right? Larry, you were at Lehman during the meltdown.
McDonald: It was really hard for me—it brought back a lot of memories, you know? It just was hard for me to watch it because I just remember going through that and losing everything.
The culture of the employees, the trading floor…I thought all that was pretty good, though some of the machines looked funky. And those equity guys were portrayed very accurately, like the lugheads that that know their stories on a couple of [stocks]. At Lehman the difference between equity floor and the fixed income floor was like night and day. It's like the Harvard, MIT crowd in fixed income and then it's like UMass on the equity floor. So many equity guys totally got blind-sided. They didn't understand credit derivatives, and they just were so wrapped up in their own little stories.
Prins: Gekko had a line, "it's not the money, it's the game." That's exactly right.
Lane: Banks are the real bad guy this time, as personified by Josh Brolin, who is some kind of strange hybrid of [Goldman's] Lloyd Blankfein and [JP Morgan's] Jamie Dimon.
Leeds: Is there a Wall Street guy—a CEO of a Wall Street firm—who looks like that and rides Ducatis? Let's take the real version, you have Lloyd Blankfein and Dick Fuld. Let's take the cartoon version and that's Josh Brolin.
Lane: To remove any moral ambiguity, Stone went into JFK mode and has Brolin try to sabotage the energy company because they actually could solve the energy crisis.
McDonald: Oh I hated that, I hated that angle. Isn't that classic Hollywood?
Leeds: The most ridiculous thing. Because, of course, right before that, he wanted to do it because the Chinese loved it.
Another ridiculous thing: The idea also that you can spread whispers about Goldman Sachs that would hurt it because it owns five percent of some fucking company? Yeah, that's going to tank the share of prices. Guys, I don't think so. There's a stunning lack of understanding of what quote-unquote "Wall Street" is.
Lane: Okay, the clear consensus is that this is not The Godfather 2 in terms of a second classic. What are the largest differences?
Leeds: In the first film, if you think about it, he took a very, very, very small story. Bud's confused and he tries to do this little deal and he becomes a little bit idealistic about it and then he sees how horrible the deal guy is. That's kind of a nice structure.
Here, he had to purport to understand the structure and the inner dealings of quote "Wall Street," whatever that is, and he doesn't understand of any of it. There was no narrative, no plot, no nothing.
You really feel like they paid him a bunch of money—Oliver Stone—and he said, you know, "Fuck it, I'll do it." And then he just had a little bit of fun, loved doing the clothes in London. He loved putting cameos in there, he loved having…But it's utterly…It's like a schoolboy who just can't resist telling a fart joke.
Prins: We just went through such a dramatic period, but the ending is so schmaltzy, like taking finance and mixing it with Nicholas Sparks. The original Wall Street ended in a world when Boesky was in jail, and Milken was going to jail, That was the time. He created a moment that then happened in real life. This wasn't as prophetic.
Plus, I'll take Daryl Hannah and Charlie Sheen over Carey Mulligan and Shia LaBoeuf. No contest.
Randall Lane is editor at large at The Daily Beast. The former editor in chief of Trader Monthly, Dealmaker and P.O.V. magazines, and the former Washington bureau chief of Forbes, he is the author of The Zeroes: My Misadventures in the Decade Wall Street Went Insane.