"When you have growing inequality, typically your level of consumption goes down.
In the United States we said to those whose income was not going anywhere don't worry
continue to spend as if your income was going up. But the only way you do that is
through debt and that particular model has been broken."
In October 2008 a humbled Alan Greenspan admitted to the US Congress that he had
been mistaken to put so much faith in the self-correcting power of free markets and
that he had failed to anticipate the self-destructive nature of wanton mortgage lending
and the housing and credit bubble it generated. Taking for its title Greenspan's
description that he'd found a flaw in his model of how the world worked, THE FLAW
attempts to explain the underlying causes of the crisis in more depth than any documentary
to date.
Made by international award-winning documentary maker David Sington, THE FLAW tells
the story of the credit bubble that caused the financial crash. Through interviews
with some of the world's leading economists, including housing expert Robert Shiller,
Nobel laureate Joseph Stiglitz, and economic historian Louis Hyman, as well as Wall
Street insiders and victims of the crash including Ed Andrews - a former economics
correspondent for The New York Times who found himself facing foreclosure - and Andrew
Luan, once a bond trader at Deutsche Bank now running his own Wall Street tour guide
business, the film presents an original and compelling account of the toxic combination
of forces that nearly destroyed the world economy.
The film shows how excessive income inequality in society leads to economic instability.
At a time when economic theory and public policy is being re-examined this film
reminds us that without addressing the root causes of the crisis the system may collapse
again and next time it may not be possible for governments to rescue it.
