Monday, September 8, 2014

Local Economies as Investment Opportunities

How can communities prepare for an uncertain future, particularly when central bankers remain reluctant to encourage further prosperity? This post looks at a few possibilities for "starting from scratch". Consider: even a recent Forbes article noted that new housing options are needed for an aging population - an argument I didn't expect from them!

Of course, the elderly are far from the only populations which need real innovation in building components. Many job offerings in the coming decade do not come with the income levels which are associated with much of today's housing stock. Nor does "build it and they will come" necessarily pan out, when solid structure building decisions turn out to be more burdensome than the income flows they can generate.

In many instances, people are looking for a fresh start in communities which are already weighted heavily toward housing assets, rather than coordinated environments for living and working. What's more, services and knowledge use systems need to be in effect at local levels, so that communities are not forced to rely on distant cities for either livelihoods or lifestyle options. Future action should reduce the government assistance (services in city environs) which has been stretched to the breaking point. Less government planning is needed, wherever locals can take part in relatively informal planning for structural needs. Also, from yesterday's post re existing government redistribution:
The first priority is to allow local investment potential to bring the marginalized back into existing systems, so that their disadvantages do not continue to accumulate over time.
Government assistance only keeps people from being able to help themselves, and further polarizes differences in skills capacities indefinitely. Future investment needs to revolve around interlocking strategies with substantial local components for entire populations, so that individuals will not need to rely on far flung governments for up close circumstance.  Local investment especially needs to change the nature of today's non tradable goods into more liquid forms of wealth. The best results come from long term strategies, and there is a lot to be said for hunter gatherer forms of business dynamics.

In many instances, the ways in which living and working arrangements are currently structured, need to be reconsidered. For instance, many more individuals in the U.S. are looking for walkable communities than actually exist, and until now, communities have been slow to adapt. In order to do so, changing conditions have to not just be recognized, but acted upon with more inclusive investment strategies.

Private property needs to enter a more vital phase. All too often, optimal property use is constantly limited by contrasts and constraints in expectations which prove impossible to meet.  Public, private, and personal properties too often become hostage to competing visions and desires, hence incapable of fulfilling productive intent and purpose.

Local investment could in some respects resemble a game board in which the game players buy their parts in the game. Often, "losing a play" in either personal or business terms would mean restructuring within other holdings within the game, instead of bankruptcy. What's more, holdings can be quite fluid in terms of commitment levels, which could be utilized along varying commitment scales and their pricing mechanisms. This would also allow risk takers - some of which hold smaller income levels as a result - to retain ownership in the property use game. In turn, individuals would retain greater control (and liquidity) over their destinies, and enough leverage to remain at the table for more "games".

How might building and land components be defined? In part it depends on the formations of the landscape, as well as preexisting commitments for land use that often naturally follow. Some preexisting land commitments could still be treated as traditional real estate (within unconventional land shareholding structures), which makes sense when they remain capable of productivity and/or their intended use over time. So long as resources exist to maintain "basic" real estate holdings, they can coexist with alternate structures. Land banks in some municipalities are (delicately) beginning to deal with similar land issues already, for abandoned properties.

Fortunately, there are multiple property options throughout the U.S. which contain neutral aspects - that is, they're not visually "special" other than what occurs through tender loving care, for instance. These properties would particularly lend themselves to flexible land and property use designations with portable building and environment components.

This would allow land and property holdings to become fluid, dynamic and often interchangeable components for the populations which utilize them. A primary goal would be to make certain that these land parcels would not be underutilized, poorly maintained or otherwise neglected because of discrepancies and disagreements.

Some land parcels would remain completely flexible (i.e. "unimproved") while these parcels could be accompanied by semi improved infrastructure grids at ground level. The combined setting would allow property to be adapted as needed in multi purpose groupings. This would especially be helpful as communities seek out service and production options they feel comfortable with, which would often change over time.

Here is where density advantages of time use optimization start to come into play. Time optimization means that individuals can come together for group projects - both services and other forms of production - in close proximity. Environments would be structured so that individuals close to the core could utilize multi purpose spaces, for both social and work related activity.

Land shares for local community building could become available - hence directly linked - through one's time use participation over the years. As time participation (skills arbitrage) lessens with age, built in "grace periods" for land holdings could assist in retirement needs. Some who are short in holdings late in life, could share a portion of their personal holdings for services needs. By the same token, other local investment options could be made available for investment in the same fashion, depending on one's level of economic interaction with others on an ongoing basis. Another possibility for local shares would be voter pricing for shares that allow direct votes for resource use.

One of the most important aspects of these structures is that they would need to remain completely transparent. This way, local shareholding structures would not work against the people with lower income levels who need them most. By utilizing these types of structures, individuals would not only need less assistance from others in the course of their lifetimes, but could also keep legal representation to a bare minimum as well.

Ultimately any community has the capacity to become as strong as the inhabitants in its own midst. Where to start? In the planning stages, there are numerous sources which individuals can draw from, to create templates which work for different lifestyle choices and needs. Domestic summits would be a part of this process. But even these would be a result of earlier efforts to find commonalities among potential groupings, who desire lifestyle options which are not readily available in existing communities.

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