8 BULLETIN 409, U. S. DEPARTMENT OF AGRICULTURE. 
lire stock, lie has this advantage, that when the cash crop, whether 
cotton or grain, is ready for sale in the fall, it is not tied up with a 
lien to meet a season's advance for food or feed. He is in a position, 
therefore, to sell his cash crop whenever the marketing conditions 
are favorable. The relatively favorable position of such a farmer 
assists him in commanding the confidence of lenders. 
On the other hand, consider farmer B, who comes to the local 
merchant and makes credit purchases of bacon, cornmeal, and canned 
goods for table use, and who goes back to his farm with a bale of 
hay or a sack of feed in his wagon box. In his cotton field there are 
patches where the yield is poor because of low soil fertility and indif- 
ferent methods of cultivation. The only enterprise on the farm is 
cotton growing and this crop is mortgaged in advance to supply the 
food and feed purchased in town and consumed on the farm. Farmer 
B has little if any credit at the bank. He gets a limited store credit 
on an advancing basis from a local merchant. His is the most ex- 
pensive kind of credit and probably he is the farmer who is the least 
able to pay for it. 
RESPONSIBILITY FOR THE ONE-CROP SYSTEM. 
In some regions the lender even more than the farmer is responsible 
for the continuance of a one-crop system of farming. This is es- 
pecially true where bankers refuse to extend credit to farmers except 
on the basis of a single crop, such as cotton in the South or a cereal 
crop hi the North. Such a mistaken policy can be corrected only to 
the extent that the banker realizes the evil effects of one-crop farm- 
ing and undertakes to cooperate actively with the fanner in the 
extension of credit on a proper basis. 
It is scarcely possible to lay too much emphasis upon the practical 
importance of the method and character of farming as a factor affect- 
ing interest rates on farm loans. Every agricultural region has its 
own peculiar problems of adapting farming methods and practices to 
local conditions. There are progressive bankers in various parts of 
the country who realize the importance of cooperating with the 
farmers in promoting the kind of farming that will be permanently 
beneficial to the community. This suggests a common interest 
between bankers and farmers which should be made the basis for 
further cooperative effort. 
CHARACTERISTICS OF THE LOAN. 
As the importance of promoting and encouraging improved systems 
of farming becomes increasingly apparent, attention will be directed 
more and more toward such questions as the purpose and size of farm 
loans. How are the proceeds of a proposed loan to be employed? 
Are they to be expended for a productive purpose, such as would lead 
