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The Biz Roundup April 8

Well, if you only need thirty-six billion dollars, I’m sure taxpayers would be glad to lend it to you!

Bank of America Corp., the largest U.S. bank, needs to raise $36.6 billion in equity to bring capital ratios in line with its peers, according to Oppenheimer & Co.

With investors reluctant to commit new funds to lenders, Bank of America is more likely to raise capital by converting preferred stock to common, or issuing 5.2 billion shares through the Treasury Department’s Capital Assistance Plan . . .

Doubling Bank of America’s ratio of tangible equity capital as a percentage of risk-weighted assets to about 6 percent would put the company in line with the 6.3 percent average of the 25 largest U.S. banks

(“Bank of America Needs $36.6 Billion, Oppenheimer Says,” Bloomberg, April 8) In the end, I predict Bank of America will suck up about $240 billion (remember, they’ve already taken $163 billion out of the $700 billion TARP funds). They will end up the largest bank in United States history — monopolizing the banking industry is the life’s ambition of Ken Lewis and they are well on their way to it. Now, this may be me talking out my arse, but doesn’t this seem to be taking this whole behemoth in the wrong direction? Didn’t BofA suck up a hundred and sixty billion dollars because it was too big to fail? That it would sink half the financial world with it? And the solution is: keep pumping more taxpayer money into it so it can get bigger?


Don’t cry for me, Argentina.

Adding to indie market woes has been the economic meltdown which caused risk-averse investors to steer clear of pumping millions into art films with narrow audience appeal.

Instead, financiers have embraced comedies and other movies that attract broad audiences and have a greater likelihood of success.

“The financial crisis is very much prevalent in this industry as well. People aren’t taking as many risks . . .

(“New film reflects indie woes,” Reuters, April 8) The indie business is pretty tough right now. I can tell you from personal experience that investor money for ticket-selling indies, like comedies and horror pics, has dried up almost as dramatically as it has for art films (but it’s easier to find a distributor). The last film I worked on, a delightful, heartwarming, masterful comedy called The Dukes, directed by and starring Robert Davi, struggled to find a distributor and eventually peetered out when Davi self-distributed it. This, in my opinion, was a major disservice to the audience — there are literally thousands of people who would have loved this film but never got the chance to know about it. But I can tell you this after three years in the indie business: it ain’t going away, folks. As long as there are hungry filmmakers with fire in their belly, an HD camera in their back seat, and a Mac souped up with FinalCut and AfterEffects, we’re going to have indie films. It’s just that you’re going to see fewer of them in the theaters (but you’re going to start seeing fewer films in general at the theaters). If you are interested in making an independent film, I have three pieces of advice: a) aim for a different distribution channel other than theaters — VOD is the way to go; b) go straight to Blu-Ray — Blockbuster and other video chains will put ANY Blu-Ray title on their shelves — ANY Blu-Ray title — because they don’t have the inventory to meet demand; and c.) there’s a HUGE untapped market for Spanish language family films. If you want to make art, then make art. But if you want to get financed (at low levels) and actually make a return for your investors, then Spanish language family entertainment is the most lucrative untapped market. And I mean untapped. It’s an oil well five inches below your feet — you can reach it with a shovel. You heard it here, folks.

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