Okay I know his worth is estimated at this level, but serious question, how much of it can he walk into a bank and withdraw? The formula they use for these calculations always strikes me as borderline alchemy or dark sorcery. Logically if he’s a trillionaire he should be able to produce a balance sheet that literally says he has an account, or accounts, that totals or exceeds $1,000,000,000,000.1 million seconds is 11.5 days
Forbes Declares Elon Musk As The World’s First Trillionaire
SpaceX began trading on the Nasdaq Friday, boosting Musk’s fortune to an estimated $1.1 trillionwww.forbes.com
1 billion seconds is 31.7 years
1 trillion seconds is 31,709 years
It's ok to be angry about capitalism
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The problem is that while the valuation of his company isn't a form of liquid asset in any real sense, it becomes a foundation of collateral to obtain whatever huge loans he wants at very low rates of interest. The money from those loans is then funneled into any type of investment that pays back at a higher rate than the loan's interest creating liquid assets that have effectively paid for themselves and (thanks to the Billionaire's Blowjob Bill from last year) are taxed at an extremely low rate, or not at all if you claim the investments as a form of business expense. After all, according to that law, if you purchase a private jet, you can write the cost of it off on your taxes as an expense. Ain't American capitalism just grand?
* Provided the majority of the usage is for business purposes, which is just how income taxes work everywhere that has them.
Great news, and some investors with actual brain and not overly blinding greed.
S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic
SpaceX won’t get easy access to billions of dollars from passive investors.arstechnica.com
Statement on the US government directive to suspend access to Fable 5 and Mythos 5
The US government has issued an export control directive to suspend all access to Fable 5 and Mythos 5 by any foreign national, whether inside or outside the United States.
In another bit of amusing Anthropic news, they've taken down access to their frontier models worldwide because the US government has placed export controls on them under the same legal authority that allows for controlling the export of cryptography. That includes the US because the government demanded foreign nationals be barred from access, including those in the US (and Anthropic doesn't want to have to figure out which users are citizens and which are not to comply), including barring some of it's own engineers from being able to access the models.
At first I thought this was referencing the next Fable game and thought "Jesus, what lies has Peter Molyneux been telling now?!"Statement on the US government directive to suspend access to Fable 5 and Mythos 5
The US government has issued an export control directive to suspend all access to Fable 5 and Mythos 5 by any foreign national, whether inside or outside the United States.www.anthropic.com
In another bit of amusing Anthropic news, they've taken down access to their frontier models worldwide because the US government has placed export controls on them under the same legal authority that allows for controlling the export of cryptography. That includes the US because the government demanded foreign nationals be barred from access, including those in the US (and Anthropic doesn't want to have to figure out which users are citizens and which are not to comply), including barring some of it's own engineers from being able to access the models.
Yeah... thats not happening. Musk deliberately inflates his prices and worth and is not going let something like reality take it from him.
The stock market does not really work this way. Nothing is tethered to reality or productivity. Its all vibes. And Musk is the king of vibes
Okay, but is this petty vindictiveness by the US government, or a marketing trick for Anthropic ("So powerful, the US government had to ban foreigners from it!")?
I mean, this is like Anthropic saying its AI was so powerful at hacking into systems that it would initially only release it to banks and governments to test their security, but expert analysts said it was at most only slightly more effective than others readily available. Or the way Anthropic periodically makes all sorts of noises about ethics, but totally is flogging its services to the US military, intelligence agencies, etc.
I get you, but the real question is how society forcibly appropriates some that stupidly excessive amount of wealth, because no one person should be allowed to have trillions, or even hundreds of billions and maybe tens of billions. At least, not until inflation gets to the point that a can of Coke costs >$100.
Not as much as you'd think. He'd have to sell the assets that money is locked up in, which would be taxed (but not as heavily as a similar amount of wages). Instead he gets to use those assets as collateral for loans when he needs liquid money, and you don't tax debt.
Basically everyone in the hundreds of millions and up range either started, inherited, or got lucky investing in one or more wildly successful businesses and most of their wealth is in the form of ownership stakes in those businesses and what that ownership stake could hypothetically be sold for is where the $ number comes from, it's why it feels like alchemy - their wealth exists in essentially the same way you could hypothetically place a $ value on the collection at the Louvre and say the Louvre is worth that much.
I've always been fond of the idea of a wealth tax. 0% until you're say 50 million in, start at 0.1% from there, and ratchet the marginal rate up incrementally to say 8-10% when you hit a billion. Allow it to be paid in cash or in dividend paying stock, any such stock will be held by the government rather than sold in order to reduce negative impact on stock prices and gain continuing dividend income from it. Transferring stock to pay this tax is not realizing a gain from it and would not be subject to capital gains tax like selling it would be.
In theory, I think the stock market should "tax" Musk by valuing his companies at reasonable prices.
What is SpaceX? SpaceX is a Frankenstein's monster of:
- megafirework manufacturer
- hard to monetise chat board
- low capacity comms network
- catastrophic money sink Mechahitler
SpaceX's revenue last year was less than $20 billion. The whole outfit. It's valuation is currently over 100x that.
Starlink is the big earner, bringing in well over 50% of SpaceX's revenue. It currently has about 10 million subscribers with revenue in the order of ~$11 billion and ~$4 billion profit. That's tidy, but hardly massive. The IPO valued it at a staggering ~$900 billion. Contextually, the entire global telecoms industry is less than $2.5 trillion, predicted to rise to over $4 billion by the mid-2030s. Who thinks that Starlink is going to have around a quarter of the glboal market in the 2030s?
Surely no-one. Starlink simply cannot compete in quality with ground-based options for cost and bandwidth. As users increase, congestion means quality goes down. It will always be a niche operator, likely mostly in rural and remote areas where it's less feasible to lay cable and put up mobile towers. Apparently Starlink's growth is already slowing, and competition is due (China wants its own satellite network) which will eat it faster. This is a great example of how irrational the SpaceX IPO and valuation was.
* * *
We also need to ask some serious questions of Musk. After all, this is a man whose most notable creation in the last five years was Cybertruck. Tesla has still not delivered autonomous cars despite repeated promises and over-optimistic claims. Meanwhile, his EV and battery company generally is already wilting in the face of competition (particularly Chinese). And Tesla is a particularly important marker, because it shows Musk couldn't ultimately dominate a market he was miles ahead in. What does that mean for anything else he's trying?