1 of 5 | Paul Dano stars in “Dumb Money.” Photo courtesy of Sony Pictures
LOS ANGELES, Sept. 8 (UPI) — Dumb Money, the film screened at the Toronto International Film Festival on Friday, is a captivating drama that sheds light on the corrupt nature of our financial institutions. While it may not reach the same level as The Big Short, it effectively simplifies complex phenomena and offers valuable insights.
The movie centers around Keith Gill (played by Paul Dano), a former analyst at MassMutual who hosted a YouTube show in his free time. During the show, Keith noticed that GameStop stock was undervalued, with a price under $4 per share.
Keith decided to share his belief in the video game retailer and invested in it, prompting many of his followers to do the same and ultimately causing the stock value to surge.
Dumb Money introduces various characters involved in different aspects of the GameStop stock saga. Gabe Plotnik (played by Seth Rogen) serves as the CEO of the Melvin Capital hedge fund.
Melvin Capital and other hedge fund managers had been shorting GameStop since 2014, profiting from covering their shorts when the stock reached its lowest points. However, as GameStop stock started rising, hedge funds with short options began losing money until their debts accumulated.
Jenny Campbell (played by America Ferrera) is an ER nurse who invests in the hopes of escaping poverty. Marcos Garcia (played by Anthony Ramos) works at a GameStop in Detroit and decides to invest as well.
The moral dilemma surrounding the GameStop situation is best articulated by Harmony Williams (played by Talia Ryder) and Riri Pariseau (played by Myha’la Herrold), two University of Texas at Austin students. Harmony remarks, “That’s the definition of a pyramid scheme,” when Riri explains that the more people buy GameStop, the more valuable everyone’s share becomes.
Harmony’s observation is accurate. If the value of an investment hinges on finding new buyers, it resembles a pyramid scheme. Additionally, when an investment becomes unsellable regardless of its rise in value, its actual worth becomes questionable. The film delves into these aspects.
Each new character in the movie introduces a fresh perspective on stock trading, allowing for the continuous introduction of new concepts as the plot unfolds.
From the perspective of the GameStop investors, shorting entails taking advantage of a company’s downfall. They resent the fact that hedge funds would profit if GameStop fails, which motivates them to continue investing even when they could cash out for substantial amounts.
The emergence of online stock trading platforms, which enable individuals to trade without paying broker fees, is another crucial element of the GameStop saga. Many of the GameStop investors couldn’t afford a traditional stock broker.
Dumb Money also highlights the representation of Robinhood CEOs Vlad Tenev (played by Sebastian Stan) and Baiju Bhatt (played by Rushi Kota). When asked how they can afford to operate a fee-free site, their response suggests that the market is far from truly free.
The film implies that a subsidiary of the Citadel hedge fund covers the costs of Robinhood trades, revealing a conflict of interest. Citadel benefits from keeping individuals driving stock prices up and down, as it enhances their own investments. Eventually, the consequences of this arrangement become apparent.
At one point in the film, the GameStop investors successfully raise the stock value to hundreds of dollars. So why didn’t they sell at that point?
None of the characters in the movie express a desire for more money. Instead, they are driven by a moral imperative not to allow Wall Street to devour GameStop.
They all choose not to sell their stocks individually. Furthermore, their faith in Keith remains unwavering as long as he holds his shares.
This suggests that the system as a whole is designed to discourage investors from claiming their profits. Even when their investment reaches millions, they are expected to refrain from taking that money or investing it elsewhere.
It’s worth considering that Keith and others may have been seeking a pyrrhic victory. They couldn’t replicate the GameStop scheme with every company, so hedge funds would simply short another struggling business. Demonstrating that individual investors can make a profit and get out on top might have been enough.
One might wonder why Gabe didn’t cash in on his GameStop shorts when they were valued at $4 per share. Did he truly need to extract that last $4? Granted, he may have had shorts on millions of shares, where every dollar counted.
The film contrasts scenes of Keith and the investors celebrating their gains with Gabe’s despair over his losses. However, this disparity seems unjustified. The hedge funds made a risky bet, and the possibility of losing was always present.
To impede the investors, a Reddit board where they shared information was reported and shut down, although other vulgar and abusive content remained unchecked on the platform. Additionally, Robinhood suspended the option to buy more GameStop stock, although none of the characters in the film sell at that stage.
Curiously, the film neglects to address the actual financial strategies employed by GameStop as a company. Marcos’ boss (played by Dane DeHaan) briefly mentions the corporate handbook but doesn’t provide any insight into how GameStop profits as a video game retailer. Earning millions of dollars independently of a company’s actual worth may not be ideal.
One notable aspect of the film is its portrayal of the pandemic, as it is based on true events that took place in 2020-2021. Characters wear masks, albeit inconsistently, with cloth or surgical masks, as N95s were not widely known at that time. Keith also experienced the loss of a sister in 2020, though whether her death was related to COVID is unspecified. Anti-police graffiti, reflective of the George Floyd protests, can also be seen in the streets depicted in the film.
The film’s portrayal of YouTube, TikTok, and Reddit culture may come across as abrasive, but it likely tones down the obnoxiousness of reality to make it more palatable for cinematic purposes. Expanding on this notion, Keith’s brother (played by Pete Davidson) consistently interrupts scenes with vulgar humor in an attempt to add comedic elements.
For casual viewers seeking insights into the GameStop story or investing in general, Dumb Money skillfully blends informative and dramatic scenes. For ardent stock enthusiasts, the film raises thought-provoking questions that warrant further discussion.
Dumb Money will be released in theaters on September 29.
Fred Topel, an entertainment writer based in Los Angeles, is a professional film critic and a member of various renowned critics’ associations. Read more of his work in Entertainment.
