Billionaire Boys Club (2018)

Trader's Film Library #49 · Frauds and scandals. A small Ponzi scheme that ended in tragedy.

Original title: Billionaire Boys Club · Type: film (and 1987 miniseries) · Created by: James Cox · Usefulness for traders: ★★☆☆☆

What it's about

The true story of a group of young people in 1980s Los Angeles who started an investment club. When the investments didn't deliver the promised returns, they paid out “profits” from new investors' money, and the story ended in murder. A 1987 miniseries had already told the story.

What it has to do with markets

The mechanism of a Ponzi scheme shown on a small scale: promises, group pressure, the appearance of success and increasingly desperate decisions.

Lessons for traders

• a promise of high and certain returns is a warning sign
• the appearance of success attracts capital (the halo effect, Atlas of biases #29)
• lies in finance escalate (escalation of commitment, Atlas of biases #41)

What to watch out for

The feature film was coolly received. The story is more interesting than its execution.

Discussion

The discussion takes place in Hetman Capital Club (in Polish). Join the discussion in the Club →

Navigation

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The description outlines the plot without revealing the ending where possible (true stories have a known outcome). Educational content, not investment advice.