137 



Credits to farmers under these conditions are sim- 

 ply moans of pillage, legally and lawfully covered. 



All over the world experience has again and again 

 demonstrated the impossibility of pretending to solve 

 rural credit through advances from rural banks dedi- 

 cated to rural business alone. 



Banks and commerce are synonymous ; a success- 

 ful rural bank without commercial clients is inconceiv- 

 able. 



CO-OPERATIVE BANKS. 



The oft-cited Raffeisen banks, the Schulze-Delitzch 

 banks, the Luzzatti, or the Lassalle banks are not banks 

 in the accepted sense of the word. The first is rather 

 an association of farmers for mutual aid, the second 

 a co-operative money lending society, and the third a 

 mutual money raising for rural folk. 



Commercial banks do not as a rule undertake any 

 of the operations which are the especiality of the above 

 mentioned societies, much less do they make advances 

 on land, which has been included in the very ample 

 charter of the "Banco Agricola". Besides the custo- 

 mary banking functions the said bank is to occupy it- 

 self in land deals, division of properties, in colonisa- 

 tion and co-operative farming, in special harvesting 

 emissions of paper money, a sort of rural "Caja de 

 Conversion'' and in mortgages. 



STATE COLONISATION AND LAND DEALS. 



One idea which seems to have attracted the atten- 

 tion of the founders is to reserve for the bank the 

 excellent business of land ' * rematador ", and "eon- 

 signatario", of buying up large estates and selling them 

 in lots. I might add here that the ideal of a State in- 

 stitution should surely be not to see itself but the client 

 enriched, not to reserve to itself the good business but 

 rather to limit its participation in the deal to good se- 

 curity, so that others run the risks and make the pro- 

 fits. In any case these are businesses quite apart from 

 rural credits, and need a highly complex organisation 

 with unlimited capital to back it. Moreover it is a field 

 which seems too admirably covered to-day to permit the 

 intrusion of a third party without a struggle . 



Mortgages appear to be adequately attended to by 

 the "Banco Hipotecario", which bank, through long 

 term mortgages, is actually financing the dividing up 



