The Washington Post

Wall Street movies predict stock market crashes

Aleks Jakulin writes:

The first two Wall Street movies came out in 1929, the first one in January and second one in December 1929 — the Black Tuesday struck in October, followed by the Great Depression. The movies’ production obviously predated the disaster.

The third Wall Street movie came out in 1987, released in December, after the October Black Tuesday crash. The production started before the crash.

Boiler Room was released in mid-February 2000, and the Dot-com bubble peaked in mid-March 2000.

The fourth Wall Street movie started rumors in early 2007. The massive crash and crisis struck in 2007-2008, delaying the release of the film until 2010.

The fifth Wall Street movie, and the second “Wolf of Wall Street” has been released around Christmas.

By this logic, another crash is to be expected shortly? Moviemakers, stop ruining peoples’ lives!

But, as Aleks points out, there also is a slightly different causal story:

Perhaps moviemakers are just good at smelling irrational exuberance, waste, excess and greed, which might be the true causes of stock market crashes.

Andrew Gelman is a professor of statistics and political science at Columbia University. His books include Bayesian Data Analysis; Teaching Statistics: A Bag of Tricks; and Red State, Blue State, Rich State, Poor State: Why Americans Vote the Way They Do.



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