Most financial manias share a common belief that the supply of some precious resource is running out. The notion that they’re running of of land has sparked several financial manias. California has land booms and busts at various times in its history. Florida had a huge land boom and bust in the 1920s. Given the millions of acres of undeveloped land in California and Florida, particularly 100 years ago, the rationality of these booms and busts is rather suspect. But once people start to believe the shortage is real, the frenzy mentality takes over, and rationality is discarded in favor of greed and stupidity. Sounds like the current attitude toward housing in Coastal California, wouldn’t you say?
Space is the final frontier. There is a lot of it, but once we start exploring and settling in outer space and on celestial bodies, our land ownership regulations — and manias — will move out into space with us.
There’s a man selling parcels of land on the moon. He’s a visionary entrepreneur who sees the upcoming shortage of moon property, and he’s positioning himself to profit from the future mania. I know it’s a long-term investment, but perhaps it’s a good time to buy your piece of the moon.
By SIMON ENNIS — Published: March 10, 2013
The notion that one man can lay claim to all the extraterrestrial bodies in our little corner of the galaxy sounds preposterous. Yet Dennis M. Hope, 65, of Gardnerville, Nev., the subject of this Op-Doc video, believes just that. For three decades, he has built a thriving business by “selling” land plots in space, on places like the moon, Mars and Venus. Of course, he has no legal authority to do so.
Don’t let small details — like the fact that the guy selling parcels on the moon doesn’t own them — deter you from staking your claim. There is only so much moon available, and once it’s gone, they won’t make another one.
Like any financial mania, you have to want to believe.
How does he get away with this? He told me that, back when he was a ventriloquist in the days before he “owned” the moon, his dummy taught him a valuable lesson: you can say anything you want to anybody as long as you smile.
Some call him a con artist. One can argue that he’s part of a hallowed American tradition, whereby land speculators sell plots of useless land on the next “frontier,” from the southern swamps to the western desert. Or maybe he’s just selling amusing “novelty items” (as his certificates acknowledge, in fine print), like pet rocks, which are perfectly legal. Personally, I think what he’s doing is acceptable. Even if Mr. Hope’s lunar land certificates have no financial value, they do seem to provide another benefit. The moon inspires awe — its white blankness is the perfect backdrop for any kind of dream we might have. Feelings of optimism and wonder can be worth quite a lot.
When I saw this story, I wanted a piece of the moon too. Sure, it’s not legally binding and enforceable, but it provides a connection to childhood dreams of space exploration. Perhaps I’ve watched Star Wars too many times, but I think owning a piece of the moon would be pretty cool.
Full disclosure: I am a lunar property “owner” (Mr. Hope was generous enough to give me an acre at the end of our time together). Yet I have no plans to develop the land anytime soon.
Let’s say you did buy a lot on the moon. How would you build there? Getting building materials and workers to the moon would be quite expensive. There is a company, The Golden Spike, who could take you there for $1.5 billion. A trip to the space station is only $20 million, and the cost of transportation will likely decline for future generations. Someday, we will settle on the moon. Why not get in on the ground floor? It’s not too early, is it?
1. What is Law today.
With regard to extraterrestrial property sales, two treaties exist today.
These treaties do not refer to “ownership” as such, they more commonly refer to the “exploitation of the Moon and other celestial bodies for profit purposes”, and extraterrestrial property sales distinctly fall under that section. The treaties are, The Outer Space Treaty of 1967 and the Moon Treaty of 1984.
The Outer Space Treaty of 1967 explicitly forbids any government from claiming a celestial resource such as the Moon or a planet.
What does this mean? Well it means that governments can not appropriate the Moon or other celestial bodies. Effectively, governments have signed to the fact that they have no rights to these bodies at all. As a law expert will tell you, what is actually important here is what the Outer Space Treaty does not say. It explicitly does not say whether commercial enterprises or private individuals can claim, exploit or appropriate the celestial bodies for profit. (Note that the Lunar Embassy are not a government.)
2. The Moon Treaty forbids the exploitation of Space, the Moon and other celestial bodies for profit motives. According to the Moon treaty, individuals may not claim the Moon and other celestial bodies.
That would seem to put a damper on this guy’s business.
This is not a Myth. This is the absolute truth and as a result, some people name the Moon Treaty as a common objection to many private commercial enterprises that are or wish to exploit Lunar or planetary resources for profit.
There’s just one small, minor problem: Of all the approximately 185 member states of the UN only six states supported it. All others, including all spacefaring nations (USA, Russia, China etc) refused to sign it and did not sign it.
Great! There had to be a loophole.
That is something that does not seem to be well known. The USA explicitly refused to sign it as it would inhibit the exploitation of Lunar and other celestial resources for profit by corporations and individuals. Some websites actually incorrectly list the Moon Treaty as ratified. (Far more worrying…this includes Nasas own, published archives.)
We feel that the non ratification of the Moon Treaty is a good thing…imagine we found oil on the Moon and a company were by law prohibited from mining it? Surely, that is not in the public’s interest. (and if you find it on your property…well congratulations…you are now rich!)
California saw a huge population explosion with the Gold Rush of 1848. Perhaps they will discover a valuable mineral on the moon too. Unobtainium, perhaps?
If left to their own devices, the next generation of bankers will inflate a housing bubble on the moon as well.
For those of you looking for a heavy analysis post, I’m sorry to disappoint you. It’s Friday, and I wanted to have a little fun.
That Option ARM didn’t work out
The owner of today’s featured property is short selling it because on 11/21/2006 he took out an Option ARM with a 1% teaser rate. It probably seemed like a good idea at the time. It didn’t work out very well for him.
If you’re planning on buying property on the moon, I strongly suggest you don’t use an Option ARM.
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Proprietary OC Housing News home purchase analysis
$798,888 …….. Asking Price
$607,000 ………. Purchase Price
5/13/2003 ………. Purchase Date
$191,888 ………. Gross Gain (Loss)
($63,911) ………… Commissions and Costs at 8%
$127,977 ………. Net Gain (Loss)
31.6% ………. Gross Percent Change
21.1% ………. Net Percent Change
2.8% ………… Annual Appreciation
Cost of Home Ownership
$798,888 …….. Asking Price
$159,778 ………… 20% Down Conventional
3.65% …………. Mortgage Interest Rate
30 ……………… Number of Years
$639,110 …….. Mortgage
$152,159 ………. Income Requirement
$2,924 ………… Monthly Mortgage Payment
$692 ………… Property Tax at 1.04%
$0 ………… Mello Roos & Special Taxes
$200 ………… Homeowners Insurance at 0.3%
$0 ………… Private Mortgage Insurance
$115 ………… Homeowners Association Fees
$3,931 ………. Monthly Cash Outlays
($659) ………. Tax Savings
($980) ………. Equity Hidden in Payment
$191 ………….. Lost Income to Down Payment
$120 ………….. Maintenance and Replacement Reserves
$2,603 ………. Monthly Cost of Ownership
Cash Acquisition Demands
$9,489 ………… Furnishing and Move In at 1% + $1,500
$9,489 ………… Closing Costs at 1% + $1,500
$6,391 ………… Interest Points
$159,778 ………… Down Payment
$185,146 ………. Total Cash Costs
$39,800 ………. Emergency Cash Reserves
$224,946 ………. Total Savings Needed