Investment units?

[iceman]

35% ??? A green bill, purple bill and a blue bill? For the renting of a brown bill?

I what a piece of that action.

[riders2010]

It's based on the model of the input companies pretty much except when you spell it out like this
We all say holy crap that's loan sharkiing.
Just a few years ago no interest until
Fall but if your late you hit the 26% and in farming
It happens but those rates of interest where loan sharing and are now even more at the current bank rate.

[Klause]

Here, I'll explain the way they pitch it.

300 per acre expenses, investor buys 1 unit = 100 or 33% of the expense.

(this is for canola).

Now, at 40bu/acre * 10 bucks a bu = 400.

Investor had a right on 33% of the profit, (based on covering a 3rd of the expense)

400 - 300 = 100 *.33 = 33 bucks/acre return on investment.

[Tucker]

Investors would be lining up around the block for this scam but why on earth would any farmer be so incredibly stupid to sign up for this?

$300 might cover out of pocket expenses like seed and fertilizer. $300 doesn't cover land costs or machinery depreciation and repair or any labor or management monies. Find a CEO of a multi-million dollar corporation and ask him to work for free. A typical 33% rental agreement means the landowner is putting up 33% of the inputs and ALL THE ****ING LAND! What do these investors do besides sitting around with their thumbs up their asses waiting to get paid?

Any farmer dumb enough to sign up for this deserves what he's going to get.

[Klause]

I used those as example numbers. Then there's clauses that exempt a dividend in the event of a "production failure" and of course a "expenses and income are not guaranteed" clause


Basically a junk bond farmer takes the money uses it and if he doesn't feel like it never pays out

[sumdumguy]

Yikes, it's an old game.

[farmaholic]

This can't be true....

The more you post Klause the dumber it sounds...

[newguy]

Thanks for the info Klause. Sounded like they were investing in irrigated farmers.Sounds like they are lending desperate farmers money to keep going. Not going to end good.

[tstep]

This dumb farmer had a deal like that years ago with a family member and it didn't work out. I guess there is a sucker in every crowd.