REVIEW | In HBO’s ‘Too Big to Fail,’ the Heroes Are Really Zeroes

In HBO’s ‘Too Big to Fail,’ the Heroes Are Really Zeroes

HBO’s “Too Big To Fail”—I just caught up with it last night; thank you, HBO On Demand—is extraordinarily revealing about the financial crisis. Only its revelations are almost entirely inadvertent.

The movie is set up in the Hollywood conventional way: A gang of misfits, each with a special expertise, is brought together for an impossible mission. There’s Treasury Secretary Henry Paulson, steely eyed at the moment of truth. There’s New York Federal Reserve head Timothy Geithner, the athlete (he doesn’t just jog, but also plays what appears to be squash). And then there’s Federal Reserve chairman Ben Bernanke, the professor with a heart of gold and secret knowledge of the Great Depression.

Ostensibly it’s a story of their success against all odds. Michael Kinsley, reviewing the movie in the New York Times, labeled Hank Paulson [1] the “hero” of the account.

Except that the movie actually depicts something entirely different: failure upon failure. “Too Big To Fail” The Movie isn’t the story of how the Three Musketeers saved the global economy. It’s a story of how the three didn’t see the financial crisis coming; hadn’t prepared for it; made mistake after mistake as it was cresting; and then, in their moment of triumph, made their most colossal blunder of all.

That, it turns out (whether or not “Too Big To Fail” knows it), is the true story of the financial crisis.

How much did Curtis Hanson and the writers mean for that to be the story? Throughout, the characters drop hints about their missteps, but the plot unfolds like a financial “Die Hard,” with our intrepid heroes battling fiendishly powerful forces toward a happy ending. (Full disclosure in this era of transparency: I write a regular column [2] for DealBook, the New York Times section edited by Andrew Ross Sorkin, the reporter upon whose book [3] the movie was based.)

Early on, Paulson complains to his staff that they have been behind on everything as the crisis began to emerge. And that’s true! The crisis actually started in the late summer of 2007 [4]. Paulson’s first effort, late that year, was to get a bunch of banks to assemble a giant off-balance-sheet concoction [5] that would save each individual bank’s off-balance-sheet monstrosity. It was a complete flop.

In the movie, as bankers and government officials frantically try to save Lehman, Chris Flowers, the private equity investor and banking impresario, is depicted as informing Paulson and Geithner that AIG is teetering on the edge. In their fumbled response, he immediately grasps the truth. “They’re not on top of it,” he tells a confederate.

And they weren’t. In real life, AIG had been struggling since the middle of 2007. Paulson and Geithner [6] of course had some inkling of the problems [7] at the world’s largest insurer. But they didn’t prepare for it.

In the movie, the chief executive of General Electric, Jeff Immelt, places a terrified call to Paulson [8] saying that GE can’t borrow. GE is standing in for every Real American manufacturing company. We are reminded it makes light bulbs and washing machines. Paulson is shocked that such a stalwart could be having trouble borrowing.

The reality, of course, is that GE was more a finance company than a manufacturer and was teetering because it financed those operations with billions of short-term borrowing. It is also true that Paulson, Bernanke and Geithner had no inkling of GE’s troubles until the very last moment and therefore had no plan to deal with it.

Plans are, in the movie, almost nonexistent. The team of heroes races from crisis to crisis, as Bond goes from chase scene to babe, eventually stumbling on the evil SPECTRE [9] plot to take over the world. Intentionally or not, the movie is echoing real life.

Despite warning signs [10], Paulson, Geithner and Bernanke had no evident plans throughout the last half of 2007 and the first eight months of 2008. Not for how to resolve Lehman after Bear Stearns’ collapse, not for AIG, not for recapitalizing the banking system.

Indeed, they asked Congress for $700 billion to implement the Troubled Asset Relief Plan [11] to buy toxic assets from the banks, and then, without any further discussion, abandoned that idea and injected capital into the banks. Many economists [12] and financial experts had been urging them to do just that, but when they finally hit on that as a solution, it was so poorly thought out that they gave the money to the banks on overly generous terms.

This moment is depicted at the end of the movie, and because it is both a triumph in the conventional narrative sense, but also a major mistake by our heroes, it is the  point at which the movie is most cognitively dissonant. Paulson, Bernanke and Geithner have finally come to their solution: Put capital in the banks. They gather outside the boardroom where they are going to confront the CEOs.

For purposes of dramatic tension, we have to see their nervousness that the deal won’t go through. The Treasury secretary and the two most powerful central bankers in the country are about rescue these CEOs and their institutions from their own recklessness, yet they cower in fear of rejection.

Of course, this rings true because the government drove awful bargains. In the aftermath of the greatest credit bubble in history, it protected creditors at almost every turn. The government gave the banks money but didn’t get voting rights and didn’t prevent the banks from using the money to pay dividends or bonuses. They wrote what was essentially a blank check. In real life, Warren Buffett got much better terms [13] when he invested in Goldman Sachs.

What is the audience to make of these scenes? Paulson, our supposed hero, insists that if the government puts any restrictions on the money, “They won’t take it!”

It’s left to the hapless PR woman, played by Cynthia Nixon (who has, moments earlier, had the crisis explained to her in words of one syllable for the sake of her, and the audience’s, simple minds), to wonder why, if the government is saving these institutions, it couldn’t impose any limits on how the money be used.

The banks do take the money, of course. They have no choice by the conventions of Hollywood. Nor did they in real life, something that the Three Musketeers never fully appreciated.

After the scene, the Big Three gather in a room, relieved, and Bernanke asks, “They will lend the money out, won’t they?” The director, Curtis Hanson, focuses in on Paulson, who gazes out the window, as if contemplating the question for the first time. He insists they will. But an unmistakable moment of doubt passes across his face.

Fade to the postscript. There we learn that, whoops, the banks didn’t lend it out after all. Instead, they got bigger, banker bonuses recovered, and Wall Street is getting bottle service at velvet-roped clubs all over again. The world was saved from ruin, but the banks quickly went back to business as usual and even felt self-righteous about it.

Follow on Twitter: @eisingerj [14]


15 Responses to “REVIEW | In HBO’s ‘Too Big to Fail,’ the Heroes Are Really Zeroes”
  1. CaitlinO says:

    To me, the most frustrating part of the movie (as well as real-time events) is that not a single bastard one of the top guys in Bush’s, and then Obama’s, administration every whispered the word ‘insolvent.’ They treated the banks from beginning to end as suffering from a liquidity or confidence problem when the real truth was, and still is, that the Morons of the Universe had bankrupted their own firms.

    If honest accounting was done, even today after back-door bailouts have allowed banks to profit enormously from the spread between 0% interest charged and 3% gained in US Treasuries at the expense of savers, pensions and retirees, the banks would still be bankrupt. They are still carrying trillions of dollars of loans on their books at full, pre-bubble-bust levels, loans that every homeowner in America knows are no longer supported by market realities.

    The real tragedy is that all that energy, all that effort, all those trillions of national treasure were wasted to solve the wrong freaking problem. Our financial sector is still rotten at the core and the economy will not truly recover until that’ fundamental problem is finally acknowledged and addressed.

  2. What its and was not in the movie:
    Why do the Banksters (gangsters) have to produce questionable documents to proceed with a foreclosure? and Why can’t the banks simply use the documents on file in the County Clerk’s Office to foreclose?? mmmm…..anybody?
    I alleged rampant, widespread bank fraud plus more fraud on top of fraud, is the reason, and it answers the questions regarding Property values, court budgets, pension funds, robo-signing, tax base, foreclosures, bank fraud and much more…are all seamlessly linked together. because the banks INTENTIONALLY DESTROYED original NOTES and MORTGAGES. On purpose. (not in the movie)
    I also like to point that they intentionally avoided filing subsequent assignments of mortgages, thereby EVATHING BILLIONS in filing fees. And there was another question: Why would the banks intentionally do that?
    Here is what was going on during the housing bubble ( its not in the movie ). 1- Mortgages were intentionally being given to anyone, so long as you were breathing, and in some cases even if you weren’t breathing yes, dead people ! (They did mention it in the movie slightly but was in the movie)
    So if you know someone who exploited this open spigot of cash, remember they could not have done it without the banks being COMPLETELY willing to provide the poorly underwritten loan.
    The bank would then package up these mortgages in large groups and sell what are known as Mortgage Backed Securities (MBS) to pension funds, municipal governments, and your grandmother, hey your garndfather too (the did mention that in the movie.)
    Therefore the banks were IMMEDIATELY made whole on the million dollar loan they had just given to the guy working the drive through. The banks were then supposed to PLACE the original note and mortgage in a trust,BUT THEY DID NOT. (not in the movie)
    The banks simply provided a spreadsheet of numbers to the investors representing the mortgages, and then destroyed the originals, or conveniently “lost” them. (not in the movie)
    Why? Why would the banks do that??
    Because if they had actually provided to your grandmother the mortgages she had been sold as well underwritten prime mortgages, she would see that they were a large pile of smelly dog excrement and know that she had been defrauded, Get it? in other words they did that to ide the fraud, (not in the movie)
    It gets worse, Sometimes they sold the same mortgage numerous times, placing it in numerous securities. They could, because they only provided a spreadsheet, and not the original docs.-NOTES (not in the movie) You guys follow me?
    This is what is ultimately affecting property values, market confidence and tax base. (not in the movie)
    But gess what, IT GETS WORSE, More often than not, these securities were sold, resold, and traded as these MBS (Mortgage back Securities) spreadsheets were kicked around like beers cups at Fantasy Fest. Novels will be written as to the scale of the fraud, credit default swaps, (CDO’s) and methods with which those in the know were gaming the system. PONZI SCHEME. (not in the movie)
    You would think that each time this mortgage and NOTE traded hands that it would be properly recorded in the Clerk’s Office as has been done for centuries, right? Well…WRONG. (not in the movie)

  3. Fury says:

    my friend said that hank paulsen was a villain in the HBO movie.
    now that i believe.

  4. Fury says:

    it is not a movie.
    homeowners have been swindled in the worst bank heist in the history of the US.

    we want full restitution for our losses.

    we will keep coming and coming. we will not give up.

  5. Fury says:

    i don’t have HBO.

    who financed this movie and who were the HBO advertisers? that will reveal a lot.

    a florida friend watched.
    she said that barney frank was the only one who kept asking, “what about the homeowners?”

    she said bernanke was protrayed as sympathetic,
    well, we all know that in reality, that is bunk. he is evil.

  6. says:


    the figure that is real is $ 4.3 trillion in bailout money. plus the back door bailouts which are still going on.

    now come’on do you really think that we saved with our dollar the whole u.s..economy for a mere 780 billions.

    they call that in marketing a “mere token” and it usually entices the consumer to believe the story.

    lets all get real. the real number is prolly like $ 10 trillion and counting .

    best regard

    the only ones to suffer will be the middle class. the game plan as I understand it is to move another 10 trillion out of the middle class to the rich to ” save out financial system” . now ain’t that speical and MR DIMON gets another $ 100 millon bonus.

    wow lets all wake up and fill up our congressman and senatores mail via uspa to make it all legal. not faxes.

    or emails which they never read.

    if we don’t complain more our great great grandchildren may think we are all a ship of fools in the middle class and we believed anything bernake says.


  7. maia says:

    What I got from the movie is confirmation that the people running our government are just plain stupid and don’t give a rat’s ass about “we the people”. Did they consult the intelligent economists of the country? They called Warren Buffet.

    I know what Bank Of America did with their bailout money–hired lawyers to steal our houses instead of work with the homeowners on their mortgages, with Freddie and Fannie complicit on the back end of the deal. I might have lost a house, but I’m sending paperwork out in hopes they all go to prison.

  8. Javagold says:

    and with that $700 Billion , ALL mortgages should be marked as paid in full

    • l vent says:

      The mortgages were paid off by the homeowner for a nominal fee way before the bailout and the crash. The proof is in the Origination Fraud and I do not mean the Liars Loans, they were all Liars Loans, there never were any loans, only specualtions. That is why we have Foreclosuregate and foreclosurefraud. That is the big secret that they don’t want us to know. The reason for the jitters by the bailout chiefs was, they were as dirty and complicate as the banks and Wall Street and they knew all about the toxic mortgage assets Wall Street and the Banksters were selling around the world and gambling on and AIG was insuring. They wanted to cover all of their corrupt asses in a hurry. In the one scene they were even talking about burning homes down and the CEO of Lehman was calling out homeowners for their demise. The Ceo got really pissed off when he heard that the Fed did not want to help bail them out.. Well they are who devised the evil plan to steal our homes and create worldwide impoverishment. Who created the crap and bought the crap and got filthy rich off of the crap? They all did including the politicians. Bottom line, the perps screwed their masters and never secured the fake debt and that is because our homes are paid for free and clear because of the BIGGET PONZI SCHEME SWINDLE AND HEIST IN HISTORY..

      • l vent says:

        Bottom Line, none of them, not the banks, not the politicians, nor Wall Street, wanted to get caught with their pants down. They are all guilty but the New World Order implemented the plan for our financial destruction, the perps just played by their own set of rules. The US Government, the banks and Wall Street on the American side of this are chicken shits of the New World Order, they all know the truth, all of the mortgage debt is paid for because of the Ponzi Scheme and they all got filthy rich including the so called elite masterminds of the scam..They all need to go away and leave the homeowners alone and give back the stolen homes they do not own.


  9. No Standing says:

    I saw a preview for this and nearly spilled coffee over some mail from the Bankruptcy court.
    It appears to be a funded effort to gloss over unprecedented theft. Superior films are already out there:
    “Capitalism, A Love Story” for excample. This is a PR piece from Hollywood, avoid!

    • l vent says:

      I think the American people are smart enough to see right through this movie. I hope this movie will make them as furious as it made me. Most of the devils are there though the main devil, Bush knew this was coming, the FBI warned his administration about the rampant mortgage fraud in 2004 and told his administration there was plenty of time to fix the mess or there would be a catastrophic financial collapse. I think they all looked arrogant and disgusting. They made me want to vomit.

      • I vent….The only movie I watched was ” Inside Job” and that was 1 movie to many for me. This real life frig’en mess of the gangster fraudsters is enough ( and that includes the government and the financial world) . Everyone involved knew of the fraud and went along with it…filled their deep pockets laughing at the scam ponzi scheme that was taking America down to shreds along with the world. The real movie is real life and as in a movie there is an ending. Not all movies end on a happy ‘ note ‘….and we don’t plan on this real life one to end the way these bastards want it to end…. You mention Bush and I add his Daddy to it….Bush is wanted in alot of places in the world…for many reasons…just as in the foreclosures…a whole lot of people are fighting mad…everywhere…so we are not alone. The world knows what was pulled and who pulled the strings and the villains all know the world is watching them. They all may look and act arrogant…that is a front to hide the fear…all gang members do the same…..till the first set of handcuffs are locked on the wrists. And this will happen in our real life ‘movie’..we will make it happen…. the camels back is getting weaker…and we are getting stronger. in many ways.

  10. My car License plates say:
    Big(heart)IRR aka
    Big Love IRR
    Big Love Internal Rate of Return (high investment returns)
    Hot(heart)IRR aka
    Hot Love IRR
    Hot Love Internal Rate of Return (high investment returns)

    90% focus on Lover
    5% Get the IRR aka Internal Rate of Return
    5% Get both the Lover & IRR meanings!
    Thanks Kathrine for the “heart” idea…

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