An executive producer who wants to cut costs has only two choice curbs: water and hair. Those are the most expensive things to replicate accurately via animation. It’s no mistake that the characters in Minions, the most profitable movie ever made by Universal, are virtually bald and don’t seem to spend much time in the pool.
Animation, as with all formulaic and saccharine film genres, tends to bring out Hollywood’s blockbuster gambling addiction. The perverse incentives of the format means that fortune favours the spendthrift — the bigger the budget, the bigger the windfall.
“In some ways, a $90 million movie is more risky than a $150 million one,” Creutz said.
This means that when animated films flop, they flop hard. In fourth quarter 2013, DreamWorks took an $87 million writedown on Rise of the Guardians. Without the charge, the studio would have posted a small profit in the period, rather than an $83 million loss. A few months later, it had to take a $57 million writedown on Mr. Peabody and Sherman, a film that cost $145 million to make and far more to market.
Interesting throughout, here is the article by Kyle Stock.
This is from an email from Ashok Rao:
You might have addressed this. On iTunes – to some extent – they do, though this appears to matter more with something you might call “scale of production” than quality of movie. Avatar is still at $15 compared to $10 for most others mainstream films (with very crappy and very lowbrow comedies sometimes lower).
But in general it seems absurd that westerns that I’ve never heard about cost as much as Harry Potter. Some points:
Does the movie industry – and ensuing bargaining with important agents like Apple – prefer completely homogenized pricing? Certainly it might be negative signaling that “we know this movie is trash” but that shouldn’t matter after the initial critic and audience review cycle is over.
A lot of crappy movies might make for good TV fodder, though the pricing structures are complicated enough that I have no idea exactly where or how this happens.
The comparison doesn’t even need to be on quality. How on earth does Godfather still cost $15 a pop – isn’t it going to be in the public domain soon?
My gut tells me piracy is a key instigator though I don’t know how exactly. Logically I feel it’s just the opposite. The price elasticity of someone who will not pirate to begin with is much lower than someone who will, on average…
Are there multiple equilibria? 1) Given that the price elasticity of non-pirates is low, you can and should charge them similar rates but 2) Given that pirates are highly elastic it makes sense to price quality.
Is the fact that I’m browsing on iTunes at all enough of an information signal to segregate the market?
It appears Netflix is what will change this entirely, and iTunes prices are completely irrelevant because no one plans on buying Sharknado 2 in HD anyway.
The other interesting question (which also requires a finessed understanding of Netflix economics) is comparing the entertainment value of television vs. cinema on the dollar. It appears there is a “timepass” value to both and a completion value for movies (and TV as well, but distributed over n episodes so basically 0).
One season of TV, which might be about 20 hours of entertainment, is frequently only 2x one movie which might be 2 hours of entertainment. Is the “scale of production” and completeness factor enough to justify 10 hours of entertainment? It is also the case that the median show and median movie are converging in parity on the margin, and increasingly on average too. – You would have to watch many hours of TV before reaching a cliff in quality where the marginal movie is dramatically better than the marginal show, versus a baseline of the best show vs. best movie.
If you insist on legal purchases only learning to read subtitles on Hindi movies is also a really cheap hack to amazing entertainment – foreign films otherwise tend to be too highbrow though that might be a rather lowbrow thing to say.
These are of course “demand side” factors, though after a reasonable period of time the supply side should largely be a sunk cost and somewhat irrelevant.
By the way, there is a new app –called Atom — which among other things will help groups of moviegoers receive discounts for movies which are doing less well.
1. The Boy & the World. A Brazilian animated movie, it actually fits the cliche “unlike any movie you’ve seen before.” Preview here, other links here, good for niños but not only. Excellent soundtrack by Nana Vasconcelos.
2. The Second Mother. A Brazilian comedy of manners about social and economic inequality, as reflected in the relations between a maid, her visiting daughter, and the maid’s employer family. Now, to my and maybe your ears that sounds like poison, because “X is about inequality” correlates strongly with “X is not very good,” I am sorry to say. This movie is the exception, subtle throughout, and you can watch and enjoy it from any political point of view. It helps to know a bit about Brazil, and it takes about twenty minutes for the core plot to get off the ground. Links here.
Here is the video, the podcast, and the transcript. Kareem really opened up. Here is the summary:
Kareem Abdul-Jabbar joins Tyler Cowen for a conversation on segregation, Islam, Harlem vs. LA, Earl Manigault, jazz, fighting Bruce Lee, Kareem’s conservatism, dancing with Thelonious Monk, and why no one today can shoot a skyhook.
Maybe you think of Kareem as a basketball player, but here is my introduction:
Kareem Abdul-Jabbar is one of America’s leading public intellectuals. I would describe him as an offshoot of the Harlem Renaissance, and what he and I share in common is a fascination with the character of Mycroft Holmes, the subject of Kareem’s latest book — and that of course, is Sherlock Holmes’s brother.
Here is Kareem:
I did know Amiri [Baraka]. I think the difference is I believe in what happened in Europe during what they call the Enlightenment. That needs to happen to black Americans, absolutely a type of enlightenment where they get a grasp of what is afflicting them and what the cures are.
I think that the American model is the best in the world but in order to get everybody involved in it we have to have it open to everyone. That hasn’t always been the case.
The most under-appreciated Miles Davis album?
For me [Kareem], the most under-appreciated one is Seven Steps to Heaven. And that shows, I think, Miles’ best group. There’s a big argument, what was Miles’ best group, the one that had Cannonball Adderley, Coltrane, Bill Evans, and Philly Joe Jones and Red Garland or Herbie Hancock, Ron Carter, Tony Williams, and Wayne Shorter?…number two is Porgy and Bess.
He cites Chester Himes as the underappreciated figure of the Harlem Renaissance. And Kareem thinks like an economist:
It [my instruction] was going well with Andrew Bynum, but Andrew finally got to sign his contract for $50 million, and then at that point Andrew thought that I didn’t know anything and that he didn’t have to listen to me, and we don’t know where Andrew is right now.
Read or hear also his very interesting remarks on Islam, and where its next Enlightenment is likely to come from, not to mention Kareem on the resource curse and of course his new book (and my Straussian read of it). And Kareem on his favorite movies, starting with The Maltese Falcon. Self-recommending!
No, I’m not in Iowa, but I’ve never covered it before, and today seems like as good a day as any. Here goes:
1. Painter: Grant Wood. Here is an interpretative take on American Gothic. It’s not by the way man and wife in the picture, but rather Wood’s sister standing next to the local dentist.
2. Novelist: I draw a blank, sorry people…Does it count that Joe Haldeman (The Forever War) was a product of the Iowa Writer’s Workshop? There must be other examples as well.
3. Hero: Norman Borlaug.
4. Actor: John Wayne is from Iowa, but I can’t call him a favorite. I guess he is my favorite version of…John Wayne. If that. Can one call Johnny Carson an actor? I never took to him either.
5. Jazz musician: Yes there is one, Bix Beiderbecke. Art Farmer too, and also Charlie Haden. Yet how rarely one hears of the “Iowa jazz tradition.”
The bottom line: Who would have thought “jazz musician” would be the strongest category here? Those Iowans are so busy with their jazz, it is amazing they have time to lobby for their ethanol subsidies.
I don’t like most Tarantino movies, except for Reservoir Dogs and Kill Bill, vol.I.; I usually find his style too mannered and self-conscious. And I read so many negative or lukewarm reviews in the American press. But more positive evaluations started to trickle in, as the British Guardian, Telegraph, and FT all gave it five stars, and some of my friends seemed to like it. One of my canonical views is that when critics have split views on a talented director, you should go see the movie. I am very glad I did.
Think of the film as a retelling of John Locke’s social compact story, except the individuals are not tabula rasa in terms of history, but rather they bring ineradicable racial and historical backgrounds to the table, epistemically uncertain backgrounds as well. The game-theoretic solution concepts unfold accordingly. The setting and details of the story are then set up to spoof Agatha Christie and the British haunted house tradition, except with snow, guns, and the American West as props.
Recommended, even for skeptics, Straussian throughout.
The New English Bible, Oxford Study Edition
Guantanamo Diary, by Mohamedou Ould Slahi
Albert Camus, The Stranger
Kamel Daoud, The Meursault Investigation
Janet Malcolm, The Crime of Sheila McGough
Njal’s Saga (on-line version is fine)
Glaspell’s Trifles, available on-line
Year’s Best SF 9, edited by David G. Hartwell and Kathryn Cramer, used or Kindle edition is recommended
The Metamorphosis, In the Penal Colony, and Other Stories, by Franz Kafka, edited and translated by Joachim Neugroschel
In the Belly of the Beast, by Jack Henry Abbott
Sherlock Holmes, The Complete Novels and Stories, Sir Arthur Conan Doyle, volume 1, also on-line
I, Robot, by Isaac Asimov
Moby Dick, by Hermann Melville, excerpts, chapters 89 and 90, available on-line
Death and the Maiden, Ariel Dorfman
The Pledge, Friedrich Durrenmatt
Ian McEwan, The Children Act
We also will see some films and cover some very short on-line readings, as I will distribute at the appropriate times; your papers may draw on these as well.
This was the year when it became clear that much of Eastern Europe probably won’t end up as free societies. It’s not just semi-fascism in Hungary. Poland and Slovakia, arguably the two most successful economies and societies in Eastern Europe, took big steps backward toward illiberal governance. How can one be optimistic about the Balkans? I imagine a future where African and North African refugees are bottled up there, and Balkan politics becomes slowly worse. As for Ukraine, a mix of Russia and an “own goal” has made the place ungovernable. Where is the bright spot in this part of the world?
Nothing good happened in China’s economy, although more fingers have been inserted into more dikes. I am not hopeful on the cyclical side, though longer term I remain optimistic, due to their investments in human capital and the growing importance of scale.
I have grown accustomed to the idea that Asian mega-cities represent the future of the world — have you?
Syria won’t recover.
This was the year of the rise of Ted Cruz.
It was an awful year for movies, decent but unpredictable for books. The idea that Facebook and social media rob the rest of our culture of its centrality, or its ability to find traction, is the default status quo. Not even that idea has gained much traction. Cable TV started to receive its financial comeuppance. Yet on the aesthetic side, television is at an all-time peak, with lots of experimentation and independent content provision, all for the better. I suspect this is one reason why movies are worse, namely brain drain, but I am hoping for longer-run elasticities of adjustment into the broader talent pool.
Against all odds, Homeland was excellent in its fifth season.
I became even more afraid to move my cursor around a web page, and in terms of content, more MSM sites became worse than better. Banning photos would solve twenty percent of this problem.
Stephen Curry and Magnus Carlsen were the two (public) individuals I thought about the most and followed the most closely. Each has a unique talent which no one had come close to before. For Curry it is three point shooting at great range and with little warning; for Carlsen it is a deep understanding of the endgame as the true tactical phase of chess, and how to use the middlegame as prep to get there. It wasn’t long ago Curry’s weapons were “trick” shots, perhaps suitable for the Harlem Globetrotters; similarly, players such as Aronian thought Carlsen’s “grind ’em down” style could not succeed at a top five level. Everyone was wrong.
But here’s what I am wondering. Standard theory claims that with a thicker market, the #2 talents, or for that matter the #5s, will move ever closer to the #1s. That is not what we are seeing in basketball or chess. So what feature of the problem is the standard model missing? And how general is this phenomenon of a truly special #1 who breaks some of the old rules? Does Mark Zuckerberg count too?
I realized Western China is the best part of the world to visit right now. The food trends where I live were Filipino and Yemeni, which I found welcome. Virginia now has a Uighur restaurant in Crystal City, and the aging San Antonio Spurs continue to defy all expectations. Kobe Bryant, who “ranks among the league’s top 5 percent of shot-takers and its bottom 5 percent of shot-makers,” has redefined the retirement announcement, among other things.
I liked it much more than I expected to, and was pleased to have been invited to yesterday’s special screening. (By the way, there are no real spoilers in this review.) The most noteworthy features of this movie, from my admittedly skewed perspective, are these:
1. The story is told through the medium of changing market prices. Really. Reported prices convey the action and its significance, repeatedly, and the audience is expected to “get” this.
2. There is no central villain, none whatsoever. The filmmakers succeed in showing how the collective actions of many, operating together, can give rise to structural problems and systemic risk. And yet the story remains suspenseful.
3. It is amazing how much jargon they packed into this movie, let’s hope audiences accept it. They even try to explain what a collateralized debt obligation is, and why its true risk can be higher than its apparent risk.
4. In terms of flow and pacing, it doesn’t feel like a traditional Hollywood movie. There is no background music (except Led Zeppelin at the close), the density of information is much higher than expected, and it draws inspiration from various souped-up YouTube clips, some where characters occasionally turn and speak to the audience directly.
5. I enjoyed how this movie showed the world of finance as being a menagerie of different kinds and levels of intelligence. My favorite scenes were at the CDO conference held in Las Vegas, showing the very specific ways in which people of above-average intelligence nonetheless can be intensely stupid.
6. Yes, the movie was “too leftie” on various points, or occasionally not nuanced enough, such as the SEC regulator scene. But what the movie does well — namely to condense amazing amounts of economics and finance into what is likely to prove a popular and critically acclaimed film — is path breaking, and more important than its shortcomings.
By the way, the preview for this movie is misleading, for one thing Brad Pitt has only a minor role. The preview is technically well done, but it makes the film look too mainstream.
Addendum: A recent movie I enjoyed on Netflix was Tangerine, which also has a unique feel to it, shot solely on iPhones. But if you’re allergic to the idea of a movie about transgender prostitutes, skip it. It’s one of the great LA movies, though.
I haven’t seen anyone cover this topic yet. I’ll put my remarks in the top blog comment, so this way you don’t have to read it if you don’t want to. My analysis does cover some spoilers — unavoidable — but I don’t think they are any of the main plot spoilers, in case you are wondering.
I’ll leave my review at the top of the comments section, if you are curious. I’ll avoid any direct plot spoilers, but I will tell you what I thought.
Netflix has built socks that read your body to understand when you fall asleep, and then automatically pause your Netflix show.
There is more here, via the excellent Samir Varma.
All the major reviews for Star Wars seem to be positive, but no one is calling it an “intense personal vision.” So it probably isn’t very good.
My father-in-law was watching the debate last night, and so I caught some of it after giving my final exam for the evening. I ended up being persuaded by Justin Wolfers’s “signaling theory,” not even mainly for Trump but for most of the candidates. They feel an extreme need to signal to voters that something is deeply, deeply wrong and that they won’t just leap on the establishment bandwagon if elected. In this sense the Republican candidates have more in common with the Progressive Left than might be evident on first glance. That they feel induced to go so far out on various limbs is, most of all, a sign that GOP primary voters still do not believe their sincerity. Fiorina strikes me as the one who is running “straight up,” and giving some semblance of her actual views, and perhaps that is why she has failed to achieve traction after a boost at the very beginning. She is signaling she will be a female, conservative member of the Republican political establishment, rather than that she will side with the frustration of the voters. The former is not such a marketable political commodity these days.
…most fancy bills trade only slightly above face value. And many of the most sought-after by collectors really have only sentimental or personal value, like their child’s birthday or an anniversary (04072004, say, for April 7, 2004); ZIP Codes (00090210, where the final five digits in this instance represent the postal designation for Beverly Hills, Calif.); tombstones (19182014, here representing the birth and death years of a long life as they might appear on a gravestone; and others known by such names as Fibonaccis after the mathematical sequence and flippers whose digits look the same right-side up or upside down.
One well-known fan in this universe of collectors, Jim Futrell, for a long time focused on bills featuring the number 27 in some fashion—for example, 27000027. “The number 27 is pretty special in my family,” he says. “Not only is it my birthday, but my mom’s, grandfather’s and at least 10 others that I know of.”
The solstice approaches, and I am waking up slightly later than usual.
I thought this was the worst year for movies since I have been watching them. In fact I think you could multiply this year’s good films by two and still have the worst year for movies in a long, long time. Maybe by three. But here are the ones I liked, in many cases with my reviews behind the links:
Ex Machina, visually nice and fun to watch, but conceptually not that sharp or original.
Inside Out, seemed splendid at the time, but hasn’t stuck with me.
Meru, documentary about climbing very high mountains and human motivation. Should win a Cass Sunstein award.
A Brilliant Young Mind [X + Y is the title of the original UK release], one of the better autism movies, nice scenes of Taipei too.
Grandma, starring Lily Tomlin, give it the Girardian/Straussian take on what can really bring a dysfunctional, squabbling family together.
About Elly, first released in 2009, not available to most American viewers until this year. From the Iranian director of A Separation. You don’t realize how good it is until about forty-five minutes have passed.
Diary of a Teenage Girl
Of those, Red Army is my clear first choice, and it is only 70 minutes long.
What would you add to this list?
Here is the full transcript, video, and podcast of the chat. Cliff was great from beginning to end. The first thirty minutes or so were an overview of “momentum” and “value” trading strategies, and to what extent they violate an efficient markets hypothesis. Much of the rest covered:
…disagreeing with Eugene Fama, Marvel vs. DC, the inscrutability of risk, high frequency trading, the economics of Ayn Rand, bubble logic, and why never to share a gym with Cirque du Soleil.
Here is one excerpt:
COWEN: I think of you as doing a kind of metaphysics of human nature. On one side, there’s behavioral economics. They put people in the lab, one-off situations, untrained people. But here it’s repeated data, it’s over long periods of time, it’s out of sample. There’s real money on the line, and this still seems to work.
When you back out, what’s the actual vision of human nature? What’s the underlying human imperfection that allows it to be the case, that trading on momentum across say a 3 to 12 month time window, sorry, investing on momentum, will work? What’s with us as people? What’s the core human imperfection?
ASNESS: This is going to be embarrassing because we don’t have a problem of no explanation. We have a problem with too many explanations. Of course, we can observe the data. The explanations you have to fight over and argue over. I will give you the two most prominent explanations for the efficacy of momentum.
The first is called underreaction. Simple idea that comes from behavioral psychology, the phenomenon there called anchoring and adjustment. News comes out. Price moves but not all the way. People update their priors but not fully efficiently. Therefore, just observing the price move is not going to move the same amount again but there’s some statistical tendency to continue.
Take a wild guess what our second best, in my opinion, explanation for momentum’s efficacy is? It’s called overreaction. When your two best explanations are over- and underreaction, you have somewhat of an issue, I admit. Overreaction is much more of a positive feedback. It works over time because people in fact do chase prices. So if you do it somewhat systematically and before them you make some money.
One of the hard things you find out in many fields but I found out in empirical finance is those might be the right explanations but they’re not mutually exclusive.
And here is from the overrated/underrated part of the chat:
COWEN: …In science fiction, the author Robert Heinlein.
ASNESS: Early stuff, underrated. Later stuff, overrated.
COWEN: What’s your favorite?
ASNESS: That is a really — Methuselah’s Children.
COWEN: Ah, good pick.
ASNESS: I could have gone with the obvious. I’m a bit of a libertarian. I could have gone with, The Moon Is A Harsh Mistress. It’s his most famously libertarian book.
COWEN: But it doesn’t age so well.
ASNESS: No, no. I like Methuselah’s Children.
This was the funniest segment:
ASNESS: I live in Greenwich, Connecticut. In some parts of the world, if you said, “my daddy runs a hedge fund,” I’d say, “what’s a hedge fund?” In Greenwich, Connecticut, the kids say, “what kind of hedge fund is your daddy running? Is he event arbitrage? Trend following? What does dad do?”
Interesting throughout, as they are known to say…