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SW Saskatchewan | The US responded with income measures- the '85 farm bill, CRP and PIK. I can't comment on specific cases but the income measures, from our Canadian perspective, were seen as a pro-active measure to halt the slump. Perhaps the mere unwise decision to purchase an over-priced quarter was covered by these programs, the big right-downs weren't needed.
But I can't comment except from the Canadian perspective.
Canada never did take the opportunity to develop a comprehensive farm policy. The answer to the ag crisis was debt reduction and whether it occurred with minimum or maximum bloodshed was merely an accident of circumstance.
Creditor's took every cent possible, if the loan agreement limited the amount they could seize, they got less. If they were in a province like Alberta that had strict limits on how assets could be accessed to satisfy a deficiency on a mortgage, the lender often saw that it was in everybodies best interest to work together and cut a settlement that matched the ability to pay and security in place. In Manitoba, the lender nearly always had access to all assets so the lenders adopted a "cut and run" attitude because they could nearly always come out with the loss all being born by the farmer. Sask had an intermediate legal structure and the results here often depended on whether your banker had trained in Alberta or Manitoba.
Sask had one controversial piece of legislation that stabilized the market, lenders were required to offer lease backs if the borrower requested, and at the end of the lease back period, the farmer who had surrendered the property had "right of first refusal"if a sale occurred.
A lot of the well to do established farmers were angry about these laws, they had the cash and they wanted to buy at the depressed prices. Often they tried to disguise their covetous plans by picturing the farmers hanging on as failures and socialists!
Don't know who were the virtuous, hope those times are really gone for good but the debt figures for Canada are scary.
Have a healthy and PROSPEROUS new year. | |
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Hey MSB, do you have anymore stories on Eugene Smith?
