Are We There Yet? vol. 266
I recently re-watched The Big Short, the 2015 movie on the 2008 financial crisis. In one scene, Ryan Gosling introduces chef Anthony Bourdain to explain the security known as the collateralized debt obligation.
Bourdain notes that a CDO is similar to what happens when a chef overbuys fish on a Friday and doesn’t sell it all over the weekend. “So, what am I going to do? Throw all this unsold fish, which is the BBB level of the bond, in the garbage, and take the loss? No way. Being the crafty and morally onerous chef that I am, whatever crappy levels of the bond I don't sell, I throw into a seafood stew.” He goes on to say that the chef takes old fish and creates a whole new thing.
In the movie, the connotation is very negative. The use of the old fish is analogous to the creation of a financial time bomb that almost brought down the global financial system. If you step back and take a different perspective, creating something from nothing can be very positive. This is especially true in a world where so many suffer from food insecurity. Perhaps chefs and CDO creators should be more transparent about the ingredients in their creations, but that doesn’t mean we should avoid all stews.
I guess my point is not about financial instruments, fish stew, or food but that trying to keep an open mind can lead to new perspectives. Too often, I find myself making judgements quickly without fully thinking through other points of view. I would be better served by spending more time taking in those other perspectives and understanding all the ingredients.
Take care and stay safe.
VIDEO:
Your Friends and Neighbors (Apple TV)
When a financial titan suddenly finds himself divorced and jobless, he starts robbing his wealthy neighbors to stay afloat. Stealing from his own social circle strangely exhilarates him but he gradually gets tangled in a deadly web.
Learn more about Bob Len here.
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