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Goldman Sachs

Goldman Sachs is a New York-based investment banking firm that engages in global investment banking, securities, investment management, and other financial services, primarily with institutional clients. Founded in 1869, the firm is recognised as one of the most prestigious institutions in the world, although its reputation has suffered after the financial sector drew fire since the global financial crisis. 

Inside Job

PUBLISHED : Thursday, 31 March, 2011, 12:00am
UPDATED : Thursday, 31 March, 2011, 12:00am

Director: Charles Ferguson
Category: IIA (English and Spanish)

The title of Charles Ferguson's Oscar-winning documentary alludes to the now widely acknowledged assertion that it's the rotten core of the financial industry that gave rise to the economic tsunami that swept across markets worldwide in 2008. Rather than the handiwork of a few rogue elements, Inside Job reveals the problem as the system itself. The deregulation set in motion during the 1980s gave birth to what Ferguson describes as a 'criminal industry' in which players develop increasingly risky (and, to them, much more profitable) investment options - which culminated in the crisis that left broken banks, bankrupt governments and bewildered small investors in its wake.

But Ferguson has bigger villains to expose here. Inside Job's most startling revelation is a labyrinthine network in which regulators and the regulated work in tandem on money-making schemes. In some cases, the two parties are interchangeable. The film begins its narrative in Iceland, where a third of the regulators ended up working for banks - a reward the country eventually paid for when the institutions went belly-up with bad debts.

This mirrored the revolving doors on Wall Street. Henry Paulson (above, left, with Ben Bernanke and Timothy Geithner) left Goldman Sachs to serve as US president George W. Bush's treasury chief and then masterminded the public bail-out of investment banks (including Goldman Sachs) in 2008.

What's disturbing is how amoral this self-serving industry has become. The insiders interviewed remain self-assured and play language games with Ferguson about the integrity of their money-grabbing antics. What's most damning is the revelation of how such collusion has seeped into academia: the discipline of economics has become - to quote interviewee Charles Morris - 'an important part of the problem'.

Scholars are recruited to write theses suggesting derivatives are stable. In the film's most engaging part, Glenn Hubbard, the dean of Columbia University's business school, is asked on camera about the income he receives as a consultant to financial firms. The hitherto amicable Hubbard turns colour and sneers: 'You've got three more minutes. Give it your best shot.'

Which Ferguson certainly does.

Inside Job opens today

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