Manchester Democrat. [volume] (Manchester, Iowa) 1875-1930, 1914-04-29
/ CO p eratjii:ye Farm Al, Il
r oduc cts Marketin
H0,p II II Done IL Europe and May Be Done
in America to the Profit of Both
lsSsSs# Farmer and Consumer
WILL THE BANKERS REFORM
Farmer and Consumer
.sy MATTHEW s. DUDcEon.

" 5000 v12'5s'7s,,'i>gv -
kERS REFORM?
capital whatsoever. Each is simply
an agency whose functions are to see
~ that the real estate security Of
fered is assessed at Its true value;
(2) that the title IL clear; az that the
mortgages are properly executed;
|s(4) that they are grouped, pledged
and deposited with the trustee;
(5) that the trustee issues bonds:
(6) that the land. buildings and equip
ment are properly cared for and their
value 10 not permitted to deteriorate;
|S(7) that the payments Of principal and
Interest are promptly met III IS s5.s%,
Easy Repayment Of Loans.
The farmer pays from four to six
per cent. OF the principal amount each
year. This Is not wholly interest. how
ever, for 1t includes small INSTALL
ment OF principal, for. the mortgages
are all amortization mortgages. Pay
ment OF this fixed sum annually or
ssemi-annually for the fixed period
therefor automatically discharges the
debt. a small amount out OF each
payment is also set aside for reserve
for the cooperative society and for
an expense account. It has been the
universal experience, however, that
the expense runs very low. .s3 Ass
Still Easier for the Farm ,Laborsr.
There are other forms Of loans even
more advantageous to tho borrower.
particularly II he is one Of the poorer
farm laborers. II such 4 laborer seeks
to become land owner on small
scale he may under certain conditions
secure loan for nine-tenths OF the
value of the proposed purchase. being
required to advance only one-tenth Of
the purchase price in cash. The gov
eminent furnished the funds for. these
loans. The conditions are az the bors
rover must have been engaged in ag-
ricultural labor for Ave years (women
may take advantage Of this law as
we'll az men); az the land must not
exceed ten acres In extent nor $2,144
In value: (3) the borrower and pro-
spective purchaser must agree to crop
the farm In q certain manner, dividing
it up into i've or seven fields and fol-
lowing . certain rotation Of crops, thus
insuring continued productiveness and
preventing deterioration of soil fer
tility. Under these mortgages the
borrower pays three per cent. interest
with no installments upon the prtnci-
pal for the first hve years. Then he
pays. In addition to the interest one
per cent. upon two-hfths OF the loan ~
an installment upon principal. doing
this until the two-nfths OF the loan 10
entirely discharged. Thereafter he
pays an annual insta1lment OF one per
cent. upon the three-nfths remaining
OF the principal, this being In addi-
ton to his three per cent. interest
as before, The bonds may DO issued
upon unstamped paper and are free
from tax.
d Does the Danish farmer take advan-
tage Of these opportunities? Are the
tenants becoming land owners! The
facts are these: Denmark has 2,600. 900
population. somewhat less than that
of Chicago. It has about 500, 900 fami-
lies, Including those in cities and vii
lagos a. well a. those In the rural re-
gions. These cooperative credit soci-
cites have . membership of over
100000; that is to say. two out OF
every ave families In the entire coun-
try are represented In them. Largely
as result Of this credit system ninety
per cent. Of the farmers Of Denmark
own their own land.
How Character 10 Capitalized.
Obtaining a loan on personal secur.
ity has been euphoniously termed
'"capitalizing character" It IL not an
inept phrase since any farmer who has
a good character, who IL a sober, hon.
est. Industrious, intelligent. productive
worker, has . capital that II consid-
cred = proper basis for credit and he
can IN fact capitalize his character.
His character is In very truth under
these conditions. his capital. Here 10
the way 1t Is done here In Denmark:
BY the law enacted in 1898 the gov.
eminent II authorized to turn over to
the credit association $3.50 900. for
which the associations account to the
government at the rate Of three per
cent. per annum. This sum IL placed
at the disposal Of the farmers credit
association in order that these asso-
Citations may be ready to give small
loans to their members. When any
farmer finds It urgently necessary to
secure Q loan in order to meet ex-
penses such ~ the payment of wages,
the price Of better seeds, or of artii-
cial manures. or OF feed for cattle, he
makes application to one of these as
sociations. In determining the amount
Of the loan to be granted to each man
It Is the theory that the earning ca
gpacity Of the borrower should be taken
into account. This Is thought to be
best indicated by the number OF dairy