Picture butte feeder

[Old Cowzilla]

Maybe the concept is outdated.

Most small town banks got out of that biz don't think our local bank manager knows what a cow is.

[bucket]

It's meant to help, but explain like I am a 4 year old , you know the ones Freeland talks to, what is going on.

Have the cows disappeared ? who are the guys in trouble with this type of thingy?

Its interesting that the board has guys named in the proceedings???

I haven't a clue because I don't follow things , but I get concerned if it might affect the upcoming spring sales for calves.

Is this another black swan event ?

[blackpowder]

Most small town banks got out of that biz don't think our local bank manager knows what a cow is.

Yes, I get served so well by my credit union that I forgot how remote the other banks have become.
Having said that, these aren't young farmers feeding 50 calves. These are operations with established lines of credit. And it's never the small guy that breaks the associations. Who are the associations really helping anymore? If you're going to subsidize, have limits.

[LEP]

It isn't subsidizing. It is essentially easier credit terms by have a minimal government guarantee and guarantee by the members. Government dollars get tapped last.

So in collection they sell the cattle, then dip into people's deposits and then if they are still short they call on the government guarantee.

If all the cattle are present that is all that should be needed because they don't lend the full purchase price and you assume they have been gaining.

Where these went wrong in the past is when there were negative margins and the losses pile up. Also when the inspectors are signing off based on a member's word and not counting the animals.

A popular loan was the FIL (farm improvement) loan. Supposed to be better terms because there is a form of government guarantee. Probably not used as much anymore.

[LEP]

It's meant to help, but explain like I am a 4 year old , you know the ones Freeland talks to, what is going on.

Have the cows disappeared ? who are the guys in trouble with this type of thingy?

Its interesting that the board has guys named in the proceedings???

I haven't a clue because I don't follow things , but I get concerned if it might affect the upcoming spring sales for calves.

Is this another black swan event ?

US tariffs will affect markets more than this will.

[blackpowder]

LEP. You are right. Subsidize was a poor word. Back when I used our local association. I remember no inspections. The manager owned the office they rented. And got paid a handsome per head fee. Probably double or more than any wage at the time. Inspectors got a per head as well.
Deposits were used when big shots, always the usual suspects, speculated with max leverage. When people are in a business strictly for deductions, it's all a bomb. Heck I even "owned" paper cattle once. My own money tho.
I realize times are different. You can now hedge. And the rules and player size has changed. But it's still the cattle business. Anyone can feel free to correct me as I've been out for a while.

[Old Cowzilla]

These are tagged and branded cattle that would take a lot of help at different levels to get them through the system . Things have changed a lot it wasn't that long ago you could put wet noses in the yard for about $1200-1300 now it's $2700-2900 . Todays hobby farm can run you 7 digits pretty quick. Things can run afoul pretty quick when your local banker (who they change every 6 months ) was a used car loan officer previous job.

[Old Cowzilla]

Lots of times the hedged cattle don't pencil on the day there bought and insurance eats up the profit margin so it's not bought. So many dreamers in the cattle biz I think it's from smelling to much corn silage

[iceman]

Not much reporting on this so far. Maybe Real Ag or the Western Producer will pick up the scent

Iceman Out

[blackpowder]

Some of those violations include accepting members ineligible for membership to a feeder association, using guaranteed loan proceeds for improper purposes, supplying livestock and advances to ineligible members, failing to maintain adequate sales documents and obstructing inspections and failing to provide reasonable assistance.

From the Lethbridge Herald.