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Show Let's Face Facts Disaster Faces Farmers If Boom in Land Values Continues to Sky ocket By BARROW LYONS I WNU Staff Correspondent WASHINGTON, D. C One glance at the current USDA Index ot (arm real estate values indicates in-dicates that a boom in land values is well started, which, il not checked by the most vigorous legislation, is likely to develop into a condition that will have a disastrous effect upon farming for many years to come. The average value of farm land per acre for the nation as a whole if ", 1 1 i v LAJlJ has been rising at the rate of about 1 per cent a month since the latter partof 1943. At the moment, the movement has slowed down slightly but this is a seasonal condition, con-dition, and unless inflationary forces are cnecKea, ac- Barrow Lyons celeration can be expected in the fall and winter, when farmers generally gen-erally do most of their land purchasing. pur-chasing. They have time to look around and bargain then. Only the very young farmers of today cannot remember what took place in the farm land boom of the last war, and the two years that followed that war. It took five years then for the national index of land values to climb from a level of 124 in 1915 (the average for 1935-1939 equals 100) to the 205 level in 1920. Those figures are March 1 averages for the nation in the years mentioned. men-tioned. That was a climb of 65 per cent. Started in 1942 This time the inflationary movement move-ment did not start until 1942. It began from a somewhat lower level of values, as the chart accompanying accompany-ing this article shows, and for the first two years the rise followed closely the pattern of 1916 and 1917. But beginning last winter, the rise in the third year of increase has been far more rapid than in the third FarhReal Estate Booms too j r 1 1 200 Average, Value. 100 --V per Acre in ISO t9e-l i-. United 3tatea Ito ' -M- 1 160 W -r&fcii-- m iko no no- r if- -too V mi 190 SVr Clatr iin) feg year of the previous boom. In the first three years of the World War I boom the rise was 26 per cent. In the first three years of the present boom the rise has been 34 per cent. If the upward climb continues until un-til next March at the same rate, the rise for the first four years of the present movement will ba more than 50 per cent, compared with 36 per cent in the first four years of the previous boom. That would mean that inflation of farm land values is sneaking up on us much faster than last time, and threatens to go very much further, for the war is still in progress, inflationary forces are much greater than 25 years ago, and we already are beginning to relax re-lax price rise restraints. Let me quote from the bulletin on the subject issued by the USDA bureau bu-reau of agricultural economics in March, this year. It says: "In the principal -agricultural areas the value-stimulating forces are increasing in strength, while the value-curbing influences are weakening. weak-ening. The predominant forces operating op-erating in the farm real estate market mar-ket stem from conditions of high farm - commodity prices, record farm income levels and growing accumulations ac-cumulations of funds available for land purchase." The analysis points out that demand de-mand deposits of country banks in 20 leading agricultural states increased in-creased 30 per cent during 1943, and by January, 1944, had trebled from 1939. This condition continues to grow, as farm income from marketing market-ing this year compares well with the all-time record of last year. There is a bumper wheat crop at excellent prices, and other crops promise high cash yields. Increase in Transfers The most alarming feature of this movement is the increase in the number of transfers for speculative purposes. Reselling after only short periods of ownership is increasing especially in the Pacific and North Central regions. In the latter part of last year, almost three-fourths of the tracts resold were held for less than a year, and over two-fifths for less than six months. Despite earnest pleas made to halt this boom through purchase of war bonds, instead of land, the only promise of effective action yet to appear has been the bill introduced by Sen. Guy M. Gillette of Iowa, which would impose a 90 per cent tax on profits made from the sale of farm land held less than two years. Some responsible officials fear that if the full vigor of the present boom is publicized, it will lead to 1 greater speculation, with resulting stimulation of the boom and great- I er disaster when values collapse. |