Wall Street: Money Never Sleeps

The movie response that leave alone be covered in this es posit will be on the film hem in street capital Never Sleeps . It was directed by Oliver Stone, released during 2010 and is the sequel to the 1987 film mole Street. The film starts with the release from confine of Michael Douglas Gordon Gekko before cutting to a rather elaborate plot involving Shia LaBeouf as the young trader with ( almost) scruples, whos rising in a world that exclusively happens to be collapsing at the same time, as investment intrust buildings run by the likes of Frank Langella and Josh Brolin teeter under the weight of the 2008 fiscal crisis.The narrative then cargonfully weaves in more and more to Gekko (who, conveniently, also happens to be LaBeoufs future father-in-law, a dad to LaBeoufs on-screen fiancee, C atomic number 18y Mulligan) (Zeitchik, 2010). Greed seems to be rampart Street Money Never Sleeps theme, reckless and over the top risky behavior has lead to the bubble in the housing pr ices to burst ascribable to the actions of Wall Street firms. Shia Labouf played by Jake Moore works for the Lehman Br antithetical(a)s-esque Keller Zabel and is mentored by managing director Lewis Zabel.He births a bonus of $1,450,000, before a late-night treasury meeting, which reveals that Keller Zabel is on the brink of collapse. This brings up an important ethical issue on how much bankers and traders receive in bonuses, irrelevant of the financial climate. After the collapse of several sizable banks during the financial crises of 2008, some(prenominal) be still paying their employees shooterstantial bonuses. some fence that the UK government countenance pumped billions of pounds into the banking sector, and has bailed out both proud Bank of Scotland and Loyds Banking Group.As a result they should have greater cite in how much the banks pay out in bonuses, barely the banks argue that they rousenot dramatically reduce bonuses without the risk of losing top staff to banks based overseas, which are under less pressure to cut payments. Even if bonuses are cut, salaries have risen signifi preservetly to compensate, by up to 40% in some cases. This is one of the galore(postnominal) flaws, which has been allowed to occur within the banking industry, to the point where it has become the average (Peston, 2011).One of the most prominent ethical issues presented in this movie is the nous of insider affair, which is the trading of stock with hidden information that the general publics is not aware about. It began with rumours being spread on Zabel by Bretton James who runs the rival bank Churchill Schwartz, which caused the rumours to become true, and Keller Zabel to be on the verge of collapse. Bretton James then insults Lewis Zabel by offering him $3/share when the firm was trading the previous hebdomad at $75/share.Zabel claims that this was revenge for letting James company go under eight years ago. These series of events causes Zabel to commi t suicide by throwing himself under a subway. To avenge his mentor Shia Labouf releases rumours on Churchil Shwartz, which caused their shares to drop hatful 8% in pre market trading costing them $120million. Insider trading kindle be a very powerful tool within the financial sector it can be used to make large profit as well as destroying others. As illustrated in the movie, Lewis Zabel took his life due to the results of Insider trading.Its a criminal offence in most countries, however as Shia Labouf said its hard to prove, this is due to the trouble of trying to prove what a person has heard via word of mouth. Because Insider trading is illegal, insiders who wish to exploit price sensitive information collaborate with other traders to make it harder to trace the trades back to the person who is known to have opening to the information. This is called an Insider Ring. The term moral hazard is mentioned several times throughout Wall Street Money Never Sleeps.Its first mentione d during the treasury meeting, when they are deciding whether to bail out Keller Zabel, if they bail them out whats to say it wont occur again. Moral hazard is the idea that an individual can alter their behaviour if they know they are insured against some of the outcomes, for framework if a car is not insured you would take more wish well than if it was. The reason moral hazard comes up several times throughout the movie is because its often used within the context of banks and sub uncreated mortgages.This is due to the fact that before the 2008 financial crises sub prime mortgage lenders were making reckless lending decisions, they lent many mortgages to concourse who were unlikely to be able to pay them back. This led to large-scale mortgage defaulting, which caused many banks to go under and cause the economy to suffer. However many banks were bailed out by governments in order to reduce the economy deplorable further, which is effectively rewarding them for defective econ omic decisions (What is Moral Hazard, 2007).The issue of overlook of corporate governing is apparent in the movie, its connected to the reasons why Keller Zabel and the other banks began to fail. A rendering of Corporate Governance is a set of relationships in the midst of a companys directors, its shareholders and other stakeholders. It also provides a social structure through which the objectives of a company are set, and the means of achieving those objectives and monitoring performance, are determined (OECD).Events such as soaring pay packages for top bank executives which are often driven by extraordinary risk fetching rather than real sustainable profits, weaknesses in risk management, board oversight, understatement of bad loans can all be linked to poor corporate governance (Corporate Governance failure to blame for banking crises, 2009). Money laundering is another un-ethical issue, which Wall Street brings about. Gordon Gekko reveals to Shia LaBeouf that he has $100 million in a Swiss account under his daughters name, which she will be entitled to when she turns 25.Gordon suggests that him and his daughter spark to Switzerland sign the account over to LaBeoufs name and he in return gives Gordon the cash so that he brings it to the States in order to keep down the RAS getting involved, which is Money Laundering. To conclude there are many ethical layers within Wall Street Money Never Sleeps, such as unjustified salaries, poor corporate governance, insider trading, moral hazard and money laundering.These issues are very real, and still go on in our quotidian lives. We continue to inflate these bubbles until eventually they will burst, and repeat the process. Albert Einstein said, The definition of insanity is doing the same thing over and over again and expecting different results. This seems to be very true of the banking industry and the lack of thought of the consequences to their actions. Gordon Gekko presented us with a question, Is Gree d Good? I believe Greed can never be good.Bibliography Corporate Governance failure to blame for banking crises. (2009, 02 24). Retrieved 05 2011 from schoolmaster Pensions http//www.professionalpensions.com/professional-pensions/news/1441283/corporate-governance-failure-blame-banking-crisis DREA. (2010, 10 30). Movie Review of Wall Street Money Never Sleeps. Retrieved 05 2011 from Businesspundit http//www.businesspundit.com/movie-review-of-wall-street-money-never-sleeps/ Insider Trading. (n.d.). Retrieved 05 2011 from Moneyterms http//moneyterms.co.uk/insider-trading/ Kenny, J. (2009, 02 25). Corporate governance failure driving banking crises. Retrieved 05 2011 from FTadviser http//www.ftadviser.com/InvestmentAdviser/Investments/AssetClass/Equities/News/ bind/20090225/2d2a7d74-034c-11de-a6db-00144f2af8e8/Corporate-governance-failure-driving-banking-crisis.jsp Peston, R. (2011, 01 07). Bank bonuses to run to billions in 2011. Retrieved 05 2011 from BBC NEWS http//www.bbc.co.uk/n ews/business-12131092 What is Moral Hazard. (2007, 12 11). Retrieved 05 2011 from Economicshelp http//www.economicshelp.org/blog/economics/what-is-moral-hazard/ Zeitchik, S. (2010, 05 14). Cannes 2010 Wall Street Money Never Sleeps issues its wake-up call. Retrieved 05 2011 from Los Angelese clock http//latimesblogs.latimes.com/movies/2010/05/wall-street-money-never-sleeps-cannes-oliver-stone.html