The value of the Beatles

by on August 17, 2009 at 4:05 pm in Music | Permalink

Don Boudreaux offers a simple calculation:

If each viewer of only The Beatles' first two "Sullivan" appearances
deposited $1 into an account in return for watching The Beatles on
these telecasts, this account would have had in it, on Feb. 16, 1964,
$143.7 million. If this money had been invested at the historical rate
of return earned by U.S. stocks, it would have earned an annual return,
on average, of 8 percent. Today, this account would be worth about $4.4
billion.

Divided equally among John, Paul, George and Ringo, Paul's share
today would be $1.1 billion — his approximate current net worth. And
this from only a small payment made 45 years ago by each viewer of a
mere two episodes of an American television show.

Levi Stahl August 17, 2009 at 4:17 pm

But really, who’s going to give Ringo a full share?

zach August 17, 2009 at 4:50 pm

It seems obvious that Paul should be worth more than he currently is (assuming that the original viewers value their experience at more than $1… a reasonable assumption, I think).

Joel August 17, 2009 at 5:00 pm

45 years, rather.

rhhardin August 17, 2009 at 5:42 pm

It’s a shame that nobody thought to invest a penny for mankind in 5000 BC.

Nobody in the world would have to work today.

anonymous August 17, 2009 at 5:58 pm

Also, if it had actually been possible to monetize those TV appearances, Ed Sullivan and CBS would have taken the lion’s share of the proceeds, not to mention Capitol Records. At the time, the Beatles needed Ed Sullivan more than he needed them, although that balance of power would very rapidly change (partly as a direct result of their appearances on his show).

babar August 17, 2009 at 8:47 pm

what if everyone in the world had started microsoft in 1975?

Paul N August 17, 2009 at 9:46 pm

I am so confused by this post, and reading the comments only made it worse. It is like: “Beatles non sequitur non sequitur”

Mark Seecof August 17, 2009 at 10:57 pm

Horsefeathers. Inflation, taxes, and management fees would have reduced the value of the initial investment to nil by now.

anon August 18, 2009 at 12:03 am

What a completely asinine, waste of time calculation.

The relevant number is not $ 1, but $ 144 million.

Who could have earned that for 2 nights work in 1964?

MPO August 18, 2009 at 12:07 am

If a fund was created in an attempt to raise $4.4 billion USD for the express purpose of building a time machine in order to assure I would never again have to hear of or from the Beatles again, I’d kick in a few hundred bucks.

mulp August 18, 2009 at 2:13 am

Why the Beatles? Why not Elvis in 56 with 60 million vs the 73 million on 1964, and 80+% of the audience compared to 60% for the Beatles?

But then, what of the Stones who are still performing and who appeared 6 times, twice as many as Elvis and the Beatles.

And Mick Jagger studied at LSE, and then dropping out, commenting in a Rolling Stone interview: “It was really a dull, boring course I was stuck on.” But Mick worked for his billion, instead of imagining getting rich just sitting around.

Mesa August 18, 2009 at 6:59 am

A good example of how to address global warming issues – create a fund to be invested and spent in the future. In effect society is already that “fund”, but these calculations highlight the dramatic effects of economic and productivity growth over time.

Martin Brock August 18, 2009 at 10:29 am

Since the “historical rate of return earned by U.S. stocks” is practically a law of nature, I propose the following reform. Every child born in the U.S. gets $10,000 invested in an S&P 500 index fund, to be released only when the child reaches 65. That’s a paltry $40 billion/year, a rounding error in the Federal budget [i]deficit[/i] these days.

Without a dime of additional expenditure, in only a single generation, every man, woman and child born in the U.S. will be independently wealthy by age 65.

As an added bonus, with today’s low birth rate, such wealthy people can easily leave their children wealthy through inheritance, with only slight curtailment of their consumption after 65, so we’ll limit their births and consumption after 65 too.

In only two generations, all native born U.S. citizens can be independently wealthy at birth, and no one born in this lineage ever need produce anything in exchange for their consumption again.

Compound interest is miraculous, don’t you know?

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