Why Mr. Jeffrey P. Bezos may deserve being #1 Billionaire

In times of quantitative easing a lot of conspiracies are discussed about killing inflation ahead of us. And when central bank officers hold out how low real inflation was, many tend to accuse them as liars. Of course, people who feel a different inflation rate than the way it is officially measured and assessed must already be on an upper level of the wealth pyramid. Of course, fears from money to lose purchasing value has led to very high inflations for well-located properties, luxury or vintage goods and collectors’ items as well as an almost 9 years enduring bull market on stock exchanges for corporate shares, enabling completely new microeconomic systems. From continued share price appreciating persistently loss incurring business models to crypto-currencies, all relying on the mechanism that at a later point in time there will be someone ready to pay more for one’s own credence than the historic purchase price may have been. One of my former enterprise’s chairmen once called it the “Greater Fools’ Theory”. For those who overpay for, out of fear to lose, what they may want to safeguard into a worse future, I guess this reflection may be a true perception.
Since a long time money was literally fabricated on the basis of granted land-use rights, one could leverage against for financing a physical value adding project built upon. Because the usage-value would appreciate more than the cost of its creation. If one looks at the world’s Billionaires’ ranking, Real Estate property headliners all rank in the twenties behind Jack Ma from e-commerce and Li-Kashing from gambling, representing a forerunner industry of Artificial Intelligence [AI]. And the only putative exception among the top-10 from digital business, some commerce and scarcely energy may seem Warren Buffet’s Berkshire Hathaway probably represented by a heavily digital portfolio. So e-commerce as a symbiosis of software, commerce, digital communication and AI has a sound footage in the wealth creation. By the way, pay as you use software licensing must be a terrific protection of it owners against inflation. And given its innovation cycles it also is for the users.
Software probably was the first sector of recognized intangible asset value creation. Developing it was allowed to build “inventory-alike” intangible-assets. Unfortunately nothing yet acknowledged for commercialization concepts of Intellectual Property brought into innovative applications. Whereas I must specify innovation as a creation of additional added values in markets or societies. Software of course has the big advantage of not having to overcome the valley of death hardware innovations need a bridge for. Usually a maybe 10% expenditure of the first real implementation but often this is more than double of genuine cost to develop something and establish an intellectual property for it. The leverage on a concept value beyond the bridge over innovations’ valley of death might never be as high as in software industry where nothing physical needs to be built. But physical values created may persist longer than a software product and have higher entrance barriers to competition. Nothing a world so far focused on just doing more of the same instead of reinventing itself new alike software has to do to sustain, could ever dignify.
However, game changers like Jeff Bezos, Bill Gates, Mark Zuckerberg, Larry Ellison, Larry Page and Sergey Brin, as well as Ma Huateng to Jack Ma among the top 20 billionaires intuitively enabled eco-system changes that prove intangible assets to have become thw new money fabricators. Fact is that e-commerce is the savior of day to day consumers from inflation. Its transparency and borderless access to new business relations has elevated competition to a new level. And competition had always been being the antitoxin against inflation. And following Amazon, Alibaba connected China’s former subcontracting manufacturers with markets. Domestically overcoming lacking retail structure and internationally bringing all marketing margins formerly generated exterritorialy into the Chinese GDP helping China to transform from the world’s biggest factory to the world’s largest market. Having peered this redistribution of wealth in favor of ordinary people: My deep respect to Jeff Bezos!

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