Two years later, Zimmer announces the end of production of silent films at Kinograph Studios, but Valentin is dismissive, insisting that sound is just a fad. In a dream, Valentin begins hearing sounds from his environment (as does the audience), but cannot speak himself, then wakes up in a sweat. He decides to produce and direct his own silent film, "Tears of Love", financing it himself. The film opens on the same day as Peppy's new sound film "Beauty Spot" and the 1929 Stock Market Crash. Valentin's only chance of avoiding bankruptcy is for his film to be a hit. Unfortunately, audiences flock to Peppy's film instead, while only a few people (including Peppy herself) attend Valentin's. With Valentin ruined, his wife, Doris, kicks him out, and he moves into an apartment with his valet/chauffeur, Clifton, and his dog. Peppy goes on to become a major Hollywood star.