Lost in Space

Faith in finance tends to reach its apogee only when it is ready to go down. That’s when the taxi drivers are giving out stock tips, and people think that prices are on a one-way trip ‘to the moon.'

Source: X.com and Grok image creation

Friday, May 22nd, 2026

Bill Bonner, from San Martin, Argentina

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‘To the moon,’ writes compadre Dan Denning, echoing the basement-dwelling ‘day traders’ who pumped up famous ‘meme’ stocks such as AMC and GameStop.

He was referring to Space X...the biggest IPO story of all time. It is expected to be the world’s most valuable corporation. With a price that is 107 times last 12 months’ revenue, it will the crown of financial creation.

We’re fans of Musk. He goes ‘all in.’ He pushes. He works hard. He takes chances. He’s a genius.

But we remember DOGE, too, and we wonder: what kind of project is this…more like Tesla…or more like DOGE? The Guardian:

SpaceX unveiled its plans to list publicly on the US stock market Wednesday, disclosing its investor prospectus and revealing details about its financials for the first time. Elon Musk’s rocket and satellite operations company will go public on the Nasdaq exchange at a valuation of about $1.75tn under the symbol SPCX, likely on 12 June. It is seeking up to $80bn in investment.

“Our mission is to build the systems and technologies necessary to make life multiplanetary, to understand the true nature of the universe, and to extend the light of consciousness to the stars,” SpaceX declared in its filing.

Oh my.

We’ve done such a swell job with our homes…our businesses…our families… Our governments have pretty much worked out all of our troubles on Planet Earth and Wall Street has mastered the ‘financialization’ of almost every transaction. Now, it’s ad astra. We’re going to be a multi-planetary species, working the same magic that we used on Earth on the rest of the universe.

And ordinary investors — including many moms and pops, who couldn’t calculate escape velocity if their lives depended on it — are already reaching into their pockets. They want to be part of a rocket revolution. And not with just any rocket company...one that is priced as it if will create more wealth than any project in human history.

Let us pause to catch our breath. Ultimately, a company must create new wealth, or take old wealth from other companies, in order to share it out with its investors. Otherwise, the fellows with the money would do something else with it.

But how is SpaceX going to do that?

Stretching the analogy to absurdity, the premise of SpaceX boosters must be that the company is set to reach the aforementioned escape velocity...free from earthly limitations, heading out into the black, cold universe like the Voyager probes. Launched almost half a century ago, Voyager 1 is now 25 billion kilometers from home...still in our solar system...and still reaching for interstellar space.

Once free of the sun’s gravitational pull...or of Wall Street’s in this case…the sky is the limit.

But, of course, SpaceX will never break the cord to earth-bound capital markets. And after the thrill of the launch, it won’t be too long before investors check the oxygen level...and wonder how they’ll back onto terra firma.

That is when the first malfunction — if not a total blow up — is likely to occur.

Faith in finance tends to reach its apogee only when it is ready to go down. That’s when the taxi drivers are giving out stock tips, and people come to think that prices are on a one-way trip ‘to the moon’...

First, with our feet on the ground, we have to be aware that this SpaceX frenzy may mark the top of today’s bubble market.

Second, we have to wonder where SpaceX will generate enough profits to justify a price, now expected to be around $1.75 trillion. In the last 12 months, the company had revenues of $18 billion. But it spent $21 billion. After provisions for taxes and interest, it ended up with a net loss of $5 billion.

We can well imagine that the company will become more efficient...and that its revenues will increase. But is there really that much junk headed into space...so as to end up with earnings of around $116 billion? That’s how much the company would have to make annually to be worth $1.75 trillion, at 15 times earnings. Were the company to make a 10% profit margin, that would presume sales of $1.16 trillion, or more than the entire US defense budget for last year...and far more than any plausible projection for the rocket company.

Unless...unless...we imagine that exploring space becomes a national obsession — like building the pyramids for the ancient Egyptians. Historians suggest that the pyramids absorbed the entire output surplus of the lower Nile Valley for many years.

So, let’s say 100% of net savings of the USA were spent at SpaceX, how much would that be? To get the net, you have to subtract all the debt. Without going deeper, we took the Federal Reserve’s number — 1.2% of GDP. That would be a surplus of about $320 billion.

But even if all of that money were spent at SpaceX...assuming competition took none of it and people had nothing else they wanted to do with their savings...it would only be about a third of the gross revenues needed to justify a $1.75 trillion price.

Of course, investors are not going to buy SpaceX, are they? This is an opportunity for speculators...

Hoping that the price goes beyond the moon, beyond Mars and Pluto...and disappears in a galaxy far, far away.

Bon voyage!

Regards,

Bill Bonner

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From the S-1 filing submitted by SpaceX, the Total Addressable Market—or maximum revenue projection assuming a 100% market share—is $28.5 trillion (or 88% of current US GDP). Total addressable market…or totally absurd metric?