1212 New Yokk State Agricultural Society 



The so-called amortization on a seventy-five year loan, the amount 

 to be paid on the principal each year, is less than one-tifth of 1 

 per cent. On a fifty-year loan it rises to al)out six-tenths of 1 

 per cent.; while on a thirty-year loan it is abont 1~/.', per cent. 

 X(i\v add those aiiKuints to tbe interest charu('(l on th(> niortii'age 

 by tlie Freneli l)ank, 4. .'5 per cent., and yon find tliat on a seventy- 

 five-year l(»an the annnal payment is less than 5 per cent.; on a 

 fifty-year loan it is still nnder 5 per cent and on the thirty-year 

 loan it is jnst nnder G per cent. 



We cannot claim that the institntion of a Credit Foncier in 

 this country will at once bring down the rates on loans to the 

 farmer to snch low figures as these. But if we can lend money at 

 5 per cent, instead of 4.3 per cent., as it is loaned by the French 

 bank, and make the proper additions for the amortization of the 

 principal, we shall still find that the burden is a small one as 

 compared to that under which we labor in some parts of this 

 country to-day. It has been suggested that we should organize 

 in each state a land mortgage bank of this character — that is, 

 that it shall have a certain paid up capital as a guarantee fund, 

 but that its main business shall be the sale of bonds in the money 

 markets of the world and the employment of the proceeds of 

 those bonds in loaning on mortgage to farmers. I believe this 

 would be a step forward, but, in order to confer the benefit of the 

 system in its fullest degree upon all parts of the country, it will 

 lie found necessary to have a national organization whose prestige 

 shall enable it to borrow money on the lowest terms not in New 

 York alone, btit in London, Paris, Brussels and Berlin. A state 

 association would proliably 1)0 very successful in Xew York, but 

 we should not be so narrow as to seek to limit the benefits of 

 this system to a single state. If we are to carry it to all the 

 states we must have a central organization which will give the 

 guarantee of its credit and its reputation to the bonds which are 

 sohl on the nioiuy niai'k(>ts of Furope and here in Xew York. 

 I fear that a state land liank in the southwestern states ofiering 

 bonds for the first time on the Paris J^ourse would not find many 

 takers; but if we have a national Credit Foncier. which is able to 

 investigate the conditions in tlutse states a.nd to issue its own 

 bonds in substitution for those of the state association, or to 



