News to watch this month

Today's labor report is a good indicator of what will happen at the Federal Reverse Board ("the Fed") meeting September 17-18. Given the data, and reaction from at least one voting member of the board, it looks like interest rates will be reduced. Many news articles presenting a range of opinions can be found searching your preferred news source. What this means is that the cut will then begin to open the door to more projects getting greenlit (funded), hence more casting calls. The amount of the cut will have a deep impact on how many and how fast loans will be applied for and become available for productions.

The Fed began raising rates 30 months ago (2 1/2 years ago), to put the brakes on inflation. That roughly corresponds with how long it's been since we've seen things slow down in Hollywood.

Projects slowed down with the anticipation of the strikes, but were also impacted by high interest rates. That was further dampened by the strikes, and why things never picked up after the strikes ended. Interest rates have not been this high since approximately 2000. No matter how large or small a production, the network, or the production company, the first step in a production is to obtain funding. Lots of that revolves around bank loans, which are then paid back from advertising and/or ticket sales after the project is finished months or years later. High interest rates can wipe out the thin projected profit margins for projects, hence fewer and fewer getting greenlit.

Add to this the crunch caused by the shift from theatrical release, broadcast and cable, over to the much lower profit margins of streaming. That leaves such a thin margin that the risk of financial failure is far higher. So, fewer private investors will take those risks, and bank interest rates wipe out that projected margin.

The bottom line is don't expect an instant flood of casting calls with the reduction of interest rates. But keep up the hope for future work.

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