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Iowa | Actually a guy mentioned this to me the other day. Historically ag is the top of the spear during inflation - 1970’s lots of new equipment, land easily tripled in a decade, but when the general economy struggled, ag got its butt kicked. This is really interesting because historically during recessions ag does relatively well, but in the few instances of major inflationary times preceding a recession, we got clobbered. So here we go again, 3 years of inflation, rumor is recession next year - lots of guys saying corn price is below or near cost of production.
I do think the fed is going to continue to devalue the currency to make the debt look better, however we are rapidly approaching a point where the government can’t make interest payments on debt accrued, at a time when a lot of unfunded liabilities will be coming to the forefront. At some point they will go the route of the platinum coin theory (they mint a coin and define it a higher value than the metals, in theory the fed could order it to be minted. The theory I’ve seen says the treasury could mint a $1 trillion platinum coin and pay back debtors with it, basically giving uncle sam a restart). If/when they do this all bets are off. We are also entering a different time politically, talks of “wealth tax” being floated around regularly. If I’m placing bets I’d say the chances of having to fight for your right to own land is more likely than 50k/acre. | |
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10 years from now
