"Hey, you Americans aren't all idiots," said an English colleague this morning.

In her hands was a copy of the International Herald Tribune, with an article headlined: "High home prices drive California exodus."

"These people are smart," she continued. "They're selling over-priced property. They're taking advantage of the property bubble without dying."

She referred to our lament about rising property prices in the United States. The only people who possibly benefit, we noted, were those who could get rid of a house without having to buy another. But now comes news that many Americans have figured out an alternative.

"A growing number of people are giving up on California after a decade of soaring home prices," explains the IHT. The article explains that there are now 100,000 more people leaving the Golden State than entering it.

It's not hard to figure out why. With an average house price near half a million dollars, few average people can afford to buy a decent house. And those who bought their houses more than 10 years ago usually have very substantial capital gains - gains they can only enjoy by dying or moving. But in the Midwest, houses of similar quality sell for one-half to one-third as much money. So, if he owns his California home free and clear...the typical homeowner can move to Kansas or Missouri and put a quarter of a million dollars, or more, in the bank.

"Sounds like a good deal to me," concludes our English colleague. "But where is Missouri?"

Ah, there's the rub, we explained. Missouri is a long way from anywhere.

Your editor is a real estate investor...perhaps a bad one. He is buying property at what appears to be the top in a huge, worldwide property bubble. The only thing that makes sense of it is that he buys in places that are a long way from anywhere - and, therefore, relatively cheap.

"But when the bubble pops, will not even cheap places become cheaper?" he asks himself. "Yes," is the only answer he can give. But what won't?

All around the world, the supply of paper assets is increasing at breathtaking rates. Paper money in Britain is increasing at 11.2% per year. In Denmark, the money supply is racing ahead at 16.3% per year. In Australia, the rate is 9.8%. In this race to currency ruin the United States is a slowpoke - with a money supply growing at only 6.6%, which is still twice as fast as the increase in GDP or consumer price inflation.

So, the supply of "things" that can be manufactured is increasing rapidly. Billions have been invested in the factories of Asia to increase the production of "things." So many new "things" have been created that prices of them are falling - even as measured by paper currencies, which are also increasing at record rates.

But some things are hard to reproduce. Despite centuries of trying by alchemists no one has ever succeeded in turning base metal into gold, and the supply of land, as opposed to condos and houses, is still limited. We continue to buy both, carefully.

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.