The movie “Margin Call” has just been released and is now showing in cinemas in New York City. For those who work in the financial industry and understand the creation, marketing and selling of complex structured derivatives it will only be an entertaining, maybe even a riveting movie.
The rest of the world, however, will be taught how mathematics mixed with a perverse incentive compensation system nearly collapsed the global economy.
What is least apparent, however, is that the start of fixing the problem, illuminating the complexity, starts with data “transparency.” Complete “transparency” into the basis of financial transactions is possible now because of the capability of computers to let their human users peer into the underlying details of products traded and the counterparties trading them.
