Okay so there are a few movies with a brief glimmer of understanding about economics that I wanted to cover. It’s not that the rest of the movie doesn’t understand economics…it’s that it really isn’t an issue so it felt better to just lump them all together.
#17 The Count of Monte Cristo
Abbe Faria: Define Economics.
Edmond: Economics is a science that deals with the production, distribution, and consumption of commodities.
Abbe Faria: Translation?
Edmond: Dig first, money later.
It’s not a lot, but it has both the technical and the pragmatic side of economics, and most importantly, that nothing is free…so dig.
#18 The Dark Knight Rises
The Dark Knight Rises, in fact the whole series, has some wonderful things to say about ethics, politics, sociology, and human nature…but it doesn’t often deal explicitly with economics, except in this one place, right after Bane has taken over the Gotham Stock Exchange.
Exchange Security Chief: You’ve gotta get in there!
Foley: This is a hostage situation.
Exchange Security Chief: No! No! No! This is a robbery! They have direct access to the online trading desk.
Foley: I’m not risking my men for your money.
Exchange Security Chief: It’s not our money, it’s everybody’s!
Police Officer: Really? Mine’s in my mattress.
Exchange Security Chief: You don’t put these guys down, that stuffing in your mattress might be worth a whole hell of a lot less.
It wonderfully takes on the idiocy of the mentality that economics isn’t a massive single thing. That what happens in one place doesn’t happen elsewhere and that what affects one sector is completely unrelated to others. Economics is a single mass where everything is connected, and to think that isolationism or just hiding your money in your mattress (both equally stupid) are going to protect you is absolutely foolish.*
Again a great movie more for politics than for economics, but which in one brilliant moment understands economics than most of Washington D.C.
Woman Selling Her Diamonds: But can’t you make it just a little more…?
Buyer: Sorry, madame, but diamonds are a drag on the market: everyone sells diamonds; there are diamonds everywhere …Two thousand four hundred.
Woman Selling Her Diamonds: All right…
I love this scene because it shows something very realistic. Nothing has intrinsic value. Diamonds are only as valuable as they are rare (and that is only because the cartels keep the supply very fixed). But if the market is suddenly flooded the price of diamonds, or gold or silver or anything valuable, drops. One only has to look at the massive inflation in Spain during the days the Conquistadors where they were shipping gold back by the ship-full to know this.
And if one were very intelligent they would know that this is why just basing currency off precious metals or stones would be foolish. Any new discovery of a large mine could cause massive inflation, any industrial need for that metal could cause a massive shortage that would in turn result in massive deflation (which can often be worse than inflation). Anyone who has read Friedman and Schwartz’s A Monetary History of the United States 1867-1960 knows that the gold standard was no guarantee against inflation or deflation (and often the cause of it) and thus anyone who argues returning to such practices knows nothing about basic facts of monetary policy.
And it’s all shown in that little moment where diamonds are not worth as much as they were a few years before.
*Okay what this movie does with Wayne’s stock trades makes no sense, but I’ll forgive it because it was something required to move the plot forward.