Trading Places

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Template:Infobox Film Trading Places is a 1983 comedy film starring Eddie Murphy, Dan Aykroyd and Jamie Lee Curtis. It was directed by John Landis and written by Timothy Harris and Herschel Weingrod. It was produced by Aaron Russo.

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Plot

Spoiler warning: Plot and/or ending details follow.

The basic plot is based on the Three Stooges 1935 short film "Hoi Polloi". As an "experiment into heredity versus environment" and for a bet, two immensely wealthy and patrician brothers, Mortimer and Randolph Duke (played by Don Ameche and Ralph Bellamy), arrange for two other men to "trade places":

  • Louis Winthorpe III (played by Dan Aykroyd), is a respectable senior employee of the Dukes, and manages their investment bank. He attended Exeter and Harvard. He is greatly humiliated through the machinations of the Dukes. He is falsely accused of theft and drug dealing, and thrown in jail. He is fired from his job, and in short order he loses his home, his possessions, and his money. As a result of this, his friends and his fiancee (Penelope Witherspoon) turn their backs on him. The speed with which this happens drives Winthorpe to crime, culminating in his rampaging through the Duke & Duke Christmas party (dressed as Santa Claus) with a loaded gun. However, he is supported by a prostitute named Ophelia (played by Jamie Lee Curtis) who takes pity on him.
  • Beggar and hustler Billy Ray Valentine (played by Eddie Murphy) is given Winthorpe's job, his house, his butler Coleman (played by Denholm Elliott), his car and other possessions - but he is not made aware that these belonged to someone else. Finding himself in a much-improved situation, and no longer having any need to break the law, Billy Ray starts to behave like a responsible and honest citizen. His unique background brings a new thinking to Wall Street, and he begins to integrate his skills with the business world. Soon, everyone seeks Valentine’s financial advice.

When Billy Ray finds out about the Dukes' bet and their intention to put him back on the streets, he seeks out the destitute Winthorpe and explains the situation. Along with Ophelia and Coleman, they devise a plan to take revenge. The Dukes' arrangement of using inside information to earn money on the commodities market is made to backfire when Winthorpe and Billy Ray intentionally and surreptitiously feed the Dukes false information regarding the crop report. This causes the Dukes to misplay the market and bankrupt themselves in the process in a highly fictionalized, Hollywood-style moment (which completely misrepresents the activities in the commodities markets) but which is still thoroughly entertaining. Simultaneously, Valentine and Winthorpe use the correct information themselves to get rich.

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Explanation of climax scene

With an authentic orange crop report indicating a good harvest of fresh fruit, Winthorpe and Valentine understood that stockpiled frozen concentrated orange juice (FCOJ) would be less necessary and so less valued (priced lower) once traders discovered the report. On the other hand, the Duke brothers believed that the fresh orange harvest would be less successful, necessitating greater use of stockpiled FCOJ in orange products in the coming year, driving the price up. By capitalizing on this knowledge (and the Duke Brothers' missteps), the protagonists are able to profit off of the significant contract price difference between the high and low of the day (before and after the crop report is announced).

Many have wondered how they were able to sell at high prices FCOJ commodities they did not yet own or able to make any money off purchasing back the commodities at a low price (i.e. it is unclear to some how they would realize an actual cash profit from them.) The explanation lies in the nature of the futures market.

  • Unlike traditional buying and selling of shares of stock in a company, futures contracts can be sold even when the seller doesn't yet possess any. A futures contract to sell, say, 1000 pounds of FCOJ at $1.50 per pound in the month of February merely indicates the seller's obligation to provide and the buyer's obligation to buy the product at that price in that month. It doesn't matter how or where the seller gets the product as long as, one way or another, he is able to provide it at that price at that time.
  • In this case, Winthorpe and Valentine sold hundreds of thousands (if not millions) of dollars worth of FCOJ futures at roughly $1.45 per pound (assisted by the Duke brothers who have driven up the price by buying so much, creating a demand), obligating their contractees (largely, the Duke Brothers) to buy FCOJ at that high price. Then, when the price fell (a result of the crop report announcing less of a need for FCOJ), they bought futures at, roughly, $0.22 per pound, allowing them to buy FCOJ at the cheaper price. Thus, for every future pound they previously sold (agreed to furnish later) at $1.45, they were able to buy for only $0.22, profiting them over $1.20 per pound, or a margin of over 545%. Though it's not stated in the movie, if we assume they invested roughly $500,000 from a combination of Winthorpe/Valentine's bank account and Coleman's and Ophelia's savings, they would have turned it into over $2.7 million assuming they only sold based on the amount of money they had. Of course, it's more likely that they purchased additional futures on margin and earned dozens (or hundreds) of millions more.
  • At the same time, the Duke brothers had purchased enormous quantities of FCOJ futures, even at relatively high prices, because they expected that the crop report (falsely suggesting a greater need for stockpiled orange juice) would induce other traders to want to buy lots of it at even higher prices, securing them a profit. When it turned out that the report they were given was fraudulent, the price began to plummet before they were able to sell their contracts. So, they were left with an obligation to buy millions of pounds of FCOJ at a price more than a dollar per pound higher than they would be able to sell them for, leaving them bankrupt.

See How Winthorpe and Valentine Pulled It Off for a more detailed explanation.

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Cast

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Awards

  • Curtis and Elliott received BAFTA awards for their roles, and the film was also noted for returning veteran Hollywood actors Ameche and Bellamy to the screen.
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Production

Most of the movie was filmed on location in Toronto.

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Trivia

  • The Duke brothers' attempt to corner the orange juice market is very similar to the real-life case of the Hunt brothers of Texas, who attempted to corner the silver market with the help of Arab investors. Eventually, the "Silver Thursday" market crash of March 27, 1980 devalued their silver holdings enough to make them fail to meet their $100 million margin call and forcing them to declare bankruptcy.
  • The Duke brothers later appear as two homeless men in Eddie Murphy's 1988 movie Coming to America. Murphy's character hands a wad of cash to 'Mortimer', who Randolph observes and says, "Mortimer, we're back."
  • Mark Twain's The Million-Pound Banknote also revolves around a bet between two immensely wealthy businessmen who then toy with the life of a penniless man, but in this case with a far more benevolent intent.
  • In 2000, readers of Total Film magazine voted Trading Places the 33rd greatest comedy film of all time.
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External links

fr:Un fauteuil pour deux ru:Поменяться местами (фильм) sv:Ombytta roller (film)

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