With awards season upon us, and the 2013 Oscars� nominee announcements
investment firm The Real Asset Company decided to look into
how much it would cost, in gold ounces, to make an Oscar winning film.
Since 1990, the average cost of making an Oscar winning film costs on
average over 118,000 ounces, but this is not reflective of our results. It
can range between 9,544 ounces to over 604,000 ounces. Last year�s winner,
The Artist, was the cheapest by far when priced in gold, but not when priced
When we began the research, we had expected two things; the first that
all Oscar winning films were getting increasingly expensive, and the second,
as a result of the first, that the cost in gold would remain the same or at
We were wrong on both counts. When it comes to the dollar cost of
making a film which will get you Best Picture at the Academy Awards, there is
no maximum or minimum amount you should spend � the cheapest film since 1990
to win was Crash (2006 winner) which cost a mere $6.5m whilst the most
expensive was the 1998 winner Titanic ($200m).
We didn�t find the second point until the last four years or so when
Best Picture films have all, by coincidence, cost a similar amount to make.
Gold and USD cost follow a similar
Looking at the graph below you can see that the gold/USD relationship
holds its own until 2001, when Gladiator won the award for Best Picture. From
this point on we see a significant downward trend in the gold ounces cost
amount of making a winning film.
This makes sense given this was around the beginning of the continuing
bull-run we are currently experiencing in gold investment.
We also find that just because your film is profitable doesn�t mean
it�s worth much in gold. The King�s Speech for example was the 6th
highest grossing film since 1990. However, in terms of gold ounce revenue it
wasn�t particularly impressive, bringing in one of the lowest amounts of gold
in the sample. This shows the ever-growing divide between the value of dollar
and the value of gold.
Invest in gold to make cheaper
The most interesting thing to note from the research carried out by
The Real Asset Company is the decreasing cost in gold ounces of making
similar priced films in the last 4 years or so. Each of the last four winners
cost approximately $15m to make, relatively cheap when you look over the last
20 years of winners. Will we one day see a time when the big Hollywood
producers and directors finance the silver screen from a gold vault?
The last four winners, between 2009 and 2012, each cost similar
amounts of approximately $15million to make. Thanks to the devaluation of the
dollar however, this does not mean that they all cost the same in gold ounces,
clearly they decrease in gold ounces over the years. In fact the difference
between the 2009 winner (Slumdog Millionaire) and the 2012 winner (The
Artist) is a whopping 7,657 gold ounces.
To continue our demonstration of the dollar�s decreasing value, Crash,
the lowest budget film in our sample cost under $6.5 million to make � half
of those in recent years. But when priced in gold ounces it cost 14,615 oz to
make, over 50% more than last year�s winner, the Artist which cost $15
million dollars to make but only 9,544 oz.
It�s interesting when we price important costs real life into gold,
but the result is consistently the same. As when we did it with your
Christmas dinner (link) we find once again over the last decade the world�s
reserve currency is being continuously devalued alongside the world�s
historically favoured money � gold.
Film bods out there should sit up and pay attention; if you�re
planning on making an Oscar contender invest in gold, no matter your budget.
Even if it�s a �cheap� one, as seems to be the trend in recent years, you
could end up making a profit out of it before you send it to the cinemas.
Worried about devaluing fiat
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