An armchair for two it will be broadcast in prime time on Italia 1 as has been traditionally done on Christmas Eve for twenty-three years. If there was anyone who hasn’t seen it yet, it is one of the most famous comedies of the 1980s and the main protagonists are Eddie Murphy and Dan Aykroyd. As to why it is broadcast every year on December 24, a few years ago the director of Italia 1 Laura Casarotto said that “at Christmas we always want to hear the same story told”. However, it would not be a unique case of this phenomenon: every year on New Year’s Eve, in Germany, the comic short film is broadcast Dinner For One, since 1972.
An armchair for two came out in 1983 with the original title of Trading Places and tells the story – set in Philadelphia during the holidays – of stockbroker Louis Winthorpe (Aykroyd) and beggar Billie Valentine (Murphy). One of the things it is known for is that, like many films that talk about stock and stocks, it may not be immediately understandable in all its passages, especially in the finale. Especially for those who don’t know what i futures.
Winthorpe, Aykroyd’s character, is superficial and obnoxious, with a rich and seemingly perfect life; Valentine, that of Murphy, is coarse and tricky, but very nice. The employers of the first, the two elderly Duke brothers, decide to engineer a complicated bet by swapping them: Valentine finds himself having a prestigious job in the stock market, while Winthorpe loses everything. The experiment, in the intentions of the brothers, should decide if people are genetically led to crime or if it is the environment in which they live that affects them.
The Dukes then frame Winthorpe, having him arrested and offering Valentine a prestigious role in their company. Valentine proves to be an excellent investor in the stock market while Winthorpe, in desperation for having lost everything, violently bursts into a Christmas party organized by Duke & Duke. The Duke brothers consider their experiment concluded: the propensity of people to behave well derives from the social context that surrounds them. One of the two then pays the other the price of the lost bet – a dollar – and they think about how to get rid of Valentine, who, however, attends the payment of the bet and understands everything. He and Winthorpe then team up, and decide to find a way to make the Dukes lose everything in a stock exchange.
What are the futures
In the film, the Dukes bribed a commissioner to get a preview of an orange crop report delivered. Knowing in advance how production was going, in fact, the Dukes planned to buy contracts futures on orange juice, to speculate on the stock market. THE futures they are contracts signed by two parties who agree to exchange, at a future date, a certain quantity of goods at a predetermined price. In the futures, therefore, those who sell the goods do not yet own them, and are betting that the price will fall in the future: if they are right, they will be able to buy the goods on the market shortly before the expiry date of the contract, and then collect the price difference between the sum paid and the – higher – agreed in the contract with the buyer. The buyer, on the other hand, makes the reverse bet: if the price has risen, he will collect the goods at a reduced price, and will therefore be able to collect the difference and then sell it at the market price.
The final scene of An armchair for two
Winthorpe and Valentine manage to intercept the commissioner who has to deliver the report on oranges to the Dukes, discovering that the harvest has gone well. They then send the Dukes a false document with the opposite information: thinking that the harvest would be low, and that therefore the future price of orange juice would increase, the brothers invest all their capital by stipulating futures pledging to buy in advance, convinced to take advantage of a low price and that it will splash after the report goes out. Other investors follow their lead, further inflating the price of oranges.
Winthorpe and Valentine, at that point, begin to stipulate futures as sellers: they undertake to sell oranges, in the future, at a price that other investors – thinking that the harvest would be scarce – consider very low. After a busy minute, where investors rush to buy from Winthorpe and Valentine, and the Dukes are wondering what’s going on, the official announcement arrives: the harvest has gone well. Investors, alarmed, find themselves pledging to buy oranges at a price that is much higher than the market price. They then start offering futures as sellers, and Winthorpe and Valentine, after waiting for the price to drop significantly, agree to buy.
At this point the agreed price for the purchase of oranges is much lower than that of the contracts they signed shortly before as sellers. They manage, in essence, to make arrangements to sell oranges that they don’t yet have at a very high price, and then to buy the oranges that they will have to sell at a much, much lower price. This practice is known as short selling. The Dukes, counting on the wrong information, find themselves instead having made the opposite bet, and thus lose their fortune.
The one practiced by Winthorpe and Valentine is a form of insider trading, that is, making stock transactions on the basis of non-public information: specifically, however, what they do in the film – speculating on the basis of confidential government sources was not illegal in the 1980s – but it became so in 2010, with a law sometimes referred to as the “Eddie Murphy Rule”.
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