Name: GO, Pamella Dafhne E.

Course & Section: Bachelor of Arts in Foreign Service - 201

"MARGIN CALL (2011): A MOVIE REVIEW"

I. BACKGROUND OF THE FILM

Written and directed by the American film director, J.C. Chandor, "Margin Call" was a
financial thriller film that portrays the situation during the economic turmoil or the global
financial crisis that occurred in the year 2007- 2008. Most of its scenes were filmed in One Penn
Plaza in New York City, and the setting revolves around the unnamed Investment Bank. The cast
consists of competent and renowned actors in Hollywood, and they play different roles and serve
their respective importance in the story. The casts are Kevin Spacey, who played as Sam Rogers,
head of sales; Stanley Tucci, who played as Eric Dale, the director of Risk Management;
Zachary Quinto, who played as Peter Sullivan, a risk analyst; Paul Bettany, who played Will
Emerson, the head of trading and Demi Moore, who played Sarah Robertson, the chief or risk
management. The movie was released in theatres nationwide on October 21, 2011, and its
running time lasts for 1 hour and 49 minutes. Even if this movie only grossed 19.5 Million
Dollars, which is considered small for a film with a superb cast, it was loved by many people,
especially the ones who are interested in general trading and the stock market. Margin Call
unravels the world of capitalism and the unfortunate event or the bankruptcy that the Lehman
Brothers, one of America's leading and biggest bank, has faced during that time. Let us find out
what could happen within the 24-hour mark and the conflict that will ensue in both stages of the
financial crisis because every movement of the clock is like a ticking bomb to the key figures in
the investment bank — leaving them at the edge of their seats.

II. BODY

It is the year 2008, the economy is teetering at the brink of collapse, and everything is not
going well according to the plan. The Human Resources Team conducted a massive layoff of
80% of the employees in the investment bank. It was right before the eyes of both junior risk
analysts, Peter Sullivan (Zachary Quinto), and Seth Bregman (Penn Badgley). They watched as
their co-workers go to the doors of the elevators without turning their heads back. To their shock,
their boss (Eric Dale) in the department was also included in the list of the layoffs. Eric Dale
(Stanley Tucci) was in utter disbelief of what happened because he is expecting that the Human
Resources team called him to address concerns in his line of work as there is something that he
cannot figure out with the project that he's been doing; he is not yet over with the observation
that he is working on. Despite the pleas that he has been giving the HR to let him finish the
project, they insisted that he should be brought out of the picture. Him being fired means that he
has no control of the project that he is keeping a keen eye on. As he strolls his way to the
elevator, Peter and Seth was able to talk and walk him off. But as Eric gets on to the elevator,
Peter took the opportunity to thank him and before its door finally close, Eric hands Peter the
USB flash drive that contains the project he's been working on the past few days but was not able
to finish and told him to "be careful" in continuing and finishing that project. Unbeknownst to
everyone in that building, that project would be the downfall and will mark the great loss of the
entire firm.

Hours went by, Peter realized that the project that Eric passed to him was more important
than anything else. So, without having second thoughts, he declined the invitation of Seth to go
to the party to celebrate their stay in the firm and have decided to stay in the office as he will
continue working on the unfinished project. After several moments of transcribing, observing,
and making calculations on the given figures, he noticed that there was something odd in the
pattern that does not make any sense at all. With strong speculations and solid judgment, he
found out that the patterns will wreak havoc and will be the cause of the bankruptcy of the entire
firm. Upon seeing all of these, Peter now decided to call Seth and asked him if he can tag Will
along, the head of trading, to go back to the office and see the pattern for themselves, because it
is huge and a serious matter to deal with.

As Seth and Will arrived at the office, Peter hurriedly and concisely explained to them his
discovery on the said patterns. If the current volatility in the firm's accounts surpass the historical
volatility, the value of the portfolios would certainly drop by 25%, and this thing could get worse
and worse every passing minute. According to Peter, if this thing continues, the projected losses
would be greater than the totality of the entire value of the company. Being a smart and
observant analyst, Peter engaged himself on a thorough research on Value at Risk or the VAR
that is currently dropping. Looking at the figures and basing on the situation, Will hurriedly tries
to get ahold of Sam, the head of sales, as this is a very huge problem that will affect the entire
company and the welfare of its workers. With all these being said, this occurrence poses a threat
to the company, that may later on result to bankruptcy.

Now that the conflict has arose, the management has called the executives for a
conference in the wee hours of the night, in order to discuss their plans on how will they avert
the entire fiasco and the major consequences that would change the system of the firm. The
meeting started when the CEO, John Tuld (Jeremy Irons) finally arrived in the room. Without
wasting any minute, he opened up the topic as to why there is an emergency meeting at the firm
during an unexpected hour. As Peter was the one who discovered and made calculations on the
historical patterns, Tuld gave him the chance to explain the rationale of the current situation in
layman's terms. He explained the historical volatility index limits and if it is overshadowed by
the current volatility, the assets would drop by 25%, making the loss bigger that the actual value
of capitalism in their firm. After the sensible banters between the executives, the decision-
making, which is the hardest part, would of course come from the judgment of the CEO as he has
to make the margin call. Looking at the statements made by Peter, Tuld insisted on going on with
just two options. Either they would let all the hard work of 107 years go down to the drain or
they would take advantage of the situation by selling all the toxic assets to everyone who is
interested, even if it is worthless. Now, given the two basic options, the majority or the CEO,
insisted on choosing the latter, and that is to sell and let go of the considerable amount of several
key asset classes even if there is no assurance that the bank will recover. Aside from the
noticeable damage that it may inflict to the firm, the domino effect may occur because not only
the reputation of the firm will be tarnished, but also the client relations, jobs, and the careers of
its employees.

III. ANALYSIS

Based on the real story behind the downfall and the bankruptcy that the Lehman Brothers
has faced, this movie was very informative in giving us a notion and imparting us the insights
with regards to the to 2008 meltdown. With the corporate and finance setting, this movie surely
lived up for its title, because whenever we hear or discuss the term margin call, it refers to the
occurrence of the decrease of the value of the client or investor's margin below the broker's
typical and required amount. Moreover, it is an indicator that the value of assets and securities in
the said margin has decreased from its original amount. Thus, the investor has the choice to make
whether if he or she is going to deposit more money from their account or sell some of those
assets held in their account per se (Kuepper, 2020). And remembering the plot of the movie
itself, it talks about the same financial dilemma or crisis because it involves, assets, securities,
finance, VAR, and the likes of it. I would also like to add the term Value at Risk or VAR in this
equation, because this helped me to go through the ropes of finance and helped me to somehow
understand of what is going in the film. The Value at Risk, widely and commonly used in banks,
helps to measure and the chances of financial risk in one's firm or portfolio in a specific amount
of time (Kenton, 2019).

As someone who rarely watches Hollywood movies, I can say that this movie is not
really for everyone, especially if it is not within the bound of your interest. This movie can be
perplexing, because majority of the scenes involves jargons and dialogues about trading, but it is
sure worthy of your time as this film can provide us the overview of what goes inside the minds
of the people who works in the sector of trading and what goes beyond their decision making in
order to save the reputation of their firm. This movie will not be possible and substantive without
the perfect and promising execution of it cast. The importance of Sam Rogers, who stepped up
for the employees of the firm and the one who stood firm with professional integrity; Eric Dale,
who became one of the key figures in the initial findings of the projected losses of assets; Will
Emerson, who tried up to come up with various solutions and of course, Peter Sullivan, who
became the main contributor in this film because of his intelligence and his capability to research
thoroughly in order to find out the real cause of the fiasco that the firm is facing. I would also
like to commend the production staff for the reason that they set the exact tone and the artistry of
cinematography for this film because the intensity of every scenes really stood out, giving minor
suspense throughout the film. Lastly, I also appreciate how this depicts the reality in the business
setting and on what measures these people are willing to take in order to save their career and the
entire corporation that they are working to.

IV. CONCLUSION

All in all, this movie has been a joyful and intense ride. The actors really gave their all in
the acting and the execution of their dialogues. For that reason, I personally commend this movie
because this embodies the situation of a firm that currently experiences a financial crisis. Hence,
this depicts the inevitable collapse of systems that is still relevant up to this day. This also
unravels the truth as to how harsh the system can be or the people who has the upper hand in
within the corporation. Even if they know what the consequences and the risks of their final
decision would be, they still gambled it all and took the measures that they think would suit the
best for the reputation of the company. And even if they know that the reputation of the firm will
no longer be the same to its partners and clients, they showed that this crisis in no longer new
and not different from the games of gains and losses that they have encountered before. Despite
the futile attempts to save the bank, the result would never be the same again and there are some
things that cannot be taken back, especially the trust of the clients.

In the tangled world of trade, business, strategies and financial system, there is no way
out. We can see the real nature of the real weigh of the decisions that these bankers, analysts and
executives has to make, without considering if their decision would stick to being ethical. We
can also take into account that these corporations, does not really care about the welfare of its
people or the public good. As long as they are benefitting from them, then they are good. But
once it encounters a problem or you did not meet the standards that they are expecting from you,
they can abandon you like you are just a lost puppy strolling around the endless street. There is
no really sense of the public good, as these corporations only exist with two goals in mind; to
succeed and to survive through it all. At the end of the film, we can still see how the employees
did their best to fulfill and help the firm for one last time and at some point, they still managed to
secure and uphold the morals with all that is left to them.
 REFERENCES

Ebert, R. (2011, October 19). Long night's journey into collapse. Retrieved on November 6,
2020, from https://www.rogerebert.com/reviews/margin-call-2011
Kenton, W. (2019, April 18). Value at risk (VAR). Investopedia. Retrieved on November 5,
2020, from https://www.investopedia.com/terms/v/var.asp#:~:text=Value%20at%20risk%20
(VaR)%20is,over%20a%20specific%20time%20frame.
Kuepper, J. (2020, May 8). Margin call. Investopedia. Retrieved on November 5, 2020, from
https://www.investopedia.com/terms/m/margincall.asp#:~:text=A%20margin%20call%2
0occurs%20when,below%20the%20broker's%20required%20amount.&text=A%20margi
n%20call%20refers%20specifically,known%20as%20the%20maintenance%20margin.
Tunzelmann, A. (2012, January 19). Margin Call: all the spills of high-level corporate finance,
but few thrills. The Guardian. Retrieved on November 6, 2020, from https://www
.theguardian.com/film/2012/jan/19/reel-history-margin-call