It could be all farmers...

In the land market from here on in. Consider this comment from Barrons:

The most imminent threat is the housing meltdown. Leuthold says that, historically, a convulsion in one part of the realty market eventually has affected all others.

In the agricultural sector, ranchland and recreational farmland already have been quietly hit, having peaked in 2006, according to brokers. Jack Horton of Vale, Ore., who has been selling rangeland for 36 years, says prices are down 10% on average, and as much as 20% to 30% in some areas of his state. Recreational plots, bought by sportsmen, have also tanked, he adds. The drought in the West also is hampering demand for working ranches, as is the high cost of cattle feed, resulting from -- what else? -- the ethanol boom.

BROKERS TOOK HEART WHEN Louis Bacon of Moore Capital Management spent $175 million recently on the 250-square-mile Forbes Ranch in Southern Colorado for a holiday retreat. "It's the American dream to own part of the West," Doug Hall of Hall & Hall a multi-state brokerage company located in Billings, Mont., says. "There are an awful lot of people who made a lot of money who want to enjoy it while they have it." But smaller places -- under 5,000 acres -- away from the mountains are harder sells, he acknowledges.

John Stratman, a broker for the Mason & Morse Ranch Co. in Glenwood Springs, Colo., concurs that the lower end of the market has slowed. "I don't think the buyers have gone away. They're on the sidelines because of all the negative publicity about the residential and subprime markets; and they're sitting there waiting to see which way the economy goes."

If the economy does teeter into a recession, that would make continuation of the farmland boom all the harder. At this stage, any investor should be wary of betting the farm on a farm. A Miami condo might be a better deal. After all, you can buy a nice one now for just 60% or so of what you would have had to shell out three years ago. [More , maybe - due to firewalling and temporary availability]

Farmers are definitely pouring profits into the land market, and for good reasons, I think. Slowing development pressure will decrease 1031 money, and advice like this could temper pure investment plays as well. But the hard truth is there is much more wealth to be invested than good places to put it right now. Farmland (about $2T) represents a small fraction of asset values here in the US.

The question is not so much if farmland is the best place to put money, but how much worse are all the other choices?