Will Emerson- Margin Call 2011

I come back to this movie, time and again and I like the boardroom scene the most.

In the scene at the roof top of office building with Peter and Seth, he says that out of the 2.5 million that he made last year, he spent on
Tax: 1.25 million = 50%
Mortgage: 300k = 12%
Sent to parents: 150k = 6%
Car: 150k = 6%
Restaurant: 75k = 3%
Clothes: 50k = 2%
Rainy Day: 400k = 16%
and Entertainment (booze, etc.): 125k = 5%

I am curious if the breakup of Will Emerson's annual expenses is kind of standard for all the top guys. Cheers!

Comments (18)

Sep 3, 2016

Umm, eh. Bumpity bump?

Feb 10, 2020

woah

Most Helpful
Feb 12, 2020

I love this movie too and particularly this scene. Let's have fun and analyze:

First, the very believable:

  • Tax: accurate. Federal+state+local. You could avoid some of it at his income level through weird ways but let's say he's too busy having fun spending it and working to discuss with the right lawyers
  • Mortgage: accurate, if $25k per month of mortgage that implies probably a $4mm condo or so at pre-crisis mortgage rates (high
  • Rainy day fund: If we back out his comp to let's say 50% bonus and 50% base, he's getting a $1.25mm bonus or around $700k after taxes. Saving $400k would be about half of his bonus so in that respect he's actually doing quite well

Then medium believable

  • Entertainment: $10k month is very silly but if you were committed to bottle service, it's about $1k per weekend day. if you have high end escorts that's $1k per night by itself, so in the context of the show it's very fair
  • Restaurant: 75k/year is $6k month or $200 a day. Again if you lived it up and had high end lunches and dinners you could cover this easily by yourself; if you treated dates (or escorts) then it's believable

The movie logic / overkill

  • Sent to parents: A bit overkill at 10% of his post-tax compensation, but ok
  • Car: $150k Per year is definitely overkill, Emerson drives an Aston Martin DB9 Volante in the movie which is about this cost, but since it's a one time expense he should have adjusted it out of his recurring cost structure. You can lease a pretty expensive car for $2k per month or 25k/year.
  • Clothes: I refuse to believe anyone spends $4k a month on clothes even at the height of the financial crisis. That being said, just browse Mr Porter and see where the fools and their money are soon parted
    • 8
Feb 13, 2020

$48K in clothes is only 4 Kiton suits ($40K), 10 ties ($2K), 4 pairs shoes ($2K), and $4K for everything else including cuff links, collared shirts, casual wear and watches.

I think the restaurant portion could be higher, especially when paying the bill for groups.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

    • 2
Feb 13, 2020

Very fair point. I'm not thinking big brain enough. Suits and watches particularly. Restaurants if treating dates, or group (like team) could be higher, I agree. This was a neat thought exercise.

Feb 12, 2020

What group were these guys in? Lol I'm assuming S&T but I'm pretty new to this world. Also, what level is he at? MD? SVP? I just wanna put it into perspective cuz the movie is amazing especially that scene

Feb 12, 2020

He mentions that he had been with the firm 10 years. For conservatism let's say he has been with the firm the whole time and started 10 years ago. He could feasibly be a Director who is very successful / top bucket every year. Pre-crisis top bucket Director could feasibly be paid as much as a successful MD nowadays.

Feb 12, 2020

"Truth is like poetry. And most people fucking hate poetry."

Feb 13, 2020

Spending is still the same, except that I'm driving a Ferrari 488 now which set me back way more than 150k.

    • 3
Feb 12, 2020

Such a criminally underrated movie with great actors, great plot and provides a realistic insight that is depressing and educational.

Array

Funniest
Feb 13, 2020

It's very good but I think it's overshadowed by the two ends of the spectrum. The Big Short is grim, dark, and painfully tethered to reality making it such a fantastic movie. Then there's Wolf of Wall Street which is so outlandish it appeals to the beer crushing GoingToBeAStockBrokerBro-OhWaitThoseDon'tExist-NorthwesternMutualHereICome bros. This movie lies in the middle. My personal preference is The Big Short if I had to pick.

"The three most harmful addictions are heroin, carbohydrates, and a monthly salary." - Nassim Taleb

    • 3
Feb 13, 2020

Audibly lol'd at NWM.

    • 1
    • 1
Feb 13, 2020

WoWS: What people think I do

Big Short: What I actually do

Margin Call: How I actually feel

    • 3
Feb 12, 2020

With the exception of giving his parents 10%, I wonder how much of this can a VP or MD can relate to this.

Feb 14, 2020

So a trader and I just saw this posted on efinancial for the figures paid to risk takers and he and I were like WTF? This can't be right, as we're both on the inside. Not even close. Maybe before the Volcker rule days when large material risk taking wasn't negatively viewed.

https :// news.efinancialcareers. com /us-en/3003200/salaries-and-bonuses-traders-natwest-markets?_ga=2.118138953.1761932552.1581339407-1983256017.1572536697

  • Investment Manager in AM - Equities
Feb 14, 2020

I read that this morning as well and highly questioned it. Thing that caught my eye is it's outside the usa so maybe they get around the regulations, I'm not exactly sure.

Feb 15, 2020
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