Showing posts from January 16, 2016

Saturday Finances—Why David Bowie Was a Smart Businessman

Way before it became popular, David Bowie created an investment bond, his own Internet service provider, and his own bank.

The Man Who Sold the World
Very talented people tend to be smart in more ways than one.  
This was the case with David Bowie, who was not only a brilliant musician, but also a financial innovator and an online entrepreneur.    
In 1997, he launched his own asset-backed security, giving his fans a chance to invest in bonds backed by revenue from his albums recorded through 1990 as collateral.  
Known as "Bowie Bonds" or Pullman Bonds (originally backed by Prudential Insurance), they were one of the first instances of a bond using intellectual property as the underlying collateral.  They were 10-year bonds that paid 7.9% interest.  Compared to current rates of 1 to 3 percent, that's a respectable return.
In March 2004, Bowie Bonds were downgraded to near-junk status due to weak album sales related to the rise of online music sharing.  
He recognized the power…