People Rich

Are these the world’s richest people? Sure, why the hell not.

But I can’t just let the launch of Bloomberg News’s Bloomberg Billionaires Index (“a daily ranking of the world’s 20 richest individuals!”) go by with just a gag lifted from The Awl. Bloomberg News journos have taken the time to compile an index of the world’s 20 richest people, plug the requisite market data feeds into it, and update it every single day… for something that is absolutely impossible to get right.

For starters, there are some things that you just can’t value day to day. It’s easy to figure out a daily value for, say, Bill Gates’ Microsoft holdings or Warren Buffett’s Berkshire Hathaway holdings. But how do you put a daily value on something like Gina Rinehart’s stake in the Roy Hill iron ore project that she’s co-developing with Posco? It’s certainly valuable – there’s billions of dollars worth of iron ore in them thar hills – but how much is the royalty stream going to be worth once the mine starts running?

And then there’s the problem of opacity. How do you know that an Indian tycoon isn’t trying to hold a few billion in undeclared investments through Mauritius? For that matter, how do you know how much cash Bill or Warren have in their checking account, unless you find one of their ATM receipts lying around?

The BBI is a great publicity stunt for Bloomberg – and it’s earned them plenty of media coverage. But c’mon – let’s not pretend the numbers are any more than wild guesses. Let’s not make this any more than the publicity stunt that it is.

(The gurus at FT Alphaville have an even dimmer opinion of Bloomberg’s work.)

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