Like so many other animation buffs, I've learned that it pays to be breathlessly excited for any and every new movie turned out by Laika, the studio Phil Knight bought for his son Travis using the billions of dollars Phil earned for co-founding Nike (there's a real possibility that Phil Knight is my favorite living billionaire, just for using his personal fortune to keep financing this little underperforming oddball). Add the same time, despite being overjoyed by how good each new Laika film has been, I've assumed all along that we've seen the best they would ever be able to offer: director Henry Selick's Coraline from 2009, the studio's first film, set the bar so high that it would be no kind of humiliation when they thereafter proved unable to top it. So anyway, imagine my surprise that Kubo and the Two Strings, Laika's fourth feature, has turned out to be maybe better than Coraline? The least I'm willing to say is that it's equally as good in a different way, and that's already far beyond any praise I would expected to hit.

The directorial debut of Travis Knight himself, with a screenplay by Marc Haimes and Chris Butler, from a story by Haimes and Shannon Tindle, Kubo shifts slightly but distinctly from Laika's previous work. Those films - Coraline, ParaNorman, and The Boxtrolls - all have one foot firmly planted in horror, a holdover from the glory days when children's entertainment assumed as a matter of course that kids liked scary stuff. There's still a bit of that left behind in the new film's villains and set-pieces (one early sequence is probably the creepiest thing I've seen in an all-ages American movie since ParaNorman itself), but the mood is much more of an adventurous quest of a sort that, prior to watching the film, I hadn't realised had been missing from our screens for so long. Nothing quite like a good, straightforward fantasy quest with a health dose of The Legend of Zelda to it. And Kubo is an absolutely splendid example, with just the right sense of dreamy nonlinearity to it to feel like it has been assembled from the bones of some vaguely-remembered fairy tale.

It would be no fun to give away the surprises, but what we have here is a 9-year-old boy, Kubo (Art Parkinson), whose mother escaped with him when he was just an infant, and his murderous grandfather and aunts were trying to capture him to pluck out his right eye (they already got the left one). Now living on high cliff overlooking the see and a tiny rural town, Kubo earns money to keep him and his unspeaking, virtually comatose mother alive by playing his magical samisen in the village square, using it to create elaborate puppet shows using pieces of origami paper that dance and fold themselves as Kubo tells his never-ending tale of the great samurai Hanzo in his fight against the Moon King.

As we can figure out from the very start of Kubo's first show, unless we are very young indeed, Kubo and the Two Strings is a story about storytelling: Kubo's performance is a way of making sense of his own autobiography (Hanzo was his father, the Moon King his grandfather), and staving off the same depression that has claimed his mother by using narrative as a tool to make the world around him better. It's also a way of turning that trauma into pleasure for the audience, for as Kubo's storytelling methods demonstrate, an audience is necessary for the creation of narrative meaning. Beyond this, there's an addition self-reflexive layer: the film opens with the same dramatic invocation that Kubo uses to start his show, which is all the more cue necessary to start noticing the way that his story, in addition to being a metaphor for the film's narrative, is a metaphor for the film itself: given Laika's extremely prominent pride in their craftsmanship and the physical presence of their immaculately-crafted stop-motion puppets, it's not hard to imagine Kubo's work with origami as the studio's back-patting praise of its own work.

So it's all one thing, is what I mean to say: Kubo's attempt to keep himself in control of life through the power of stories and the whole Laika project. It's all of it about how a great story can completely redefine the way we think about life, and give us a mechanism for processing negative, hurt feelings in a safe way. And this is not me reading anything into Kubo and the Two Strings that it doesn't put out there right on its own: the film's beautiful, beautiful ending, which treats its villain with more generosity than any animated film I can name outside of the work of Studio Ghibli (and while Miyazaki Hayao obviously casts a shadow over everything Laika has done, Kubo is an exceptionally Miazaki-esque film, right down to its flirtation with Japanese folklore), is a miniature expression of the idea that we interpret life as narrative, and can therefore choose which kind of narrative it shall be.

Anyway, the film's resonances and themes are stunning, and would be worth it even if the rest of the film wasn't every bit as good. Kubo takes the humble old form of the quest to gather items, making no attempt to sex up that ancient genre with subversion or irony: it's just a little boy, a humorless talking snow monkey (Charlize Theron), and a dimwitted samurai-turned-giant-beetle (Matthew McConaughey) on one hand, the ghostly Sisters (both voiced by Rooney Mara), Kubo's otherworldly aunts, dressed all in black with empty-eyed smiling masks underneath broad-brimmed black straw hats, on the other. There are elaborate monsters in between Kubo and the three items he needs to stop the Moon King, some drawn from Japanese mythology, some not; there are also mysterious, beautifully-designed caves and lakes and ruined castles. I did not make the Zelda comparison idly; this is as close to a film version of that game as I think we're apt to get, and certainly the best, capturing the odd video game narrative logic of moving from place to place more as a matter of intuition than narrative logic, and finding those places to be amazing sites to explore and discover. The film glides through its episodes with stately rhythm, with Knight moving the story just slow enough that we can really suck in all the beautiful locations Laika's incredible team of designers have made for us, while also keeping in mind how much of the film is a race against the implacable, genuinely horrifying Sisters.

Technically, this is the best thing yet made by Laika, continuing the studio's increasingly sophisticated, invisible, and unnameable hybridisation of computer animation with cutting-edge stop-motion animation techniques to create extrarodinary visions: the giant skeleton fight justifies the movie all by itself, and it's far from the only great accomplishment of staging and framing animated action. I believe I noticed that the facial animation has been made a little less fluid than in The Boxtrolls, perhaps because Knight wants us to really notice and appreciate the sublime physicality of Laika's craftsmanship. It works, anyway; like the placeless story ("Japan", but not specifically), and the indefinite narrative flow, it creates a sense that this is all unreal in some important way, belonging to the world of fable and myth rather than concrete reality.

It's not quite perfect; the script makes too many concessions to the 2016 animated marketplace in America, with jokey, anachronistic lines that do nothing to help the film's delicate tone; "That's so you" says the beetle at one point (the beetle is the film's obvious weak point, through no fault of McConaughey's warmly idiotic performance; but I do wish his very recognisable voice was maybe not in this cast), and there's no earthly reason for a bland 2010ism like that to infect the fairy tale Japan of the movie. Still, that's a minor annoyance in the face of so much that works tremendously well: the complexity of the theme, the beauty of the settings, the gracefulness of the animation. Kubo is a legitimate work of art, not merely the best animated film of 2016 by a resounding margin, but very probably my favorite animated American studio feature of the decade so far.