The Flaw (2011) User Reviews

Excellent documentary

[Leofwine_draca · 6/10 · 20 November 2011]

An extremely interesting look at the problems associated with capitalism in America. This documentary goes hand in hand with Michael Moore's CAPITALISM: A LOVE STORY, although there's more of an emphasis on helping the viewer to understand technicalities (whereas Moore focused on showing the human side of the story).

I came out of it with a better grasp of Wall Street, the real estate market, boom and bust and consumer society in general, which is no mean feat. The voice over narration is well judged, the graphs extremely useful and there are no dull bits. The use of old cartoons and film clips adds comedy to a documentary you wouldn't think of as amusing. Recommended.

Misleading Through Omission (this movie lies like every other socialist lens placed on the 2008 crisis)

[pianos-70093 · 11 November 2020]

There is not a word about Bill Clinton's 1990 Affordable Housing Act, which is in my opinion the socialist root of this problem:

1. It forced banks to change house lending rules in a way that created substantially higher risk of default from the borrowers (compared to the historical risk levels). If a bank did not agree to this they would lose access to government contracts; 2. (1) above was the primary reason for the artificial rising in home price levels (not the sudden increase in house spending by the top 1% followed by the middle class out of desire of priviledge - the pre-1990 lending rules would have prevented so many people's getting easy money to bid on houses); 3. (1) above created indeed a higher percentage of defaults, as expected, but banks and those buying mortgage packages miscalculated based on century old formulas that did not account for the behavior of those who for the first time in history could buy a 200K house with 5000 of their own money. This behavior - high default rate among this category - is the socialist element that started the dominoes falling because 4. There were just too many defaulters who thought they were entitled to spend on consumer goods equity from the homes they were never going to pay back the mortgage for, with the end result that 5. Banks wound up losing the most which made all taxpayers (future generations included) the biggest losers - it would have been a much bigger disaster to let banks fail, though a shorter one which could have hurt just our generation and not that of our children.

The fact that Bill Clinton's socialist policies were not mentioned is very telling given the many hints at equalitarianism as a solution throughout the movie.

Lastly, the crisis that started in 2008 made many people who lost part of the asset (the percentage of the house they had already paid off) because they suddenly lost salaries they would have continue to pay mortgages from. They are also victims, not the poorest ones who saw the golden egg of home ownership as a temporary huge credit they could spend from for a while.

All details you are given in the movie would not have been sufficient to create this catastrophic effect in the absence of the socialist policy that started it. Don't get me wrong, I would rather go out for a beer with Bill Clinton than with any other president, but socialist policies, past and future, will continue to diminish our country's economic power and the well being of each of us.

Watch The Flaw

[gacha2013 · 10/10 · 2 November 2013]

Only 2 reviews for this remarkable film? I leave the spoiler box unchecked, but really, the film is a "spoiler" since it refers to the most recent crash, a veritable implosion of the global economy based partially on mortgage backed securities.

The film is British, so at the very least we have a fine mix of American and British academics in economics giving slightly different, but converging approaches to what happened.

I've seen a number of films on the crash (fictional and documentary), and this one is by far the best. The film is technical at times, but this is necessary. Nowadays, many of the actors involved in the financial sector are "financial engineers." The days of simplicity are long gone. It's all algorithms and computers now.

The film strikes a perfect balance between archival footage, expert discussion, and interviews with "real people" who were caught up in the real estate binge. And not all of those who bought houses were speculators, some just wanted a decent place to live, and maybe to use that decent place to consolidate debts.

The title "The Flaw" seems to have come from testimony given by Greenspan who referred to a flaw in his own ideology. The irony of this Randian admitting a problem with his ideology should not be taken for granted.

I walked away from this film wanting to watch it again. I hope more people will watch this film. This is not some kind of anti-capitalist diatribe. Instead the film methodically and subtly point out something we all know intuitively; capitalism as it presently functions cannot be sustained.

There are no simple answers. Only some terrifying questions. And by the way, nothing was solved by the bailouts that wasn't short term. Nothing.

Informative and Educational

[view_and_review · 9/10 · 3 March 2022]

"The capitalism in the last thirty years has decreased the standard of living for everyone except at the top."

This was the statement of Louis Hyman, an economic historian. I'm mentioning this statement because it was in respects to the more surprising issue behind the '08 financial collapse. Everyone heard the term "subprime mortgages" and everyone believed that that was the core issue behind the '08 financial collapse. What I never heard was "income inequality" which was mentioned in "The Flaw."

When wages stagnate for the poor and middle class, the only way an economy can keep humming is through borrowing and credit, i.e. Debt. When debt increases so does spending which increases the wealth of the top 10%. Debt can only increase by so much before defaults happen and then it all comes tumbling down. But, as Hyman pointed out, it begins with outrageous income inequality.

Of course, there were a lot of other factors mentioned for the '08 crisis: CDO's (Collateralized Debt Obligations), sector rotation, asset market, and more. This 80 minute documentary was very informative and educational. It's been fourteen years since 2008, but it still seems like only yesterday. Furthermore, the way home prices have skyrocketed in the last decade I can only wonder what will cause them to plummet again, and who/what will be to blame this time. Again it seems like the government is behind the curve on the economy and does too little too late.

Free with Amazon Prime.

Brilliant; the experts were all correct, and the film put it all together by the end of the show.

[suite92 · 10/10 · 7 September 2013]

At the start of the film, there is no clear POV (point of view). Instead, the problem is approached in the style of showing each of ten blind men a different piece of an elephant. It takes some work to get the data returned by the blind men into something overarching and coherent, such as a single 3-d model of the elephant which explains all reportage.

Brilliant; the experts were all correct, and the film put it all together by the end of the show.

Cinematography: 8/10 The archival footage is not all that good. The modern interviews were crisp and well-done.

Sound: 8/10 Almost everyone is properly miked. The archival footage of Greenspan versus Waxman in the House hearings was weak.

Screenplay: 10/10 Obviously had a lot of careful thought. This is so well done that it moves well even with the large amount of detail and history being conveyed.

Inadequate explanation

[moderator-862-914745 · 5/10 · 16 March 2019]

A rather mild and weak explanation of the way people were duped before the 2008 crash and the sheer uncaring criminality of the suffering caused to many ordinary people who lost their homes, jobs and much more. For a more robust examination of and explanation of what went on, watch The Big Short instead, it's more entertaining and enlightening.

Scant documentary that every person should watch once

[schreiber-stephen · 5/10 · 21 January 2014]

The Flaw delivers the story of the causes of the financial crisis and what may have caused it. There is bias in this documentary but it isn't as overt as most documentaries. The great thing and the reason why I believe that everyone should watch this movie is that this documentary delivers a the information of the financial crisis in a format that is easy to digest and gives great visual representation of everything that lead up to the collapse. The flaw of The Flaw is that there are some stories and story lines that are personal to one or two people instead of a whole audience. These stories, in my opinion, are David Sington's attempt to elicit an emotional connection and reaction to what happened with the financial collapse. This makes the documentary feel more personal and allows the viewer to feel more connected to the issues. That said, that is part of what I am not a huge fan of with these types of documentaries. I personally would have rather just had the information and the graphs and charts showing what happened without the personal stories so that the movie wouldn't feel so biased. This is a good documentary that is a scant 78 minutes, has good information and is easy to get through.

Do not lend people who cannot afford a $300k house $500k

[sanjsrik · 3/10 · 19 January 2020]

So many "documentaries" keep being made about a very simple fact.

Banks lied for their own greed. The "economists" who lied who CAME from the banks lied to keep up the greed. The government who was filled with the economists who came from the banks lied to keep up the greed.

In the end, the public was sold the BS that every house and every "homeowner" was "entitled" to have a house.

The simple fact and instead of making more of these dumb documentaries that can be summed up in one sentence:

If you can't afford a house because you can't afford the mortgage, don't believe the banks that you can.

The stupidity of the mortgage-back crisis was that the banks and the institutions couldn't keep the sham up longer.

People need to take some responsibility for their willingness to believe that they "deserved" a house.

Greenspan and the rest of his ilk are a bunch of crooks.

Economic "theory" is not really a theory when it's based on greed and keeping the banks propped up.

Lots of Equity focus, ignored Fed law that required banks to do this

[socjmh · 4/10 · 9 March 2023]

4 is a generous rating.

This documentary spends too much time on inequity of pay. Frankly, if all pay increases, we don't care if someone else makes more.

The housing index adjusted for inflation from 1890 was interesting.

They pulled out tiny bits of Allen Greenspans congressional inquiry to make him look bad. They used it to cast doubt on capitalism without justifying or explaining what the actual failure was that caused the crisis.

Banks loaned to people who should never have qualified for the loans. Yes. But why!? Banks would never do that because it puts them at risk. Underwriters would never do this if they were free to make their best decisions.

This documentary makes it look like it's the banks who cooked up this idea to lend money to people without verifying income. That's false. Bill Clinton signed law requiring lending without checking. They wanted to NOT DiSCRIMINATE based on INCOME That is just stupid. Banks simply complied and then figured out a way to sell the unvetted loans... risk mitigation. It's exactly what any business would do when the government forces them into business practices that do not make financial sense.

This had a lot of potential to enlighten about the 2008 fall, but it failed. I would not recommend this to my kids or anyone for a big picture of the 2008 banking crisis. It had agenda toward equity instead of focusing on the actual laws and resulting compliance that caused it.

Propaganda

[mikekansasmike · 22 March 2022]

This is Communist propaganda. It omits so many of the actual catalysts for the 2008 collapse.

I would not recommend watching this program. Watch The Big Short instead. Far more accurate and educational.

Highly flawed and superficial explanation

[nwnz · 1/10 · 23 June 2021]

Typical socialist/statist claptrap. Maoist propagandists would be proud.

Riveting documentary

[Phil_Chester · 3 September 2018]

Utterly fascinating and very well put together account of the true source of all that "bother" in 2008. Highly recommended. It would be wonderful to hope that we will learn lessons from this, but unfortunately human nature doesn't work like that. "Greed is good."