Private wealth

May 23, 2007

Reuters is reporting that a Hong Kong businessman Joseph Lau has ordered a private 787 airliner from Boeing, retailing at US$153 million. Useful if you want to fly 200 of your friends around the world, but still a lot of money for a private jet. Or so it seemed until I did the maths. Lau is reputedly worth about US$2 billion, which means that his new vehicle is costing him about 7% of his total worth. That is probably about equivalent to the average homeowner in the Eastern suburbs of Melbourne buying a small BMW.

Mind you, affording something does not make owning it necessarily right. I don’t suppose Lau or any of the other 7 purchasers of the so-called 747-VIPs are concerned about carbon footprints, diminishing oil resources, dangerously crowded air-corridors, or any other anti-social aspects of owning a huge private jet. Maybe I am doing these multi-millionaires a disservice, maybe not. I note that Joseph Lau has given a generous scholarship to the Hong Kong University of Science and Technology aimed at encouraging “the study of foreign language and personal development through community services”, though the price he paid for Andy Warhol’s painting of Mao is 5 times as much as the establishment cost of the scholarship and he is quoted as saying “I’m so happy! Just think. I could have wasted all that money on charity or helping the poor.” Who knows? Private wealth is just that – private.

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