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Show SOUTH CACHE COURIER Boom in Farm Prices and Rapid Turnover Where Prompts Fears Collapse Will Follow Peace Memory of Bust After World War I Still Is Vivid to the Farmers When GI Joe comes back to his farm home from the war he may find a lot of new faces around the neighborhood. And he may miss a lot of the old familiar ones. The family up the road may have moved bag and baggage to Oregon. A new owner may be tilling the bottom lands on the back eighty. Rural America is on the move. Farmers, like their city cousins, have been shifting their base of optemerations at an po in the months since Pearl Harbor. More farms are changing hands this year than' at any time in the past generation. They are changing for scores of reasons, but back of almost every sale Is the chance to strike pay dirt to realize a profit ever-increasi- on the old homestead. Many farm folks are frankly concerned over this trend. They are troubled not so much about the migration as they are about the steady increase in farm real estate transactions. They fear that the long threatened land inflation is under way. And they are asking themselves: Will the old cycle of boom and bust be repeated?" Every previous war has brought its own land boom that left a wreckage of deflation behind. The collapse of the speculative era following World War I is painfully fresh in the memory of many a farmer. considered fairly representative, it that farm land prices have risen about 17 per cent be tween April, 1943, and April, 1944. From the beginning of the year until April 1, the advance has been about 2 per cent. The increases have been largest in Indiana, Illinois and Iowa, in which states the per cent of purchases by city investors waa largest, being 30 to 37 per cent of all sales. It is true that farmers have been using much of their larger incomes to buy bonds and to pay off debts. The steadily decreasing volume of farm mortgage debt is evidence of this trend. But now reports indl cate that heavier debts are frequently being assumed when farms are bought. This is especially true of tenants who are buying on contract or with relatively small down payments. All Sorts of Buyers. Surveys by county banks indicate that all types of farm buyers are now in the market. Tenants are acquiring their own farms. Owners are expanding their present units or are taking on additional acreage, perhaps for sons now in the service. Even large commercial farms in some instances are changing hands at increasing prices. Local business and professional people and city investors bent on hedging against inflation or higher income taxes are buying land. War plant workers, too, are making purchases, expecting to turn to farming when their munitions jobs are ended. All these conditions are reminiscent of what occurred in World War I, for that too, was a story of agricultural upsurge. Farm income rose from 6 billions in 1914 to 146 Is estimated Midwestern Land Prices Climb 18 April I, 1943 July Od. I Symptoms are already evident suggesting that history could repeat itself in World War II, unless brakes g are applied to the up- surge in farm land buying. For instance, land values have risen 38 per cent above their 1935-3average and are already up to 100 War I per cent of their levels. Farm sales during, 1943 were at a record volume, surpassing even the previous high reached in 1919. Sales In 1944 are forging ahead of last years record. Plenty of Money Floating. TTiree factors are believed to be immediately responsible for the urge to acquire additional holdings: 1 Both farmers and nonfarmers have large and increasing funds available for land purchase. 2 Present high Income and the rosy prospect of more yet to come make the purchase of farms seem especially attractive not only to as well. farmers but 3 Long Um credit at low Interest rates makes It easy to acquire land. Speaking of income, nearly 20 billion dollars $19,764,550,000 to be exact flowed into farmers pockets from the 1943 bumper harvest. Last years total was more than four times the low-ebdepression income of billion dollars in 1938. It was about $3,750,000,000 in excess of the 1942 total. When operating costs, including taxes, interest, wages for labor, machinery and other items are deducted, farmers were left with a spendable income that was almost double that of 1939. Meanwhile, the cost of living had advanced only U. S. department of commerce estimates of individual savings indicate an increase of 7.5 billion dollars for 1940 to 36 billion dollars for 1943. A very large part of these savings is in highly liquid assets of currency and bank deposits. Whenever an industry does as well as farming has done, there is a tendency to speculate. Those already in the business seek to expand their operations. Others seek to get in on the good thing. And thus a spiraling boom can be born. In the midwestem area, comprising the Seventh Federal Reserve district, for instance, which may be fast-movin- 9 pre-Wor- ld rs b one-fourt- 1 Jan I in Year April 1, 1944 billions in 1919. High prices and a ready market for agricultural products, plus easy credit facilities, encouraged farmers to bid up land prices. Farms were bought on speculation with the expectation of a quick sale at a profit. Land values were inflated from an average of $40 an acre in 1914 to $70 in 1920. Within those six years farm real estate rose in total value from 3916 billion dollars to 66 billions. The sequel was a history-makin- g crash. Land prices fell from an average of $70 an acre to $28. More than a third of the nations six million farms were foreclosed by the All farm end of the depression. land and buildings declined in value from 66 billion to 31 billion. It is natural that people today fear that the same thing will happen all over again. As a result leaders already are urging legislative controls. Some of these are drastic, some milder. Proposals range all the way from restriction of privileges in some cases to credit control and heavy federal capital gains taxes. Dangerous Remedies. Lest the remedies be as fatal as the disease they are designed to cure, however, farmers were recently urged by Ray Yarnell, editor of Cappers Farmer, to look carefully into these proposals, their implications and what else may be land-ownin- g proposed in the future before endorsing them. The land boom of the first World war and its awful consequences throughout 20 years have been credited by some to unwise land ownerUpship policies, he declared. swings of prices with the second World war have engendered the fear that another boom was in the making and that its consequences would be the same as the first. "Buyers have been warned repeatedly. Still, reports of advancing prices multiply. Some belief holds that voluntary action would be ineffective. So legislated remedies are proposed. Most drastic proposal Is the permit system advocated by William G. Murray of Iowa and others. It would require a prospective purchaser to appear before a board and show reason why he shoulj be allowed to buy a farm. If the board found him an unfit person to own land, or didnt like his attitude, It apparently could turn him down. No permit would be awarded before the land had been appraised. Limited Loans. Another proposal is credit control. First provision is that no loans should exceed 50 per cent' of the value of the land. Presumably value would be established by appraisal. Such a regulation might be legislated, and it might stick. Presumably, also, lending agencies would establish a policy of refusing to lend to men who paid long prices. An approach to this is already in effect The land banks, mortgage, trust and insurance companies have been discouraging borrowers both from paying too much and from borrowing too much of the purchase price. But they dont have any control over folks who are prepared to pay cash, or the private money lender who is willing to take a long chance for a high interest rate, or the owner who can finance his own sale. Mildest of these proposals is to impose a stiff federal capital gains tax. Such a bill was placed before congress by Senator Gillette of Iowa. It is directed at speculators by providing a tax amounting to 90 per cent of the profits if the land is resold before the end of two years. Each year thereafter the tax would be decreased until the end of six years, when none would be levied. There is no doubt as to the class of transactions which the legislation is intended to curb. But would a farmer who was obliged to sell within the limits specified be subject to the tax? All the schemes thus far advanced seem to be pointed toward keeping the buyer from making a fool of himself, but of course every sale must' have two parties. So the man who wants to quit farming; the man who wants to retire on proceeds from sale of his land; the fellow who wants to sell and move elsewhere; the widow who has been hanging on until she can get the family equity out intact; the who is sick of wrangling with tenants and who has been longing for the time when he can get out and save his shirt all these welcome " the upturn of prices. Now lots of farmers who have no desire to sell, who think their troubles are caused by folks they dont believe should be allowed to own land, applaud these proposals. And they may be right, but it will be well to look into them, their implications, what else may be proposed in the future before endorsing them. This country can have control of land sales and purchase in two ways. First by doing nothing; second by whooping it up for the proposals. Farmers will be moi vitally affected than any other group. If they want a Federal agency empowered to say who may own land, they can have it. If they dont care, they can have it anyway. Forces sponsoring the change in land policy will see to that. But if farmers dont want it, they may be able to forestall it by protest. Bankers Say Land Is Selling Above Normal Average prices at which farm lands are now selling in the seventh federal reserve district as compiled from reports of 500 country bankers are shown in the chart. The seventh district includes Iowa, Michigan, Wisconsin and the northern parts of Illinois and Indiana. get adjusted to staying put.l Actually, only 30 per cent of the New York is well land in adapted to farming today, and much Estimates show that about 900,000 for the farming of today is only one of this land is in established farms New York state residents will be pitfall which veterans and war workthat will not be for sale. Another demobilized from the armed forces, ers will need help to avoid, says the 38 per cent is fair farm land. and another 500,000 from war in- New York State Rural Policy comCounty agricultural defense comdustries. If the proportion of these mittee. Others are purchase of mittees, or other groups, should be men interested in farming runs farms, at perhaps inflated values, charged with the responsibility of about the same as it does in our with a large debt; location in an helping men who wish to return to total state population, about 75,000 area which carries on a type of farm- the land, in order that they make persons from the Empire state will ing different from their past experi- good invejtments and become probe looking for a place on the land. ence; and too hasty purchase of land ductive and citizens, Purchase of submarginal land unfit that will tie them down before they the state policy group advised. Veterans, War Workers Who Plan to Go Back to Land When Peace Comes, Should Be Cautious, Board Warns Counter-Attack- Spawn as Allies Advance s As the Allied invasion moves inland to become the battle of Normandy the beachheads grow in depth as new thousands are landed on coast. Constant threat of violent counterattack by the enemy becomes closer and louder. Shown here are two counterattack hubs of the Nazis. In the west the Allied thrust from landing zones has resulted in the capture of Bayeux and a drive to the south toward Caen. well-clean- ed Allied Army and Navy Chiefs Confer in France American army and navy chiefs pay their first visit to France since the invasion. L. to R.: Gen. Henry H. Arnold, Admiral Ernest J. King, Gen. D. D. Eisenhower and Gen. George C. Marshall. Left, insert: Gen. Eisenhower, supreme Allied commander (left) and Gen. Sir Bernard L. Montgomery, commander of Allied forces, enroute to the beachhead area in France where all armed leaders surveyed the campaign. Allied Wounded Return np, De Gaulle in France Wounded in the invasion of France, British soldiers are shown lined on tier along the walls of an LST hospital ship. These were among tier the first wounded to be returned following the initial landings on the coast of France. Censor has blacked ont faces. Gen. Charles de Gaulle is shown as he landed in France on a Normandy beachhead before he proceeded inland on tour of inspection of allied occupied territory. It was nearly four years since he last set foot on French soil. Nazis Leave Markers Jap Prisoners Taken '.;r ' v I- - G vs-- V'- P V-- ch 44 iot i i Y 'V ft ' & :5r ; I : .a I. When U. S. forces landed at Humboldt bay during the Hollandia, Dutch New Guinea, operations these eight Japanese were captured. The second and third men from the left are officers and both have tried to hide their faces from the photographer. The group is being taken by truck to a plane. rMimi. The Germans retreated so fast i many sections of France that no) only did they leave a vast store ol equipment, but the markers showing mines were left intact. The Allie troops found some of them duds. V I |