Read it and weep: Elon Musk’s obscene wealth breaks new ground

We hit a bizarre milestone this week as the fortune of one individual tipped close to half a trillion US dollars (or $756 billion Australian). It’s a staggering sum of money and it lines the coffers of an entrepreneur who is a deity to some and evil incarnate to others.

The entrepreneur is Elon Musk, who was once celebrated as a paragon of innovation but now widely derided as a grotesque symbol of tech excess.

At $US500 billion, Musk’s net worth (according to the Forbes rich list) also illustrates the breakneck speed at which the tech oligarchs are amassing wealth.

Few would have imagined even five years ago that this level of wealth was attainable by an individual. But here we are, welcome to the world of AI – “Artificial Intelligence”, or is it “Accelerated Income”?

Ten years ago, Microsoft founder Bill Gates was celebrating his 16th appearance at the top of the Forbes rich list with a fortune of $US79 billion. In today’s dollars, this equates to about $US109 billion. Musk, at that time, was worth a relatively modest $US13 billion.

In today’s dollars, Gates’ wealth has stayed steady, but he is no longer the king of the hill, having fallen out of the top 10 to come in at No.17 in the latest list.

By contrast, Musk’s wealth has grown exponentially in the past decade, all on the back of Tesla’s share price. Tesla’s value is almost entirely tied to the expectation that Musk (when he is not consumed by culture war clashes on social media) will devote more time to the business of selling cars, rolling out self-driving taxis and developing humanoid robots.

It’s the metaphorical reinvention of the wheel, and the chances of that happening hinge on Musk pressing pause on his passion projects of meddling in US government affairs, anaesthetising society’s woke, fighting immigration in the UK, or alleged white genocide in South Africa.

Musk’s disciples are counting on his abilities as an innovator being outstanding enough to see his other business ventures such as SpaceX and xAI Holdings (which owns X, formerly known as Twitter) exponentially explode in value.

Since 2015, the Tesla share price has increased more than 3000 per cent. Most of this gain came from the wellspring of Musk commercialising the electric vehicles.

But China has put paid to any dreams of Tesla’s world domination of EVs. The country now boasts 129 EV makers and has recently very successfully colonised many markets, including Australia with brands like BYD.

Meanwhile, Tesla has struggled to maintain EV sales growth in many markets, with Musk’s pro-Trump antics hurting sales.

Even Musk’s supporters don’t expect a repeat of the kind of share price performance Tesla has experienced over the past decade. That said, a recent remuneration proposal from Tesla’s board has promised to award him $US1 trillion if he surmounts a series of hurdles over 10 years, including increasing the market capitalisation of Tesla from its current level of $US1.4 trillion to $US8.5 trillion.

That’s some incentive, and just the sheer number of zeros highlight a growing chasm in the way we as a society understand wealth. The numbers in the rich lists are increasingly detached from any measure of purchasing power. In Musk’s case, there are literally no goods and services that he can’t buy.

So, if the numbers are just a metric for success, then those at the very top of the wealth tree are more successful than any generation before. And this explosion in net worth is now largely tied to investments in the AI revolution.

Larry Ellison, who co-founded Oracle, recently boosted his fortune by more than $US100 billion in a single day. Oracle’s share price skyrocketed 36 per cent on the back of a statement that revenue from its cloud infrastructure business will soar by 700 per cent to $US144 billion over the next four years – all thanks to the power of AI.

Most of the others occupying the top 10 positions on the latest Forbes list are in the tech sphere.

Meta’s Mark Zuckerberg comes in at No.3 with $US251 billion, ahead of Amazon’s Jeff Bezos at $US232 billion. Google’s Larry Page and Sergey Brin are next in line and followed by Nvidia’s chief executive, Jensen Huang.

A lot of these guys are not household names, but all have more wealth than many of the world’s economies. But Musk’s wealth is next level, and as far as tech oligarchs go, he is in a league of his own.

The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.