The story chronicles the work of hedge fund manager Michael Burry (portrayed by Christian Bale), who recognizes that the U.S. housing market is driven by an asset bubble inflated by high-risk loans. In 2005, Burry – the manager of Scion Capital -- recognized that he could establish a credit default swap market that would allow him to short the housing market. However, his clients grow angry when the banks and creditors he tries to convince about the mortgage bubble argue that the housing market – which was surging at the time – is stable. When investors demand their money back as Burry shorts the market, he places a moratorium on withdrawals.

Meanwhile, Jared Vennett (Ryan Gosling) inadvertently discovers Burry’s goal to establish the credit default swap market. Hedge fund manager Mark Baum (Steve Carrell) joins Burry in investing in the credit default swap market and recognizes that poorly structured loan packages known as collateralized debt obligations (CDOs) have received AAA ratings and are exacerbating the mortgage crisis. After discovering that questionable innovation in the CDO market has fueled massive risk in the markets, Baum concludes that the housing bubble will ultimately lead to the collapse of the U.S. economy and bets big – shorting the financial sector. Baum was based on hedge fund manager Steve Eisman. Meanwhile, Vennett was based on Greg Lippsmann, a former bond salesman at Deutsche Bank.

Finally, two investors -- Charlie Geller (John Magaro) and Jamie Shipley (Finn Wittrock) – seek the investment advice of retired banker Ben Rickert (Brad Pitt) after they discover a paper written by Vennett. After Shipley and Geller make a series of successful bets against the housing market, Rickert grows angry that they have profited off the downfall of the U.S. economy and Middle America’s financial doom. Geller is based on Cornwell Capital founder Charlie Ledley, while Jamie Shipley was based on Cornwell partner Jamie Mai. Rickert was based on Ben Hockett, a former trader at Deutsche Bank.

Though they make a fortune on their trades against the housing market, they are left highly dejected about the amount of risk taken by Wall Street and the moral hazard that ultimately would fuel the bank bailouts. Shipley and Geller would later try -- and fail -- to sue the ratings agencies that gave poor loan ratings.

Burry, meanwhile, ends up producing nearly 500% returns for investors who stayed with him through the duration of the financial crisis.

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