June 7, 2010
A one week delay, until June 14, 2010, has been agreed to by Trend Exchange (TrendEx/MDEX) and the Commodity Futures Trading Commission on whether to approve the first futures contract based on movie box office revenue.
According to a brief report by the Hollywood Reporter, the delay was requested by Trend Exchange.
The Senate-House Conference Committee considering the Wall Street Reform Bill, a version of which includes a ban on movie box office futures, may take longer than that until it finishes its work. [See Will Box Office Futures Survive The Senate-House Conference Committee On Wall Street Reform?]
Visit Jabcat’s Box Office Futures Page for the latest news-links.
{ 4 comments… read them below or add one }
Hey Jabcat,
I just wanted to let you know that I and many others appreciate the way you’ve been championing the cause of box office futures. Your articles are very insightful and I love that you’ve been compiling all these articles. It seems the CFTC requested the delay and that Trend Ex complied. You can read about it in this article from thewrap.com.
http://www.thewrap.com/ind-column/feds-delay-decision-movie-futures-trading-18100
Thanks FilmGo! It would be interesting if the CFTC approved the TrendEx (or Cantor) contracts before the Conference Committee finishes its work. I wonder if the Senate-House conference members would take note or be swayed by CFTC approval. I also wonder if the CFTC intends to keep delaying so Congress can act first.
I know that the two exchanges feel quite strongly that a positive decision from the CFTC in their favour would be a huge claim to have when they try to convince the committee to drop the ban – its hard to justify a ban for a product that has otehrwise passed every test it has been subject to.
For that reason I imagine Trend Exchange agreed very reluctantly to the extension – the sooner they get the approval the sooner they can focus their efforts on debating the ban wording. Cantor will also take comfort from the MDEX decision. Hopefully some more info about the delay will come out in due course – Trend Exchange may have been assurred that this will only help their cause.
Jabcat makes a good point though: I wouldnt be surprised if Senators etc are pressurising the CFTC to take their time so they can not make the situation more difficult for them.
Odd statement in an article in Variety: “Media Derivatives had requested the delay so it could review the futures and options product submissions to the agency by its Trend Exchange unit. ”
This could just be erroneous filler from the journalist or it could indicate that the CFTC staff advised that certain product design changes would aid obtaining the commisioners approval? (Pure speculation… but this could be the use of Rentrak numbers, the categorisation of insider information: to make it more studio friendly, position limits?). To have time to asess and think these through, the exchange would need to seek an extension…otherwise it seems odd that Media Derivatives would need to review something it has been developing for 2 years unless positive recommendations had been recommended.