r 
454 
American Agriculturist, May 26,1923 
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SIDING 
CEILING 
Proof Against 
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Lightning 
We can furnish for immediate de¬ 
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Furnished in CORRUGATED, V- 
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There is a special Penco metal ceil¬ 
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Send for catalogue for Metal Lath, 
Corner Bead, Culverts, Bridge 
Arches, Gutt ers, Leaders, 
Ventilators, Skylights. 
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also 
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Write your nearest office 
Get Jim Bi‘own*s new 
FACTOBYPRICES 
How Federal Land Banks Help Farmers 
Write qaick for my big 
new book of money-BEv- ^ 
iog factory pricos on bigb-^ 
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Stool PostSnPalnts,lloorifig. 
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pay o penny more tbim Jim 
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0 Fence S Wire Cs., Dept8Q02, Clsweland, 0. 
$56.00 on I 
rorder. 1 paid 3 
37c per rod, and! 
fence here no bet¬ 
ter is 938-4 eta.’ 
•.Charles F 
k Stella, 
early days and feel fairly familiar 
with its methods and precedure. But 
a few weeks ago, at the request of the 
American Agriculturist, I made a trip 
to Springfield and spent a day at the 
bank in order to check up my informa¬ 
tion and to make sure that I was not 
presenting ahything other than the 
truth regarding the work of the bank. 
The word “bank” in a big city at least 
suggests a large, ornate room on the 
level of the street, with revolving port¬ 
als and uniformed attendants, and men 
locked in steel cages along with stack's 
of coin and imposing rolls of “yellow¬ 
backs.” Well, the Federal Land Bank 
is quartered well up toward the top of 
a tall office building, and there is very 
little about it to suggest our usual 
ideas of a bank. I went around at the 
stroke of nine, which I supposed was 
the very earliest hour at which any one 
would appear, and found the place al¬ 
ready humming with activity and 
punctuated by the clack of typewriters. 
Of course, the mere handling of money 
is a very small part of their activities. 
Not a Government Institution 
1 ET me make one thing plain, and 
J correct a common misapprehen¬ 
sion, the Federal _ Land Bank is not 
a government institution. It is organ¬ 
ized under the Land Bank Act, and it 
enjoys a large measure of govern¬ 
mental control, supervision and privi¬ 
leges, but it is a private corporation, 
nevertheless. In one important respect, 
the Federal Land Bank differs from 
the so-called joint stock land banks in 
that the latter are private corporations 
formed for the purpose of personal 
gain, while the Federal Land Bank is, 
by its charter, specifically declared to 
be a non-profit-making organization, 
and any profits arising from its opera¬ 
tion must eventually be returned to the 
borrowers through the local associa¬ 
tions. It seems to me that the differ¬ 
ence is fundamental. 
4 TIMES Around the World with ONE OILING 
100,000 Miles Without Stopping for Oil 
An inventor who could develop an automobile, a railroad car or any 
o^er conveyance on wheels which would perform such a feat would 
be considered a wonder. But such is the record of regular 
accomplishment by the Auto-oiled Aermotor during the past 
eight years in pumping water. 
^ Did you ever stop to think how many revolutions the wheel 
a windmill makes? If the wheel of an Aermotor should roll along the surface 
of the ground at the same speed that it makes when pumping water it would 
encircle the world in 90 days, or would go four times around m a year. It would 
travel on an average 273 miles per day or about 30 miles per hour for 9 hours each 
day. An automobile which keeps up that pace day after day needs a thorough 
oiling at least once a week. Isn’t it marvelous, then, that a windmill has been 
made which will go 50 times as long as the best automobile with one oiling? 
The Anto-olled Aermotor after 8 full years of service in every 
part of the world has proven its ability to run and give the most reliable service 
with one oiling a year. The double gears, and all moving parts, are entirely 
enclosed and flooded with oil all the time. It gives more service with less attention than 
any other piece of machinery on the farm. To get everlasting wind-mw satisfaction buy the 
Auto-oiled Aermotor, the most efficient windmill that has ever been made. 
AERMOTOR CO. ^ci,y !&poiu SSSST 
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Milks anywhere in back or in front of 
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power chores besides milking. 
No better or faster milking done by any 
other make of milking machine at any 
price. Will demonstrate in your stable be¬ 
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ANDERSON MILKER CO., Inc., Randolph, N. Y. 
Gasoline Engine Milker. 
Electric Milkers also 
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CHIC A <30 
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{Continued from page 451) 
The money that the bank loans is 
obtained through the sale of its bonds, 
these bonds being secured by the origi¬ 
nal mortgages. Now, to be exact, 
these are not really government bonds 
because the government does not guar¬ 
antee their payment, but as a matter 
of fact they enjoy a reputation for ab¬ 
solute soundness that permits them to 
be sold in large amounts at prices 
comparable to the very highest class 
municipal and State obligations. Sorhe- 
how, the financiers do not for one mo¬ 
ment question the credit of the bank. 
Encourages Thrift 
I MIGHT add the somewhat remark¬ 
able fact that these bonds will be sold 
to farmers in amounts as small as $40 
and at prices just as favorable as if he 
was a very large purchaser. This is 
simply in line with the policy of the 
bank to encourage thrift among farm¬ 
ers and not to make money for any 
individual. Last year the Springfield 
Bank sold more than $60,000 in bonds 
to farmers. 
However, it must be understood that 
the bank is not wholly a philanthropic 
or benevolent institution. It is true 
that it is not organized for the pur¬ 
pose of private gain, but rather for the 
purpose of furnishing more advanta¬ 
geous borrowing facilities for farmers. 
Yet—unfortunately, perhaps—it can¬ 
not finance the insolvent farmer. One 
common criticism of the bank is that 
it emphasized “safety first” so strongly 
that usually the man who it can help 
can also help himself. I am sorry that 
this is in a great measure true, yet, on 
the other hand, if.it were to adopt the 
easy policy of loaning everybody all 
they asked, it would be only a question 
of time until it would be unable to loan 
anybody anything. The bank is by no 
means superior to economic .law. If a 
loss is sustained, it is born not by the 
government, but by the bank, and in 
the end this loss is passed on to the 
stockholders (the borrowers) in the 
form of reduced dividends. The policy 
of rigorous safety is, after all, the 
only one that is fair to all their thou¬ 
sands of stockholders. 
If there is a default in interest or 
principal, the bank has no special ad¬ 
vantages or privileges. It can only 
follow the usual rather long and ex¬ 
pensive route of foreclosure through 
the courts. 
Under Government Supervision 
I F 1 were to define or describe the 
function of the Federal Land Bank 
in a single sentence, it would run like 
this: It is a great cooperative cor¬ 
poration operating under intimate gov¬ 
ernmental supervision and control, and 
its business is the loaning of money 
secured by first mortgages on farm 
property under unusually liberal and 
attractive terms. 
At first sight, there does seem to bq 
a good deal of red tape about getting 
a loan from the bank. What might be 
called the “farm end” of the proposi¬ 
tion is the local farm loan association. 
In any locality, a group of ten or more 
farmers whose borrowing needs aggre¬ 
gate not less than $20,0^00, may form 
themselves into an organization, select 
a secretary-treasurer, and with the ap¬ 
proval of the bank become a local asso¬ 
ciation. The field of such an associa¬ 
tion is generally, but not always, 
bounded by county lines. Every coun¬ 
ty in the Springfield territory is now 
regularly secured by some local asso¬ 
ciation. The essential officers of such 
an association are the secretary-treas¬ 
urer and the loan committee of three 
members, whose business it is to make 
a preliminary appraisal of all farms 
offered, and to make such recommenda¬ 
tion as seem wise to them. All move¬ 
ments looking toward a loan must 
originate with and be vouched by the 
local association. 
Applying for a Loan 
T he owner of a farm who wishes to 
offer it as security for a loan must 
first make application through the sec¬ 
retary-treasurer of the local association. 
It then becomes the duty of the loan 
committee to make an examination and 
appraisal of the farm along with the 
collection of such other information or 
data as may have a bearing upon the 
matter. This report must be made a 
part of the application to the bank and 
must always be signed by all three 
members of the loan committee. Per¬ 
haps this report may be characterized 
as a sort of guarantee of good faith on 
the part of the local association. If it 
seems evident to the loan committee 
that the loan asked is impossible, the 
matter stops right there. This ap¬ 
praisal of the loan committee cannot 
be increased by either the Federal ap¬ 
praiser or by the bank, but it can be 
decreased by either. 
After an application for a loan has 
been approved by the local association, 
it will be forwarded to the bank, which 
will then direct its own—the so-called 
“Federal” appraiser to examine and 
report on the property. His report, 
after being forwarded to the bank 
along with the original application, 
which will be very promptly consid¬ 
ered and passed upon by the executive 
committee of the bank, and the appli¬ 
cant will immediately be advised of 
their decision. The bank may take 
any one of three courses: (a) It may 
grant the loan for the full amount 
asked; (b) it may grant a loan for a 
sum smaller than that applied for; 
(c) it may unconditionally refuse the 
loan. This latter course is not infre¬ 
quent if there seems to be unfavorable 
factors which can ultimately result 
only in disappointment and disaster. 
Refusals Sometimes a Kindness 
I FEEL sure that to refuse a loan is 
often in the end the great kindness. I 
remember once appraising a rather 
good farm which had been purchased 
a few years, before, by some misguided 
“back-to-the-landers.” They were fine, 
intelligent, refined, Christian people, 
but they were helpless and hopeless 
babes-in-the-woods so far as agricul¬ 
tural matters were concerned. They 
were accumulating fioating debt and 
running behind until finally they 
turned to the bank for a loan. I went 
over their plans and affairs with them, 
and was convinced that a loan would 
only prolong the agony a few years — 
a conclusion with which the bank 
agreed, although on the face of it the 
risk was not a bad one. The same 
farm and the same loan would have 
been unhesitatingly granted if the ap¬ 
plicant had been a real farmer who 
knew his right hand from his left. 
Personally, I am inclined to lay great 
stress upon this human factor. I be¬ 
lieve the great financier, the elder 
Morgan^ said that he had loaned some 
men a million dollars on their unsup¬ 
ported say-so, and that he had refused 
a loan to other men who came with 
bales of bonds seeking it. 
In securing a loan there are two, or, 
perhaps, we must say three, items of 
expense to the applicant. First, there 
is a fee of $10 which goes with the 
application and which cannot be re¬ 
turned even if the loan is subsequently 
refused. This fee is for the purpose of 
partially (and only partially) defray¬ 
ing the cost of appraisal by the loan 
committee, the Federal appraiser and 
also the preparation of the necessary 
papers. If the loan is granted there 
will be a fee of one per cent of the 
amount of the loan, but the ten dollars 
at first advanced will be deducted from 
this amount. 
The Abstract of Title 
A MORE serious expense or payment 
which in no way directly benefits 
the bank is connected with the fact that 
after all other details are completed 
and before the loan is actually closed, 
the applicant must furnish to the sat¬ 
isfaction of the bank an “abstract of 
title” showing that there is no cloud on 
the title, such as unsatisfied judgments, 
wills that have not been properly pro¬ 
bated, or ancient encumbrances of any 
kind. It ought to be said that an ab¬ 
stract of this kind often requires a 
great amount of skilled research on the 
part of attorneys accustomed to the 
work. I was shown abstracts whose 
bulk amazed me. If set up in type 
they would make a fair-sized book. 
The bank is surely very rigorous in 
this matter. Personally, I have won¬ 
dered if in the interest of service and 
economy it might not be possible to 
waive a part of these requirements, 
alth'ough that idea does not for one 
moment appeal to a title attorney. 
{Continued on page 463) 
