The Super-Rich In Space

This month we’ve seen a lot of seriously rich people leave the surface of the planet and journey to the edge of space. Earlier this month billionaire Richard Branson took a flight launched by Virgin Galactic–Branson’s company–to a height 50 miles above the Earth’s surface, and yesterday Jeff Bezos, who is even richer than Richard, rode a rocket launched by his space company, Blue Origin, to an even higher destination, 62 miles up. And let’s not forget fellow billionaire Elon Musk, who hasn’t traveled above the stratosphere, yet, but whose SpaceX venture has launched far more rockets and capsules, traveled farther, and advanced space technology more than Bezos’ or Branson’s companies put together.

Bezos’ flight is interesting, and not just because one of the world’s very richest men wore a space uniform and took the risk of a potentially fatal mishap. The Blue Origin flight also was piloted by the oldest person yet to fly into space–82-year-old Wally Funk, who was part of a NASA Women in Space program back in the ’60s–as well as the youngest person, who also was first Blue Origin’s paying customer. The paying customer was 18-year-old Oliver Daemen, whose Dad, a wealthy businessman, bought a seat for him. Oliver filled in for an anonymous person who had paid $28 million for a seat on the flight, then backed out due to “scheduling conflicts.” (Really? Somebody paid $28 million to take a trip into space, and then let “scheduling conflicts” delay their departure? Those must have been some pretty serious “scheduling conflicts”!)

Blue Origin hopes to help fund future flights, in part, through space tourism sales. It has announced that it is now officially selling tickets to future flights, and that it has made $100 million in sales so far. It’s not clear how much such tickets might cost, but it’s obvious that there is a market for a ride into space among some segments of the megarich, and their kids and other family members. And while it wasn’t a particularly long ride yesterday–the CNN article linked in the first paragraph above described the trip as allowing the passengers to experience “about three minutes of weightlessness, unstrapping from their seats and floating about the cabin while taking in panoramic views” before coming back down to a landing–it’s obviously an experience you can’t find anywhere else right now.

We often bemoan the lifestyles and luxuries enjoyed by the super-rich, but in this case I’ll gladly tip my cap to Musk, and Bezos, and Branson, and Oliver Daemen’s Dad, and the anonymous person with the “scheduling conflicts.” If the hyper-wealthy are willing to help fund private ventures in space, and are doing it, in part, so they can enjoy a joy ride to the edge of outer space, I’m all for that. I’d rather see the affluent putting their money down to help pay for new technology that will help us, collectively, move forward into space than frittering it away outbidding each other for Picassos. And, if space tourism is going to become a real thing, obviously the first passengers are going to pay a lot–but by doing so, we can hope that they will help to usher in an era when spaceflights become routine, costs decrease, and tickets are reasonably affordable for the rest of us.

To Mars, And Beyond

This week, Elon Musk of SpaceX announced his plans for getting humanity to Mars.  The plans involve massive rockets, trips by 100 passengers every 26 months, and deliveries of supplies and housing — all with an ultimate goal of establishing an independent, self-sustaining colony on the Red Planet.

mars-colonial-bThere’s still a lot of details in Musk’s ambitious plans to be filled in — like figuring out how in the heck the massive rocket is going to paid for, and how they are going to get materials sufficient to keep 100 people alive for months on a planet that is basically a cold desert.  Critics think the Musk plans, in their current form, are implausible.  They almost certainly are, of course.  The key point, though, is that somebody is actually thinking about how to accomplish passenger space travel and is doing something about it.

Musk isn’t the only one who is thinking about space.  SpaceX has shown that there is commercial value in space, and Jeff Bezos, the multi-billionaire founder of Amazon, has his own space development company with plans to launch satellites . . . and ultimately, people who would colonize the solar system.  NASA, too, is proceeding with Mars mission planning.

We seem to be on the cusp of a tipping point, where talk about colonizing Mars is moving from the dreams and visions of science fiction writers to fundraising, timetables, and engineering reality.  In my view, it’s about time.  Whereas Musk thinks we need a colony on Mars to protect our species from extinction through a cataclysmic event on Earth, I think we need to get a toehold in space to change our Earthbound perspectives, broaden our horizons, and reintroduce an explorer’s mentality to our world.

It’s good to see internet billionaires using some of their cash to open new worlds and opportunities to humanity.   We may not know what’s out there, yet, but let’s find out!

Losing $9 Billion In A Day

Monday was a crappy day in the stock market all around the world — but it was crappier for some than for others.

rsz_istock_000017344562_fullBloomberg Business reports that yesterday, the world’s five richest men lost a total of $8.7 billion — and when you’re talking that kind of coin, you might as well ignore that paltry $300 million and round that figure up to $9 billion.  Jeff Bezos’ holdings alone fell $3.7 billion in value, Amancio Ortega lost $2.5 billion, and Warren Buffett, Carlos Slim, and Bill Gates saw their net worth drop between $730 million and $870 million.  Yikes!  You could buy a professional sports franchise with that kind of cash.

Imagine, losing billions of dollars in a single day.  And we think we’ve got problems when the market tumbles, as it did on Monday, and our 401(k) portfolios drop, and we wonder whether the bottom is going to fall out of the market again, as it did in 2008 and early 2009.  At least we’re not measuring the money that has disappeared in billions, with a “b.”

We shouldn’t feel too sorry for Jeff Bezos, though.  Even after losing $3.7 billion, his net worth is still a hefty $56 billion, and he had a pretty good year last year — his net worth increased by $31 billion in 2015.  Ortega is even more in clover, because his net worth after his $2.5 billion loss is still a staggering $70.4 billion.

It’s hard to imagine one person having so much money.  It makes you wonder:  for these guys, when the market plummets, does it hurt to lose a billion dollars in a day?  Or is it really more like Monopoly money is to us?

The (Sigh) News About The News

The news business in America has been in the news a lot recently, and unfortunately the news is pretty much all bad.

Two of our most storied newspapers, the Washington Post and the Boston Globe, have been sold for a small fraction of their value only a decade ago.  The New York Times, which bought the Globe in 1993 for $1.1 billion, sold it to billionaire John Henry for only $70 million.  What’s worse, the Times retained liability for the Globe’s pension obligations, which reportedly total more than $100 million.  If you do the math, that means the Times basically lost its entire $1.1 billion investment over 20 years.  Although the Times tried to justify its sale as an effort to focus on its core “brand,” it’s obvious the sale sought to unload a money pit that the Times didn’t know how to turn around.

The Washington Post and related publishing businesses were sold to Jeff Bezos, the founder of Amazon, for $250 million.  Although the price was higher than the pittance paid for the Globe, it still shocked the journalism world because it was much lower than the Post‘s expected value and because it ended the long-time ownership of the Graham family.  Both the Post and the Globe have been troubled by the same trends that have plagued other newspapers — declining circulation and a business model based on paper, with all of its attendant costs, when the rest of the world is moving full throttle into digital communications.

In addition to the fire sale prices paid for these two legendary publications, recent journalism news has seen continuing layoffs of reporters, editors, and other members of newspaper staffs.  Last week, for example, the Cleveland Plain Dealer laid off about one-third of its editorial staff.

One sign of the desperate times in the news business is the effort to see the silver lining in Bezos’ purchase of the Washington Post.  Some people in the journalism industry hope that Bezos, who has taken Amazon from an on-line bookseller to its current status as an ever-expanding conglomerate powerhouse, may be able to figure out what has stumped others in the journalism business:  how to make the daily newspaper something that everybody will read, and happily pay for, again.