It was something made up on the spot... no one had any idea what they were doing so they faked it
The actor who played the electrical specialist on the original Mission Impossible TV series once admitted that he was just clipping wires here and there because he was told no one would know the difference.... he just had to act like he knew what he was doing. So he did.
Same goes for the knot (seriously, I don't remember the movie well enough to determine what the old man was tying)
Yes, it sure made flyfishing suddenly popular. In some respects it was a good thing and a lot of new flyfishing companies sprang up with new and improved products. Unfortunately, it did cause crowding conditions at some of my favorite flyfishing only fisheries.
Sadly, once the movie wore off, there was no longer enough business to go around and many, many companies, fly shops and publications bit the dust.