http://www.cnbc.com/id/39727942

As much as I hate to admit it, I think he said to get out in 2009.

This seems ridiculous, I was at an auction in Montana not to long ago and ranches appraised at $800,000 were getting 300-400k and 2m properties were getting 1.1 max! If farm land (w/ water rights) is in a bubble, I'm in it.

Yeah. Since the value of something is not what a buyer will pay. Its what some guy will randomly write down on a sheet of paper to say its worth.


gud1

The FDIC may not consider the value of the productivity of the land, whether high, medium or low grade crop land or pasture with high animal unit ratings. The value of lease rights to either around $100/acre for cropland and $11/acre for pasture. The value of the water rights, surface and sub-surface minerals. The FDIC discounts the fact that the underlying commodities produced by these properties have supported the rise. My point being I was on the ground watching people laugh at the overblown prices and picking up "great deals" for 30-60% of estimated FMV.

Thremp, my own personal troll. I like my old troll better, what was his name Otis...

That was the time to get IN.

There is a growing movement to end ethanol subsidies.... i'm not sure if this will ever happen if it does a lot of corn land is going to go down in value. Yes they will be able to grow other crops but that is a lot of free money going away. November elections should give a better idea if this has any short-term chance of happening.

Price of land may be over-priced, but it isn't going to crash, ever. The price of farmable land is only going to continue going up as the urban sprawl continues, and populations across the world keep rising.

What happens when sprawl goes down and populations fall?

Can someone explain to me why, in a country where farmers are paid to not plant crops, should farmland prices keep rising?

It's a loaded rhetorical question btw.

I'm no economist, but...

Farmland is typically priced at a value determined by the yield or profit per acre right? If everyone on these boards assumptions about hyperinflation is correct, won't commodity prices rise with the inflation?

If commodities keep rising, the amount of money from the crops keeps rising, meaning the value of the land rises along with it, right?

I guess if the "costs" of the land (diesel, equipment, wages, fertilizer, wells, property taxes etc.) rise faster than the commodity prices do, then they wouldn't.

Gold bugs don't believe in holding real assets (stocks).

What's going to cause sprawl to go down and populations to fall? Urban sprawl has been an ongoing process since the industrial revolution, and I'd argue that the leaps and bounds we're making in technology will mean that the rural populations will continue to decrease as people head to urban areas seeking employment opportunity. This means that more outlying farmland is consumed and converted into residental area. Basic law of supply and demand says that this pushes the value of land higher.

As per populations falling, what will cause the population to fall? Any graph of human population over the last 10 000 years will show it's only continued to rise. The only way that the population goes down is if there's a major catastrophe, at which point, money probably won't have much value anyway...

See Europe

A growing amount of global wealth. Richer people have fewer kids. Population growth rate is almost all from immigration now. World populations are going to stabilize in the next 50 years. Sprawl will end if energy and transportation costs increase. More people may live in more central locations. There has been a resurgence in urban living in many areas away from the suburbs.

As for the past 10,000 years - past performance does not guarantee future returns.

While it may be unlikely that these things happen, they are far from mortal locks, especially in the long term.

For thousands of years the world population was stagnant or increasing slowly.

US/Canadian growth rates are almost entirely from immigration, but this does not apply to the rest of the world. As the population continues to rise, as is suggested here, the cost of food will increase. Investors will see the opportunity for macro scale farming operations with acreages in the thousands and buy the land, grow grain crops and ship them globally.

See above link.

If energy costs and transportation costs increase significantly, there will be a substancial change in the world, and I agree that sprawl will end as people move back to more traditional "closed society" type lives, which are already advocated by the "Buy local" activists.


There is no arguing that past performance does not guarentee future returns, but I think that if there's no major increase in energy costs, that the populations will continue to rise. As we become more technologically advanced, we can produce better yield crops, as well as producing in areas that were previously unfarmable. I agree that the population will have to plateau at some future point, but right now I think technological progress is outpacing population growth, and that the plateau will be measured in centuries rather than decades.

Right, and I should correct myself. The growth of the human population isn't over the last 10 000 years, but rather since the industrial revolution.

I know a bunch of other people already pointed out other reasons why your statement could be false, but also remember that each acre of land is increasingly more productive as technology increases.

Well let's see, from 10,000,000,000,000 BC until around 1909 AD the world grew to a population of one billion humans.

From 1910-2010 the world grew to nearly seven billion humans, population increased over 650%. When are you expecting world population to fall, after the world population supposedly will "stabilize" in 2060?

You said ITT... Do you think energy and transportation costs have risen since 1910?

This thread makes me want to donate to charities promoting birth control.

Steady 2% population growth means 13,400,000,000 humans on earth by 2045.

At the current estimated 1.2% population growth rate, the population doubles in under 60 years.

Look up the meaning of real assets one day lil troll.

Do you not understand what exponential growth is?

Also, modern medicine and lowering childhood death rate is probably the biggest factor in any increase in population. Unless we start making people live to 150, that growth mostly historical. As the world gets wealthier, people choose to have less kids. They don't need to have 15 kids to run their farm or take care of them when they are old. Kids move from being helpful in life to being an expense.

I was merely attacking the idea that we must expand forever.

Energy and transportations costs have dropped. Does that mean it will happen forever? Of course not. They may continue to drop. They may rise as easy access to energy drops. They may drop if we can make new technologies that become cheaper to get energy. I'm not making bets about what will happen but acknowledging what could happen. Energy costs have increased in the short term, and may continue to go up even more and then drop off again. Counting on sprawl as some kind of guarantee, especially when many cities are shrinking in population (and many are gaining of course) is another flaw. It's very location dependent. Perhaps places like Phoenix and Las Vegas will lose huge chunks of population in the future, just like Detroit and Cleveland have the past 50 years.

Yeah. I own a piece of a company and ergo all its assets. My GE stock gives me a little slice of a nuclear reactor patent/etc etc etc.