Forward themes
by smhon | June 30, 2012 10:44 am
The funny thing about markets is that the fascination for thematic investing has gripped imaginations since the Dutch glorified the Tulip (and probably longer, but we don’t really have records on them).
So whilst eventually cooler heads recognise that a Tulip is a flower; there could be real opportunity.
I’ve been hearing talk of farmland investing from guys that have been known to be ahead of the curve and wonder if there are others who have been hearing of similar interest.
Share notes anyone?
Source URL: https://www.stockgumshoe.com/2012/06/microblog-forward-themes/
Porter Stansberry put out a ridiculous report saying that “farmland” was astronomically profitable. He knows nothing about what he wrote. He grossly distorted an agricultural economic report by some midwestern university extension service that was apparently talking about particularly valuable and fertile irrigated working farms. (It had to be, generic farmland simply hasn’t been anywhere near as profitable as claimed. Most farms have barely been profitable and many dry land farms have been abandoned.)
Farmland is most profitable when it is subdivided and sold in lots to build suburban houses on. Porter Stansberry didn’t mention subdividing at all, and in many areas there are strict rural planning codes in effect that make it illegal without a planning commission exemption.
Unworked farmland that is not sub-dividable is practically worthless. Its current owners would be happy to trade an entire farm for a semi-tractor so they can switch from farming to truck driving.
agree with your views on this one and with the media attention on the current US drought and rising food prices it would be too late to get any exposure. I’m not an expert but make a simple observation that after prices of a sector rise significantly the best response is to shrug and say “Oh well, maybe next time” and walk away.
Lately there are so many things to shrug at my shoulders are getting numb 🙂
Seems to be a major disconnect between public markets and ‘trench data’. To share with fellow irregulars what I see and hear here in Asia: Raw material substitution has been happening since March in the F&B industry, even among top names. Heavy vehicle traffic in China is down sharply. Advertising budgets for 2013 are severely reduced y-o-y. Receivables are stretching beyond 180 days and the volume is growing.
I really don’t know where is opportunity yet holding cash will be painful given the current economics.