Grainews Article

[farmaholic]

Seems this issue won't die(or I won't
let it). In the Dec issue of Grainews
on page 20 Les Henry is saying what a
lot on here have been saying. He has a
nice 90 year chart
(with the last two years missing) that
shows the run-up in land prices. This
could be the last chance some older
farmers/landowners might have to cash
in. "If" there is another correction
similar to the one in the early 80's, I
don't think I will see this opportunity
in my lifetime again.

I have a cousin who sold land in 1997
for 80K bought it back in 2004 for 65K
and sold it recently for 240K (per
quarter and some of it the same land).
If I was the buyer I would be more
skittish than a long tailed cat in a
room full of rocking chairs!!

I try not to be a pessimist but who
thinks this can sustain itself? I guess
I don't have to worry because I never
got caught up in this frenzy. Around
here it isn't the average farmer who is
buying this land it is "Non Ag Money".
At what price is there no more room for
appreciation or speculation or it's
priced beyond it's productive capacity?

Am I missing something?

[cottonpicken]

Your missing which way the decimal point moves.

In some towns in the states they sell gas for 10cents
a gallon,true story.

[freewheat]

You are missing what I am missing
farmaholic. Whatever that is...

[farmaholic]

Cotton: both ways my friend.

[bobofthenorth]

Name one Cotton

[cottonpicken]

All of them

http://www.usgoldcoinauctions.com/gold-coin-blog/2011/04/the-price-of-gas-is-only-10-cents-a-gallon-whats-the-problem/

[westsider]

cotton - he just bought land and needs a reason to sleep at night

farmaholic - you are mostly right. these land prices are dumb. there is not a person out there that can show me a calculator that shows how this land can sustain itself. go talk to any other business in the world and ask the CEO "mr CEO, did you buy this asset because it is self sustaining and can turn a profit or did you buy it because thats what everyone else was doing". the successful ones will all answer the same way.

US housing - same thing happened, however i think this time it will be the individual meat-head that gets hurt, not the nation or even the general farming community.

what you were wrong in is "non ag money". its mostly greed and fear on the farmer side. Smart investors/ good businessmen all left the game awhile ago.

[farmaholic]

Well, with that analogy 1 oz. of Au will
buy a little more than 1 acre around here.
Should I sell a quarter for a lb. of gold?
Both tangible assets but which will hold
its value longer? Or will they move in
tandem?

[ajl]

Most people in the land market believe,
and rightly so, that the government is
going to print so much money that a loaf
of bread will cost a billion dollars 10
yrs from now. So land will go up right
along with that. I do believe that we
will be in an inflationary depression so
severe 10 yrs from now it will make the
30's look like child's play. That was a
deflationary depression.

[farmaholic]

Westsider: I think we may both be
right. Although around here, land
prices reached 1500/ac and none it
traded at this level was bought with
"farm income" only. Kids coming back
home with big off farm incomes and
savings or investors looking for
somewhere to park some money are the
people paying these prices. But I am
sure there are some large farm
operations in some places that think
they will miss the boat if they don't
get in on it and are willing to take the
chance. If these people have a lot of
cash and are looking for somewhere to
park it, fine, but don't be surprised
if......

[westsider]

ajw- if there is one extra bushel of grain in the world no one pays for it or any of the others.

if the price of a loaf of bread goes up do you think mills will want to make any extra money by buying cheap and selling high? we are primary producers, lets not kill each other by jacking land prices or rent!

[Hopperbin]

Basically if you don't buy it the immigrants will. Depending on what stage your in there is money in farming.
Clearify that does not matter what stage your in, if you worked the last few years you made money.

[Hopperbin]

Cotton can you actually give the name of anyone that will pay 5 dollars for a 1964 dime?

[ColevilleH2S]

<a href="http://www.coinflation.com/coins/1946-1964-Silver-Roosevelt-Dime-Value.html">Value of the Roosevelt Dime.</a> Just the facts ma'am.

[phoenix64]

feelin these land values will stay high as long as interest rates are low and countries such as china can continue to expand their borders without firing missiles