President Obama is now set to sign the Wall Street reform legislation on Wednesday. The legislation passed by Congress last week includes a ban on trading of movie box office futures.
Cantor Fitzgerald abandoned plans for its trading in the wake of the legislation, though it had won approval for the trading from the Commodities Future Trading Commission. Media Derivatives, whose plan for trading was also approved by the commission, has yet to say for sure whether it will move forward. The company’s CEO had originally argued that his firm was “grandfathered," but the company was rethinking that position.
The ban on box office futures trading came after legislators heard warnings from the Motion Picture Association of America and Hollywood unions that the trading could hurt the movie industry by increasing negative talk about movies.
Trading firms and some movie finance specialists had suggested the trading and the opportunity to hedge would in fact bring more money to movie production.