[extropy-chat] Communication vs transportation

[Mike Lorrey]

--- scerir <scerir at libero.it> wrote:
> From: "Henrique Moraes Machado" 
> I've been reflecting lately on communication versus transportation. 
> The first is developing faster than ever, while the former seems 
> to be stalled. 
> 
> -----------
> 
> "And despite putting in billions and billions and billions of
> dollars, 
> the net return to owners from being in the entire airline industry, 
> if you owned it all, and if you put up all this money, is less than 
> zero. If there had been a capitalist down there [at Kitty Hawk the
> day 
> the Wright brothers made their first flight] the guy should have shot
> down Wilbur! I mean . [audience laughter]. You know. one small step 
> for mankind, and one huge step backwards for capitalism!"
> - Warren Buffett 
> http://www.geocities.com/peopleplanes/Carrier/WB.html 
> 
> What's wrong with this?
> For sure the expression 
> "one small step for mankind" 

Well, Warren, like any democrat, is counting net return averaged among
all owners, past and present, and not individual fortunes made.
Investors owning stock when an airline goes bankrupt have the same
amount in losses that those they bought from had in gains if these
original owners invested from the IPO forwards. Actually the losses
would be greater than the gains, since IPOs usually sell for a
significant dollar value and a bankrupt stock is worth pennies on the
dollar.

This does not mean that all that value disappeared. It is often picked
up at bankruptcy auction at bargain prices by new ventures.

Another error Buffet is committing is only counting airline companies
specifically. Any fool who knows anything about the business know that
the people that make the real profits are the aircraft makers and the
companies that actually own the airliners that lease them to the
airlines...

However, plenty of individuals have made fortunes in the airline
business. I happen to have known several such people, one who was
involved in the Boeing/United marriage for many years, cashed out to
help found a major Seattle bank. Another involved in the same venture,
a fellow name of Gleed, his descendants I've known for years.

=====
Mike Lorrey
"Live Free or Die, Death is not the Worst of Evils."
                                       - Gen. John Stark
"Fascists are objectively pro-pacifist..."
                                       - Mike Lorrey
Do not label me, I am an ism of one...
Sado-Mikeyism: http://mikeysoft.zblogger.com

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