Just finished reading that pdf file. Great read, a good summation of the history of lunar outpost planning. I had read most of the reports you mentioned on and off over the years and agree with most summations.

That said ( smiles) BUT it does not, in my mind, bring in commericial aspects as fast and furious as my thinking. This is NOT to be critical and spinning off into negativity, just trying to create talking points.

As I understand it, you are saying something to the affect that NASA built a space station for 100 billion and tooks years to complete to the point someone in private enterprise steps up and says “100 billion for a space station, that is crazy I can do it cheaper”

Here is where I differ, the space station in no way, shape, or form was ever mean’t by NASA to provide tourism, demonstrate tourism, or provide a road map to tourism. Nasa actually was against it. Mir was rather seen better off sent to burn up then have tourism go on by the russians.

The tourism that did take place was to save the russian space program not actually to provide tourism as an end game.

As far as political candidates, I believe they both view the NASA budget as an asterick on the pie graph of government spending, it is so small it does not even warrant a slice or even a line, just an asterick.

Obama and McCain both have stated the HUGE importance of energy independance. I mean they are talking energy is at the absolute forefront of problems we face. Both McCain and Obama says energy is one of THEE most pressing issues. So McCain is going to spend something like 7-8 billion and obama 15 billion a year. Energy is so important that they are both going to move it to the forfront to the point of ALMOST reaching the 18 billion dollar EARMARK level.

If energy is so dire that both campaigns are STRESSING it so much that the federal government has to step in and spend ALMOST as much as the 18 billion in earmark spending WOW energy MUST be REALLY important. For me that means BOTH campaigns have pushed the importance of space spending also less then 18 billion a year in earmarks to the nonexistence of it’s importance at all other then to briefly mention it as nothing more then a tiny regional issue and not important at the national level at all.

Maybe that is why I push for more private enterpise, no faith in either of them. Obama uses NASA as a: look at we have done in the past in space, lets use that knowledge here and not in space. McCain used Nasa as a quip to say “I know what astronauts have to have in mortal fortitude and I have it too”

Neither have used space as a forward looking mission for the nation, lacking that, I do not see Nasa on the moon with a base, or having ANY true lunar economic activity for 30 years.

To say that NASA will order a terrestrial company to build something here and then NASA takes it to the moon does not, for me, bring the moon in to our DAILY terrestrial economic activity. Land claims AUTOMATICALLY bring it into our spere of economic activity INSTANTLY.

For example, I bid on a 50000 acre parcel at a discount and the government recgonizes my ownship rights, I can immediatly use it as an asset. Building a wrench for nasa might make me a few bucks profit but does not create a lunar asset base or the buying and selling of anything lunar.

Also, If I sell any parcels for a profit, I am under a capital gains tax that brings revenue into the government that was not given to me by the government in the first place. I sell nasa a wrench for a profit and the irs takes a bit of the government check back in taxes. There is no speculation phase that is the keystone of capital formation and input to the activity.

Let me hear your thoughts and I will try and stay on topic.

Not necessarily. I am spending a LOT of time right now examining lunar photographs and at least initially I see no need for the expense of a lunar GPS.

“Sunk costs – Sunk costs cannot be recovered if a firm decides to leave a market. Sunk costs therefore increase the risk and deter entry.”

I understand this but right now we are confusing two things. If this is a private only enterprise it will evolve much differently than if the government operates to provide the initial infrastructure and revenue to a private company through support contracts. If it is a private only system, it will begin in GEO, which is where the money is being made today and then grow from there.

If there is a government based initial system, most of your sunk costs are absorbed by the government. Without the government Space Adventures would not exist, no matter the interest in space tourism as the sunk cost risk issue would preclude the investment ever being made. One day a Bigelow station serviced by a Musk Vehicle may take over that role, but that would not happen without the proof principle of an overly expensive government owned asset that provided the initial market for orbital tourism.

If there is a private only system, it will take far longer and will be based upon the GEO comsat model to provide the revenue for growth beyond GEO. Even with that, it will be by a privately held company that is not beholden to public stockholders.

Since we are in a thread that is about presidential contenders and what they want to do, what I am talking about is the former model.

Right now your mining model seems to be at least somewhat orthogonal to the discussion.

Maybe to lay out the initial implementation model would make sense.

Check out this contractor report of how an initial commerce model would start and then grow outward from there.

http://www.lib.uah.edu/researchassistance/files/NNL06AE27P.pdf

“The pre existing economic activity is the comsat business as well as the increasingly important alternative energy market.”

That economic activity is relegated to LEO/GEO of earth, We are not in disagreement there but there is a difference. Geo has already been settled.If you read satellite magazines and journals they refer to satellite slots as “real estate” and there has been many recent articles about how the best real estate is gone. You can now OWN a satellite slot. The OWNSHIP of that slot has value and satellite businesses routinely talk about owning these slots and how it is an asset. So EARTH satellite slots have been allocated and the market determines their relative value.
But has this taken place for the moon yet? No, as far as I know, private industry can not own lunar satellite “real estate” slots for LLO/GLO.

GPS provides package tracking for industry and if we are going to be dropping packages on the moon and exploring we will need lunar GPS. As we wont need military GPS on the moon ( I hope) and it will more market driven why not put lunar slots up for industry to bid on? If you put up GPS and com satelites in lunar orbit you get to OWN that slot for 50-100 years from today? Satelites around earth does NOT bring LUNAR satelites slots into earth’s economic sphere of activity.

“no barriers to access” There are always barriers of one kind or another, it is just a matter of first determining what the barriers are and what piece of legislation will be needed to lower that barrier. For coal the barriers are pollution, environmental degredation, cost of mining equipment etc. If a country wants coal you loosen regs, if you want less more regulations.

For the moon, I believe there ARE barriers to access and one of the BIGGEST ( in my opinion) are the “sunk costs”. The higher the sunk costs the risker the investment.

http://en.wikipedia.org/wiki/Barriers_to_entry
“Sunk costs – Sunk costs cannot be recovered if a firm decides to leave a market. Sunk costs therefore increase the risk and deter entry.”

Right now, if a company wants to land on the moon, the sunk costs are HUGE. You have to build the transportation system and go there, you can keep whatever you can wrap your arms around AND bring back to earth and bring to market. So you goto the moon, find gold, and bring back 200 pounds of it. At today’s prices 200 pounds of gold is worth around 30 million dollars, not only would it not even pay for the gas it doesnt do anything towards the cost of construction of transportation. Remember, economic activity HAS to be taking place with CURRENT transportation FIRST.
This is the current “freedom of the seas” mentality for the current moon treaty seems to be worded.

The value of a gold mine is never and has never been determined by how much gold you pull out, actually it is closer to the opposite, the more you pull out of a mine the more it DECREASES in value over the long term. The value of a mine is determined by it’s FUTURE VALUE to produce. That is how the market does it, it automatically adjusts and includes that future potential into TODAY’S market price. So in mining you are not buying a mineral claim for what it has produced in the past but what it can produce in the future.

Now let’s take that same example, a company builds a ship, brings back the 200 pound lump of gold and then files a LAND CLAIM for that area. Not only are they bringing back CURRENT value, but they also are bringing back FUTURE POTENTIAL. So the real value is in the UNMINED gold, not the current chunk they bring back. This is the only way to lower sunk costs unless the government assumes ALL sunk costs AND provides the ONLY market.
This also brings the moon into earth’s economic sphere of activity. Because that land claim will have an asset value and can now be broken up and bought and sold. Like north dakota coal mineral rights claims that never actually get exercised there will also be lunar claims that actually never get worked, but at least the claims will be traded for their asset value and moon gets brought into our economic sphere of activity.

We are not in disagreement here. The pre existing economic activity is the comsat business as well as the increasingly important alternative energy market. The pre existing transportation exists as well in the form of the existing fleet of vehicles but as Al has accurately observed, that form of transportation is too expensive.

You make a good argument but I just wonder how it would carry over to a lunar asset. Today those mineral rights, even though not exercised, has an implicit understanding that there are no real barriers to access them, transport them, and sell them. There is also the doubtful nature of the legal validity of a claim due to the various U.N. conventions. These are obstacles to overcome, not barriers.

I don’t think that the ownership issue will be settled until a concentrated resource like an asteroid impact with a few million tons of metal is actually discovered and even then I think that it will go down the route that Berin Szoka has talked about with ownership established when someone lands on it and starts using it, even in-situ.

I do think that the vast majority of the metals will be much better used in-situ. I would not advocate bringing back iron for example, probably not nickel, but cobalt, germanium, gallium, and the PGM’s are distinct possibilities. Not on day one or even day ten but I can see how it can work without a lot of miracles.

Some of this will start sorting itself out next year after the election in regards to getting a transportation network to and from the Moon. Remember that even though transportation systems existed from the east to California it took federal government incentives to get that railroad built.

Think about it, MOST businesses and people new exactly where they were going, they had a LAND DEED in their hand OR a government giveaway of the land. It was OWNING the timber rights, it was OWNING the mineral rights, water rights, etc that drove the exploration and settling of those lands.

Our current policy is “build a spaceship travel to the moon and when you get there, NOTHING is yours.”

How much is a 1 pound hammer worth on the moon? 10 bucks PLUS the $20,000 a pound NASA says it cost to put it there.

If NASA builds a station there and says they will buy lunar oxygen from domestic lunar sources and suppliers how much would you charge NASA for a ton of oxy? You would charge them the same as it cost on earth PLUS the 43 million dollars it would cost to ship there.

If I am a supplier to NASA and I am selling them lunar oxygen at 40 million ton priced just below what they can get it for themselves AND I OWN 50000 acres of regolith with another 10,000 tons of unprossed oxy how much on my BOOKS do I get to claim for the value of that oxy?

YOu would get to claim the earth based market costs PLUS the 20,000 a pound transportation costs. That is why in california during the gold rush an egg was LITERALLY worth its weight in gold because you had to INCLUDE the transportation costs until domestic production and transportation changed.

That is why it does not matter if a SINGLE OUNCE of ANYTHING is EVER brought back at first. Alcoa keeps on it’s books as assets ALL metal it has laying around AND in the ground AND get to claim those minerals rights they have as ASSETS. They use those asset values to borrow money.

It will be the same for the moon, how much is an ounce of moon gold worth? 1000 bucks PLUS transportation costs, if anyone ON the moon wants to buy that gold for ANY reason, that is what they will have to pay.

It goes for EVERY metal, gemstone, silca, etc. So it is just the fact that OWNSHIP is recognized of THOSE assests, and companies get to list them as an ASSET in the accounting books that will make development possible AND THEN that will lead to a NEW transportation system. Economic activity HAS to be in front of transportation, it is the instant asset wealth that will provide the funding bridge to create it.

I am from the state of north dakota, we have about 800 years of coal here. Coal mineral rights have been bought and sold here for ALMOST A CENTURY! And in the VAST BULK of those mineral rights not one single ton of coal has EVER been mined in almost 100 years. They just keep being bought and sold, carried as an asset on the books for whatever current market is paying. That will be the same on the moon claims will be bought and sold and THEN industry will go after them, the cheaper they get them the more likely to act on them as the economics will be better.

Sorry, was in a hurry. I do like the idea of the localized bank, it has interesting ramifications.

There are several problems with the high cost of transportation argument. All of them are predicated on a lean model of space activities. If we go to a fat model, which means that we are at least developing the ability to at will travel within the gravitational confines of the Earth (to the Earth/Sun libration points), then we can start to acquire and use the resources of the Moon in various ways. Al is right, if the context is ESAS, but fortunately we do expect to see the ESAS architecture die soon.

I go back now to a familiar soapbox and say that launch from the earth is but a single aspect to the issue of the ubiquitous use of space. We have beat our heads against the wall for several decades not and it is my position that we can make a lot more progress, a lot sooner by developing reusable in-space transportation systems. This leverages the high cost of launch in a positive direction and sets the stage for the ability to move around (humans and robots) in cislunar space in a more affordable manner. We are taking the first step in this with Orbital Recovery with more to come.

This is an assertion, not an argument.

Why do you continue with the FALSE arguement that material HAS to come back to earth to be economical?

I don’t and I have never. I do think that some of it will come back to the Earth as a trade good. You seem to have a one track mind that this is the entire reason for doing this. It is part of a larger plan to actually develop cislunar space. Transportation costs come down as a function of the development of a general ISRU architecture that includes fuels as well as trade metals and even fully assembled systems. As I stated before, there is no silver bullet, but there are a lot of bronze ones.

Now you can either continue the discussion or continue with all caps.

Your choice.

Why do you continue with the FALSE arguement that material HAS to come back to earth to be economical?

You say it DOESN’T matter how HIGH you stack it up OR how pure it is, as long as you CAN NOT bring it back to earth it is not economical.

I tell you what, tell me where there is a pure mountain of gold is on the moon and give me OWNERSHIP to that gold, I will stick a sign on it with the word BANK written on it and will conduct business electronically. You do not have to move it at all.

When transportation to california was expensive it was the same thing, rather then risk shipping the gold by ocean transports, they just put it in a box and opened a bank. It was the value of ownership that allowed them to borrow money. If companies were given 50000 acres of regolith it would AUTOMATICALLY become an asset on the books to borrow against to finance operations.

You keep on making technical arguments, but the issue is not technical. It will not be economical to bring these materials back to Earth.

You can repeatedly ignore the economic reality of this issue, but it does not make it go away.

“For a successful technology, reality must take precedence over public relations, for nature cannot be fooled.” – Richard Feynman

– Al