Why Bill Gates Is Buying Up ALL of America’s Farmland?

Bill Gates is now America’s largest owner of farmland, by far – alarming many people and making others simply wonder what the heck he is up to.

I set out a few possibilities below, before delving into what I think the real reason is.

Possible Reasons Why Bill Gates Is Buying Up So Much Farmland

1. He wants to control the world’s food supply and make us all eat quinoa and bugs, instead of cows and pigs, to save the planet.
2. He wants Melinda back and he heard that she thinks farmers with a lot of land are “hot,” even if they have man-boobs.
3. He wants to be able to roam free for miles with his shirt off, without being self-conscious, because, well, don’t we all?
4. He’s jealous that Elon Musk is getting all the attention now, so buying up all of America’s farmland to foster nutty conspiracy theories (see above) is a great way to steer attention back to him.
5. He thinks serious inflation is on the horizon at some point, and real estate (in any form) is the most kick-ass inflation hedge there is.

As much as I enjoy reasons #1 – #4, I am going with reason #5 (inflation hedge) for the reasons I discuss below.

Gate’s Land Holdings

Bill Gates only owns about 270,000 acres of farmland – out of almost 900 million acres across America. So the rumors about him “buying up ALL of America’s farmland” are pretty much nonsense.

Gates does however still own more farmland than anyone else – and I suspect it is just a massive inflation hedge.

Even though I think we will see inflation wane in the near future (we may even see deflation again), massive inflation seems inevitable at some point for a variety of reasons.

We have $30 trillion of government debt, and well over $100 trillion of unfunded liabilities for social security, Medicare, pensions, and much more. And there is simply no way we can pay off our massive debt or cover our future liabilities with tax revenues alone. And Mr. Gates knows that.

What the government is going to have to do at some point is “monetize” that debt, or effectively print money to pay off the debt with much less valuable dollars. And that will of course foster significant inflation, and wipe out the value of savings and stocks and bonds.

Gates knows this too, so he is likely buying up farmland as an enormous inflation hedge – given that real estate in any form is a “hard asset” and an excellent inflation hedge. Hard assets tend to hold their value in absolute terms – no matter what a currency is doing.

I should add that we actually “monetized” our debt successfully in the 1940s to pay off our massive WWII debts – so there is definitely a precedent.

I also think America will lose its “reserve currency” status. Currently almost 90% of world trade is in U.S. dollars and this fosters an enormous demand for dollars (keeping its value up), no matter how irresponsible our politicians are. If and when we lose that reserve currency status, the dollar’s value will plummet. This is probably years away, but it is much more likely now because of how much havoc the dollar plays on the world stage and because people will continue to lose faith in the dollar in general because of our reckless borrowing and spending.

Houses = Best Inflation Hedge!

Here is my final point and the primary point of this blog: If we can’t buy up America’s farmland, we should buy houses while we can. This is because we will all need inflation hedges at some point, and houses are one of the best inflation hedges there is! If you don’t believe me, ask Mr. Gates.

Jay Voorhees
Founder/Broker | JVM Lending
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