The fall of real estate investments is nothing compared with the shadow of hunger following the food price rises, but there may be links between them. Here in the eastern Spain local food production doesn’t look as vigorous as before since the promises of residential projects, the derivation of water to urbanized areas and the lack of the same dedicated labor as we had some decades ago have left many fields abandoned.
Then there’s the diversified speculative businesses that targeted bioproducts suitable for being processed into fuel. Their business is speculation, that’s not going to go away with the fall of real estates, they will grab the food market until it has to be taken almost off their cold dead hands. While governs are patching and repairing the damages done to the owners of home loans, they’ll feed the food bubble until some unsustainable damage is done. This means that the economic model that created both the real estate and the food prices problems is still kicking around and there’s little to achieve by running behind them with a mop funded with public taxes.
There’s no excuse for an economic crisis right in the XXI century. They should know better by now. The kind of failure leading to a shortage of first need products would be a serious global failure, and we can remember what that lead to in the past.
