This piece originally appeared in the Strategic Planning Group, as a Supplement exclusively for Members. It has been edited for content.So recently, the New York Observer ran one of its snooty, fawning pieces about hedgies in New York.
|“So you’ll give me 2% of your money up front, |
then 20% of any winnings,
plus you’ll eat all the losses on my bad bets:
Isn’t that a great deal I’m giving you?”
That sharp-toothed rodent cunning was on display in the Observer story: These hedgies were boasting about buying farmland left and right, as a hedge against inflation.
So: Is farmland worth buying as a hedge against inflation?
This is a reasonable question.
Bottom line, the answer is: No.
The reason, however, is worth examining in some detail, because insofar as farmland is concerned, there would be a period of time when it is a clever investment, and then a point after which it would be a terrible investment. And as with everything in life, the dividing line between the terribly clever and the terribly stupid is as smeared and undefined as roadkill on an Interstate.