From the invaluable Currents feature of the WSJ comes the idea of “slow money”, which seems to me to be basically an exhortation to invest in your local farmer, regardless of how weak a return you might get compared to other investments. According to Woody Tasch, the former venture capitalist now pushing the idea, the key is for investors to expand their idea of what a “return” is:
Mr. Tasch is thinking about farmers like Martin Ping of upstate New York, who invites customers to invest in projects like a cheese processing plant. Investors can expect only about a 3% return. But they also get a ready source of fresh-made cheese and the knowledge that they help preserve an agrarian landscape. “They have to redefine what return is,” Mr. Ping said. “I tell them, come out in the pasture and you can watch your money grow.”
I’m no economist, and God and RBC know what a lousy investor I am. But surely, if this is the sort of thing that jazzes me up, I’d be better off putting my money in a higher-return investment, and then using the extra money to buy artisan cheese or local tomatoes or goat milk or something. Or if I’m really feeling flush, I could just give the extra money to the farmer. My return on investment is the same, and the farmer gets not a loan but a grant.
Meanwhile, not everyone is keen on this, not least of all the farmers themselves:
They like the Slow Money concept but worry that it may be more cumbersome than a traditional bank loan. Specifically, they fear deep-pocketed local investors will demand a say in management decisions. Equally perilous: small-sum investors swamping the Lobaughs with requests for tours and samples, and interminable inquiries about the goats.
This reminds of the time I blogged about the fetish for “local bookstores,” and I got an email from someone who actually worked at one. The job was ok, he said, except for the locals who wanted to hang out all day long and be his friend.