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>willingly pay to give up their Perpetual water rights. Why would any farmer in California, making bank because they have basically free water, give that up, f
by mrguyorama 3y ago
>willingly pay to give up their Perpetual water rights.
Why would any farmer in California, making bank because they have basically free water, give that up, for ANY single payment?
- PeterisP 3y agoWhy would any farmer in California ever sell their land (to which the water rights are linked) for ANY single payment? Or, really, why would any landowner anywhere, getting money from rent, would give that up for ANY single payment? Of course, there is a price for that. Even a truly perpetual guaranteed income stream is worth a certain finite single payment, that's how rates of return work given the standard assumption that future money is worth less than cash in hand now.
- bombcar 3y agoBecause you can offer more money than expected future value. Say a farmer with free water can make $1m a year from his farm, working hard on it. So offer him more than $1m a year. Buy it outright for $100m and they'll start to jump on it. Index funds on that would return more than $1m a year with no digging.