Department of Agriculture, p. 2.]

BORROWING

Every business requires capital, some more than others. Farming
requires more capital to-day than formerly because of the
increased use of machinery. The necessary capital must either be
saved by the person who wants to use it, or borrowed from others
who have saved it.

The advantage of borrowing is that one does not have to wait so
long to get possession of the tools and equipment. One can get
them at once and make them produce the means of paying for
themselves. Without them the farmer's production might be so low
as to make it difficult ever to accumulate enough with which to
buy them. With their help he may be able to pay for them--that is,
to pay off the debt--in a shorter time than it would take to
accumulate the purchase price without them. That is the only
advantage of credit in any business, but it is a great advantage
to those who know how to use it. [Footnote 2: T.N. Carver, "How to
Use Farm Credit," FARMERS' BULLETIN, 593, U.S. Department of
Agriculture, p. 2.]

CREDIT

Credit is simply a person's ability to borrow and depends upon the
confidence that others place in him. This confidence depends on
his reputation for honesty and his known ability to repay. A man,
as a rule, has to HAVE something--land or property of other kind--
that he can offer as security before he can borrow much. It is for