Film festival juries sometimes have a rush of sanity. Good sense goes to their heads, like new wine into old bottles, and the bouquet can nearly knock a festivalgoer out. We are so used to daft juries picking daft films, but this year’s Venice victor was Israel’s Lebanon, the best film in the competition. (Where did you read that first? Here in the Financial Times. From everyone I encouraged to wager his shirt I would now like a small commission on winnings.)

Lebanon may be the millennium’s best war film to date. I cannot pile much more praise atop the plaudits I gave in my previous dispatch. But if you ever wondered what it is like to be trapped inside the moving eye of a hurricane – here the hurricane of war and the “eye” of a tank advancing deep into enemy danger – speculate no more. Writer-director Samuel Maoz provides the experience. Two short framing shots apart, the entire film is set inside this grisly echo-chamber. Horrors are reported, threatened, enacted, endured and – through the sights of the ever-turning and grinding gun turret (an unforgettable visual and aural motif) – seen.

Maoz knows of what he speaks. He was a tank gunner in the 1982 Lebanon war. But his film is much more than memory or memoir. It is a living, livid re-imagining, a film that stands taller even than Waltz with Bashir in what begins to look like the vanguard of a visionary new Israeli cinema.

The Venice jury, led by Ang Lee, tried to make up for the wisdom that guided their Golden Lion choice by erratic distribution of the runner-up prizes. Fatih Akin’s Soul Kitchen, a flailing attempt at feelgood comedy from the director of Head-On, won the Special Jury Prize. Imagine Alice’s Restaurant directed in German by the “Carry on” team. The Iranian artist-turned-filmmaker Shirin Neshat won the Silver Lion for Best Director, though Women without Men, visually accomplished but dramatically inert, more deserved Best Big-Screen Video Installation. The performing prizes went to Britain’s Colin Firth, modestly affecting as Christopher Isherwood’s fictive alter ego in Tom Ford’s film of the novelist’s A Single Man, and to Russia’s Ksenia Rappoport, playing a Serbo-Croatian hotel maid who stumbles on murder and intrigue in Italy’s La Doppia Ora (The Double Hour).

Happily the handouts to runners and riders included a Best Screenplay award, richly deserved, to Todd Solondz. His Life During Wartime, a weird but often scintillating sequel to Happiness, was the favourite in a final-day critics’ poll. Solondz now joins that growing band of artists who have returned to the scenes of former crimes.

Also in town was Oliver Stone announcing, between questions about the Hugo Chávez interview film he brought to Venice (South of the Border), that he was about to make Wall Street 2. From Venezuelan Marxists to the fat cats of Financeland: you can’t say Stone doesn’t box the compass.

Sequelmania on the Adriatic was rounded out with Werner Herzog’s Bad Lieutenant: Port of Call New Orleans (previously reviewed on these pages), which had the Bavarian director insisting he had never heard of Abel Ferrara, creator of the original cop drama, while the rip-off-sensitive Ferrara, also in town, said he hoped Herzog and his producer Edward Pressman, who owns the Bad Lieutenant title, would both rot in hell.

What fun. By close of play we needed it. A festival where the gap between good and bad was already of Grand Canyon proportions ended its days with the mostly bad. The Men Who Stare at Goats is a fatuous comedy about military “psi ops” starring George Clooney, its hippified take on army life about as funny as a dud episode of the M.A.S.H. television series. Mr Nobody from Jaco Van Dormael (Toto the Hero) is a time-journeying whimsy so windbagging it makes The Time Traveler’s Wife seem watchable. Survival of the Zombies – another sequel – lumbers out of the George A. Romero stable with livid features and metronome gait, begging for a bullet to end its misery.

“Transitional” is finally the best word for the 2009 Venice Film Festival. It had its highs. It had its lows. Then it had a few more lows. Lebanon, though, is a great film. And northern Italy in early September is always lovely. And in two years – I said three in my previous report, inadvertently adjusting for Italian building time – we shall have the new Palazzo del Cinema. Try to keep me away from Venice then.