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fyi youtube video of why these simplistic comparisons of "net worth" based on shares-times-stockprice is meaningless... - The Ranks of Global Billionaires: Not

by jasode 6y ago

fyi youtube video of why these simplistic comparisons of "net worth" based on shares-times-stockprice is meaningless... - The Ranks of Global Billionaires: Not All Billionaires Are Made Equal: https://www.youtube.com/watch?v=0MeRN7LE1LQ https://www.youtube.com/watch?v=0MeRN7LE1LQ E.g. Theranos owner Elizabeth Holmes once had a "net worth" of 4.5 billion (as calculated by Forbes Magazine[1] for attention-grabbing headlines) ... but that doesn't really mean she was actually 2x richer than Dropbox's Drew Houston who's worth ~2 billion. That said, Elon Musk is a bonafide billionaire but the comparison to Buffett via a volatile Tesla stock price is meaningless. [1] https://www.google.com/search?q=forbes+elizabeth+holmes+4.5+billion+%240 https://www.google.com/search?q=forbes+elizabeth+holmes+4.5+...

lmilcin 6y ago
Elon is billionaire because he has potential to sell his shares. That the share price fluctuate a lot doesn't change it.
- bryanlarsen 6y ago
  The point is that if Musk sold his shares the value of those shares would drop like a rock, partly due to supply & demand but mostly because that would signal non-confidence. OTOH, Buffet regularly sells his shares, mostly indirectly by donating shares to charities who then sell the shares. The amounts are large enough that they do affect the stock price, but not by nearly as much. That's why it's silly to say that Musk is richer than Buffet. If they both liquidated their positions, Buffett would be sitting on a bigger pile than Musk. It's also moot because it's so obviously temporary. Musk is going to end up either bankrupt or king of Mars. Buffett is going to fade away. His money will end up doing a lot of good -- it may be directly responsible for eliminating polio, malaria and/or HIV. But that good will have the Bill & Melinda Gates Foundation name on it, so Buffett's role may end up being forgotten. Perhaps that's for the best, given the number of Bill Gates conspiracy theories are floating around.
  - lmilcin 6y ago
    I think this is no longer true. If Musk decided to sell his shares to get cash for another venture what investors would see is that even without Musk Tesla is still a well functioning company that delivers. Elisabeth did not have a product or well functioning company and if she decided to sell (even if she could) large portion of her shares this would likely cause investors to panic

by jasode 6y ago

lmilcin 6y ago

Elon is billionaire because he has potential to sell his shares. That the share price fluctuate a lot doesn't change it.

bryanlarsen 6y ago
The point is that if Musk sold his shares the value of those shares would drop like a rock, partly due to supply & demand but mostly because that would signal non-confidence. OTOH, Buffet regularly sells his shares, mostly indirectly by donating shares to charities who then sell the shares. The amounts are large enough that they do affect the stock price, but not by nearly as much. That's why it's silly to say that Musk is richer than Buffet. If they both liquidated their positions, Buffett would be sitting on a bigger pile than Musk. It's also moot because it's so obviously temporary. Musk is going to end up either bankrupt or king of Mars. Buffett is going to fade away. His money will end up doing a lot of good -- it may be directly responsible for eliminating polio, malaria and/or HIV. But that good will have the Bill & Melinda Gates Foundation name on it, so Buffett's role may end up being forgotten. Perhaps that's for the best, given the number of Bill Gates conspiracy theories are floating around.
- lmilcin 6y ago
  I think this is no longer true. If Musk decided to sell his shares to get cash for another venture what investors would see is that even without Musk Tesla is still a well functioning company that delivers. Elisabeth did not have a product or well functioning company and if she decided to sell (even if she could) large portion of her shares this would likely cause investors to panic