Congress Won't Let You Bet On The Box Office
When two separate companies, the Trend Exchange and Cantor Exchange, came up with the bright idea of trading movie futures the way you would trade orange juice or milk futures, they faced plenty of resistance. Back in March the MPAA was struggling mightily to block both the Trend Exchange and the more prominent Hollywood Stock Exchange, though since then the projects seem to be moving forward without a hitch. Now they've hit a roadblock in a pretty powerful place: Congress.
As THR reports, included in the recently finished Wall Street reform bill is an amendment that bans the trading of derivatives based on box office results. No, that doesn't have anything to do with Wall Street reform, but that happens a lot in Congress, when specific legislators will work in pet bits of law and defy anyone to cancel the whole thing to defeat it. The MPAA had lobbied hard for the amendment, and with bipartisan support for the bill as it stands now, it's unlikely that it-- or the whole reform bill-- won't pass.
The Hollywood Stock Exchange came under a lot of debate when it surfaced in the spring-- KCRW's The Business podcast had a fantastic episode about it-- but mostly the concern seemed to be that betting on the box office could torpedo the business even as people were trying to profit from it. I wouldn't count on either company taking this lying down, but it seems unlikely they'll find a way to make box office futures trading slip under the law any time soon.
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