With the arrival of autumn, the days get shorter and the desire for the sofa, a blanket and a good film returns. But cinema can also be a magnificent gateway to economics. Bubbles, speculation, corporate fraud, tax havens, bank bailouts or insider information. At 11Onze, we have selected eleven films and documentaries that will allow us to understand some of the most surprising mechanisms and episodes of modern finance.

We want entertainment, yes. But also crash courses in economics while eating popcorn. Is it possible? Here we list eleven films to learn about finance from the sofa.

• ‘Wall Street’: when greed becomes culture. Oliver Stone portrayed the financial euphoria of the United States in the 1980s in Wall Street (1987). Bud Fox is a young broker obsessed with succeeding who enters the orbit of Gordon Gekko, a powerful investor who represents a way of understanding business in which money, power and information are closely linked.

The stock market, corporate acquisitions, speculation and insider information come together in a classic that, almost four decades later, continues to raise an uncomfortably relevant question: where does ambition end and greed begin?

What will you learn? The stock market, mergers and acquisitions, speculation and insider trading.

• ‘Rogue Trader’: when nobody controls who takes the risk. Based on the real case of Nick Leeson, Rogue Trader (1999), directed by James Dearden, takes us into the world of derivatives trading through a trader at the British bank Barings.

More than a story about getting investments right or wrong, it is a lesson about the importance of internal controls. What can happen when the same person has too much capacity to trade and too little supervision? The film allows us to discover a world where an apparently small decision can be multiplied through leverage.

What will you learn? Derivatives, leverage, operational risk and internal controls.

• ‘Enron’: when the numbers stop explaining reality. There is no fiction here. Enron: The Smartest Guys in the Room (2005), a documentary directed by Alex Gibney, tells the story of one of the best-known corporate scandals in the United States. Enron had become one of the most admired companies in the country before the practices hidden behind its spectacular results came to light.

The documentary shows the extent to which incentives, corporate culture and extremely aggressive accounting can distort the image of a company. A particularly interesting warning for any investor: brilliant accounts do not always tell the whole story.

What will you learn? Accounting, conflicts of interest, incentives and corporate governance.

• ‘Boiler Room’: selling the perfect investment. A group of young brokers learn to sell shares over the phone with an extraordinary ability to persuade. Boiler Room (2000), by Ben Younger, introduces us to an environment where commercial pressure and the promise of getting rich quickly can carry much more weight than the actual quality of the investment.

The film is particularly useful for understanding how certain aggressive sales techniques work and why urgency is such a powerful weapon when it comes to our money.

What will you learn? Boiler rooms, penny stocks, aggressive selling and stock market manipulation.

• ‘The Wolf of Wall Street’: when selling matters more than investing. Martin Scorsese brought the story of Jordan Belfort to the big screen in 2013, a stockbroker who built his business around extremely aggressive sales techniques.

Beyond the excesses that have made The Wolf of Wall Street one of the most popular financial films of recent decades, the story highlights an essential issue: the conflict that arises when the person selling us an investment has very different incentives from our own.

What will you learn? Penny stocks, commissions, sales techniques and manipulation of retail investors.

• ‘The Big Short’: those who questioned the consensus. How can a mortgage crisis end up shaking the global financial system? The Big Short (2015), directed by Adam McKay and based on the book by Michael Lewis, takes us to the years before the 2008 crisis, following several investors who begin to question the solidity of the US housing boom.

Its great virtue is explaining with humour concepts that seem reserved for specialists. And it raises a particularly powerful idea: the fact that everyone trusts a market does not necessarily mean that anyone has checked what lies beneath it.

What will you learn? Subprime mortgages, securitisation, CDOs, credit default swaps and financial bubbles.

• ‘Margin Call’: a night at the heart of an investment bank. A young analyst discovers that the risk models of the firm where he works are hiding a potentially enormous problem. From there, Margin Call (2011), by J. C. Chandor, concentrates practically all of its action into a few hours inside an investment bank.

It is fiction, but the context inevitably recalls the moments of greatest tension during the financial crisis. It needs no chases or spectacular special effects. Just meetings, screens and executives faced with one question: what do you do when you discover that you have taken on far more risk than you thought?

What will you learn? Risk management, leverage, asset valuation and the internal workings of an investment bank.

• ‘Too Big to Fail’: when a bank is too big to fail. Too Big to Fail (2011), directed by Curtis Hanson, looks at the financial crisis from the other side of the table. Instead of investors or Wall Street traders, it focuses on the major banks, the Federal Reserve and the US Treasury during some of the most critical moments of 2008.

The film helps us understand one of the great dilemmas of any systemic crisis: what happens when the collapse of a private company can put many other institutions at risk?

What will you learn? Systemic risk, bank bailouts, liquidity and moral hazard.

• ‘Inside Job’: anatomy of a crisis. While The Big Short dramatises the road towards the 2008 crisis, Inside Job (2010) attempts to dissect the system that made it possible. Charles Ferguson’s documentary, winner of the Academy Award for Best Documentary Feature, examines financial deregulation, indebtedness, rating agencies and the conflicts of interest surrounding Wall Street.

It is probably the most educational piece in the selection for understanding that a major crisis rarely has a single cause. When the wrong incentives are combined with debt, opacity and insufficient control, risk can spread far beyond those who initially took it on.

What will you learn? Deregulation, rating agencies, conflicts of interest and the causes of the 2008 financial crisis.

• ‘The Laundromat’: following the money trail. How can it be so difficult to know who really owns a company? The Laundromat (2019), directed by Steven Soderbergh and inspired by the Panama Papers scandal, uses dark humour to take us into the complex universe of offshore structures.

The film helps us understand how companies created in different jurisdictions can form structures that are difficult to trace and why knowing the true beneficial owner of money is a fundamental issue for financial transparency.

What will you learn? Offshore companies, shell companies, beneficial ownership, tax havens and financial opacity.

• ‘Arbitrage’: when the numbers have to hold up until the buyer arrives. Robert Miller is a powerful financial manager who is about to complete one of the most important deals of his career: selling his investment empire. But behind an appearance of success lies a problem that could derail the entire deal. Arbitrage (2012), directed by Nicholas Jarecki and starring Richard Gere, turns this tension into a financial thriller about money, reputation and power.

The film raises a particularly interesting question for any investor: what happens when the value of a business depends on nobody discovering what is really in its accounts? As the sale of the company approaches, it becomes clear that a hidden financial loss can affect not only the protagonist’s wealth, but also the trust on which the entire business has been built.

What will you learn? Financial fraud, accounting manipulation, hedge funds, business valuation, liquidity and due diligence.

A brief history of financial excesses

Seen in this order, these 11Onze films tell us something more than eleven good stories.

Wall Street takes us back to the financial euphoria of the 1980s. Rogue Trader and Enron show what can happen when controls fail. Boiler Room and The Wolf of Wall Street focus on incentives, aggressive selling and manipulation. Then comes the great earthquake of 2008: The Big Short explains how risk accumulated; Margin Call, how it is experienced from inside an institution; Too Big to Fail, the problem from the perspective of the institutions; and Inside Job, the structural causes behind it. Finally, The Laundromat and Arbitrage broaden the focus towards the opacity of global finance.

Different eras. Different characters. Different crises. But one pattern repeats itself. When the incentives to make money are stronger than the mechanisms that should control risk, someone ends up paying the consequences. And this may be the great financial lesson shared by all these stories.

Understanding finance is not just about knowing what a share, a bond or a derivative is. It also means understanding the incentives of those who sell, those who buy, those who lend, those who regulate and those who take on the risk.

This autumn, then, we have a good excuse to learn economics in a different way. Turning off the lights, preparing the popcorn and pressing “play” can also be a magnificent way to start understanding how money works.

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