Within the Marvel movies franchise, Thanos has always been one of the most well fleshed-out characters. Ultimately, he is trying to solve an economic problem of scarcity – the exact same thing we should look at to determine what makes a sound investment. Thanos started as a one-dimensional villain and was slowly revealed to be someone driven by a divine purpose of trying to save the universe. This was illustrated in the most important scene in the movie where he was required to murder his beloved daughter for his cause.
He believed that the only way to eliminate famine and war over resources was to eliminate half of all living creatures. Immediately we can see the logical fallacies in his thinking. The first being he could have simply doubled all the resources in the universe or made it so that they renew at the same rate that they are being consumed. The second is that the population growth of any species is exponential while resource production is linear. Given a long enough timeline, the population of the universe would increase again to the point that a shortage in resources would inevitably place everyone in the same position again.
This isn’t a new concept and was first popularised by the English demographer and economist Thomas Malthus in the 1800s. He believed that population growth would always outpace food supply in the long run and that the only way to prevent this would be to limit our rate of reproduction. This concept is shown below – at the point that population overtakes resource production we would see war and famine – the so-called Malthusian catastrophe.
Animal populations have proven Malthus’ theory right repeatedly, with population explosions and crashes but to date, we haven’t seen much evidence for this in human populations. This is due to several reasons. Namely, we still have an abundance of fossil fuels where most of the nitrogen, sulfur and ammonia used for fertiliser come from. The productive output from modern farming techniques has more than met the challenges of feeding the world’s population so far. Quite simply we’ve been able to get a higher yield from the same plots of land by constantly replenishing the lost nutrients from the soil using byproducts of the petroleum industry.
While we have not seen Malthus’ apocalyptic view of the future play out yet it’s almost certainly only because we are just looking at the wrong timeline. In the case that the world’s population does keep growing it would be a near certainty that we would use up all the resources resulting in a crashing population.
This brings us to the topic of land – a finite resource and one of the major factors of production that over time becomes increasingly scarce as the population rises. Particularly land that is scarce in iconic locations or with views of the city or water that can’t be built out. The consequence of rising demand and resource scarcity of course is price rises – particularly in times of inflation like we’re seeing today. Land has always been an exceptional store of wealth and an inflation hedge. If we look at Bill Gates – he’s been quietly buying up land in the United States over the past decade and is now the largest private landholder in the country. Blackrock, the world’s largest asset manager has also been quietly buying up houses recently purchasing 15% of homes in the US in the first quarter of last year.
It’s getting hard for the central banks to hide the real inflation figures once they start spilling out of assets and into the price of general goods and services. Smart money and institutional investors are all buying up. If you haven’t already, this could be your chance to front-run the market for a chance at generational wealth.