REPORT OF THE SECRETARY. 29 



rural credit. This is the running accounts at the stores where the 

 farm oAvners and tenants buy groceries and other goods without giv- 

 ing security. Correspondents were requested to report with regard 

 to this, and their answers indicate that 59 per cent of the farmers 

 owning their land have running accounts with local merchants and 

 that 53 per cent of the tenants have such accounts in communities 

 where this form of credit exists. 



In 1 per cent of the communities it was reported that farm owners 

 did not obtain store credit, and in 2 per cent of them that tenants did 

 not do so. Country merchants sell goods on trust to more than 

 ono-half of the farm owners and farm tenants in their communities, 

 and this without security. 



RATES OF INTEREST. 



Substantially no statistics of rates of interest paid by farmers have 

 been collected in this country since the census of 1890; and conse- 

 quently it was especially desirable that the correspondents be re- 

 quested to contribute information in this investigation and report 

 with regard to the subject. Six questions were framed, and these 

 were answered with undoubted understanding as to the meaning of 

 the questions. The results are of much interest. 



The questions Avere expressed in dual form, in such a way as to 

 call for an answer for agricultural loans and also for loans on town 

 and city real estate, the circumstances of the loans being otherwise 

 substantially the same. 



The interest rates on the bulk of the purchase money throughout 

 the United States range from 6 to 8 per cent in the case of farms; 

 and also from 6 to 8 per cent in case of town and city real estate. 

 Upon taking account of the differences in rates of interest as between 

 farm and town property, it is discovered that in the case of purchase- 

 money loans 10 per cent of the responses state that the rates are 

 higher for farms than for town and city real estate; 33 per cent 

 report that the rates are lower for farms than for town and city real 

 estate; and 57 per cent report that there is no difference in rates of 

 interest on purchase-money loans between the two classes. 



A similar question was asked with regard to short-time loans, 

 with the result that 11 per cent of the answering correspondents 

 reported a higher rate for farms than for town and city real estate, 

 21 per cent reported a lower rate for farms, and 68 per cent reported 

 no difference. 



The same question for long-time loans induced 8 per cent of the 

 responses to report that the rates of interest on farm loans were 

 higher than for those on town and city real estate, 33 per cent to 

 report that the rates were lower on farms, and 59 per cent to report 

 no difference between the two classes of real estate. 



