Askov American. [volume] (Askov, Pine County, Minn.) 1914-current, 1915-01-07

tnept phrase since any farmer who has
b good character. wlo Ii sober, Aon-
est. Industrious. inteliigant. productive
worker, has capital that In eonsfd.
erred proper hasia for credit and he
ran ia FACT capitalize hia character.
Els character Ia TIN very truth under
these conditions hia capital Here lie
the way III lie done here In Denmark:
by the Law enacted In 1898 the gov
ernment In authorized 20 turn over to
which the associations account 10 the
government at the rate of three per
cent. per annum. This sum In placed
nj the disposal of the farmers credit
association In order that these asao-
Citations MAY be ready 20 give small
loans to their members, When any
farmer finds II urgently necessary to
secure q loan In order to meet ex-
penses such ~ the payment Of wages,
the price OF better seeds, or of artih-
cial mAnnrea. or of feed for cattle. he
makes application 70 one OF these az
sociations. In determining the amount
of the loan TO be granted TO each man
II tn the theory that the earning ca
pacity OF the borrower should be taken
into account. This Ii thought tn be
best indicated by the number OF dairy
cows which he owns, A member may
thus obtain loan to about So per
head of cattle fed and MIXED On the
place. The loans must be repaid In
from one to nine months. Interest
must not. according to the original law
exceed 40 per cent per annum to
the borrower.
canish Bankers Have 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 Dam
ish banker TO the fact that the rural
credit il q 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 o manner which would surprise
Americans. This il particularly true
| OF the method I'm which he assists In
| financing cooperative associations.
| When the big Trifolium dairy associa.
ton was formed, for example. 1t was
done In this way: One hundred farm.
| ers, most Of. them owners ut large
farms, formed an organization for the
manufacture Of dairy products and for
the further purpose OF supplying milk
to the city OF Copenhagen. These one
| hundred farmers we're the owners OF
something like $4,000 cows, While
| they individually had property, real
and personal, they had no money
| which they wished to invest in h CO
| operative organization. They there.
| fore sent their leaders 10 the bank
| to borrow the money. They simply
| asked the bank for loan of sI25. 200
| on the note signed by these leaders
members Of tha association TO sign
| the note, although by the terms OF the
| agreement into which all had entered
| In the formation of the cooperative
association all we're liable, jointly and
severally. for the debt contracted at
the bank. As o matter of course the
bank made the loan to these farmers
at u low rate OF interest.
A most interesting feature OF this
I transaction Ia the method OF repay.
mant. 1t was agreed that the loan
should extend over q period of twenty
years with the privilege on the part
| Of the, association TO repay out Of ita
| profit each year sufficient sum so
| that at the end of the twenty years
| the debt should be discharged. At
| this time the association has been run
| ming for twelve years and has been
| more than able to keep up it's amortt
| ration payments. At the end of eight
years more the debt with the bank
| viii be discharged. At Fredericks
sund. out some little distance from
| Copenhagen, there Ia a cooperative
egg association which is composed oil
| loooo farmers. These 1o.0o0 farmers
had no capital which they wished to
invest In an egg packing and shipping
organisation. Their leaders went to
the bankers 50 did the leaders of the
Trifolium dairy association and made
similar loan except that In the case
OF the 10000 farmers who wished to
start an egg packing establishment the
period OF repayment was over period
Of ten years rather than twenty. This
seems to be quite an ordinary prae
tica.
1 Can Banks Supply Rural creditF
4 | have said IL Ia up to the banker
to supply the American farmer with
loans similar to those supplied To the
European farmer. But there are those
who say that the joint stock bank can
never meet the farmers needs A. do
cooperative credit societies and that
cooperative credit win eoma In spats
OF all the bankers can do.
/ DR.. Charles Mccarthy Ia OF this
number, He bases his conclusion on
these grounds: First. no joint stock
bank can afford to tie its money w
for longperiod loans a. do the credit
banks, These deposits are all short.
time deposits. They have no way oil
hypotheeatiag one series of loans In