THE RURAb NEW-YORKER 
1163 
1912. 
AGRICULTURAL CREDITS IN EUROPE. 
No. 3. 
The Credit Fonder is the land bank 
of France. This institution was organ¬ 
ized in 1852, and has become the largest 
as well as the most famous land bank in 
existence. When first organized it was 
given a monopoly in. the loaning of 
money on real estate mortgages. It was 
also given a government subsidy in the 
form of a loan which has never been 
repaid or demanded. In addition to 
making loans on mortgages on farms 
and other real estate it makes loans 
without mortgages to municipalities and 
public institutions. The monopoly was 
not renewed after the first 25 years, but 
this was probably because this privilege 
was not needed. It had secured such a 
strong position in the first 25 years of 
monopoly, and other special privileges 
which it yet retains, that the renewal 
of the monopoly was not essential to 
its future success. Some of the special 
concessions enjoyed by this bank in 
addition to the original subsidy and mo¬ 
nopoly are exemption from taxation, 
use of the national treasury for receipt 
and deposit of its dues and funds, ex¬ 
emption from registration of its bonds 
every 10 years as required by others, a 
lottery privilege in connection with the 
calling in by lot and payment of deben¬ 
tures, a privilege in clearing title of real 
estate in which it is interested in case 
of dispute, and the privilege of attach¬ 
ing and selling properties on which it 
holds mortgages in case the property is 
deteriorating in value, or when dues 
are not paid, with simple, speedy and 
inexpensive processes, and the further 
privilege of selling debentures in amount 
equal to the total amount of mortgages 
held. In addition to all this the fact 
that the government exercises a control 
and supervision of its management is 
a valuable asset in itself, inasmuch as it 
insures confidence in its debentures, and 
makes them the most popular form of 
investment securities in the country. 
On the other hand, this bank is sub¬ 
ject to very definite laws, and very strict 
government regulations. It is a stock 
corporation, the stock being held by 
private persons, and the shareholders 
elect a board of directors and three 
auditors, and legislates, on the general 
policy of the company in such matters 
as are not specifically defined by law. 
But the governor and two lieutenant- 
governors are appointed for life on good 
behavior by the President of the French 
Republic, and this governor selects the 
other officers and employees of the 
bank,-except the auditors, whose duties 
are to see that all the transactions of 
the bank are regular, and to make nec¬ 
essary investigations and reports. The 
capital stock of the bank must not fall 
below five per cent of the debentures is¬ 
sued, and after the stock pays five per 
cent dividend, the bank must set aside 
from five to 20 per cent of the remain¬ 
ing profits as a reserve. This provision 
must be repeated each year, until the re¬ 
serves amount to one-half the capital 
stock. These two provisions, namely, 
the reserve and the maintained ratio 
of capital stock to debentures issued, 
form the surplus to guarantee the pay¬ 
ment of the debentures when due. The 
surplus is invested by the directors, but 
the capital stock is invested only in se¬ 
curities defined by law. 
The Credit Foncier is allowed to loan 
only on first mortgage. The property 
must have a clear title and yield a defi¬ 
nite and steady income. The loans must 
not exceed 5A per cent of its value, and 
in the case of vineyards, orchards and 
woods it may loan only one-third of its 
value. It cannot accept a mortgage 
when the annual payment exceeds the 
annual income from the property. It is 
not allowed to make loans on certain 
properties, such as theatres, mines, etc. 
The interest rate which the bank may 
charge on mortgages is not definitely 
fixed. It varies with the rate at which 
the bank sells its debentures from time 
to time, but it is not allowed to charge 
on mortgages more than six-tenths of 
one per cent over and above the rate 
it pays for the money on its debentures, 
and to municipalities the excess is only 
0.45 per cent. There is a provision also 
that the debentures issued must corre¬ 
spond in amount exactly with the 
amount of the loans outstanding. 
The Credit Foncier is authorized to 
accept mortgages as security for short 
time loans, and it does so; but it was 
established principally to make long¬ 
time loans, and its principal business is 
confined to them, and its fame derived 
from its success in handling them. At 
the present time its rates on mortgage 
loans are 4.3 per cent, and the rate to 
municipalities is 1-5 of one per cent. less. 
The time of the loans run from 10 to 
75 years. The mortgages provide that 
the borrower may pay them off at any 
time, but the bank cannot compel pay¬ 
ment until maturity, provided the pay¬ 
ments are regularly made and the prop¬ 
erty is not deteriorating in value. But 
the great feature of these loans is the 
amortization principle. This simply 
means the extinction of the debt by 
means of a sinking fund. You pay the 
interest each year just as in a common 
mortgage, and in addition a small per¬ 
centage annually on the principal. This 
payment is called an annuity. It is the 
same principle and the same policy 
adopted in the government loans to 
Irish farmers to which reference has al¬ 
ready been made. These annuities are 
so trifling in amount as to be almost in¬ 
credible at first sight. If you secure 
a mortgage from this bank at the pres¬ 
ent time at its interest rate of 4.3 per 
cent, for a term of 75 years, for every 
$100 received you will make an annual 
payment of $4.48, and at the end of the 
75 years the mortgage will be wiped out 
and the farm will be free and clear. If 
you take it for 50 years, your annual 
payment on every $100 will be $4.88. If 
for 25 years, your annuity will be $6.56. 
The Credit Foncier simply borrows 
money on its own notes or debentures 
at the lowest rate possible, and loans 
the money on mortgages at a rate about 
one-half per cent above the rate it pays 
for the money on its own notes. Evi¬ 
dently its success depends on the confi¬ 
dence the people have in the value of 
the debentures. This confidence comes 
largely through the government control 
and supervision and the vigilance of the 
auditors representing the stockholders 
or owners of the bank. 
The debentures have now become one 
of the most popular investments in 
France. They are issued in denomina¬ 
tions of $20 and upwards, and are held 
by farmers and frugal city people of 
small means. An issue of $100,000,000 
of these bonds was recently offered at 
three per cent, and 18 times the amount 
was promptly subscribed. The bonds 
are payable to bearer, so they are read¬ 
ily negotiable. They are written to run 
for the same number of years as the 
mortgages which they cover, and pay¬ 
ment of these cannot be enforced soon¬ 
er, but since the borrower has the right 
to pay a mortgage at any time and a 
surplus is always accumulating, a num¬ 
ber of each series is payable at any time 
by lot, and certain numbers, so called 
in, are entitled to a prize by chance 
drawing. This is the lottery feature re¬ 
ferred to above. It is one of the at¬ 
tractive features of the debentures. In 
a recent drawing one debenture holder 
drew a prize of $40,000. The capital of 
the bank is now $40,000,000, and its 
loans are about $875,000,000. It is mak¬ 
ing provision to increase the capital to 
$50,000,000. 
The American farmer who pays from 
six to 10 per cent annual interest on a 
mortgage which he is obliged to renew 
at frequent periods at an additional ex¬ 
pense of five to 10 per cent may well 
look with envy on the French system 
of financing farm mortgages. It may 
interest him to know that practically 
every country of Europe, even Russia, 
has a system for financing farm mort¬ 
gages and farm credits on something 
the same plan, all of which are modeled 
after the Landschaften system of Ger¬ 
many. JOHN J. DILLON. 
Quarantine of Christmas Greens. 
Coniferous trees, such as spruce, fir, hem¬ 
lock, pine, juniper and arbor vital, or in 
other words, “Christmas trees,” cannot be 
shipped from New England States after 
November 25 next on account of a quar¬ 
antine declared November 7 by the Depart¬ 
ment of Agriculture. Christmas trees and 
greens from nearly all New England will 
be barred because of the prevalence there 
of the Gypsy moth and the Brown-tail 
moth. 
For many years the shipping of Christ¬ 
mas trees, shrubs, etc., from certain New 
England States has been a profitable in¬ 
dustry, but according to the investigators 
of the Department of Agriculture it has 
been shown that the Gypsy moth and the 
Brown-tail moth have been incubated in 
New England and disseminated by Christ¬ 
mas trees and similar decorative plants, 
such as holly, laurel and by logs, taubark, 
posts and poles, railroad ties, cordwood 
and lumber and field-grown florists’ stock. 
Under an act of Congress passed just be¬ 
fore adjournment of the last session the 
Secretary of Agriculture was authorized to 
make quarantine regulations in connection 
with plant diseases, and the quarantine 
now promulgated is based ou this law. 
Tinder the regulations issued November 7 
none of the trees or products of the trees 
named can be moved in interstate com¬ 
merce until after inspection by the repre¬ 
sentatives of the Agricultural Department, 
which means that New York and other 
States west of the New England States will 
have to get their Christmas trees and 
shrubbery from other than New England 
points. 
EVENTS OF THE WEEK. 
DOMESTIC.—At White Plains, N. Y., 
October 30, County Judge W. P. Platt sen¬ 
tenced Fred Fawcett, a burglar, to 34 
years and six months in Sing Sing at hard 
labor. Had the prisoner received the full 
extent of the law on all counts against 
him he could have been given a sentence of 
90 years. He admitted that he had already 
spent 20 years in jail. 
After rescuing from a fire 85 children, 
six Sisters of Charity gave up their lives 
October 30 in flames that destroyed St. 
John's Orphanage, San Antonio, Tex. Only 
two of their little charges were lost. One 
baby fell to its death with Mother Mary 
F. Cross, mother superior of the institution, 
who had left a place of safety in a vain 
effort to save the child. The fire started 
early in the morning. Roused from their 
sleep, the nuns marshalled their wards to 
fire-escapes, remaining at their posts until 
flames barred the way to safety. Two of 
the sisters, Kostka Farrel and Monica 
Montez, were killed by jumping. Three 
sister escaped. Instructed to pilot the 
first column of frightened children out of 
danger, they gained the ground in time to 
escape the crash of falling walls. The 
death of each of the sisters was due di¬ 
rectly to their efforts to save the children. 
They belonged to the Sisters of Charity 
of the Incarnate Word. 
Vice-President James Schoolcraft Sher¬ 
man died after a long illness at his home 
in Utica, N. Y., October 30 from urtemic 
poison, caused by Bright's disease. For 
several years Mr. Sherman had been af¬ 
flicted with Bright’s disease and his diet 
had been restricted according to the orders 
of a physician. Last Spring the disease 
became more serious, and learning that his 
heart had become involved the Vice-Presi¬ 
dent abruptly left his duties in Washing¬ 
ton, came to his home and placed his af¬ 
fairs in order. At times recently he suf¬ 
fered much. He was 57 years old on the 
24th of October. Mr. Sherman is survived 
by his widow and three sons. 
Rodney B. Swift, former right hand man 
of the McCormick Harvester Company, told 
in the Chicago inquiry October 30 the first 
detailed story of the manner in which the 
International Harvester Company was 
formed. Among the important points 
brought out was that the McCormick com¬ 
pany earned profits in the three years prior 
to the formation of the International com¬ 
pany in excess of 816.000,000. This is at 
variance with the statement that the com¬ 
bination was made because competition had 
reached a point where the business was 
being ruined. Also it was testified that 
the profits of the McCormick plant were 
close to $6,000,000 a year in 1901 and 1902 
and that dividends totalling 463 per cent, 
were distributed in the 13 years prior to 
the International’s formation. The witness 
was the head of the legal and patent de¬ 
partments of the McCormick Harvester 
Company up to the time of the Interna¬ 
tional Harvester Company’s formation in 
1902. The defence sought to force an ad¬ 
mission from him that his revelation of 
secrets would violate the confidence placed 
in him as head of his legal department by 
Cyrus II. McCormick. Had they succeeded 
the Government’s line of questioning would 
have been thrown out on the ground that 
a lawyer cannot be forced to violate pro¬ 
fessional confidences. The Government 
succeeded in getting the statements as to 
the profits of the McCormick company into 
the records. In the 13 years the book value 
of the McCormick company holdings in¬ 
creased from $12,000,000 to $50,000,000 
without additional investment. Testimony 
was given that the International Harvester 
Company in 1903 paid a law firm a fee of 
$8,000 to defeat a bill in the Kansas Legis¬ 
lature designed to prohibit the corporation 
from using an “exclusive agent” clause in 
its contracts with its representatives sell¬ 
ing on commission. Mr. Swift testified that 
he was instructed by Cyrus IT. McCormick, 
president of the International Harvester 
Company, and Charles Deering, chairman 
of the executive committee, to go to Kan¬ 
sas and “fix it up.” The witness said he 
arranged with W. H. Rossington, of the law 
firm of Rossington, Husted & Smotli, of 
Topeka, to prevent the passage of the bill, 
and that later the firm presented a bill for 
$8,000. which was paid. Reports of the ap¬ 
praisals made of the properties of the Mc¬ 
Cormick and Deering harvester companies 
in 1902 show that those two companies 
earned dividends of about 1,000 per cent, 
on their capital stock in the five-year period 
from 1898 to September, 1902. The Mc¬ 
Cormick company earned profits of $25,- 
000,000 on its capital stock of $2,500,000, 
and the Deering company about the same. 
William N. Reay, comptroller for the har¬ 
vester company, explained the appraisals 
in detail, being the principal witness of the 
afternoon session. 
During a storm November 1 the steamer 
Cecilia, which plied between Montreal and 
Valleyfield, Quebec, sank at Isle Ferret in 
Lake St. Louis. Sixteen men, women and 
children were drowned. Only four, all 
men, were saved. 
Clinging to a davit projecting from the 
stern of his vessel, Captain Frederick God¬ 
frey, of the three-masted schooner John 
Maxwell, survived a half-mile journey 
through breakers at New Inlet, N. C., 
November 3, and is the only one of eight 
alive who put to sea in the craft. - Captain 
Godfrey had been lashed in the rigging for 
24 hours. The Maxwell encountered a 
heavy southwest storm off Diamond Shoals 
November 1, and was driven up the coast. 
Before the vessel could be worked out of 
danger the storm drove it on the shoals off 
New Inlet. 
As a result of the blowing out . of a 
boiler head on the battleship Vermont at 
Norfok, Va„ November 3, two members of 
the crew were killed, and four others seri¬ 
ously injured. The accident occurred on 
the Sound drill grounds, a few miles be¬ 
yond the Virginia Capes. 
Riding in a buggy drawn by five wolves, 
Frank Yomer and Darius Young, both from 
Seattle, Wash., left Lafayette, Ind., No¬ 
vember 1, for New York. They left Seattle 
on their transcontinental trip last May and 
expect to reach New York before Winter. 
In a suit filed against the Du Pont 
Powder Company in the United States 
Court at Hartford, Conn., the Buckeye 
Powder Company, of Peoria, Ill., accuses 
the other of monopoly and piracy of man¬ 
ufacturing secrets and claims damages of 
$1,119,957.82. The complaint alleges that 
the Du Pont company conspired to destroy 
the business of the Buckeye company by 
discrediting the value and quality of the 
Buckeye powder and that the Du Pont 
firm engaged spies to work at Peoria for 
the purpose of stealing the secret processes 
of making Buckeye powder, thus securing 
control of 95 per cent, of the powder busi¬ 
ness of the United States. 
Woodrow Wilson, of New Jersey, was 
chosen 27th President of the United States 
November 5. Swept into office by a Demo¬ 
cratic laudslide, he carried with him all of 
the doubtful States and many States firmly 
in the Republican column for years. Wil¬ 
son's popular plurality bids fair to exceed 
the record one of Roosevelt in 1904— 
2.500,000. The New Jersey man carried 
38 States surely, giving him 426 electoral 
votes. Colonel Roosevelt is second in the 
electoral vote race with 72. President Taft 
is third, with 17 electoral votes. 
FARM AND GARDEN.—October 30 a 
meeting of the Federal Agricultural Board 
was held in Washington to discuss re¬ 
strictions applying to nursery stock from 
localities infested with gipsy and brown- 
tail moths. No decision was reached, but 
it is believed that quarantine may be de¬ 
clared against Christmas greens from in¬ 
fested localities, owing to the difficulty of- 
inspecting such goods. The fact having 
been brought to the attention of the Fed¬ 
eral Horticultural Board that the Gipsy 
moth is more apt to be carried throughout 
the country by telegraph poles, railroad 
ties, railroad freight cars, stones from 
the quarries, etc., in both its caterpillar 
and egg periods, the special aim of the 
board would be also to inspect shipments of 
said materials. 
According to the American Consul at 
Montevideo, Uruguay, the reports from ag¬ 
ricultural experts sent to the United States 
by the government of Uruguay are most 
gratifying. They give credit to the Ameri¬ 
can Government officials and the people 
for the valuable assistance they received 
and recommend that all future agricultural 
commissions sent abroad spend all their 
time in the United States for the purpose 
of studying our methods. 
A new laboratory for the work of test¬ 
ing samples of seeds to learn their quality, 
either as to purity or germination, is rap¬ 
idly nearing completion at the Kentucky 
Agricultural Experiment Station at Lex¬ 
ington. 
The annual apple show of the Ohio State 
University Horticultural Society will be 
held in Townsend Ilall, Columbus, on De¬ 
cember 5 and 6, 1912. Competition is open 
to agricultural students and practical fruit 
growers over the State. The entry list in¬ 
cludes plate, tray and box displays. Lib¬ 
eral cash prizes are offered, as well as a 
number of magazine subscriptions and other 
articles of value to fruit growers. Pros¬ 
pective exhibitors, who intend to enter fruit 
for competition, are requested to communi¬ 
cate at once with the committee in charge 
of exhibits and secure printed premium 
list, entry blanks, etc. Address C. L. Long. 
Horticultural Dept., Ohio State University, 
Columbus. 
COMING FARMERS’ MEETINGS. 
Annual meeting of the Maine State Po- 
mological Society, City Hall, Portland, Me.. 
November 12-14. 
Apple Show, Grand Rapids, Mich., No¬ 
vember 12-16. 
Indiana Apple Show, Indianapolis, No¬ 
vember 13-19; secretary, C. G. Woodburv, 
Lafayette, Ind. 
American Land and Industrial Exposi¬ 
tion, 71st Regiment Armory, N. Y., Novem¬ 
ber 15-December 2. 
Pacific Northwest Land Products Show, 
Portland, Ore., November 18-23. 
Negro Farmers Conference, Hampton 
Normal and Agricultural Institute, Hamp¬ 
ton, Va., November 20-21. 
New Haven Poultry Association, annual 
show, New Haven, Conn., November 20-23. 
New England Corn Show, Horticultural 
Hall, Boston, Mass., November 20-24. 
Twin City Poultry and Pigeon Associa¬ 
tion, annual pigeou and poultry show, 
Spring City, Pa., November 27-30. 
International Live Stock, Chicago, No¬ 
vember 30-Doeember 7. 
Trenton Poultry and Pigeon Association, 
annual show, Trenton, N. J., December 2-9. 
Annual Apple Show, Ohio State Univer¬ 
sity Horticultural Society, Columbus, O., 
December 5-6. 
New Jersey State Horticultural Society, 
New Brunswick, N. J., December 9, 10, 11. 
Western New York Horticultural So¬ 
ciety, Rochester, N. Y., December 11-13. 
Northern Nut Growers’ Association, Lan¬ 
caster, Pa., December 18-19. 
Fourth Ohio State Apple Show, Zanes¬ 
ville, O., January 20-24. 1913. 
Cleveland, O., Fanciers’ Show, January 
20-25. 
American Breeders’ Association, Colum¬ 
bia, S. C., January 25-27. 1913. 
New York State Dairymen's Association, 
Syracuse, N. Y., December 10-13. 
Farm products in this vicinity are gen¬ 
erally governed by the market prices in 
Boston. Beef cattle are hard to find, but 
there is a good demand for new milch 
cows at $60 to $100. Hard to find a good 
young horse well broken and unafraid of 
automobiles and cars for less than $200. 
Potatoes, 75 cents a bushel; eggs, 40 to 
45 cents a dozen : hay around $20 a ton. 
private sale ; auction sales at a large auc¬ 
tion last week, $14.50. Cordwood, $4.25 
in four-foot lengths, green, $5 dry, $6.50 
cut three times and split, the above de¬ 
livered to consumer, and very hard to get. 
Summer prices for garden truck: Peas, 75 
cents a peck; beets, carrots, onions, etc., 
eight cents a bunch ; green corn, 10 cents 
a dozen; new potatoes. $1.25 a bushel. 
Milk, 37 cents 8%-quart can. Butter, 40 
cents a pound. Apples, $1.50 per barrel; 
Baldwins, McIntosh and Spy a little higher. 
Pine timber on the stump, $7 to $8 per 
thousand; labor, $2 a day and hard to 
get; mills in this town running full time 
and plenty of work; wages, $10 to $18 
per week. w. e. g. 
Antrim. N. II. 
