There are only a few of them left. And they are hard to spot. They are not the usual surviving species types — no big-eyed, furtive forest creatures fleeing decades of civilization’s pressures.
These people look just like the rest of us but are actually members of a microscopic minority.
They are otherwise normal people but for one thing: Whether by accident or by choice, they have never seen “Planet of the Apes” any of its sequels, its remake in 2001, or any of its television mutations.
Even those of us who haven’t seen the movie are aware of its famous final scene, in which Charlton Heston comes upon the broken-off head of the Statue of Liberty, partially buried in the sand. Realizing that he was not on another planet but his own, now-wrecked Earth, the rage in his voice mirrored something of our own anger and frustration with civilization, its leadership, and ultimately with ourselves. “We finally really did it. You maniacs! You blew it up!”
The latest market expansion move on Wall Street could, with the right Hollywood treatment, invoke the same level of frustration and anger. When Cantor Fitzgerald, a major Wall Street firm, announced that it would begin buying and selling movie box-office contracts, it was clear that the maniacs finally did it. They were wrecking the market.
What Cantor Fitzgerald wants to do is to set up an exchange where individuals can buy or sell contracts based on guessing the box office receipts of a specific Hollywood movie. The investment firm has applied to the Commodity Futures Trading Commission for permission to do so, and Veriana Networks has applied to do the same thing, but only for institutional investors.
It is difficult to choose which idea is worse — gambling with your own money or having your retirement fund do your gambling for you.
At least two things are wrong with the whole scheme. The first is that it is pure, unadulterated gambling. It has nothing to do with investing, and the funding of these contracts has not even the remotest connection to the productive or even the unproductive economy. It doesn’t matter that the transaction is done through an investment house. It is gambling, pure and simple.
The second is that it presents such an obvious opportunity for major corruption in the form of fixing the results, and minor, enabling corruption as well. There is only one source for information on box office receipts and that is the movie industry itself, which, by most accounts, is still run by human beings. Consider the temptation to shift the box office results a little bit; not enough to change the overall outcome but enough to shave the numbers and beat the point spread. Nobody could ever tell the difference because there is no way to check the numbers. It is almost a certainty that some human being will eventually find that temptation irresistible.
The entire scheme, in fact, is a disinterred version of what used to be called the numbers racket, a rigged, lotterylike gambling scam in the New York City area that was run by the mob (that didn’t exist). It was a simple game, sometimes called policy, where players paid money to pick three numbers. If those three numbers were selected as the winning numbers, usually the next day, the player won.
Rigging the winning numbers proved to be too much of a temptation for the mob and, losing disillusioned customers, they had to regain their credibility by looking to an outside source for the three numbers. Eventually they settled on the daily dollar volume of bets at local horse racing tracks — called the handle — that would supply the numbers. This led to minor forms of enabling corruption such as newspapers publishing the daily handle on their front page. It sold newspapers because people wanted the information, but it also supported a mob enterprise.
The movie industry has objected to the idea of a box-office futures market, and some members of Congress have expressed their concern about it. We all should. Wall Street has already lost a lot of credibility, and it is a sure thing that they won’t get that back by adding casino gambling to its portfolio.
James McCusker is a Bothell economist, educator and consultant. He also writes a monthly column for the Snohomish County Business Journal.
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