The rest of the media were reporting on an asteroid named 16 Psyche last month worth $10 quintillion. Oddly enough they reported in July 2019 and again in February 2018 that the same asteroid was worth $700 quintillion, so it seems the space rock market is similar to cryptocurrency in its wild speculation. Those numbers are ridiculous, but it had us thinking about the economies of space transportation, and what atoms are worth based on where they are. Let’s break down how gravity wells, distance, and arbitrage work to figure out how much of this $10-$700 quintillion we can leverage for ourselves.
The value assigned to everything has to do with where a thing is, AND how much someone needs that thing to be somewhere else. If they need it in a different place, someone must pay for the transportation of it.
In international (and interplanetary) trade, this is where Incoterms come in. These are the terms used to describe who pays for and has responsibility for the goods between where they are and where they need to be. In this case, all those materials are sitting on an asteroid, and someone has to pay for all the transport and insurance and duties. Note that on the asteroid these materials need to be mined and refined as well; they’re not just sitting in a box on some space dock. On the other end of the spectrum, order something from Amazon and it’s Amazon that takes care of everything until it’s dropped on your doorstep. The buyer is paying for shipping either way; it’s just a matter of whether that cost is built into the price or handled separately. Another important term is arbitrage, which is the practice of taking a thing from one market and selling it in a different market at a higher price. In this case the two markets are Earth and space.
