Credit- To easy for farmers to get?

[bgmb]

Sask I am missing "the" point? or a point that you are now making? Anyway you basically made the same point as I did except you used machinery as an example instead of land.

I agree that type of machinery lending is bad business. However in the inflationary nightmare some are predicting it won't matter cause tractors will be worth 3 million in ten years instead of 300k so who cares if you never make a payment in ten years your ten year old tractor will be worth a million bucks. Whats a 50,000 payment on a tractor when canola is $50 a bu?

[SASKFARMER3]

You wouldnt have got that letter if you didnt have a decent balance sheet. Or read at bottom subject to final approval.

[cottonpicken]

This is why i follow bond action so much.

Interest rates should already be higher.

If they goto 20% and real inflation is low,sell
everything you have and get into paper,this is the
deflationists dream come true.

But this isnt what is happening,we need to inflate to
clean out this debt this time.This isnt the early
eighties.

Global currencies are burning against tangibles.

And the fact a few bubble/debt fueled asset classes
are collapsing doesnt mean we are in deflation
mode.

I have the same position as i did 7 years ago.

[bgmb]

Just one thing I might add. Interest rates don't need to go to %20 to get some guys into trouble. %7-%10 would cause quite a few trouble I suspect. Farms are in general allot higher leveraged than they were in the 80s.

[charliep]

Actually farmers are not getting more leveraged on average. From the farm finanicial survey (2008), the total asset value of Canadian farms is $1.6 mln. Debt 300,000. Net worth - $1.3 mln. This has to be put in the context of the average age of farmers being 57 years old.

Will put the general web link for the farm financial survey in and you can look at information specifically for you province.

[URL="http://www.statcan.gc.ca/pub/21f0008x/2009001/tablesectlist-listetableauxsect-eng.htm"]farm financial survey[/URL]

[cottonpicken]

7-10% interest rates and 12-15% inflation is a very
real possibility.

Went shoppin today and and bought myself a whole
lotta sugar and some rare earths,probably should have
waited few weeks.