Explaining Southern California's economy

Update: Disney buys Lucasfilm for $4B : 'Star Wars: Episode 7' due in 2015 (poll)

Stormtroopers

Chris Jackson/Getty Images

"Stars Wars" Imperial storm troopers. They work for Disney now.

UPDATE 4: Iger and his team see upside in the deal in the future, in terms of exploiting new filmmaking opportunities and realizing new consumer-product opportunities. The idea seems to be that "Star Wars" merchandising has room to run outside North America.

Also, Disney doesn't have a completely free hand with "Star Wars," due to intellectual-property claims that Fox and Paramount may hold from the films that they worked on.

UPDATE 3: In its last earnings report, Disney had over $4 billion in cash. However, Iger pointed out that Disney expects a return on Lucasfilm "well in advance of its cost of capital," suggesting that the company didn't burn half its cash on hand to make this acquisition. Although the company is proposing to buy back, in several years, the shares it issued to complete the deal. This will hit Disney a bit in terms of share value — issuing new stock will dilute the value of existing stock.

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No Hunger (video) Games, please

Opening Night Of Lionsgate's "The Hunger Games"

Valerie Macon/Getty Images

Opening Night Of Lionsgate's "The Hunger Games" at the Regal Cinemas L.A. LIVE Stadium on March 22, 2012 in Los Angeles, California.

The first installment of the film adaptation of Suzanne Collins' blockbuster young adult series "The Hunger Games" opened at midnight. It's expected to break all manner of box-office records, get its studio, Lionsgate, back on track, and inspire fevered debates among parents about whether their kids should be allowed to see a movie about children in a dystopian alternative future killing other children for sport.

From a business point of view, there's a larger question to be asked, beyond the philosophical and ethical ones that have already been addressed: Will "The Hunger Games" inspire massively successful video-game and merchandising tie-ins? And at a deeper level, who would want certain kinds of potentially inevitiable "Hunger Games" video games/merchandising?

The Wall Street Journal has already covered the business case for Lionsgate. It's good but not great. The studio could make around $100 million. But that's just the movies. And a cinematic franchise, as George Lucas discovered when he retained what were in the 1970s thought of as fairly worthless licensing rights. is waaayyy more than the movie now. In fact, you could argue that the film is just a large moving billboard that's seen indoors.

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Invest with James: How to make money renting your shirts

Matthew DeBord

James has discovered the value of renting stuff he isn't using.

My almost-six-year-old son James is very interested in money. But unlike some kids who think about ways that they can do jobs for an allowance or create little businesses (Lemonade stands!) in order to get some cash to spend, James wants to divert wealth from other people without actually providing any real services. 

I think this makes him a member of the 1% that Occupy Wall Street is protesting, if not in assets then in philosophy.

His chief target is his older sister, Lucia, who has decided that she doesn't care about money and wants to live for her art.

James is obsessed with separating her from her money. He doesn't really know anyone else who has money he can get his hands on, so this makes sense. 

Money for both of them comes from the traditional sources of pre-adolescent capital: intermittent allowances, gifts, the Tooth Fairy. But James has more of it because he saves it all.

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