Watch the US House video instead. You will have more facts and more arguments.
Felix Salmons hastily written NYT Op-Ed about the Cantor Exchange and MDEX
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Tag Archives: CFTC
Max Keiser: Cantor Exchange and Media Derivatives Exchange would be an insiders/traderss paradise.
Max Keiser –- 12:00 into (17,000 views already):
I disagree with Max that a prediction market quote can change perceptions that much.
What the Cantor Exchange (HSX) and the Media Derivatives Exchange (MDEX) really said to the US Congress about movie futures (a.k.a. box-office derivatives) – [VIDEO]
House Committee Agriculture @ US House Of Representatives:
Download this post to watch the video if your feed reader does not show it to you.
–-> Prof Schuyler Moore mentions InTrade 1:35 into.
Cantor Exchange and Trend Exchange defend the usefulness of movie hedging.
Lions Gate vice chairman Michael Burns said the markets “would allow a diverse group of motion picture industry participants, including studios, film distributors, theater owners, investors and other financial intermediaries within the motion picture industry to manage their risk and exposure to new film releases.”-
“We believe a market in domestic box office receipts would substantially widen the number and breadth of financing sources available to the motion picture industry by lowering the risk inherent in such financing,” Burns wrote.
Robin Hanson is in favor of movie business futures.
ADDENDUM:
– Jason Ruspini sends us the link of the Senate bill.
CFTC approves the Cantor Exchange, but wont approve its movie box-office prediction markets.
CFTC Commissioner Bart Chilton on the Trend Exchange and the Cantor Exchanges movie box-office prediction markets
CFTC Commissioner Bart Chilton on the movie box-office futures:
Via Max Keiser…- who has this to say:
I’m glad Chilton brought this up.
When I was CEO of HSX – I shared a board seat with members who were also on the board of Lionsgate Films.
Lionsgate was constantly moving the prices of their films (or films they had an interest in, or a friend’s film) on HSX as a way to manipulate perception and marketing dollar spends.
This conflict blew up in the now famous Access Hollywood incident-
http://www.villagevoice.com/1999-11-16/news/access-denied/
I was stopped from reporting the real numbers on HSX on Access Hollywood and prices from that moment forward were controlled by people who whose interests lay with the studios.
I went to war with the rest of the board to defend my creation, and my technology, and all the IP that is HSX/Cantorx – board members included Citibank and NBC who sided with the studios – in allowing the prices on HSX to be moved per ‘marketing’ requests made by the studios. This lead to a blowout on the board and my leaving HSX as a result.
Shortly thereafter, the same dissident board members engineered the deal with Cantor for HSX – that has yet to be consummated. None of the investors who put $40 mn. into HSX have ever seen a penny from Cantor. There is no paper trail that links Cantor to HSX. Cantor claims everything was lost on 9/11.
Now – they hope to take the studio/wall st. collusion to the next level via Cantor Exchange. Bart Chilton is right to be suspicious of this. Will they really due their due diligence? Doubtful. This is Wall St. we’re talking about.
Personally, I put 95% of my wealth in gold bullion 8 years ago – so to be clear – another blowup of another exchange will only drive the price of gold higher – so I am half-wanting to see this catastrophe unfold.
Why the CFTC wont approve the Cantor Exchange and the Trend Exchanges prediction markets on movie box office
Product approval (see below) is a different question from exchange approval (blogged previously by Mike Giberson).
CFTC Commissioner Bart Chilton called it a a€?popcorn prediction market,a€? […]
Hollywood studios that participate by hedging their filmsa€™ prospects will doom ticket sales, said Peter Guber, chairman and CEO of independent production company Mandalay Pictures LLC.
a€?The word will get out in three seconds and the picture will be a complete catastrophe,a€? said Guber, who was chairman and CEO of Sony Pictures Entertainment in the early 1990s. […]
a€?We have serious concerns regarding the trading of media contracts and we support a very thorough review of all of these first-of-a-kind products,a€? CFTC Commissioner Scott Oa€™Malia said in an e-mailed statement.
U.S. Senator Blanche Lincoln, an Arkansas Democrat, today added language banning trade in movie futures to a broader derivatives bill she is writing. Lincoln is chairman of the Agriculture Committee that oversees the commodity commission. […]
Activity on the exchanges would bring about a€?risky and manipulativea€? behavior, said Patrick Leahy, the Vermont Democrat who heads the Senate Judiciary Committee, and Senator Orrin Hatch, a Utah Republican.
a€?Ia€™m worried about manipulation,a€? Chilton said in an interview on Bloomberg Television before the vote.
My bill will bring 100 percent transparency to our financial markets, prevent future bailouts and, most importantly, protect Main Street.
Why Hollywood Doesnt Want You Betting on Hollywood
“It is clear that the MPAA is not familiar with the futures markets or the regulatory framework within which they operate.
The Futures Industry Association:
No one can argue that the movie-making business is without risk or that there is no need for effective risk management tools. The potential introduction of innovative instruments for managing that risk should be applauded rather than criticized.
Via Max Keiser