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Think about it: a year ago, the Dow was at 14,000. Today, the stock market hit fresh 5-day lows. Today's Dow number looks as bad as it does -- minus 678 points -- mostly because GM's stock plunged to a 58-year low, and it's a component of the Dow. By the way, the ban on short-selling ended last night. The market was volatile during the day, but really sank in the last hour. There's a huge crisis of confidence in Wall Street right now, even with the Federal Reserve taking measures to guarantee commercial paper market. No one knows where go from here. No one. Here's the year to date prices of infotainment stocks at close of Thursday's trading:
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The Federal Reserve is essentially powerless at this point to stop it. How’d that $700 billion bailout work so far, eh?
the fed! they’re making this happen! this is a take-over, a centralization of power. Those assets being bought for cents on the dollar are worth plenty in real wealth….its a brilliant plan….lend to those who cannot afford, and then call in the debt, and foreclose. This is the endgame. Next step, china is going to buy us up! and boy do they have a record on human rights abuse! the chicken come home to roost. this is the result of an unjust war which americans turned a blind eye to, and now the bloodletting is on your doormats…..the revolution will be televised after all.
I bet the studios wished they made a fair deal now. Soon SAG will strike and it may close one of them down. At least Les Moonves will get to tan.
And SAG continues the stalemate which is really beginning to hurt not only BTL workers, but everything else including prop house, post production, local restaraunts, and the huge sybiotic web that relies on the industry. Holding out for the impossible in the current economic climate is incredibly reckless and at the very least shows little to no compassion or the rest o us. Meanwhile, Rosenberg continues to live in his dream world where he can get his 75% strike auth vote to vindicate his huge fucking ego.
i am going to start calling this site: doomsdayhollywood.com
I never really beleived it was worth 14,000, anyway. Funny money. Smoke & mirrors. Creative accounting. Sooner or later something had to give.
I’d rather the Dow Industrial Average be a realistic 7,000 than a fantasy 14,000. I like to keep it real, even if it stings a bit.
You knew something like this was bound to happen. Every asswipe I know has a hot stock top or insight, and some bluster about how well they are doing in the market. Of course, every other part of their life is either mediocre or worse, so why should their stock market acumen be any different?
Hang on!
I don’t want us to stick our heads in the sand, but… if the liberal media would stop predicting doom and gloom, maybe the average joe wouldn’t be scared to death. I mean, Time mag asked if this is the great depression. It’s like they are trying to convince everyone that you are not safe, and you know if they are, there is something in it for them, oh, that’s right, the election. And, making everyone believe that, no one but the government can lift you by their proverbial boots straps. Dude above, was right, how ’s your millions hanging
Actually, the S&P, which tracks a vast number of stocks, was down by a greater percentage than the Dow.
The studios are continuing the stalemate, not SAG. All they have to do is negotiate fairly, in good faith, and agree to SAG’s reasonable demands. SAG isn’t the bad guy here; they’re not asking for anything the studios can’t afford to give.
“everything else including prop house, post production, local restaraunts, and the huge sybiotic web that relies on the industry”
If this is all true, why not fairly reimburse actor’s for their work? Regardless of the economic status, the studios would not be interested in making a deal. It is to their economic advantage to create a standard where residuals don’t exist. And the current offer made by the networks is a step in that direction. SAG cannot accept that offer.
Like it or not these are public companies. It is harder for them to secure funding for projects and that will affect budgets. This obviously supports their claim that they simply can’t afford to put money on the table and at a certain point they would be forced to take money off the table because they just won’t have it. It would be very difficult for them to even appear to give into the actors at this point.
Look at GM they are on the verge of bankruptcy and the Feds may bail them out. Do you think the feds would bail out these production companies? No. SAG will not get approval to strike and probably will end up not asking. They have missed their opportunity.
So while there is less food on the table, why is sag asking for more?
This is the liquidation phase. People are in full panic mode. I am a trader for a multi billion $ hedge fund. I have been extremely bearish for well over a year (It was a year ago to the day the market peaked as in SPX). Currently I am not shorting more stocks but covering shorts. As far as media stocks I am covering some shorts like VIAB, DIS, CBS, DTV. I am eagerly awaiting buying stocks as longs but probably will focus outside of media at the start since I think media stocks are poorly run companies with overpaid management with crappy expensive product. Media stocks are terrible long term investments. Maybe as trades but like in Hollywood long term marriages never work.
GM is the smallest % weight in the Dow Jones. Today the big attribution losers for the Dow were the oil companies CVX and XOM which were both combined 25% of the loss today. GM was not even 2% of the loss on the Dow. GM fyi is toast.
It’s obvious that the Fed is doing this and just like 1929, they are calling in everything so they can once again consolidate the power. I wish this small group of people like the Rockefellers, Morgans and company were not so greedy, but it must be ingrained in their blood.
This whole country is a damn sham.
more proof that sag’s leadership has their heads up their asses.
if you ran a company that’s worth half what it was worth a year ago and you couldn’t get a loan to produce more product to sell, how could you justify giving a significantly large piece of the pie to one of a dozen unions, all of which have favored nation status to renegotiate to include the same benefits if one union gains it? it’s a vicious cycle and as a responsible businessman, you’ve got to look at the big picture and realize that what some might think to be a “reasonable demand” has disastrous repercussions down the line.
have you ever hear the term “bite the hand that feeds it?”
This drop has already been of historical proportions and is approaching biblical… And it doesn’t matter at this point about any underlying business for any industry other than financial, if you can’t get a loan you can’t do business in the modern economy.
The question is, will government be taking preferred stakes in these financials ala the scandinavian bailouts, and if so, how will they change the rules to reduce harm to taxpayers whilst still writing down bad debt… Abolish CDSwap contracts and other derivatives? How much appetite for risk will there be to lend to a peaky-profit industry like entertainment (where multi-hundred-million dollar pictures could easily tank) as opposed to, say, manufacturers of soup or ammo?
This could be seen as an opportunity for SAG leadership to show some leadership and save face. They should announce that in the light of the financial crises gripping America and in the interest of resolving the uncertainty that has gripped our industry they are accepting the AMPTP’s offer and moving forward. That would save us all from continuing this protracted stalemate that will probably end in defeat for SAG anyway.
Tom
Blackball Gavin:
Your post is literally the funniest thing I have ever read. when you said, “I bet the studios wish they had made a fair deal now” I laughed myself into a coughing fit. Say what you will about SAG, they are the masters of absurdist labor relations farce.
Actually Blackball Gavin is right on the money. If the studios made a fair deal with SAG, then we may have more movies in production, the moguls would be making more money, and not one of them would be close to going out of business. As is stands, the pecking order of destruction is:
1. News Corp
2. Time Warner
3. CBS
Anything below $13 per share is bordering on dangerous territory and all three aren’t diversitified. At best News Corp owns a lot of money losing local stations who report local news and money losing papers, Time Warner is basically a magazine holding company that also owns a stake in a money losing internet piece called AOL, and CBS is just by itself. At this time, News Corp and Time Warner are on this list because movie production is shut down and they would have benefited from a new. and fair SAG deal.
If one of the three listed goes out of business due to an SAG strike, blame Nick Counter. That isn’t SAG’s fault, it is the AMPTP’s. SAG has all the right in the world to strike, because the defacto strike isn’t covering TV, but a real strike, or threat of one, would force both sides back to the bargaining table where they need to reach a deal now because everyone’s live depends on it.
Jessy – you’re not wrong, I think everyone would’ve benefited from a signed deal.
But the fact is that the current crisis puts SAG at an enormous disadvantage in further negotiations. SAG’s options seem to be either to sign the proferred deal (which would be political suicide within SAG) or work without a deal (which hurts the members of SAG). Tough tough choices, it’s true.