By Lee Pfeiffer
The good folks at Wall Street investment firms who guarded your money so well in the recent financial meltdown now have a new ideal for sapping what's left from your piggy banks: gambling on the financial fate of major films. The firm Cantor Fitzgerald is seeking permission to launch a complex plan whereby investors would bet on whether specific films in production will soar or tank upon their release. From the firm's standpoint, the idea is brilliant. Everyday people are always looking for ways to be associated with the glamor of show biz, even if it is on a dotted line basis.The problem is that, what most of them know about the movie industry is limited to what they see on Entertainment Tonight. As Mother Jones magazine, which reports on this story points out, the deck would be stacked among industry insiders who could see a flop in the making and bet on a film's failure. To ensure the bet pays off, they could manipulate marketing strategies and use other techniques to make good on their investments. The investment firm promises that they would hold "boot camps" for potential investors to teach them the ins-and-outs of the film business. (I'm not making this up, folks.). If nothing else, this would give them the chance to wring even more money out of the suckers who attend these Camp Run-a-muck's for attention-starved investors.
There actually is a precedent for everyday folks getting burned by
trying to invest in the entertainment industry. In the early 1980s,
most video stores were pioneered and operated by small business people.
The idea was great and at first, customers even paid annual fees for
membership rights that allowed them to rent movies. However, in those
days, the cost of a video cassette was nearly $100, so stores had to
really know what consumers wanted. In all too many cases, the store
owners were clueless and responded to garish ads placed in video
catalogs for movies that had virtually no mainstream appeal. Before
long, mom and pop stores were going broke from investing in product no
one wanted. The coup de grace, of course, was administered by major
chains who ultimately put most of the small timers out of business. The
lesson was clear: you cannot become an expert on the entertainment
industry overnight- but I fear a new generation of hapless souls is
about to find that out the hard way. For more
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