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Caroline Hid and Paul Sweeney, we are live here in our Bloomberg Radio studio here in New York City, Bloomberg HQ special edition of Bloomberg Markets here on this Black Friday. Renowned economist Nouriel Rabini is warning that Donald Trump's agenda of tax cuts and tariffs is shaping up as a double edge sword for the United States. The CEO of Rbini Macro Associates told us more about the potential impacts of Trump's plans on inflation and growth.
The economic policies of Trump may lead to high economic growth, to being for business, keeping tax or it's a low dilate economy, but unfortunately many of the other policies are going to have an implication of hiring, inflation and lower economic growth. The first thing he has already announced is going to be tariff against Mexico, Canada and China. And that's only the beginning, he said, we might have up to twenty percent tarif on all our trade partners, up
to sixty percent against China. He wants to have massive deportation of people. In the last few years, the increase in migration has kept the lead on wage growth, has increased the labor supply has increased economic growth. So definitely mass deportation is t inflationary. He wants not only to make all those tax cuts permanent, but you made other promises and no taxes on tips, on overtime and so security on income earn abroad, and so on and so on.
This estimate that these things we add to the deficit by eight thrillion dollars. Too much demand inflationary. You might want to weekend a dollar that's going to be inflationary. You may interfere with the independence of the FED. Getting out of the Paris Accord is going to make climate change much worse, in create a food price and things of that sort.
It's interesting, Nouriel, a lot of things you just said, or what a bitcoiner would say as to why you should buy bitcoin. There's now the Bitcoin etf there over one hundred billion dollars. Clearly a big hit there's talk that it could be a strategic reserve. You have gold in the portfolio. Is there anything that could move you to add bitcoin to your ETF to help accomplish some of these goals.
You know, the bitcoin is highly volatile. It can go up by ten percent one day and down ten to fifteen percent another day. If you want to a stable store of value, you will not put bitcoin into your portfolio. The kind of acids we're actually thinking about are all acid that do well when you have over growth and you have higher inflation, whether it's tapes, shortened treasuries. Gold
is a hedge against inflation. The basement did Alara shown geopolitics, financial crises, some exposure to a commodities, they're going to do well in a world of inflation, amid change, and environmentally sustainable rids. So it's a diversified pulfolio of acids that historical have done well in these types of tail risks. I'm skeptical for a lot of reasons about cryptocurrency is a bitcoin because they're not currencies. They're not the unit of account, they're not the scale of means of payment,
they're not the stable store of value. And if you want well preservation rather than high relativity. You want to stay away from those types of assets.
That was Noria Rubini speaking with Blue Bag Intelligence analyst Eric Beltunus. Meanwhile, we want to delve in a little bit more to just these markets and the SP five hundred, of course on a tear one of the best years in history. Tho those investors have just been methodically shrugging off geopolitical risk, of the geopolitical risk of central bank temper concern and inflation perhaps running a little bit warmer
than had been anticipated. We've got to sort of try and analyze therefore and market it's been for the money makers out there, the banks in particular, it's not been pleasant. If you've been trying to make these markets in flour X and rates, they've not been having a great year for traders there the hit by title margins by challenging
macroeconomic backdrops. We want to get to it with jess Menton, who's been going through what is a great story of how difficult it has been to trade the macro of late, because there's been these shock moves that go against everyone.
It really is, and especially because Paul and I have spoken so much over the last couple of years about especially going into not even just this past year, but in twenty twenty three, after we saw the loan, the S and P five hundred and October of twenty twenty two.
There's still so much gloom and doom, and a lot of it has been especially when you're coming out of COVID and what the disruptions from the pandemic did, because a lot of people were trading off of playbooks that would have worked maybe prior to the pandemic, but when you have a once in a century pandemic like that and it up ends business activity, it made a lot of the trades tougher to call because there are certain strategies where you would use for instance, if this happened,
you'd buy this or only you know there would be one hundred percent track records for certain thresholds where you know you wouldn't see the S and P five hundred
hit another low. But there are a lot of things that they had to like throw that playbook out, And I'm sure paul In like your career with a lot of things you saw, especially if you thought about like the housing crisis or I know you were on the floor a couple of weeks before the eighty seven crash, things were very different when you think about pre COVID versus now. So especially on the macro side, if you're looking at the City Economic Surprise Index, particularly for the US,
I mean, that's continuing to outpace those expectations. And even if you're looking at fourth quarter GDP growth for the Atlanta Fed GDP now model, I mean, that's above two and a half percent. So still you're continuing to see strong consumer but also on the corporate side of things, for particularly the stock market, that's continued to power things higher.
And Gina Martin Adams always talks about that too, So those have been some communicators Caroline, why a lot of these things just haven't panned out for some of these banks.
I mean, and some of that it used to be. I'm not gonna used to but some of the biggest profit geners were from the macro traders. They were at the south side firms and then the hedge funds. Particularly you're a macro trader, that just meant you were smarter than everybody else.
I didn't think that equities or pods.
I think about the macro picture everything and those are the guys and gals that made huge amounts of money.
But I've heard that again the performance has not been there.
No, they haven't.
I have the funds are pulling out, I mean in the fun flows out of that, out of those strategies.
So that's a key thing too, because even the S and P five hundred right now, I mean, it's on pace for over twenty percent gain this year. I mean, that's the first time you'd see back to back gains of that type of magnitude since the late nineteen nineties, and we saw that happen twice during the dot com bubble, but continuing to see even going into next year. It seems like every year when the calendar turns, there wants
to be this kind of doom and gloom. I know a lot of people are pointing at valuations, say like the S and P five hundred right now trading around twenty two times forward earnings on a blended basis if you're looking in the terminal, if you look at the average over the last decade, es around eighteen. But even if you strip out the Magnificent seven, it's still around twenty.
But a lot of traders I speak with, they'll point to how valuations if you look over the last ten years, or even if you want to look at sentiment, that stuff can stay kind of frothy and grow on for weeks once even potentially years there. So they tend to not like to use that for trading strategies right now.
What's interesting, I mean, I think it's Coolish and Greenwich, which has been putting together a lot of these stata around the moon music for rates traders and for four X a little bit more optimism if you're trading foreign exchange. But rates is painful in large part because of electronification here as well. I mean, things look very different twenty years ago because there were a few at market makers and most people are still picking up a phone.
That's a good point, and it's just a different dynamic of how interconnected the global economy is as well as technology, and when you're trying to make some of these trades too, and so when you're looking at kind of the four X market versus the rates markets too, I mean, especially because the conundrum of when you're seeing yields rise, whether that's okay, was that on a strengthening economy or is that trying to tell you something about federal reserve policy.
It's make it a lot.
More of a conundrum coming out COVID too, Caroline, So.
What's the smart trade for twenty twenty five is or such a thing?
I might just buy a Nvidia, right, I know, because especially with that, I mean Nvidia the third quarter I didn't do as well as it had in prior quarters, but still the best stock in the S and P five hundred, not over even just the last year, but the last two years. But something that people are watching. If you look at the ETF that tracks semiconductor companies and chip makers smh, that's important because there's a level
around two forty. It's trading around to forty two right now, but the two forty is kind of more of a broad support measure that they're looking at. So you kind of want to look at that as a gauge, not even just for semi conductor companies, but also kind of more broadly for the stock market to see what that could mean because not surprisingly, the big waiting that chip makers.
Have good software.
Yeah, exactly why there's going to be the need, right, And so that's a big thing too, because it's beyond even just some of the big AI type players there and what. But when I'm speaking with a lot of portfolio managers, that actually is a space like Marion Bartel's. She's on Bloomberg a lot too, but software companies is one of the ones that she continues to plow money into.
All right, Jess ESPN dot Com Texas five and a half point favorite little action down there.
I mean, you know, I was not able to get a ticket. Unfortunately, we're talking about how expensive there is. I think at the average purchase price was over one thousand bucks.
This experiential, right.
That's what the kids are doing Texas at Texas A and M College Station Texas.
It's going to be great.
But just watch it here.
Exactly, jess Man, thank you so much. We appreciate it.
You're listening to the Bloomberg Intelligence Podcast. Catch us live weekdays at ten am Eastern on applecar Play and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station Just Say Alexa playing Bloomberg eleven thirty.
Christmas Trees yougo Hill, No, of course not.
I buy my Christmas tree honor about my birthday, which is early one yes, but we've gone. I've gone both ways over the years. Because my kids were younger, they had some allergies. We would go for several years we went to fake tree. I'm kind of indifferent.
Yeah, we got a bit of both.
Do We got like we get one real one for the smell and one fake one for the downstairs.
Right five, So let's how you do it, all right, It all works out. People have their their play there.
Chris Butler Joints is National Tree Company CEO joining us here, I believe from Cranford, New Jersey, which is a cool little town there. So Chris talk to us about kind of Christmas decorations.
What are people doing these days?
What's different today versus I don't know, ten years fifteen years ago. It seems like people are going nuts for Christmas decorations.
They are going nuts. Yeah, And I like what both of you guys said. You switch between the artificial the reel. Were big fans of real as well as artificial. Obviously, eighty percent of US consumers by artificial trees, and so the reel is definitely the minor. But again, obviously we're big fans of trees in general. But you know, it's the pre lit now, so trees come pre lit. Obviously, there's no mess, they're a lot cheaper, the materials are
a lot better. There's a lot of functionality with the lights that you can get today, and so that's really what we're seeing. And there's a lot of extra wreaths and garlands and things being brought as well. And I think with the Instagram generation, the show me generation, people are really now decorating to kind of show their friends and show their followers just how beautiful our homes can be.
And so you know, as you said, Carolyn, they have a lot of trees in a lot of different rooms and so you know, maybe the kids have a tree now, the kitchen has a small tree putting the mantlepiece with garlands and small trees. So you know, we're seeing a lot of incremental decorating with a lot of different items and in terms of getting back to that swell thing. So you're right, the main reason people buy a real
tree is for that real Christmas smell. We bought a company called Sensicles a few years ago and they are scented ornament which smells just like Christmas. So if you hang your centered ornament on an artificial tree, you get that real tree, that real tree smell as well, and no allergies.
Assume I'm looking at god onto your website. First thing, holiday magic begins. Enter a week, win a gift card, Blackout Friday blowout deals up to eighty percent off. How much are you having to think about discounting? How much amid perhaps fear of some that where you're getting your supplies from the cost might have to go up in the future.
Yeah, that's a great question. So look, Black Friday through Cyber Monday this year obviously is one week later, so the holiday season is a week later. So I think every retail as ourselves included, are really discounting to make sure that we can take it kind of capture those sales that we might have missed otherwise given given the
week's delay. In terms of the tariffs, Look, you know, we've been on a diversification kind of trend over the last few years now any way, trying to diversify ourselves out of just one source of manufacturing, which which would
be China. You know, I think if the tariffs go through, who knows what the tariffs will be or when they will go into effect, but you know, from our standpoint, obviously, it's it's impactful, and so we're trying to diversify a manufacturing base between now and you know, now in kind of twenty twenty six. You know, the promotional things we're doing right now really aren't in answer to that. It's really more just to kind of capture those sales for
this season. But if you are a consumer and you're looking for a tree and you're thinking of buying a tree or other holiday de corps, this year is a great time to buy it because if those tariffs go into effect, prices will definitely go up in the next year or so.
Can you give us a breakdown of sort of how much of your supply chain is dependent on China?
Yeah, it's very large today, so I can't give you the exact numbers, but it's very large. But we are diversifying out. We've been on this diversification journey for a few years now, and so you know, probably by the end of twenty twenty six we could be completely out of China, which you know is a significant change.
So anything particularly the hot cellar this year, Chris.
Yeah, you know, so it's funny. So my wife loves the sparkly trees, the snowy trees, and many consumers love those things. But you know what we see year after year after year is that green triangle, you know, the kind of the staid, good drink green triangle, solid materials, great lights, multi multi function lights. So you know, it's not a trend driven it's not a trend driven industry. I will say this year, disco is back. So who doesn't love a bit of disco with their Christmas trees?
So disco is back. So we've definitely seen some sales on some of our kind of disco themed items. But again it is you know, people still do prefer that traditional green tree with either the white lights, clear lights, the multicolor or again we have the dual color functionality. So that's that's what we every year.
Are you white lights, Caroline? Are you a different colored I.
Think one of ours has multicolored, but I think in general I'm a boring person. I like a white light with only red and gold vibes going on. And then our thing is we collect Christmas decorations from.
Any city that we go.
So and then you have to remind yourself where the hell you've got some of these random items. But I'm really interested in not just about the idea of what color lights or what you're whether you're doing sparkle or disco, but you must be talking, Chris, to people in your
industry that are doing the real tree situation too. How much you're going to have help this year by the fact that we're here in the Northeast, we've had terrible lack of water, We've had droughts, and the local Christmas fruit tree farms next to me have been struggling.
Yeah, you know, it's a great question. Eighty percent of like I said, eighty percent of consumers already buy artificial trees versus twenty percent of consumers buying the real trees. So it's a small market already. And yeah, I'm unfortunate with you know, with some climate change or with some just whether in general is definitely hurting. Look, Oregon a few years ago got hit. You know, there's some fungus
issues in the Carolinas. So it's it's a tough business to be in making the kind of doing those real trees. And look, we're here to pick up the pieces when when you know they falter with some of their supply chain.
Chris is there any regionality in your business.
Do people in the South, I don't know, spend more on their decorations per capita than the Midwest or anything like that as a pretty standard across the.
Board, it's pretty standard.
You know, we do see the coastal towns going more for kind of Christmas by the Sea type themes. But typically, you know, our sales are driven by population centers, so, you know, very good sales in the Northeast, obviously California, Texas, Florida. It's really population driven. We don't necessarily see big regional differences in our sales. Anyway. We sell, you know, most of our sales are online, so we sell through Amazon, wafair,
home depot based, et cetera. And so we really see sales driven by, you know, by where people live.
Hey, Chris, thanks so much for joining us.
Really appreciate it. Chris Butler, National Tree Company CEO, Carolyn, If you noticed differences the way people decorate their houses here in the US versus growing up in England, that's a great question.
More is always less here?
We're more, right, Yeah, you are more. You are more here in the United States. And I love that there's like a tree for every room, a tree for every person in the family, every animal that you might have.
So I'm all in on that.
I feel in the UK we were a bit more dependent on real trees right, just as a general I mean we're a smaller country and easier access to them.
But is there something that you guys do in England that we don't do here decoration.
Wise, so Advent calendars.
Advent isn't deemed like a religious taking part in the UK obviously, you know the Queen of England and King of England. I mean generally there is a little bit more focus on on Church of England within the country. But actually the countdown and a twenty four day opening of a calendar, whether there's a suite, candy and active kindness in it, that was something.
That I grew up with. I found it much harder to get here and Crackers is my other one. Now suddenly we've getting them everywhere.
I'm seeing my local storehouse Crackers has Advent calendars.
I'm thankful you're.
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Black Friday. It's important for retailers. This is it, folks. Do you know why it's called Black Friday?
Because you're running the red all year and then Black Friday Friday comes into a big advertising year, I mean big sales year, and you kind of go into the black. You become profitable Black Friday. Dana Tellsley knows that better than anybody. Dana Tellsey tells the Advisory Group CEO and Chief re church Officer, the go to voice on Wall Street for all things retail for I'm going to say twenty five years and I'll.
Leave it there.
Dana, It's been a wild four or five six years for folks trying to figure out how they spend their money, where they go, did they spend it on goods, services, experiences? Give us a lay of the land of retail here on a Black Friday, twenty twenty four.
First of all, you're exactly right, and thank you for having me. It is the super Bowl of retail always on Black Friday. Retailer is prepared for months in order to get it right. So what do you do? What is happening right now with retail I think the consumer's resilient. I think a bit it's about product newness that's driving sell through in conversion. Look what you have with companies
like a Birkenstock or Ralph Lauren Deckers and on. And then it's also about value because that lower income consumer, they are being very watchful about their dollars given what they're seeing out there, the continued pressure of elevated prices. Inflation might not be going up, but it couldn't come down fast enough for them. And that's why you saw Walmart talk about the fact that most of their share
gains came from the higher income consumer. And given that sixty to sixty five percent of their sales come from grocery, you look at Target, which has more coming from discretionary nearly half. That was the headwinds. And then you look at what's happening with gift giving. Who would have thought that the off price was like TJX. They're getting in the throes of gift giving and they're gaining more traffic. But what every retailer is doing this holiday season increasing
the marketing. You have a very social consumer who basically is enticed, whether it's by their phone, whether it's by emails or in store. And yes, what we saw this morning so far, because I was at Macy's two already as the mornings come on, you've seen traffic increase, and I think that social engagement with the physical store is helping. We also have a compressed holiday season. Don't discount that Thanksgiving on the twenty eighth last year, it was on
the twenty third. The pull forward to promotions led to more conversion earlier in the season, but consumers are still going to spend a lot of them are procrastinators.
Am I going to get deals?
Dan?
And what's the promotional environment like ethic? Cause that impacts the margins for your companies.
It does.
Average promotion these days seems like around thirty percent. When I did my walkthroughs yesterday, I even found a store that's open because you know me, I have to be in a store every day. Ritzia in Soho was open, just open on Tuesday, brand new store, absolutely beautiful. But overall it's around thirty percent. That's the discounts. Some of them may be higher, some may be a little bit lower. Luxury goods is having a tough time, but you never
see discounts at luxury goods. What you need to see on fifty seventh Street is those Louis Vuitton trunks.
But overall, yes, beautiful.
I think it'll be a resilient holiday of three to three and a half percent increase on the margin side, Increased marketing is planned, the promotional levels are planned. I think there's more stability in the margins, more uncertainty what the top line looks.
Like, more uncertainy.
If you're starting to think the costs are going to go up because of tariffs, I'll consume is even considering that, because I'm pretty sure the reten is.
All the retailers are considering a big time, and the diversification from China is playing at every single retailer. Look what you had this week when even a Abercrombie and Fitch talked about less than ten percent their goods coming
from China. Look what you had with Gap talking the same thing on apparel with those who have significant exposure, and a lot of it is footwear companies, they're working to diversify fast because if anything, look at the NRF study where nearly eighty percent of consumer spend dollars would be impacted by tariffs requiring nearly a double digit price increase. Consumers don't want that.
They definitely don't.
Do they want to be shopping via influencers or do they want to be shopping via their own viewpoint and long term love affair with certain companies and brands.
I think influencers create the viewpoints. I think influencers help the consumers overall see what's working for them. The brands also advocate for influencers too, because they want that awareness given to expand their demographics. Because influencers today, it could be for millennials, it could be for baby boomers. What
you know is consumers are watching pictures. Pictures are on Instagram, they're on social media, and I think that's going to be one of the bigger themes as we move through twenty twenty five.
Dana e commerce versus bricks and mortar.
I know the pandemic brought a lot of e commerce market share forward.
How's that dynamic? These days?
Overall, you need both. You can't have one or the other. It's got to be both. And what you're seeing is the store fills a broader function. They do buy online, pickup and store. They do ship from store, and you know what they do back to that word again, social. They create social engagement. So I think overall, you're continuing to see bigger gains in the holiday season from online should be high single digits this year, but you need that bricks and mortar in order to drive awareness, and
you're seeing more retailers invest in their stores. You have more stores being opened in terms of retailers and net openers, but of a smaller sized box than in the past. Go physical is what I'm about. Go physical.
I mean even on Thanksgiving, you mind to go and find a store that's open. I mean, I feel that Black Friday deals have been thrown at me for the past week, if not longer. I mean we were reporting on of course eleven and eleven and what happened with the Chinese discounts that just were never.
Ending in terms of length that we had for Singles Day? Is this just the new world order? Do we feel like there evident isn't.
A discount on I think one of the things that happened this year, it just started earlier the minute Amazon had their their Prime Day, and then you had the Target Circle week in Walmart in October. It was game on for the holiday season because every wanted one, wanted to capture as much as they could of that consumer spending dollar because it's back to school in the fall and it's holiday. That are your two key shopping time periods.
Anything the go to gift or item this season.
I mean, you're gonna look for Birkenstock closed toe shoes. Told you ag that's going to be a go to that people.
Want Birkenstock closed toe shoe as opposed to Birkenstock sandal.
Yes, but you know you gotta have both, okay.
So and then you know what, look at the Brooklyn bag coach that's been super popular lately on running in their foot that's been working very well too. So we've got and you know what, even some of the private companies with intimate apparel like Skims, you got to watch what they're doing.
They have some cool marketing campaigns as well. Daniels is great to have you. Thank you for me, Thank you for pas.
Stop up to Bloomingdale's next door, a Dantel going there next and CEO and chief revenue officer and a Telsey advisory group.
Always a joy to have.
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I haven't seen Gladiator two.
I haven't seen Wicked, but I got to do that maybe over the weekend. But that's been some positive story here for the US box office. Daniel Laurier joins US editorial director at The Box Office Company. Dan, you'll talk to us about kind of the of North American box office.
Here are people going to the movies.
Oh, it's a hot streak, Paul. We've seen great recovery so far this year. Remember we entered the year expecting down season year over year twenty four to twenty three. But really since June it's been a hot streak. We're expecting to finish the year close to even to twenty three after beginning of the year expecting a ten percent slide. So it's been a really, really big recovery thanks to films like this.
I mean, Disney just knocking it out the park at the moment they've had winning Formula after winning Formula, how big a deal is Mana Are you going to be?
I think it's going to be huge.
We just posted the largest Thanksgiving Day ever for a title, Maana Tuo did that yesterday, over eighty million dollars in box office for the first two days in release.
For Mawana Too, we're.
Expecting maybe two hundred million dollars plus from that title this weekend. To give you an idea, guys, this might be the highest earning Thanksgiving weekend of fall time.
And is that because they've got the formula right of this something for everyone as well. When one of my producers she was off to go and see or not to typecast, but she was going to go and see Wicked while her husband was going to go and see Gladiator Too.
Everyone there's something for everyone. And then there's the family formula with Mahana two. So we're all satiated.
Caroline. I think you nailed it right there.
We have something there for every type of audience at the movies this weekend. The Gladiator to opening weekend's opening weekend audience was sixty one percent male, for Wicked seventy two percent female, and obviously, family audiences are coming out to support Moana to on mass. This weekend, those three movies occupy seventy five percent of all showtimes in North America according to our data at the Box Office Company.
That's a massive response from theaters to the overwhelming demand from audience is to watch these movies in theaters.
So Daniel give us a sense of maybe how the Hollywood movie make he moguls out in LA. How are they thinking about the theater release window versus the streaming and all that kind of stuff today versus pandemic? Is it still what it used to be or is it a different world?
It's different from twenty nineteen. But which industry isn't right?
The big lesson I think that the entire industry in Hollywood has learned is the overwhelming role that a theatrical release has in promoting your title downstream. So streaming is still very important, but that theatrical performance is crucial. Let's take Mona two for example, a year ago today, that was supposed to be a Disney Plus animated series just for streaming. Today this is a billion dollar plus global
box office hit for Disney. Disney now with two huge animated movies, one earlier this year, inside Out two, this one Moana two, and then you have other titles like Deadpool and Wolverine from over the summer and in December, I fas had that Lion King prequel. You have a lot of energy from Disney to go big on theatrical and we see the box office numbers to back that up.
Hey, Dan, I'd listened to some of the conference calls from some of the big media companies that Disney's, the Warner Brothers, they're kind of pointing us to twenty twenty five is a really big theatrical release year, you know, do in large part to some of the writers and actor strikes that push some production out.
Talk to us about next.
Year, Paul, I think you're absolutely right on that.
If we look at the at the last four years in production, Hollywood hasn't had an uninterrupted year in their production capabilities since twenty nineteen. You had the pandemic in twenty and the strikes last year. Twenty twenty four is the first full year of production in Hollywood.
Since twenty nineteen.
So twenty five is going to be a huge bounce back for the theatrical industry. We're right now forecasting between nine point five and ten billion dollars in box office in twenty five and in twenty six we have a ceiling of eleven billion dollars. That benchmark that this industry hit in the latter half of the twenty tens.
What is spending like when you're actually going to the theater?
I'm sorry, what is suspending like?
Yeah, people like embracing it wholeheartedly. How much of margin is accrued to those that are running them movies as well as making them.
I think you're seeing a lot more embrace from movie theaters right now in reinvesting back in their theaters to make sure that that experience is as perfect as possible
for the audiences. Let's face it, the technology we have at home is great, so the theatrical experience has really invested a lot in making that experience, either inside of the auditorium in advancements inside and sound, or in the lobbies with alcoholic beverages or expanded menus, in making that more of that experience, and I think audiences are responding to that. You listen to some of those conference calls
that Paul was saying a second ago. On the movie theater side, you're seeing huge margins on the spending side, on food and beverage that's been a big, big uptick since the pandemic, and formats like premium format that means our friend over at Imax or at a Dolby or other of those companies with a higher ticket price. Consumers are looking for that to have the best possible experience at the movies.
The thing is for a Gladiator two or for a Wicked. These movies in particular cost a lot to make, and I'm interested as to the marketing spend that's gone with Wicked or the shit technology effort that was needed with a Gladiator two. Are they making that money back? And then some how much are they managing to crack the code that the movie that they spend a lot on is the one that they bring in a lot of money on.
Carolyn, What you just said right now, I think is a big reason why these studios are highlighting and emphasizing a theatrical release. The more release windows you have in different formats, the more of a possibility you have to break even and make more money over the lifetime of a film. If you go to streaming too early, or if you only did streaming, you only.
Have one revenue cycle.
There one small window to get there with the theatrical release, you could have three months of success at the box office and from there have that amplify your marketing when it goes into streaming to have that second dip in the revenues. So having a long life cycle for films is crucial, and that's why I think a lot of movies and a lot of studios have gone back to this windowing a theatrical first and streaming second to make sure they can hit the numbers they need for their shareholders.
Dane talk to us about China.
Before the pandemic, China was rivaling North American terms of total box office.
It was really a gold mine for Hollywood. Is that still the case.
You know, I don't think it has as much of a role as it did in the pre pandemic era. Obviously, the pandemic raised a lot of question marks on who was going to be the box office king. But really from the studios, what we've seen is less of an emphasis to make sure that they lock down that Chinese release. It's just such a gamble, Paul. You don't know what you're going to get from a release in that market.
If you get it, it's great. A movie like the third installment of the Venom series is doing fantastically in China right now, but it's far from a guarantee. I think studios agree that having a strong domestic release and the reliable turnout from overseas audiences and markets in Europe, Latin America and in other markets in Asia, that's still the winning formula for most movies.
What about AI and whether it will be a doctor next.
Year huge talking point, right I think that's still up in the air. There's a lot of things that we need to figure out, and what that means for actors, what that means in labor relations, a big part of the strikes last year. We're around these questions. Like in many industries, AI has a lot of potential. I'm not sure it's a reality just yet.
I have so much more to debate on all of that. We thank you so much for joining us. Daniel Laurier, Senior Vice president of Content Strategy and editorial director at The Box Office Company, making us all want to go out and watch some movies.
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