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Investing in the Movies
1HE ELEVENTH Ol A SI Rll 5 ( >! Ak'llc I I S KY A Rl c OGNIZI I) AUIHORI1Y ON llll. I INANCIAL LND Ol A OKI \l INIHMI^
By Paul H. Davis
LJUNDREDS of requests have been received by the editors of PHOTOPLAY -*-» MAGAZINE from persons who contemplate investment in moving picture companies and who seek advice on the subject. In many cases investigation showed
that these people were being solicited to invest money in concerns that, in the face of existing conditions, did nt>t have <"i< chance in a hundred to succeed. Mr. Davis will be glad to answer any inquiries from readers.
THIS is a mighty good time to be exceedingly pussy-footed about investing in the Movies. \\ hen all of the signs point toward an unsettled condition in any industry it pays to be a little overcautious.
It is generally conceded at this time that the motion picture industry is undergoing a transition. By this I don't mean that the demand for motion pictures is becoming any less and that the enthusiasm of the fans is less zealous. I am referring en
The market price alone is not a sufficient standard for judging the condition of these
companies, but, when balanced with other indications, it points out (dearly that some thing unusual has taken place. You can scarcely read a paper without seeing some reference to the unsettled condition of the motion picture business. So often you hear someone say that the time is ripe for a reorganization of the business — that the people in the game must get together — that something must happen sooner or later or
During the last year there has been a very decided overproduction of films. Much of it has been trash, but it has increased the supply of stuff for sale and has diminished the profits in the business.
tirely to the "works" of the industry. It is easy to see the symptoms of this acute condition. When you look back at the prices at which the stock of several of the better known movie concerns were selling at six months ago and see the prices at which they are selling today, you will realize that there is something more than just a general financial depression back of their eccentric action.
I am listing here the market quotations of several of the better known companies as of May. 1915. and May. 1916:
May, mis May, 1916 Bid' Asked Bid Asked
Mutual Film Corp. pfd.6o 63 40 43
Mutual Film Corp. c'm.79
New York M. P. Corp. 75
Biograph Co 65
General Film Co. pfd..45
World Film Corp 4^2
82
40
43
80
38
42
70
40
45
50
40
45
m
1^4
154
the movies will go to the dogs. Such statements of course must be taken with a grain of salt, but since observations such as these come from both the inside of the business as well as from outside they lead one to believe that a careful consideration of the situation, as a whole, is well worth while.
The fact that the motion picture business at the present time is in an exceedingly unsettled condition is evidenced by several ' obvious facts, some of which you have doubtless noticed. It used to be that almost any one could get a job in the movies, now it is hard for the regulars to keep their jobs. I recently heard it said that a well known club in New York City that is the rendezvous of screen stars now has all of the genial atmosphere of an undertaker's establishment.
In spite of the big salaries that are
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