Today we talk economics. Like history, it’s a boring subject only if you have a bad teacher. Vox Day gets me started on the topic:
This destruction of the housing stock by rich foreign owners is the sort of consequence the free traders never factor into their “it’s good for the economy” arguments when considering the free flow of capital:
Drained whirlpools, decaying walls and foliage creeping up the stairs can be seen on a North London street called Billionaires’ Row. Bishops Avenue in Hampstead, north London, is one of the most exclusive roads in the country, but many of its 66 mansions lie vacant. Footage taken by ‘urban explorers’ shows moss growing up the once pristine white walls of the huge rooms and swimming pools with a shallow layer of murky water. The gardens rise high and in many the decor is clearly a few decades behind.
They include a selection of residences worth £73 million, reportedly bought for the Saudi royals between 1989 and 1993. In those days the homes caught be purchased for a cool million, now prices rise to around £20 million. In 2014, an estimated £350 million worth of mansions could be found on the prestigious street, the Guardian reported.
An Iranian resident told the paper: ‘Ninety-five percent of the people who live here don’t actually live here. It is a terrible place to live really.
So, the best housing stock in the most desirable areas is being destroyed, but on the plus side, the natives can’t afford to live there anyway. And the cycle will only continue as new developments are built to house the people who now live elsewhere and are building up a desirable neighborhoods that will attract more foreign “investors”.
Living where I do, I assure the reader that the same is true of America’s Pebble Beach. The occupancy rate tops at 17% or so when a major event like a golf tournament passes through. The homes are extremely valuable but not enjoyed. There are more security guards there than residents and from what I’ve heard, more illegal immigrants than security guards as live-in staff.
“An Iranian resident told the paper: ‘Ninety-five percent of the people who live here don’t actually live here. It is a terrible place to live really.”
I once worked the streets of a wealthy neighborhood in Los Angeles. It reeked of sewage because the area was remote enough to rely upon septic systems which, thanks to absentee ownership, weren’t always well-tended. The value of investment properties doesn’t depend (much) upon the condition of the homes there. They tend to get remodeled with every change of owner.
So, the land isn’t being destroyed even when the homes aren’t being kept up. It’s very hard to destroy land short of strip-mining. But that’s the thing about land: it isn’t going anywhere.
When you have a region like Pebble Beach, the Hamptons or here, Billionaires’ Row, what you actually have is a bank. It’s a place to keep your money safe from inflation and other currency manipulations.
So far, so good. Wealthy people are always going to have more nice things than they can realistically enjoy. I don’t want to fault them for that because someday, I’d also like to have more wealth than I can enjoy. Sounds like fun!
But here’s something interesting. Now that every government in the world uses fiat money, most particularly the United States as the global reserve currency, inflation and other currency manipulations will inevitably and swiftly eat away at one’s savings. That makes the Bank of Land Ownership very attractive today.
So, wealthy folks the world over are putting their money in land, in preparation for the global economic collapse that everybody but welfare addicts sees coming. But wealthy types don’t like static value. What can they do to increase the value of the land they own?
(In fact, not liking static investment values is practically the definition of being wealthy. Beyond a certain point, proper management of your wealth becomes a full-time job… and eventually, a job employing multiple managers & analysts. If you buy a fancy house and make a home out of it then you’re paying a whopping lot of upkeep for something you’ll be emotionally reluctant to sell.)
They can do mass immigration. There’s no better way to drive up the value of land than the inevitable demand increase from millions of new arrivals per year… and although I lack the language skills to confirm this, I bet the lands they’re coming from are cheap, cheap, cheap right now, and motivated to sell. I’ve heard that some regions in Mexico have lost fully half their population to El Norte.
Buy low, sell high.
Perhaps one reason for the Elites’ focus on identity politics is waiting until they buy up the lands of Honduras or wherever so they can “repatriate” the migrants onto newly built plantation estates. Actually encouraging the migrants to go native could leave them reluctant to return. Or worse, fill their heads with Western concepts of Christianity and limited government.
They need to go back regardless. But if you’ve ever wondered why rent prices are skyrocketing then wonder no longer. The Elites don’t trust national currencies anymore and are looking to max out the value of their investments held in the Bank of Land.