Saturday, November 12, 2011

(500) Days of Summer

A boy meets a girl. A boy falls in love. A boy lets the girl go. So what so special about the movie? Everything. It is magical: funny, sad, confusing. 

The cinematography is amazing. There is so much warmth and color. The beautiful Zooey Deschanel shines in every shot. The storyline might be fragmented and out of order but it flows so smoothly from shot to shot. Like pieces of a little puzzle all the elements feet together so perfectly. 

Joseph-Gordon Levitt's Tom falls in love with a girl that is not hard but is hard to keep. It is not something that he does that pushes her away. It is just time. He met her too early. I will always wander what changes her mind so suddenly and completely because just like Tom we never get to see what happened. But this is how it should be: this is Tom's movie, Tom's memories. If we saw something he didn't this would have been cheating and this movie does not cheat. It delivers on its promise to be special. It is out of order, yet everything seems to make sense. Even though as we see from the movie, sometimes love does not.

This film is great at depicting the small things, the details that make us fall in love. A hand, a tattoo, a smile, a song.

Previous Movie Reviews: MelancholiaImagine Me and YouVelvet Goldmine

Wednesday, November 9, 2011

The Recession: Volatility and Positive Feedback

I have been thinking a lot about the recession lately. I understand why they call it the "Great Recession." Because frankly compared with the Great Depression based on its impact on unemployment, growth and consumer confidence worldwide, the only thing which is different this time around is that there is no price deflation. Yeah with the enormous amounts of debt on the balance sheets of all developed countries, you can only have inflation. What some people do not realize is that actually there is deflation: in the real value of wages. When inflation is rising the purchasing power of every nominal dollar drops and nominal wages tend to state the same during a crisis, therefore real wages are decreasing. There is deflation, just not everywhere.

We also have unemployment, especially in the developed countries. The problem with recessions is that they tend to overreact to long growing problems. The truth is that some industry simply do not have a future in those countries: they do not have the competitive advantage to operate them. Politically, however, it is very hard to concede that an entire billion dollar industry is dying and should move somewhere else. So hard that the US government would double itself down with trillions of dollars of debt to save the financial and the automobile industry in the country when they have obvious problems staying competitive. The problem with industrialization and affluence is that you cannot go back: a country cannot suddenly have lower wages to allow it to produce competitively in a lower stage of industrialization. What western governments should be doing is looking ahead, not looking back.

I think saving the financial world in 2008 was a bad strategic decision: it sustained an industry that was not producing value added to the economy but actually was hemorrhaging investments. So much of the money investment in Lehman Brother's stock could have gone into tech stock to product real future value. The way the US financial system is operating is extremely inefficient: it does not hedge against uncertainty, it produces systemic risk by overleveraging. The costs of artificially sustaining this industry when its basic principles are no longer valid is increasing every time around. No, it is not profitable any more, no more than the US car industry is: after billion dollars of bailouts, we still got a small 50 billion dollar trading company evaporating last week. It is also not driving market growth, it is producing volatility in the market. The attempts of the big financial companies to exploit minuscule opportunities with leverage are increasing their exposure to government debt (under the funny assumption that it is a riskless asset). This means that there is not only volatility in the bond market but also volatility in the stock market for the stocks of the financial companies. When one or two of those companies go under we have a chaos in the credit default swaps market and systemic risk. Markets freeze and governments are forced to intervene with bailouts to keep the zombie industry afloat. The problem is that there can be no bailouts these time around. The outstanding government debt is just too much.

So let's see the model. We have low regulation and easy credit in the beginning of the 00s. We also have a lot of credit default swaps that make every default very costly for the entire market. Then all we need is a bankruptcy (Lehman's) and volatility starts. We save other companies from going under by borrowing as a country and when we borrow too much, the outstanding debt produces volatility in our government bonds. Then the volatility moves to stocks. So every step of the way we have more volatility. And uncertainty is worse than market drop because if the market goes straight down at least those that are short on it are making money. When we have volatility, however, wealth evaporates. Companies become overleveraged and increase the volatility. I think it is safe to say that we have a nice positive feedback loop - volatility produces more volatility.

The problem with positive feedback is that it tends to explode. And it is simply not possible to do the same kinds of bailouts as last time if there is another Lehman-sized company or country that goes under.

----To Be Continued-------

Previous Economy Related Post: Economy and Math

Monday, November 7, 2011


I saw Lars von Trier's "Melancholia" over the weekend. It is a truly remarkable movie. It is so honest that it is sometimes painful to watch. Yet, it is also stunningly beautiful.

I have to admit that it was Alexander and Stellan Skarsgard that got me interested into the movie when I first heard about it. I have a little thing for Swedish cinema, especially after seeing "Puss" over the summer (which merits a post of its own in the near future), that has nothing to do with my addiction to HBO's vampire drama "True Blood." So the two Skarsgards in the cast convinced me to make the leap and disregard the female lead Kirsten Durst (I don't think I will ever get over "Spiderman", even though it was not her fault that the script was extremely badly written). It was certainly worth it, even with his few scenes Stellan manages to steal the screen (similarly to Marvel's blockbuster "Thor"), while his son does a dissent job portraying Durst's one-day husband. I would expect more form the younger Skarsgard when I get to see the new version of "Straw Dogs" later this year. I have to admit, however, that Kirsten Durst is great in this movie. The emotional depth she portrays in the shoes of Justine is amazing. It seems an extremely psychologically exhausting role to play but Durst does it marvelously. The depth of her delivery certainly merits a handful of nominations when the awards season starts if not an Oscar. 

The other great thing about "Melancholia" besides Durst's polished performance is the cinematography. This movie is a stunning visual poetry. It is so beautiful that it certainly will not appeal to the mass audience in the States. The colors and the framing rival that of a Renaissance painting. The beginning is extremely controversial but it is this one scene in which Durst's character is lying on the grass next to a river completely naked that is the real money shot. I cannot remember another scene in recent cinema that works so well in portraying sensuality without any vulgar sexual subtext. 

Von Trier is a real genius and a real auteur. This is the bravest movie I have seen recently (ever since Nolan's classic "Memento") and this includes my 2010 favorites ("The Social Network," "The King's Speech," and "Inception"). It is impossible - the visual and emotional depth of this movie is stunning. Von Trier manages to portray depression with such nuances that you walk out of the cinema feeling slightly off balance, examining carefully your own emotional condition. It is not a feel good movie, not by a long shot but as a movie fan, I adore it because it brought me back the belief in the future of cinema. There are still directors that are ready to go that extra mile and be artist by delivering something new. 

This probably the only film about the end of the world that manages to keep it small and personal. It is so focused that the pain it demonstrates within its small four member environment triumph any other clash of worlds. Yes, in Star Wars: New Hope billion minds screamed and fell silent but in "Melancholia" the emotional torture that this family endures before the inevitable end is so charged that by the end your heart is racing, praying that the pain will end soon. The whole movie delivers a very loaded philosophical question: what hurts more - the actual moment of death or all those moments preceeding it when you now that this is it?

Previous Movie Reviews: Imagine Me and YouVelvet Goldmine

Quotes Part 3

The long time Liverpool manager Bill Shankly once said:

4. "Some people believe football is a matter of life and death, I am very disappointed with that attitude. I can assure you it is much, much more important than that."

I rarely share the opinions of the Scousers but with this one I do agree. Those of us that care about football know that it consumes you. There is nothing quite like walking inside a stadium for the first time. It's magical!

I'll always remember the first time I saw Old Trafford, even empty the stadium took my breath away.

Thursday, November 3, 2011

Imagine Me and You

I saw this movie "Imagine Me and You" a couple of weeks ago. Its about two women (Rachel and Luce) falling in love during the wedding of one of them. It has the typical British ensemble cast and reliance on brilliant dialogue. I really like this line delivered by Rachel's husband Heck:

"I want you to be happy. More than anything else I wanted to be the cause of happiness in you. But if I'm not, then I can't stand in the way, you see? Because what you're feeling now, Rachel, is the unstoppable force. Which means that I've got to move."

I am not a fan of cheesy romantic movie lines and definitely don't believe in love from the first sight but this really touches me. This is how I imagine true love feels like: you love the other person so much that you would let them go just because you know they will be happier with somebody else. Regretfully, we rarely see this kind of love in Hollywood movies. "Imagine Me and You" is indeed about two gay women but it is a lot more than that. It is about love in general and the strength we all need to be ourselves, especially when it means hurting those close to us. Cudoos to the director Ol Parker for being brave enough to tell this story in such a way. Love is just love, no need to labeling it. The score was also quite catchy: I think I will always associate "Happy Together" with this movie.

Altogether I really like the movie, I fish it had gotten more critical attention when it came out - it has definitely a lot more positive representation of LGBT than mainstream favorite "Brokeback Mountain". Maybe still the general public would like to see gay characters in the "closet" but great directors distinguish themselves by not adhering to the rules. The problem with the economic crisis in Hollywood is that only the movies that make economic sense get to be made. Regretfully, we should get used to "The Tourist"-like movies being produced:  nothing out of the box, only tried and true techniques (i.e. cliches) - even if they amount to 2 hours of boredom. Christopher Nolan and this guy Ol Parker are among the few directors that have the professional integrity to make "different movies" that nurture the soul like "Imagine Me and You."

Previous Movie Review: Velvet Goldmine