The Big Short Page #3

credit default swaps on

these mortgage bonds.

Can we make it a hundred million?

Absolutely! We can make

it one-hundred million.

We'll be in touch,

send some paperwork over.

I like these cups, could I take one for my son?

Have one, yes, yes!

Thank you!

Have two!

Is there any way to do two-hundred million?

We can...

But are you sure?

Absolutely...

Absolutely, we can!

We do, eh... different projects

we do gardening, we do

the bonds... I'd like to .. Eh...

It's not bad for yourself

to be found extreme

it's very cool!

Hey Randall, what with the Dom?

Bonuses aren't for three months.

We just sold 200 million in

credit-swaps for mortgage-bonds

some fund-manager from California,

f***ing crazy right?!

Only way to make money dog!

I didn't know there

were swaps on mortgages

there are now, we made it for him!

His head must have caught up with his hole

or do something... I don't know.

Want one? No?

Awwwww

Jared

did you hear about the deal

that Randall did with some fund-manager?

Randall?

Bullshit!

He's a foot-soldier,

I'm sure it's a sh*t deal.

No, it's for real!

I told you we'd meet later.

Unfortunately... it's in a place like this,

which I would never be in.

I never hung out with these idiots after

work, ever! I had fashion friends.

Apparently this guy wanted

two-hundred mill in credit default swaps.

Randall made the sale,

can you believe it?

Somebody shorted two-hundred mill

in mortgage bonds?

That was just with deutsche...

Word is... he had half the town.

How much in total?

1.3 billion

what?

That's... that's pretty much

all of scion's liquidity!

Michael, that's highly distressing!

Lawrence...

That is not all of our liquidity!

And I'm not certain that you

really understand this trade.

This is a certainty.

Mike, I consider myself a mentor to you.

But our company is not

comfortable with this investment.

Am I being clear?

Lawrence

I have full autonomy when it

comes to investment strategy

you can read our agreement.

Do not throw our acception-

agreement in my face Michael!

We had an underlying understanding,

you wouldn't act like a goddamn crazy man!

This is not crazy...

It's all very logical.

So now we pay up premiums

on these swaps against

housing-market until

the mortgages fail?

In other words...

We lose millions until something

that has never happened before... happens?

That's correct!

Hello mark Baum

oh hey Cathy!

It wasn't me, I had a personal thing this afternoon.

I'm not your babysitter.

If your appoint makes money for

mark and Sally I'm happy!

Ok... hey did I hear you're expecting?

Eh, we're expecting to be expecting...

I'd be upset clearing this out, but we're ..

That's exciting!

Lump.. In my ball

I'll go in for a scan

hmm

turns out I have large thing,

called an epididymis

which is a thing that goes around the ball

and is like a sack underneath.

I have an extremely pronounced epididymis

enriveted that is.

Almost as large as another

testicle on itself

so get this... Cynthia..

Guys!

Cynthia wants me to quit!

And open a b&b in Vermont.

That's great! I'd love to see mark

Baum run a bed and breakfast!

Like:
Here's your steel-cut

oatmeal a**hole!

Mark refused to kiss the ring

of the people with the checkbooks,

so he had to set up his fund

under Morgan Stanley's umbrella.

His small team his...

Distrust of the system.

You guys are sick..

You're sick!

She says, this job is making me unhappy.

But you're happy when you're unhappy!

I am happy when I'm unhappy!

Bennie Daniel

you know how to make a muffin?

Mark's numbers guy.

Do you even know how to do laundry?

Make a bed? -Okay!

Bennie lost his father to a

violent crime when he was young

just like mark,

he didn't talk about it.

I don't talk about that!

Cynthia's no joke, she could

actually make him move to Vermont!

I mean, she made me start wearing a suit.

Porter Collins, former Olympic rower,

went to brown.

He worked with Baum at

a previous firm, and

couldn't figure out why

no-one listened to Baum.

The guy with all the good ideas.

Sir, yeah, I know, do you have the

wrong front-point? Cause there

is another front-point in this

same building that is baum's

and Danny Moses, the optimist of the bunch.

And a hell of a trader,

which is the only

reason they put up with

his bullshit optimism.

You're a weird caller, you take longer

with a wrong number than anybody else

I mean... it's this guy...

From... deutsche,

who was talking about

shorting housing bonds.

And then, in the middle of the call where I

had realized he had the wrong front-point.

And then... and then... cause he

wanted the one on the eighth floor.

He wanted to short housing bonds?

Hmmm

it happens like five times a day, that

somebody uses the wrong front-point.

We should change our name!

Wait, wait...

He wanted to short housing bonds?

Who bets against housing?

What's the abx at?

What's abx?

- It tracks sub-prime mortgage bond value.

-Go back to sleep!

The abx is at... eh...

Wow! It's down, it's down 3 points

since last year, that's weird.

I haven't heard a peep about that!

What was this guys name?

Jared vennekt... vennett

that's right!

These lucky sons of b*tches caught wind

of one of the best trades in

wall-street history from a wrong number.

They should've paid 10 percent

to my fox ticket system.

He was Jared vennett, vennett

Jared vennett, from deutsche, sounded very sketchy.

Sounds like a douchebag.

murmuring in himself

ok.. Hi... how are you?!

Have a seat!

Hey mister vennett from deutsche bank,

who do we have?

So, how many people have you talked to about this trade?

A few.

There's definitely some interest.

Ohh..

My boss would have my ass

are you crazy Jer?

Get lost!

F*** you!

Which is why you're here

talking to us on the wrong number?

Sounds like there's a lot of interest.

Alright.

A few people have us in, just to laugh

at me on this deal, is that you?

Is that what this is?

That's not what this is,

that's just how mark is.

Let's see what you got.

I'm sorry, do you smell that, what is that?

What?

What's that smell?

Cologne?

No...

Opportunity!

No... money.

I smell money...

Chris...

Goddammit!

I'm sorry.

This is your basic mortgage bond.

Alright, the originals were simple.

They were just thousands of

AAA-mortgages bundled together,

guaranteed by the us-government.

The modern ones are different.

They're private.

And they're made up of layers of tranches.

Highest level AAA's getting paid first.

The lowest rated Bs getting paid last,

taking on defaults first.

No obviously if you're buying Bs

you could make more money.

But, they're a little risky,

sometimes they fail.

Chris...

Somewhere along the line, these Bs and

bb's went from a little risky to dogshit.

Where's the trash?

I'm talking rock-bottom fico-scores.

No income-verification.

Adjustable rates...

Dogshit!

The default-rates are already up

from one to four percent fellas.

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