American Falls press. [volume] (American Falls, Idaho) 1907-1937, 1914-05-21

lent phrase since any farmer who has
GOOD character. who is a sober, hon
&C. Industrious, intelligent. productive
o-ker, has a capital that Is consid-
rad a proper basis Tor credit and he
20 in fact capitalize his character.
His character is ia very truth under
nese conditions his capital. Here is
he way it is lone here in Denmark:
BY the law enacted IN i698 the gov
ernment is authorized to turn over TO
.e credit association s1.250.0O0, for
hich the associations account TO the
government at the rate Of three per
cent. per annum. This sum is placed
nc the disposal Of the farmers credit
sss ociatiou in order that these asso-
Citations may be ready to give small
loans 70 their members. When any
farmer finds Il urgently necessary TO
secure a loan in order to meet eX-
penses such as the payment of wages,
The price Of better seeds. or OF artih-
cial manures. or Of feed for cattle. he
makes application 70 one Of these as
sOciatione. In determining the amount
Of the loan 70 be e. nted to each man
il is the theory Ii the earning ca
pacity OF the borrow should be taken
into account This Is thought to be
best indicated by { number of dairy
COWS which he WI A member may
thus obtain a loar to about $t3 per
head Of cattle fed nd MIXED on the
place. The loans must be repaid in
from one 10 nine uouths. Interest
must not, %accordina o the original law
exceed AZ per Get. per annum to
the borrower.
Danish Bankers ave Reformed.
The fact that there are in Denmark
many banks which are organized for
the sole purpose OF meeting the needs
of the farmers has awakened the Dan
ish banker TO the fact that the rural
credit is a big business which he can
not afford to ignore. Compared with
the American banker the Danish
banker most decidedly has reformed.
He does meet the needs OF the farmer
in a tanner which would surprise
Americans. This is particularly true
Of the method in which he assists in
financing cooperative associations.
When the big Trifolium dairy associa-
ton was formed, for example, it was
done in this way: One hundred farm
ers. most OF them owners of large
farms, formed an organization for the
manufacture OF dairy products and for
The further purpose Of supplying milk
20 the city Of Copenhagen. These one
hundred farmers were the owners oil
something like 10000 ows While
they individually had property, real
and personal, they had no money
which they wished TO invest in a co
operative organization. They there
fore sent their leaders to the banE
TO borrow the money. They simply
asked the bank for a loan Of 1925 .00l
on the tote signed by these leaders
The bank did not require the othe
members Of the association TO sigl
the note. although by the terms Of N
agreement into which all had entere
in the formation of the ~cO-operativ
association all we're liable. jointly an
severally, for the debt contracted a
the bank. AS a matter of course ID
bank made the loan TO these farmer
at a low rate Of interest.
A most interesting feature OF thi
transaction is the method OF repay
ment. It was agreed that the loa
should extend over a period OF twent
=. years with the privilege on the par
of the association 10 repay out Of i.
profit each year a sufficient sum s
that at the end of the twenty year
the debt should be discharged. A
+. this time the association has been rul
ming for twelve years and has bee
more than able to keep up its amort
zatiOn payments. At the end Of eigh
years more the debt with the ban
will be discharged. At Frederick.
= sund. out some little distance froI
> Copenhagen, there is a c~O-Operativ
egg association which is composed
: 10000 farmers. These 10000 farmer
: had no capital which they wished t
: invest in an egg-packing and shippin
: organization. Their leaders went {
the bankers as did the leaders OF tn
Trifolium dairy association and mad
a similar loan except that in the cas-
: Of the 10000 farmers who wished
start an e~gg-packing establishment Ia
period Of repayment was over a perio
Of ten years rather than twenty. Tn.
=. seems TO be quite an ordinary pra
= tice.
Can Banks Supply Rural Credit
n I have said it is up TO the banks
. 10 supply the American farmer wit
loans similar to those supplied TO II
: European farmer. But there are thos
A who say that the joint stock bank ca
never meet the farmers needs as q
a cooperative credit societies and tn;
y cooperative credit will come in spit
4 of all the bankers can Go.
a DR.. Charles Mccarthy is OF III.
number. He bases his conclusion G
these grounds; First, no joint stoc