The Big Short: The Effects Of Ambition And Corruption

Power, in the form of either capital or leadership, is sought to extremes at potentially high cost. Ambition to gain power in the form of wealth at the cost of fraudulence in the banking sector led to the collapse of the housing market during the beginning of the 21st century. Ambition to gain power in the form of rule can lead to drastic measures such as depicted in the play “Macbeth” or practiced in ancient Rome; sacrificing the current leader’s life in order to become the new king. Power and ambition, across the worlds of economics and politics, possess potential dangers within their respective areas on damaging prior foundations. In the area of economics, power and ambition are not limited to one small scale of range, such as exclusively

In “The Big Short”, directed by Adam McKay, corruption within the banking sector and housing industry during the early 21st century became evident to the main characters. The movie explains one tactic used by the fraudulent bankers and private sector called a CDO (Collateralized Debt Obligation), stating that the “...[the banking sector] take a bunch of B’s, double B’s, and triple B’s that haven’t sold and put them in a pile. When the pile gets large enough, the [CDO] is considered diversified. And then the...rating agency gives it a 92-93 triple A rating, no questions asked...” (McKay, "The Big Short"). In other words, the sector complied low-valued assets into a package that when grew to a large enough size it was re-labeled as the highest rating an asset can possess. Tools like CDOs, synthetic CDOs (high stakes side betting on the potential success of assets such mortgage bonds based on false observation and chance), CDO squareds (CDOs within CDOs), and other were used by the sector to increase profit margins at the sacrifice of quality control and legality. Such actions vastly contributed to the collapse of the housing market as, in the case of synthetic CDOs, loss in odds can cause billions of dollars to drain out of the housing market and a national economy in a matter of