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Wall Street's Falling Stars Burn Hollywood

Studios scale back films, lose capital

By Ambreen Ali,  Newser User

Posted Sep 18, 2008 1:40 PM CDT
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(Newser) – When Steven Spielberg is feeling a budget pinch, you know the financial crisis is bad. His hunt for financing on a new studio deal gets tougher with each day of bad news from Wall Street, Time reports. With credit as tough to come by in Hollywood as everywhere else, many studios are “making a conscious decision to slow it down,” one exec says.

Wall Street poured billions into the industry in recent years, with movie “mutual funds” created 4 years ago allowing investors to diversify by funding several projects. Those sticking with Hollywood in the current market want more money and choice over the movies in their portfolios. But there’s no “fire sale” yet, assures a studio financier. “Smart deals will continue to get made.”

Twilight, which releases in November, is being produced by a new studio funded with $1 billion from Wall Street.
"Twilight," which releases in November, is being produced by a new studio funded with $1 billion from Wall Street.   (AP Photo/Denis Poroy)
In this May 18, 2008 file photo, director Steven Spielberg is seen at the Indiana Jones and the Kingdom of the Crystal Skull press conference.
In this May 18, 2008 file photo, director Steven Spielberg is seen at the "Indiana Jones and the Kingdom of the Crystal Skull" press conference.   (AP Photo/Francois Mori, file)
American director Steven Spielberg plays with photographers as he leaves the Indiana Jones and the Kingdom of the Crystal Skull premiere, on Sunday, May 18, 2008.
American director Steven Spielberg plays with photographers as he leaves the "Indiana Jones and the Kingdom of the Crystal Skull" premiere, on Sunday, May 18, 2008.   (AP Photo/Francois Mori)
Steven Spielberg is looking for financing to sign a deal with Indian conglomerate Reliance.
Steven Spielberg is looking for financing to sign a deal with Indian conglomerate Reliance.   (AP Photo)
Big hits like Spider-Man were kept off investment portfolios in the past, but Wall Street is insisting the safer bets be included.
Big hits like "Spider-Man" were kept off investment portfolios in the past, but Wall Street is insisting the safer bets be included.   (AP Photo)
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Studios look to cut risky films
Los Angeles Times

Hollywood looks abroad for funding
New York Times

 
Wall Street • Hollywood • Steven Spielberg • credit crisis • subprime crisis • Hollywood studios • financial crisis

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