U.S. Approves First Contracts Tied to Movie Box-Office Receipts

[Lucky Luciano]

Source: Bloomberg

U.S. regulators approved the first trading contracts tied to movie box-office receipts, turning aside objections from Hollywood and clearing the way for financiers to hedge investments on motion pictures.

Veriana Networks Inc.’s Trend Exchange may let institutional investors wager on opening-weekend movie revenue, the Commodity Futures Trading Commission said today in a statement. The agency voted a 3-2 to clear the contracts.

Film studios and theater owners oppose such contracts, calling them in a letter to the commission “wagers susceptible to manipulation.” Witnesses told the CFTC at a May 19 hearing the contracts could help attract capital to film production.

Veriana will start to sell contracts as soon as possible on a set of movies to be determined, Rob Swagger, chief executive officer of Trend Exchange, said today on a conference call.

Film futures are a commodity and “not readily susceptible to manipulation,” the agency said. The regulator has approved trading in contracts for more than 500 commodities, including statistics on non-farm payrolls and unemployment claims.

The CFTC’s analysis could result in “anything under the sun” being considered a commodity, including “the likelihood of UFOs hitting the White House,” Democratic Commissioner Bart Chilton said in an e-mail announcing his opposition. “Popcorn prediction markets would serve no national public interest.”


Read more: http://preview.bloomberg.com/news/2010-06-14/movie-box-office-futures-contracts-win-approval-from-commodity-regulators.html

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gotta love it!

[Sanity Claws]

1. How does this create value?

We don't need more gambling outlets

[izquierdista]

3. It's the next bubble

As Max Keiser, who invented the trading platform for it, has pointed out. It will suck all the speculative money into it (which may be a good thing, since it was speculative money that drove the price of oil up in 2008) and burst like a bagful of Dutch tulip bulbs. The key to making a killing here is to get in on day one, not as a buyer of these futures, but as a broker. Keep calling suckers to pour more money into it until the amount of dough hedged is far, far in excess of the actual cost to make the movie. Keep cashing your commission checks and converting them into gold, then when the bubble bursts, you will have the money of a lot of stupid, greedy rich people who were stuck when the bottom fell out.

[Blue_Tires]

17. exactly...

[neverforget]

5. No shit.

:banghead:

[Heywood J]

16. +1

We've moved from a society that produced things into one where the most profitable thing to do is gamble and speculate on things that may or may not actually exist or matter.

[catnhatnh]

2. And many states outlaw gambling...

as "games of chance"...K&R because I believe monetary speculation is a fun thing and marketing gain and loss is more important than value added or production of goods...

[McCamy Taylor]

4. So, if NewsCorp bets the film will fail, what will the reviews on Fox be like?

This is seriously f***ed up. Can't you just see Chase Bank telling all the people it advertises with "We want Film x" to fail.

[aquart]

7. Another license to steal has been issued.

Who are these "regulators" who have guaranteed the destruction of the American film industry?

And whose is going to be the first script on it to make it to market?

[Missy Vixen]

12. If any of you remember the run-up to the release of "Avatar"

FOX was very concerned that the movie tanking would take them down, too, due to the expense of producing the film.

It's succeeded beyond anyone's wildest dreams, but wow, we've seen some stinkers in the past few years that would be cleaning out some investors...

[scentopine]

6. Fucking on-line gambling with your 401k and when they go broke

our democrat and republican oligarchy will tap your tax money to bail em out.

Everything is for sale now. Everything. We can't actually manufacture or design things anymore so we behave like casino gamblers stuffing quarters into a slot machine. God damn every last one of the sons of bitches in Government who enable this shit.

[ShockediSay]

8. Simple

It's all tied to pre release advertising

The stinkers are over advertised, and do great in the first weekend

[lunasun]

9. What assault on all my senses awaits

via the multi marketing blitzes on this crap to hype?

[depakid]

10. MMS meet CFTC

[boppers]

11. Yawn.

Intrade's been doing this for years, and yes, just about "anything under the sun" has been contracted there.

[hughee99]

13. For all you people who like Wall St., but think it just doesn't have enough

corruption and insider deals, have we got something for you! Now we're adding in all the extra corruption and insider deals from Hollywood. Yes, you too can wager on movies as a group of insiders decides the fate of your investment.

Frankly, I don't care if they do it, but basically, if you're gambling on whether people will like a move or not, you deserve to lose every dime you put in. The first person who sues a studio because it didn't release in as many theaters as expected, or because some celebrity refused to promote their bad movie deserves every bit of ridicule they get.

[howaboutme]

14. It's a club and you ain't in it

and now they are coming for your social security, and they'll get it. http://www.youtube.com/watch?v=acLW1vFO-2Q

Wall Street is not about adding value to our economy or creating jobs. It about keeping a segment of the USA very rich which equates to being very powerful, and able to perpetuate their power and control the USA via corruption.

Now they want to gamble on movie futures and soon they'll profit trillions more from the absurdity of cap and trade. Cap and trade is another angle to keep them rich after the stock market has been totally tainted.

[No Elephants]

15. ....

:popcorn:

[Kittycat]

18. Movies are going to suck now.

They're going to be so over marketed, that we'll know the entire movie before we even go see it. Like toy story 3. I almost don't even want to take my kids to see it at this point, because we've seen so many previews I feel like I've already seen the movie. Why do I need to pay 9.50 for a ticket? Plus, they'll play it so safe on everything that is released, always going for the 'sure thing' - that there will be no creativity, no 'indie' - nothing original.