The Washington times., 1936-11-06
By L. w. MEREDITH
International News Service


The farmers have about as much
money in the banks now as they
had in the boom year Of '29, despite
the disastrous droughts Of 1884
and 1885, and they owe the banks
and the Government less money
than they have since the Govern
ment has kept official records, re-
ports of the U. S. Bureau Of Agrl-
cultural Economics showed today.
They will need new credit next
year, particularly in the drought
areas, because of increased costs
of crop production. But there will
be "a plentiful supply of credit for
sound agricultural loans" at low
rates of interest, the bureaus fore
cast on the farm credit outlook for
1887 said.
Increase in Incomes
Increased demand for farm prod
ucts, with increased prices for at
least the first half of the year
pointed toward a continued in
crease in the farm income.
The report stated:
Increasing proceeds from the
sale of crops and livestock, COM
bined with benefit and grant
payments to farmers under the
agricultural adjustment and soil
conservation programs, have sub
Stantially increased farmers in
comes from the low levels Of
1892 and 1888.
Farmers deposits at banks
are increasing. Demand deposits
of Federal Reserve member
banks located in places of less
than $4,000 population are now
at levels apprOximating those of
1929"
Farm deposits reached their
peak for the last decade late in
1928, then slumped to less than so
per cent in 1888. Now, according
to the bureau, they are on a par
with the 1929 deposits and almost
equal to the 1923 high mark.
Loans not Needed
But the banks are not gaining
the benefit of loans, the report
and records of the bureau revealed.
The outlook resumed:
with their increased in
comes, farmers are now able
to pay operating expenses and
make improvements and addi-
tiOnS to their properties to a
larger extent than formerly,
without borrowing"
Farmers personal and collateral
loans from commercial banks, out
standing on July l this year, were
estimated at $660,717,000.
Two years ago, they totaled
$807, ,613, 900, as compared to ST.
936,360 in 1881. The peak year
for farm loans was $500, ,891 900
in 1920.
Federal Governmental agencies
began making their appearance
in the farm loan field in 1929, when
short-term loans to farmers to-
tailed $56,942,O00. In 1882 they to-
tailed $196, 10000; in 1888, $685.
100000; for 1884, a total of $313,-
$4,000; in 1885, the aggregate was
1868, ,716,000, and this year the
bureau places loans of Govern
mental agencies to farmers at
$4S6, 10000.
Payments Excluded
These figures do not include
the more than $1,400, 0,O0O, 900
rental and benefit payments
paid by the government under
the Agricultural Adjustment Ad-
ministration, nor grants totaling
$24,00O,000 made by the Reset
tlement Administration to farm
ers made destitute by the drought.
To the proceeds from sale of
crops and livestock for farmers
next year will be added the bulk
of payments of the $470,000,0
appropriated by Congress for the
soil conservation program, which
supplanted the AAA. While the
payments apply in compliance
with the program this year, the
bulk of the actual payments will
not be reached until after Jan. !,
the bureau stated, adding:
Increased needs for new
credit will arise in many regions
as the result of the drought and
the advancing cost Of crop pro-