Weekend July 29 2018

Every few years someone discovers that popular movies can be made inexpensively.

In 1969 there was Easy Rider

Here is a list of movies that did.

The king of the low budget film makers is Roger Corman

who has been at it for decades.

Jason Blum is disrupting Hollywood

In fact while Eastwood is popular with his fans, he is really popular with his studio. Only  one film failed to make money.He always comes in on time and on budget. Every Which Way but Loose at the time was the second biggest grossing movie Universal had after Jaws. Themovie co starred an orangutang.

Tuesday July 24, 2018

Bob Prechter  began formalizing about socionomics  in 1985  to explain human valuations on everything from music to movies to art to stocks. Today’s WSJ offers an interesting way to explain socionomics to the novice and I will do just that in class.

Pages B1 and B2 relate that Sergio Marchionne is suddenly out of the picture due to an undisclosed medical problem. He dismissed Luca Cordero di Montezemolo over whether to take Ferrari public and to ramp up annual production from  7,000 to 10,00. Production is now 8.400 which is a rounding error for any of the international firms. By the way,Sergio is a Chartered Public Accountant in Canada, the Equivalent of out CPA.

But here it gets interesting. FCAU Fiat Chrysler has a market cap of 29 billion. Ferrari RACE has a market cap of 25 billion, almost as high as Fiat but for selling a smidgeon of autos. Yes RACE has a profit margin of 25% while all other makers sink in the single digits. The reason is hat RACE has a fantastic marketing effort selling ball caps for sky high prices and the cars themselves are so rare, think expensive watches, that they are rolling art objects.  Vintage Ferraris have all set record prices the last few years with the 1963  GTO expected to go to $100 M.

Meanwhile on page A 9
Christie’sSales Soar in strong Art Market

A Matisse sells for $80 M and a Picasso for $115 million.  Soaring markets have raised expectations for real estate and art and rare autos around the world. And that is an expression of mood which as Bob says is really the only way to explain such valuations. With your interest in art I thought you might find this analogy interesting.

Click here to learn more about socionomics.