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Money is Easy

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William Goldman, who wrote the screenplay, “Butch Cassidy and the Sundance Kid,” in his book about the entertainment business, “Adventures in the Screen Trade: A Personal View of Hollywood and Screenwriting,” examines the situation when the movie studio, United Artists, faced a crisis with the failure of their major motion picture, “Heaven’s Gate.” It was a fiasco that led to repercussions of practically earthquake proportions. There was talk in the industry that the studio was done for. Goldman picks up the story there:

Anyway, here’s UA, shunned and forlorn. So what did they do? They bought, for the record-breaking sum of two and a half million dollars, Gay Talese’s sex book, Thy Neighbor’s Wife. There was great publicity and the studio announced they would make not one but two major films out of the material. (They have made, to this date [1982], a grand total of none and things seem likely to stay that way. [No film has been made as of this date, 2017.])

Now, the thing that made the Talese buy remarkable wasn’t just the remarkable sum. The book was famous long before publication, and the logical assumption would be, to grab such a property at such a price, you have to outbid the competition. I mean, the reason you pay two million five has got to be that someone else bid two million four.

Well, the rumor around town was that nobody else had bid anything for the Talese.

UA paid that amount for two reasons: The first, obviously, was to acquire the property. But the most important was the second: They were announcing to the Hollywood community, “Hey, we’re still here.” Probably they could have bought the book for half or even less than half of what they spent. But that wouldn’t have served their purpose―they needed to blow the money. It served to put them back up there with their peers.

This little anecdote explains something about money that I have been trying to tell people for years: In any given situation that revolves around a problem, the easiest part of the solution is the money.

Many people, maybe even a majority of the public, do not understand this. Some even twist my words to try to trip me up. An old colleague of mine (whose English is not up to snuff because he was born and raised in Japan) has said on numerous occasions, “You say that money is easy. Well then, how about giving some of that money to me?!”

Of course, that is nonsense. No one gives money to anyone without a good reason. To put your palm out for free money is something that only panhandlers do. (Although I suppose that maitre d’ at restaurants do it, too. Theoretically, guests at a restaurant should be seated for free. But it is such a common practice, and some kind of service is being rendered, I suppose, that is acceptable.) I spent years trying to make my colleague understand what I was saying.

Money is not free. Years ago, a comedian had a great routine where he said that, “Cats are free.” Which is true. The comedian had a cat and it died. So he just picked up another cat. No problem. But, of course, this has nothing to do with money. Whether the money is free or not. Which I never said to begin with! I was discussing money being easy, quite a different topic.

The Wall Street Journal this past week noted that venture capital investment in the US had recently hit the level of 1999, just before the high tech crash sent the industry tumbling in 2001. Does the reader remember how things were way back then? Let me refresh the memory. The crash cost investors more than $210 billion in capital. Whew! Quite a sum. And now, exactly the same type of situation seems to have occurred. That is, an influx of venture capital into the high tech world. Look at the stock price of Amazon.com if you want proof of what I am saying. You have to wonder if another bubble is or is not in the works.

I have begun stopping in at real estate open houses in my area. Nothing systematic; I’m just checking out prices. It is amazing the prices I am seeing. A 1131 sq. ft. two bedroom house for $700,000? Insane! Built in 1920? When I first came to this city [1987], that house would have sold for something around $45,000 to $50,000. And it would have been considered pricey if the top end of that range was the eventual sales price.

Since I am looking at houses, realtors are calling me. That’s fine. I’m always seeking more information. But I find them shockingly ignorant of the market. This is their business, right? They should know at least as much as I do. Unfortunately, that is not the case. I get tiny dabs of reports, like, “Chinese buyers are interested in coastal condominium properties.” Well, duh! They are precluded from putting money into the Chinese real estate market because the Chinese government fears a bubble developing, so they are diving into the best other market they can find. They have already been buying up property in San Marino for years. That is close to Cal Tech and it is becoming the Chinese Beverly Hills.

A few years ago I knew a Chinese real estate agent working that market. Meetings with him were frustrating since he was always getting calls from clients. He would excuse himself from the table and chat for ten or more minutes in Chinese while we all waited. Not a pleasant memory. And Chinese wonder why they have a poor reputation all over the world…

Money is easy. I wonder if the meaning is clear by now. But I have one more story. My mother called me one day to say that she had been diagnosed with pancreatic cancer. It was devastating. And before she passed away a few months later, it was traumatic for everyone in the family.

Is there any doubt that if money could have solved the problem, it would have been the easiest solution? But, of course, money isn’t everything…

Those who wish to comment on the opinions expressed here may send their thoughts to info@GoWizardry.com. The most interesting responses will be addressed in future postings.

Robert J. Terry

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