Creating the Cis-Lunar economy

Terraformer · 2012-01-14 12:32:05

Erm... you don't plough profit back into a company, unless you're either a not-for-profit or a small one agressively focused on growth. I'm thinking of a ROI of 10 years, so we're looking at 0.5-1 billion a year already to the investors, before profit. Add another 1 billion for manned flights, and 0.5 billion for cargo required to expand the base, and we're looking at needing to make 2-2.5 billion each year.

louis · 2012-01-14 14:44:01

Terraformer wrote:

Erm... you don't plough profit back into a company, unless you're either a not-for-profit or a small one agressively focused on growth. I'm thinking of a ROI of 10 years, so we're looking at 0.5-1 billion a year already to the investors, before profit. Add another 1 billion for manned flights, and 0.5 billion for cargo required to expand the base, and we're looking at needing to make 2-2.5 billion each year.

You are confusing profit with dividends to shareholders (stockholders).

I do agree we would be talking about billions of dollars of revenue.

There are lots of money-earners we haven't yet discussed. Won't Hollywood want to start setting some of their films in part on the moon? Who is going to provide them with the footage and backdrops? That could generate maybe $20million a year, as would TV programmes (documentaries) about the moon and the lunar colony.

Terraformer · 2012-01-14 17:21:06

No. Profit is what you have left over after all your expenses have been paid, which is then usually payed out to shareholders.

Any situation where we can write off capital costs is not one we should get involved in, since it invariably means the government is involved somewhere. Perhaps we can get a grant from them with no strings attached, but I doubt it. We're going to have to factor these costs in.

louis · 2012-01-14 17:47:47

Terraformer wrote:

No. Profit is what you have left over after all your expenses have been paid, which is then usually payed out to shareholders.
Any situation where we can write off capital costs is not one we should get involved in, since it invariably means the government is involved somewhere. Perhaps we can get a grant from them with no strings attached, but I doubt it. We're going to have to factor these costs in.

No, your original "correction" of me was completely wrong. See this reference for the real position:

" Profit is also an important source of finance for a business. Profits earned which are kept in the business (i.e. not distributed to the owners via dividends or other payments) are known as retained profits. "

http://tutor2u.net/business/gcse/finance_profit.htm

You're now trying to create wriggle room by using the weasel word "usually."

As you can see from the definition, it is perfectly acceptable to retain profits and use them to finance your business.

Terraformer · 2012-01-16 10:35:43

However, not when you need to pay off your capital costs... the investors are going to be wanting some return on their investment.

louis · 2012-01-16 17:50:27

Terraformer wrote:

However, not when you need to pay off your capital costs... the investors are going to be wanting some return on their investment.

Do you know much about company finance? - I'm not claiming to be an expert, but there are various ways in which capital can be raised e.g. share sales, retained profits, bank loans, selling company bonds, and government grants. A well run company accounts for the need to pay off its capital costs. The profit is the money left over when ALL costs have been covered INCLUDING capital costs (e.g. repaying interest on bank loans). Therefore your comment makes no sense. There will only be profit if the capital costs have been covered (along with all other costs).

SpaceNut · 2012-01-16 18:25:28

Wow way to far off the mark for the intended first post on this page....

Assumptions that can be backed up to a point is the travel to space, of which a ride to the ISS for about a week to 2 give or take is 20 million on a Russian rocket but that seems to be all that we have to use at this point...

Gems can and do yeild big bucks but what is the satuation level before they are worthless...

There could be lots of marketing rights for video broadcast of any activity open to the imagination....

Hop · 2012-01-16 20:25:40

louis wrote:

There are lots of money-earners we haven't yet discussed. Won't Hollywood want to start setting some of their films in part on the moon? Who is going to provide them with the footage and backdrops? That could generate maybe $20million a year, as would TV programmes (documentaries) about the moon and the lunar colony.

Bill White's science fiction novel Platinum Moon explores different ways of generating revenue streams. TV rights, product endorsements, merchandising, etc.

I believe all of these should be used. I don't think this could pay for a lunar base, but it could pay for a fraction.

SpaceNut · 2012-01-16 21:49:37

I see a trend I all of the economy threads thus far and its all one way back to Earth bound investment and profits of those on Earth.
What about these other directions for investment or profit to be had....
What about the wages of the settlers?
What about the settlement of one place to another on the same destination(Mars or Moon)?
What about the Destination place Mars or Moon to another Mars or Moon settlement?

JoshNH4H · 2012-01-19 12:22:50

SpaceNut wrote:

I see a trend I all of the economy threads thus far and its all one way back to Earth bound investment and profits of those on Earth.
What about these other directions for investment or profit to be had....
What about the wages of the settlers?
What about the settlement of one place to another on the same destination(Mars or Moon)?
What about the Destination place Mars or Moon to another Mars or Moon settlement?

How would any of these be sources of money for the colony as a whole?

Terraformer · 2012-02-05 11:06:49

Hmmm. Looking back at what I've previously written, the main cost would seem to be the cost of human launch. Any chance this will drop by an order of magnitude, to maybe $1-2 million? At that point, it might be possible for people who have a suitable income source to rent an apartment on Luna and live there... charge say $100k/year, inc. free medical care, and make them pay for their ticket home in advance...

JoshNH4H · 2012-02-06 16:48:51

Well, I mean it's certainly possible. That's probably not a near term thing, though, seeing as SpaceX, by far the best in the business at the moment, are doing it for about 8 million per person (or at least, that's what the cost of the Falcon 9 rocket over 7 people works out to). Getting to the Moon will of course be more, but I could see the price being brought down significantly, especially with lunar-based refueling.

SpaceNut · 2012-02-06 21:32:59

If a settler is paid a wage that means there is time for an individual to work for one's self as well to create another path to wealth. That also means a way to barter or trade in what can be had for ones own time. This also means more to sell back to Earth that was not paid for by a wage.

clark · 2012-04-13 19:19:39

Mars has no product for Earth- perhaps Luna, but not Mars. Luna has no product for Earth, perhaps LEO, but not earth.

Before any start with Fusion, i heard the same thing 10 years ago, and it is still 10 years away and holding. Boot strap leo and the rest will follow.

SpaceNut · 2012-04-13 21:07:59

Ah to spectulate on a future path outward through movement to LEO that was cheap enough for anyone to afford so long as you had a guide or had been there before ex. how the western frontier was opened....

clark · 2012-04-13 22:59:47

I don't need to speculate a future path. I don't need out dated modalities of frontier fantasy. Oh, how the West was won!

Look to the center of gravity- pardon my heavy handed pun.

Volume is a booming business! Where is the volume? Where is the money?! I'm not a rocket scientist, but when I play one on TV, I recommend looking at where the market is.

Chase the market like every dreamer chases Mars.

For the cliff note version, if you have made it this far- space offers energy, most likely. the market for energy is earth. LEO is better suited to offer energy to earth. Luna is better suited to support LEO. Mars is better suited to support Luna/LEO.

One cannot build a roof without a wall.

SpaceNut · 2012-04-14 07:22:17

Very true Clark with regards to the frontier models of the past and the problem of beaming that energy to Earth is still not resolved.
The market models are price driven and volume limited with regards to reaching orbit as with only 1% of the pouplation having the top 99% of the money to go and do it...
even the cheap Russian seats have gone to less than a dozen over a decade to the ISS...

louis · 2012-04-15 09:27:52

clark wrote:

I don't need to speculate a future path. I don't need out dated modalities of frontier fantasy. Oh, how the West was won!
Look to the center of gravity- pardon my heavy handed pun.
Volume is a booming business! Where is the volume? Where is the money?! I'm not a rocket scientist, but when I play one on TV, I recommend looking at where the market is.
Chase the market like every dreamer chases Mars.
For the cliff note version, if you have made it this far- space offers energy, most likely. the market for energy is earth. LEO is better suited to offer energy to earth. Luna is better suited to support LEO. Mars is better suited to support Luna/LEO.
One cannot build a roof without a wall.

One cannot build a sentence without sense.

Look to the lightning that sheds its light on a dark night.

There too you will find the rocket that takes you to Mars.

Or not, if you prefer to remain Earth bound.

Mark Friedenbach · 2012-04-15 12:59:03

There are other markets besides energy, and more promising ones to boot. Space solar power gets less and less viable with each passing day and He3 fusion is a dream.

But I don't want to dampen this discussion because clark is right. There's a fortune to be made in near-Earth space--although I would expand that to include the entire cislunar region--and rising tides lift all ships.

NeoSM · 2012-07-17 13:29:22

Gathering moon rocks and sending them back to make jewlry would not be profitable at all. Quoting SpaceX's Steve Davis "If the entire moon was made of solid gold, it would be unprofitable for any company on Earth to go mine it and bring it back, if the entire moon was made of heroin, it would still be unprofitable." The cost alone of the fuel + lander (every time the lander spashes down / lands on the earth, it will have to be completely stripped down and refurbished after taking the extreme thermal stresses) to get them back to earth is much greater (using your optimistic return cost) than the moon rocks (100/g - your price, which would significantly drop if you tried introducing 20 tonnes/year of the stuff into the world economy) are even worth. This is why planetary resources won't be sending anything back to Earth (as they said), instead they will be catering to the growing space infrastructure.

Last edited by NeoSM (2012-07-17 13:32:38)

louis · 2012-07-17 17:12:59

NeoSM wrote:

Gathering moon rocks and sending them back to make jewlry would not be profitable at all. Quoting SpaceX's Steve Davis "If the entire moon was made of solid gold, it would be unprofitable for any company on Earth to go mine it and bring it back, if the entire moon was made of heroin, it would still be unprofitable." The cost alone of the fuel + lander (every time the lander spashes down / lands on the earth, it will have to be completely stripped down and refurbished after taking the extreme thermal stresses) to get them back to earth is much greater (using your optimistic return cost) than the moon rocks (100/g - your price, which would significantly drop if you tried introducing 20 tonnes/year of the stuff into the world economy) are even worth. This is why planetary resources won't be sending anything back to Earth (as they said), instead they will be catering to the growing space infrastructure.

Nonsense.

Firstly do you have a citation for that quote?

Secondly, we know that lunar regolith has sold for extremely high prices as do rare meteorites ($1000-$1500 a gram often) - and meteorites will be much easier to locate on the Moon.
There are tens of thousands of universities, schools, institutions, space agencies and individuals who will pay 100s of dollars per gram for lunar regolith. Lots of schools will invest a bit of moon rock at maybe $500. Hundreds of thousands of individuals will do the same and there are many rich collectors who will pay huge sums for rare meteorites.

Lunar jewelry would definitely have a high price tag, much higher than $100 per gram in my view.

A lot of this is down to marketing - the Moon has incredibly strong romantic association for humans on Earth. You really only need to build on that.

Not only will jewelry be very marketable, so too will be ferrying people's ashes to the moon - it will be a great comfort to the deceased's loved ones to look up at the Moon and see their resting place, with all its "heavenly" associations.

Then there is lunar tourism - which I think will be the biggest money spinner of all.

NeoSM · 2012-07-17 18:36:34

A simple google search will bring up the article about the Atlas Summit where the exact quote is mentioned. - and yes this quote is referring to current tech, but this hypothetical current lunar colony was also shown to be "near term"

http://shortformblog.com/post/266330740 … sm-profits
http://www.motherjones.com/mojo/2012/07 … usk-spacex

Don't forget that the price of lunar rock is affected by it's availability. The prices can't be set. Dumping a lot of it into the market (in this case 20 tonnes a year - Terraformer's number not mine) would without a question de-value it over the years, even to the point where it's lower then the return req. The "rare lunar regolith" you mentioned would no longer be rare.

However, dispite all this you are right that "lunar jewelry" could be worth alot, and worth the costs like you stated it would be (with regulation): the issue is dumping 20 tonnes a year into the economy, which is not the way to do it.

louis wrote:

Then there is lunar tourism - which I think will be the biggest money spinner of all.

In agreement 100% with that ^^^^

- If you want a source for planetary resources stating that they are focusing on providing resources for in-space infrastructure, rather than bringing it back to earth, I can provide a video link.
- Also, mining the moon for water is profitable - that's the main thing planetary resources is mining for anyways. - the idea that was put forward saying it wouldn't be is another indicator that this hypothetical base/colony is very very near term - if that's the case I disagree with the launch + return costs.

Last edited by NeoSM (2012-07-17 18:55:56)

louis · 2012-07-18 02:26:46

NeoSM wrote:

A simple google search will bring up the article about the Atlas Summit where the exact quote is mentioned. - and yes this quote is referring to current tech, but this hypothetical current lunar colony was also shown to be "near term"
http://shortformblog.com/post/266330740 … sm-profits
http://www.motherjones.com/mojo/2012/07 … usk-spacex
Don't forget that the price of lunar rock is affected by it's availability. The prices can't be set. Dumping a lot of it into the market (in this case 20 tonnes a year - Terraformer's number not mine) would without a question de-value it over the years, even to the point where it's lower then the return req. The "rare lunar regolith" you mentioned would no longer be rare.
However, dispite all this you are right that "lunar jewelry" could be worth alot, and worth the costs like you stated it would be (with regulation): the issue is dumping 20 tonnes a year into the economy, which is not the way to do it.
louis wrote:
Then there is lunar tourism - which I think will be the biggest money spinner of all.
In agreement 100% with that ^^^^

- If you want a source for planetary resources stating that they are focusing on providing resources for in-space infrastructure, rather than bringing it back to earth, I can provide a video link.
- Also, mining the moon for water is profitable - that's the main thing planetary resources is mining for anyways. - the idea that was put forward saying it wouldn't be is another indicator that this hypothetical base/colony is very very near term - if that's the case I disagree with the launch + return costs.

I would estimate the global market for lunar regolith alone being at least 50,000 institutions (universities, colleges, schools, research institutes, museums, space connected companies, space agencies, chemistry associations etc etc).

Some of the larger universities would undoubtedly be prepared to pay millions of dollars for a range of regolith samples and meteorites.

Many would also pay large ongoing fees to set up experiments on the lunar surface.

Impaler · 2012-07-18 03:30:57

The best way to estimate the value of raw moon or asteroid rock being sold on the open market on Earth would be to look at the prices that are obtained for natural asteroid material, their is already a mature and profitable market for it and people who are 'making a profit mining asteroids' RIGHT NOW, they just let the asteroids come Earth first and avoid all the cost and expense of a space vehicle.

Pallasite asteroid material can sell for $20- $30 a GRAM retail (these are the ones with olivine crystals in Nickle Iron sponge matrix), even rarer types can be even more valuable but any such rarity value is likely to fall. The Pallasite is likely to be a very good target for retrieval because it's structure is readily recognizable and intrinsically attractive and not 'just a rock' to the average person, thus is should retain value better then other meteorites as the market saturates. I can't find any exact figures for the total whole-sale volume (In order to determine if retrieval will be profitable you need to look a wholesale value not retail, retail markup is typically double) but I'm fairly sure it's would measure at least a million world-wide.

I'd estimate that if a 1,000 kg Pallasite fetching $10 a gram could be retrieved for a cost of under 10 million dollars then a profit could be made on a FULLY SUSTAINABLE basis without resorting to the 'wow' factor of the artificial retrieval to inflate the price and without causing an significant depressing of the existing meteorite market. A mission some what like the Dawn and Star-dust mission could do this, a small SEP based craft goes out encloses the asteroid in a small reentry capsule and goes into an Earth intercept trajectory, the craft would probably need to mass 250-500 kg so launch, assuming launch is half to total cost then launch cant exceed $10-20 thousand dollars a kg. That looks to be near-term possible for larger vehicles like F9 that carry secondary payloads, as a primary payload 'mini-sat' launcher its quite a long way off.

Last edited by Impaler (2012-07-18 03:33:21)

Mark Friedenbach · 2012-07-18 07:54:23

That market would implode or become inaccessible the moment you bring back a sample with the promise of more on the way. Meterites are fetch high prices because they are a rare, naturally limited product. The people who are paying $20-30 a gam for pallasite have no interest in buying it from you (trust me, I know many of them). Either the entire collectors market will disappear, or more likely it will be come like diamonds: only 'natural' meteorites will continue to have value, and rigorous documentation of the fall is required to sell one.

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Re: Creating the Cis-Lunar economy

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#35 2012-01-19 12:22:50

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#38 2012-02-06 21:32:59

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#39 2012-04-13 19:19:39

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#40 2012-04-13 21:07:59

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