I doubt many really understood the film

And the polar opposite of those movies is Primer. Bust out the textbooks because you have to complete a 15-hour course on the implications of disturbing space-time before you can follow THAT one!

I think you need an MBA to understand even the non-financial dialogue in this movie. But I stuck with it to the end.

The protagonists, basically, bet that the economy will collapse. So for them to win the bet the economy had to collapse, which it did... So all in all it was a sad ending but for them... They won the best and a LOT of money.

I really tried to explain this in the simplest possible way. Hope it helped.

Didn't seem to me hard to understand. I've looked at generic investments a bit and stayed out of them because they didn't seem solidly analyzed - like the way Burrey analyzed them. That's the kind of assurance I wanted. At the level I could get in, it was all voodoo, so I stayed out.

But a key thing you need to understand is that a short is like a bet that something undertaking (business, market, company, whatever) will fail. But as was shown, this short requires an "instrument" or a type contract with a bank. Burrey went in and got them to create such an instrument so that he could invest in that way, make that bet.

Another important thing is the S&P and Moody's reference - when they went to interview the lady with the weird dark glasses, the one that worked at Standard and Poor's. Basically, the point is that they are supposed to be an independent rating agency, but they aren't because they have a competitor, MOody's, and she said if they play hardball (or should I say poetry, ie the truth), the bank will go to the other agency.

This was well symbolized by the redhead ex-gf of the brother who worked for supposedly a regulatory agency (of which I missed the name - I am not American and not familiar with the exact acronym - sounded like FCC but that can't be it. SEC maybe? Securities Exchange COmmission? I think we have the same thing here in Canada.) She was literally in bed with someone from a bank, as they said a lusty goodbye in front of the hotel at one point.

I remember being astonished at the time that the US Government bailed out the banks with taxpayer's money, and millions of little guys got hurt as shown in the final statistics (8M job losses, 6M home losses, just in the USA). And only one banker went to jail!

I think you're overestimating the intelligence of the general audience. The basic premise is that by shorting the housing market you're essentially betting on Armageddon which of course occurred in 2008, leading to the collapse of Lehman Brothers, Bear Stearns etc., yeah on that level it was successful. But when Carrell is involved in the discussion in Vegas regarding synthetic CDO or tranches I think it become a bit more complex. You might have a handle on these matters, but I think for most of the audience being familiar with events that gave us the Great Recession is one thing, but their eyes glazed over when discussion got into the weeds. On the overall, my hats off to the film-makers for making what should really only be a serious documentary so entertaining.

Why did the risk assessors want Baum to sell the swaps then? Why did Shipley say they were the first ones to short AAA tranches? CDOs are comprised of different tranches and Baum and folks were already shorting those in their deal with Venette.

1- Bale made a fortune for himself & his fund members by buying credit default swaps. The insurance against CDO defaulting which of course they did.
2-No, I don't believe he did because they also made a fortune.
3-No, he just held out longer before calling in his winnings, so to speak.
4-The also profited mightily.
All of these entities were among the minority of investors who bet that housing prices would plummet. The bonds, that were sold based on the underlying value of those mortgages they represented therefore also collapsed. The prime reason being that mortgage lenders had bee selling mortgages to a group that were financially poor risks or sub-prime lenders. These lenders came to be known by the acronym NINJA, because the had No Income, No Jobs, or Assets. Since they began defaulting in record numbers the entire market was taken down. Our heroes saw the possibilities of this occurring and began betting against the Market, or shorting it. This was made possible by the purchase of financial instruments known Credit Default Swaps. These swaps were essentially an insurance against what seemed to be an improbable event, the decreasing value of home prices.

I suspect the next bubble to collapse will be student loans. If you could discharge student loan debt during a bankruptcy I suspect the market would have collapsed already. But, the academic industry has many of the same hallmarks of the housing bubble, bad loans issued to people who really have no way of repaying them by for profit colleges that don't really care about the credit ramifications as long as they get their payday. College tuition costs have sky rocketed in a unsustainable arc similar to what the housing market did in the early 2000's. Even with bankruptcy not clearing the debt enough people will default on their student loans to crash the entire system.

Anybody interested in the full details of why and how this happened, read:

The Great Deformation by David Stockman

https://www.amazon.com/dp/B00B3M3UK6/ref=dp-kindle-redirect?_encoding=UTF8&btkr=1

Anybody interested in the full details of why and how the next crisis will happen, check our Jim Rickards latest book:

https://www.amazon.com/Road-Ruin-Global-Elites-Financial-ebook/dp/B01CDVCBGO/

If I take your question correctly about the value of swaps decreasing as the CDOs were becoming worthless. My recollection of Carell's character is his reluctance to sell his swaps at the end. I don't remember quite the specifics at that point but swaps had an intrinsic value based on regular scheduled payments of premiums. Bale was paid in full, I believe $1.3 billion, which was dictated at the outset at the table with the people at Goldman Sachs. Now as in any insurance the premium is based on the risk, greater the risk : higher the premium and lower the risk : lower the premium. At the end the likelihood of CDO default was high so swaps would have gotten more expensive. But then a secondary market might have been created by institutions trying to sell their swaps and since they would have been toxic the prices probably droppied. Honestly, I have to revisit the film since it's been a while since I watched the film myself).

Agreed, then why introduce it to a general audience ? The concept of shorting, although foreign to most, must be introduced to understand the basic premise of the film. Hence Credit Default Swaps are also essential, but when the likes of Synthethic CDOs are presented I think your stretching the capacity of the average "Dollar General" consumer.