Given the comedy factory Adam McKay and Gary Sanchez partners Will Ferrell and Chris Henchy built in feature films, TV and videos, the director was a surprising choice to tell the sobering story of the 2008 global economic collapse. But McKay, a political activist who has been working sly topical references into scripts since he and Ferrell first met on Saturday Night Live, played to his strong suit to adapt the Michael Lewis book about a band of misfits who saw the perils in bundling shaky mortgages and profited handsomely by betting against them, when no one listened to their warnings. The Big Short, which McKay wrote with Charles Randolph and which stars Brad Pitt, Steve Carell, Christian Bale and Ryan Gosling, uses comedy to make the drama and technical banking terms palatable, as the film builds toward a tragic punchline, with the joke on everyone but the bankers who caused the debacle.

big shortDEADLINE: Your background is comedy, and you use it deftly in The Big Short. There are laughs as you go along and they help you grasp the complexities of things like credit default swaps and mortgage bundling. Then it hits you that this is a tragedy. How did you come up with that mix?
MCKAY: I always viewed the book as two stories. The first half of the story, we’re seeing it through the eyes of these main characters and they think they’re participating in a fair market. They think they’re doing counter-investments against bad investments and the banks are sort of rolling their eyes. It is like that movie 21, where we’re rooting for these weirdos to beat the bank.

I always viewed the first half of the movie a little bit as a thriller, little bit of a satire. Yeah, it’s got some funny stuff. But it’s got a lot of energy. And then, after Vegas or during Vegas is when they really go, like, “Oh, my god, we’re alone on the other side of the room on this investment and the whole system has been compromised.” At that point it becomes a bit of a tragedy. I never read it one way or another, as a comedy, a thriller or a tragedy. The movie goes through two or three phases. Then, they see that they’re not just betting against these banks, they’re betting against themselves, they’re betting against the world and that everything has been compromised. To this day, when you meet the real people, they’re still just in shock. They really, truly believed that the market works. And when they found out that it was rotten to the core, it really upset them. A bunch have quit, and to this day they are just as mad as ever. So, yeah, it’s an interesting movie. You know, people are calling it a comedy and sure some people call it a tragedy, some even call it a “tramedy.” It’s an unusual movie, no question.

DEADLINE: Structurally, there is an Ocean’s 11 caper movie vibe, only many of those characters never actually intersect. Christian Bale and Steve Carell don’t share a scene. How much of a challenge was that for you and co-writer Charles Randolph to figure out?
MCKAY: Yeah, I don’t think Christian Bale left his office much during the entire time, except maybe to go play heavy metal drums. In real life, that’s what Dr. Michael Burry did. It’s a movie really about large forces at work, rather than individuals working together. And it’s really a story of how this idea, the mortgage backed security, mutated and just runs over these guys. So, they’re not directly connected face to face, but they’re all connected by these forces they’re dealing with. It was definitely one of the questions we had when we shot the movie: is that going to be OK? When you watch it, they all do feel connected because they’re so tied together by what they’re dealing with.

the big shortDEADLINE: You break into the narrative to have Margot Robbie, Selena Gomez, Anthony Bourdain play themselves and talk directly to the audience to explain complex Wall Street economics. What inspired that and how concerned were you that you might take the audience out of the movie?
MCKAY: When I first read the book, what I liked was that the characters are the central backbone of the movie. Their vulnerability, their oddness, their pain ties us to the story. But I also loved that there was a sense that the book was having this really respectful conversation with the reader about how all this stuff works, the end goal being that, yes, it sounds very complicated, but it’s actually really not that complicated. I knew that that conversation had to happen in the movie, but it had to be done with the right alchemy because you’re right, you don’t totally want to throw us out of these characters lives by breaking the fourth wall too much. I’ve done a lot of theater in Chicago where we’ve played with and had success with breaking the fourth wall. And I saw it done well in the movie 24 Hour Party People and American Splendor. There is energy to it and an excitement that wakes up the audience, and that felt perfect for this movie.

DEADLINE: You also peppered in pop culture references, even including your Funny Or Die short on Pearl the drunken landlord. Like you were saying we were like children distracted by bright, shiny objects. But the sad truth is, people lost homes and saw pensions destroyed and they won’t be able to retire. Did you take a hit when the bubble burst in 2008?
MCKAY: Well, I certainly had no idea it was coming but was fortunate to have had a smart business manager who took a lot of my money out of the stock market and saved me a lot of money. But I had a very close family member lose their house, and a bunch of close friends lose their jobs. We all felt it in the movie business.

MCKAY: Studios reduced the amount of movies they were making and you saw the work decline and a whole new kind of scrutiny of criteria put towards what movies get made. I feel it really changed the film business in a big way. I’m lucky. I work in this crazy world of filmmaking where I was buffered enough. But I had a lot of family and friends who were heavily affected.

Adam McKay

DEADLINE: I read Moneyball when it was optioned and didn’t see that movie in there. Same with The Blind Side. Michael Lewis has this uncanny knack of writing well informed stories on complex subjects with characters that speak to certain filmmakers. What is it about his writing that grabbed hold of you?
MCKAY: He writes about what’s happening now, writes about world-changing ideas and then personalizes it with the characters involved. I think people are hungry for that. If you look at The Blind Side, the idea that the NFL passing game started opening up so suddenly you needed a left tackle to protect the quarterback, and then it leads to this kid suddenly having a lot of value and this whole story unfolds. And you look at Moneyball, and because baseball doesn’t have a salary cap, Billy Beane was forced to kind of come up with this new way of putting together a team and this whole new idea that changes sports on every level. I would say the same thing about The Big Short. It really starts with the original mortgage backed security, which completely transformed banking in a way that none of us really noticed even as it went from 6% of Gross Domestic Product to 24% of GDP. That’s a massive growth rate that was never really discussed in popular culture, and it changed all of our lives in a massive way that we didn’t really notice. And then he layers in these amazing character sketches and gets to the essence of these people. He ties his information and ideas to these amazing characters in all of his books, but I really feel that The Big Short is his masterpiece, his most ambitious work. And when I read it I was just, like, oh my god, I have to make this.

DEADLINE: You made that decision, but your stock in trade is high concept comedy. How tough was it for you to sell yourself for this, when comedy gets short shrift in the respect department?
MCKAY: Well, I thought there was no way anyone will let me make this movie, so I just forgot about it. About two years later, Anchorman 2 had come out and done really well, and then I did Ant-Man and that was looking good. My agent, Cliff Roberts, asked if there was anything I really wanted to do if I could and I remembered The Big Short. Turned out to be one of those right-time, right-place moments, because the script stalled at Paramount. And the folks at Plan B said, “We are open to the idea of Adam McKay doing it.” We had this gangbusters meeting, where I pitched them my vision and they were completely into it.

The Big ShortDEADLINE: Steve Carell turns in this performance after Foxcatcher. I still remember him when he was all silliness on The Daily Show. Now, you’d have to look at someone like Robin Williams as a comic who made this kind of transition into emotionally complex acting. You worked with him in Anchorman, when he played Brick Tamland, the weatherman with the IQ of 48. He stole scenes, but did you at all see the potential for this?
MCKAY: I definitely knew he was a guy who really prepared and really worked hard, even though it was a silly comedy. He was never satisfied with a take until it was really there. I saw the drive and the precision back then. But I didn’t really see this until I watched The Way Way Back and thought, whoa, I didn’t know he could do that. There’s an anger and a coldness to that character that I had never seen. People talk about the comics going to drama, and I thought Robin Williams was amazing at it, but there was a sweetness and warmth in the way he played those characters. Carell brought real edge. Little Miss Sunshine was great but The Way Way Back was where I first saw him marry that method of rigorous preparation I saw in Anchorman, with drama. He’s got this amazing nose for when it’s true and when it isn’t and the two of us had a lot of fun chasing down those real moments together.

DEADLINE: Bennett Miller said after meeting Steve, that there was some darkness to an inherently nice guy, which made him right to play the oddball murderer John du Pont. I said it seems like every comedic guy has that dark side except Will Ferrell. Miller surprised me when he said, it’s there in him, as well. Do you see it in your regular collaborator and did you consider Will for this?
MCKAY: He was already shooting another movie we were producing, Daddy’s Home, and was going right into a movie with Amy Poehler, The House, which we’re also producing. It was a good problem to have, him shooting two movies. We did talk about a cameo, but he was just so cool about it. He said, “You know what? Go do a movie without me. I think this is great for you.” But I too have thought about exploring that dark side, that edge he’s got, in a different kind of role. We’ve discussed it a bit. Bennett Miller’s right. It’s there.

DF-13373_r - Will Ferrell (l) and Sacha Baron Cohen star in Columbia Pictures’ comedy Talladega Nights: The Ballad of Ricky Bobby. Photo Credit: Suzanne Hanover S.M.P.S.P. Copyright: (c) 2006 Columbia Pictures Industries, Inc. and GH One LLC. All rights reserved.

DEADLINE: You have made subversive points in movies like Anchorman, Talladega Nights and The Campaign, but they were overshadowed by the broad comedy. You are a political activist. Are these more serious themes taking more prominence in what you write?
MCKAY: I think things have changed in the world. There was a period in the late ‘90s, 2000s where doing absurd, laugh-out-loud comedies with a kind of secret, satirical edge was a pretty good way to play it. As our society has continued to sort of spiral out in this really strange way, I’m just not sure that’s the method anymore. It was exciting to do a movie that was about a story happening as we were making the movie. This collapse was in ’08 but the repercussions are still evolving and changing. You look at things differently as you get older, and this feels like the right type movie to do for the time that we’re living in right now. I think in the future we’ll probably do a little more work and go after issues that are a little more on the surface, as opposed to absurdist comedies that we made. There’s no question we’ll still do comedies; I just think there’ll be a different tone we’ll develop.

DEADLINE: When the WGA voted a list of 100 best comedies, I lamented the omission of Step Brothers and Talladega Nights.
MCKAY: What happened?

DEADLINE: The commenters beat on me like I owed them money. Was I wrong?
MCKAY: I would actually say, yeah, there’s no way Step Brothers shouldn’t be on that list. But, I will say this, as well. There are two different types of people, as far as how they view comedies. There’s people who like smart, wry, “I’m going to smile” comedies. And then there’s the bust-a-gut, laugh-out-loud comedies. And I think the hard, laugh-out-loud comedies are the hardest ones to do. And for me, they’re the ones I really value. The ones where you go to a movie theater and laugh so hard you have tears in your eyes. That’s a special experience. I haven’t studied the list but I’m guessing there’s a bunch of movies on there that don’t really have laugh-out-loud moments.

step brothersDEADLINE: There are some, but not enough for my liking…
MCKAY: I’ve really debated with people about that. I’m like, “That’s not a comedy.” It’s a movie with a light tone but to go to a movie theater and laugh hard, like, one of the great ones of all time, Blazing Saddles, or Airplane!, that’s a very difficult thing to do. It’s also a special experience to have in a movie theater. So, for years I’ve noticed that there are just certain people that don’t like to go to movie theaters and laugh. They pick comedies that aren’t really like laugh-out-loud funny. I’m sure that’s what the list was doing.

DEADLINE: I’m sure it evolves, but does an outlandish laugh-out-loud moment take precedence over a polemic message or a dramatic moment?
MCKAY: I always do a rule, which is, I want one of five things to be happening. I want something visually cool, interesting or surprising, to be happening. I want something really funny to be happening. Or I want some key character story moment to be happening. And if one of those things isn’t happening, I will take it out of the movie. But, yes, the way we’ve built a lot of our comedies, they’re designed to be laugh-out-loud, and that’s what Will and I really love. But it doesn’t have to be the only thing. In Talladega Nights, we really went out of our way to try and shoot those race sequences to make them look really cool. That and the music created a style I was really excited about, but it was also generally laugh-out-loud funny. But yeah, I just think, man, there’s nothing better than that feeling, making people laugh hard. If you can get a blend, a point of view, a cool look, and you’re laughing out loud, hard? To me, that’s a dream movie to go see.

DEADLINE: You and Will have been collaborating since he was a performer and you were a writer on Saturday Night Live. What skit formed that bond?
MCKAY: We became friends just from joking around in the office, but there was one. Every writer knew how great Will was and always tried to write him stuff. I’d written him into some sketches and he liked what I was writing and then one day I told him I had this idea based on VH1’s Storytellers. And I said, you’re getting a really benign pop musician and the stories behind your songs are all just heinous, awful, twisted, perverse tales. And it was like a chocolate-peanut butter moment because Will goes, “You know, I’ve always been dying to play Neil Diamond.” So the first sketch we ever wrote together was Neil Diamond: Storytellers and it played really, really well. We had a lot of fun writing the together and that was it, from that on we would always make a point of writing sketches together.

ferrell mckayDEADLINE: Oh, man, I thought you were going to go with more cowbell.
MCKAY: No, that was 100 percent Will. He wrote that by himself at, like, four in the morning one night, like it came out of a cave and they were like, where did that come from? Our first was Neil Diamond: Storytellers. We wrote a bunch of stuff. We wrote the Bill Brasky sketches, and another where he was this crazy Ob/Gyn. And there was another called Wake Up And Smile, about a morning show where the teleprompter breaks and they revert to being cave men. We just hit it off with these crazy, anarchic sketches, and I wrote a lot of the political openings and he was in those a lot. We found it enjoyable to collaborate; we had a similar sense of humor.

DEADLINE: You spent a lot of time researching the 2008 crash. Any bubble up the road we should be worried about?
MCKAY: I’m definitely no economist or finance guide. But a lot of people keep talking about China. That economy is propped up on some pretty sketchy numbers and they’re so tied to the U.S. with the treasury bonds they buy. That scares me a little bit. I also just think there’s a giant asset bubble overall, a lot of things are just overvalued things. There’s no way I’m qualified to tell you how a collapse is going to come, but the one thing I can say is that the banks are definitely still too big to fail and it’s insane that we didn’t correct that.

china-and-hollywood__130605112955-150x150__130925193515__131105220131__131105231458DEADLINE: You mentioned the impact of the 2008 collapse on Hollywood. If China tanks, there goes Hollywood again because it’s where everybody goes for co-financing now, and it’s very difficult to vet whether people have the money they say they do.
MCKAY: That is no joke. That is a hundred percent true.

pearlDEADLINE: A final question, since you put in in the movie. A few years ago, Pearl was one angry 2-year-old landlord, abusive in collecting overdue rent so she could get her “drink on.” How’s your lovely daughter doing, retired from her Funny Or Die videos?
MCKAY: Pearl was in Boyhood, and now she’s in this. She takes it in such a blasé manner. She’s all about gymnastics now. She’s constantly doing back flips, she plays violin and she’s very, very funny. That actually worked out really well. Just did The Landlord and Good Cop, Baby Cop and then my wife said, “I’m going to strangle you if you make our kid a child star.” So she stopped at that point and her video has become a fun little thing that some of her friends know about. She’s doing great, she’s a force of nature.