The Space Lottery

A frontier, a founder-cult, and a price: antiquity could conjure the first two for centuries before it could set the third. SpaceX wants all three on Friday.

Belief is the oldest asset on any frontier, and the last to be given a price. On Thursday evening, SpaceX will give it one, and on Friday it begins to trade on the Nasdaq under the ticker SPCX at a valuation near $1.75 trillion. The raise alone, some $75 billion, is the largest any flotation has ever drawn from the public, comfortably past the $29 billion that Saudi Aramco took in 2019, the previous record. The headline figure is not the arresting detail. The float is.

As much as 30% of the offering, perhaps $22 billion of stock, has been set aside for the public. That’s treble the portion a retail buyer is ordinarily allowed. Brokerage applications stand open across seven countries. The wager is explicit, and the bankers have put it on the record: a founder’s devotees will hold what they buy. SpaceX therefore invites ordinary people aboard a venture whose principal assets are a satellite constellation not yet complete, a heavy rocket not yet proven, and a horizon no shareholder will ever stand upon. The price, $135 a share, attaches to a promise.

The honest difficulty for connoisseurs of market manias, if one reaches behind the early-modern period for an older precedent, is that the pure financial bubble is almost unknown in classical antiquity. The famous follies, tulip mania and the South Sea Company, belong to the seventeenth and eighteenth centuries, and both depended on the very machinery Greece and Rome did without: a liquid secondary market in which a price can swell away from the value beneath it. There were shares of a kind in the great Roman tax-farming partnerships, the partes that passed between well-placed men; yet no exchange listed them, no tape quoted them, and no crowd could chase a float that did not exist.

The point takes a sharper form. Antiquity could price peril. What it could not price was promise. Risk it knew how to spread and to charge for; the unbuilt future it could only believe in. So the instructive parallel to Friday is not a security at all. It is the fervour itself. Two ancient phenomena answer to it with disquieting precision, the Greek colony and the lunar voyage; and Rome supplies the rest, a frontier genuinely mispriced and a sum that looks, on inspection, like madness.

The founder who carried the fire

The first is Greek colonisation. From the eighth century BC the Greek city-states, with Miletus, Chalcis, and Megara the most prolific among them, sent population and capital to the literal edge of the known world, to the Black Sea, the Libyan shore, Sicily, and the mouth of the Rhône at Massalia, the city we now call Marseille. Corinth planted Syracuse in about 733 BC, Phocaea reached the coast of Gaul near 600 BC, and the pattern held for three centuries. These colonial outposts were called apoikiai, “homes away from home.” Before a city would commit families and ships to ground none of them had seen, it sought the sanction of the oracle of Apollo at Delphi. The oracle did the work a securities regulator does (or purports to do) today. It vetted the venture, it blessed the issue, on occasion it named the founder outright, and it lent the authority of the god to a wager on the unknown. No prospectus of the age carried a heavier seal.

The promoter held a title: oikistēs, “the founder.” He carried the sacred fire from the hearth of the mother-city, he set it upon the new shore, and, if the settlement took root, his people worshipped him as a hero after his death, with a shrine in the marketplace and a solemn rite each year. Charisma, in this scheme, was no personal flourish. It was collateral, and it outlasted the man who supplied it. The worth of the colony rested on the founder’s promise and on the god’s endorsement of it, which is to say on two quantities no abacus could sum.

Herodotus, the father of history, tells the best of these stories. In the fourth book of his Histories, written in the fifth century BC, he recounts the foundation of Cyrene on the Libyan coast. The people of Thera, the island we know as Santorini, endured seven years of drought and received a Delphic instruction they would gladly have refused: sail to Africa and found a city. They tried to evade it, they failed, and at last they dispatched a reluctant expedition under a man named Battus, who had gone to the oracle to ask about his stammer and came away with a colony instead. Battus founded Cyrene in about 631 BC, and his house ruled it for eight generations.

This is the template, and it owes nothing to the modern CEO who offers guidance to analysts. The founder is a prophet who executes an oracle, and the worth of his venture is exactly the unpriceable promise of unseen ground.

The venture reached the ordinary citizen as well, and here the resemblance grows uncomfortable. A colony divided its land into klēroi, “portions,” and assigned them by lot, in the strict sense. A place in the new world was therefore a lottery ticket in fact and not in metaphor, and the men who drew it staked a passage and a name on soil they had to take on trust.

Antiquity affords no closer thing to retail participation in a frontier, and the brokerage queues that open at dawn in seven countries are that lottery in modern dress. The promoter on Friday is best read as an oikistēs who carries the fire towards a coast he has mapped in detail and no one has reached, at the head of a following upon whom his own bankers rely, in the faith that the devout, unlike ordinary holders of stock, will not sell.

The war over the Morning Star

The second phenomenon strikes nearer the target, because antiquity did not merely finance frontiers. It wrote the story of space colonisation outright, and it wrote that story as satire. Lucian of Samosata, the keenest satirist of the second century AD, opens his True History, a burlesque travel-narrative in prose, with a confession that the whole of what follows is a lie, a thrust aimed at the tall tales of earlier travel-writers (and even at Homer before them). A waterspout then lifts his narrator’s ship clean off the sea and sets it upon the Moon, where the traveller finds the Moon at war with the Sun. Endymion, who rules the Moon, and Phaethon, who rules the Sun, contend for the right to plant a colony on the Morning Star, Heōsphoros, which translates into “the dawn-bringer” (and is the planet we call Venus). The one surviving tale of space travel antiquity has left us amounts, at its core, to a quarrel over a colonial charter.

Lucian’s companion piece, the satirical dialogue Icaromenippus, written about the same time, fits a man with a pair of mismatched wings, one from an eagle and one from a vulture, and sends him to the Moon so that he may look back upon the human scene and take its absurdity from a height. From up there the lawsuits, the boundary feuds, the hoarded estates, and the whole anxious scramble shrink to the dimensions of ants about an anthill.

Both works hunt one quarry: to wit, the Schwärmerei that Kant deplored, the rapt public appetite for marvels that will swallow any report so long as it touches a new world. Here the valuation problem appears in its purest form. It is not a number. It is the willingness to believe, and the willingness is the asset. Friday is a market made in that and in little else. History’s most enduring derivative bleeds no theta, for it never expires: it is a perpetual call on credulity.

The syndicate that overpaid

For a single ancient case of a valuation cut loose from reality, the cleanest comes from Rome in the form of the Asia tax contract of 61 to 60 BC. A syndicate of publicani, the tax-farmers, won the censors’ contract for the revenues of the province of Asia, and then learned they had paid far too much, that the receipts of the frontier would never meet the sum they had pledged. They went to the Senate and asked for relief.

In the letters to his friend Atticus from those two years, Cicero judged the request disgraceful, and he backed it all the same, for reasons of state. The tax-farmers belonged to the equestrian order, and Cicero prized above almost everything the concordia ordinum, the harmony between the orders, on which he held that the republic depended. The relief came in the end from Caesar, who remitted a third of the price in his consulship of 59 BC.

The sequence is wholly familiar: capital values a frontier’s future receipts at the price of pure optimism, the optimism proves false, and those who overpaid present themselves, aggrieved, to ask that someone else absorb the shortfall.

The madness in the price

Pliny the Elder, the empire’s great cataloguer, furnishes the other half of the theme. A sesterce in his day bought a loaf or two, and a legionary earned some 900 sesterces in a year. Pliny’s Natural History, complete by about AD 77 (and only two years ahead of the eruption of Vesuvius that killed him), returns with metronomic insistence to the sums his countrymen paid for pearls, for silk, for the scents and stones of the East; and it treats those prices not as economics but as a public derangement.

By his count, 100 million sesterces drained eastward each year for such things, a year’s wages for over 100,000 legionaries. He records one woman dressed in 40 million sesterces of emeralds and pearls, the pay of some 45,000 soldiers, for no grander occasion than a betrothal supper. He cannot set the figures down without the manner of a man who watches his society mislay its reason. For Pliny, valuation at its edges is a species of madness, and the madness is the substance of the thing, not a lapse from it.

The unseen ground gets a ticker

Greece and Rome could conjure a mania for a frontier, and build a cult around its founder, centuries before they could put a price on either. The oracle blessed the venture; the founder carried the fire and won worship for it; the citizen drew his lot and sailed; the satirist saw that the whole machine ran on belief, and said so; and only at the far margin, in a tax contract gone wrong, did anything that resembled a traded valuation of unseen ground appear. And it appeared as a debacle.

SpaceX asks the public to perform the whole of it at once, and on a single Friday: to supply the fervour, to supply the cult, and to supply, for the first time in the entire story, the price. The unseen ground now carries a ticker. Whether the promise is worth $1.75 trillion is not, at bottom, a question about rockets. A loan, to the Romans, was a creditum, from credere, “to believe.” Both credit and credulity share that root, and what the public extends on Friday is credit in its first and literal sense. The only question is how much a crowd will believe, and the answer, as ever, prints at the close.

The author and associated persons may hold long or short positions in the instruments mentioned herein. Nothing in this commentary constitutes investment advice, a solicitation, or an inducement to trade. This analysis is published for informational purposes only. Past performance provides no indication of future results. Readers are expected to form their own independent views and, where appropriate, consult professional counsel before acting.