One of the best financial movies that I have seen in awhile happens to be The Big Short. It's gold like Wolf of Wall street is to salespeople, and 99 Homes’ appeal to the real estate crowd. The Big Short includes big name actors and was nominated for five Academy Awards, but the awards and accolades are not the best part of this movie. The best part is that it takes a real look at the mortgage crisis of 2008. I find it great (and productive) when entertainment can teach you something about your career, and with The Big Short, I learned valuable lessons about real estate investing. Here are some essential takeaways from the must-see financial movie of the year.
The Mind-blowing Ramp Up To 2008
It’s mind boggling to understand what was going on behind the scenes— at the highest levels of the real estate and banking industry— in 2008. If more people had been cognizant of what was going on, the market correction wouldn’t have shocked so many. The Big Short is important to watch for those active, AND not active in real estate before 2008. The movie will give insight into what happened then and will help alert investors to any possible cues of economic change in the future.
Awareness
It’s critical to continually be aware of what is going on in the market. Awareness applies to current real estate sales and price trends, but not to be forgotten, is the intent to pay attention to mortgage and secondary market trends. Hit the streets and dig into data instead of burying your face in the front page news.
Go Against The Grain
Significant gains are made and continue when you go against the grain. It’s possible to make profits when you have the courage and insight to buck the herd’s blind stampede mindset. Still, you must be careful to "buy right," and do your research to make sustainable profits, as well as structure profitable and long-term investments. Having a short term view can get you in trouble, and by trouble, I mean facing either bankruptcy or foreclosure; which most people experienced during those times.
The Big Short is an eye-opening movie that truly makes you contemplate what goes on behind closed doors at some of those big corporations.
The School Of Life Lasts Forever
This film taught me that I ALWAYS must continue to learn and better my mind, which in turn will further my career. As someone committed to self-improvement The Big Short solidified the need to learn, study, and grow. After watching this film, I am taking more time to educate myself on the Federal Reserve. The Federal Reserve exists to regulate banks, and by watching what is happening with the Federal Reserve, you can discover indicators of the current economic state. It’s interesting to see how interest rates have raised over the past few weeks. We’re already seeing the impact by investors calculating these increasing rates into their underwriting on deals.
Be A Thought Leader
Thinking for yourself is essential. This will keep you from momentary fads and ‘outside of the box’— in a good way! Don’t follow people just to follow them! Find your sandbox and begin to play there. Believe that the entire playground is yours, not just for the moment, but for the long-term.
Summary
Beyond the truth that Steve Carroll can portray a serious role (which I applaud his performance), the insight gleaned from watching The Big Short is deep. It is a complete must for anybody thinking about investing— especially real estate or mortgages. Go check it out!
