GERMAN MORTGAGES.

Taranaki Daily News, 12 April 1916, Page 8

GERMAN MORTGAGES.

Germany is mortgaged to the hilt, says an informative article is the English Review. The article deals exhaustively with the enormous credits given by tile banks to merchants and traders, and gives some interesting facts regarding the Co-operative Credit Societies for lending in smaller sums. It says: "There are in all about 32,000 societies. All of them do not lend money, but at least 18,00 C are actively engaged in financing their members and have a turnover of 25 milliard marks ( £1,250,000,000). Statistics of 1710 societies who {specially cater for agriculture have given their members credit to the extent of about .">5,000,000 marks. So urgent was the demand for credit and so difficult was the task of providing this credit that in 1805 a Central Genossenschafts Kasse was established. It is practically a Government bank, and occupies the same position, in regard to small credits as the Eeichsbank does towards large credits. Its success has been prodigious. All the small credits societies needed a central bank in which they could place their surplus funds or at which they could finance when needed. In its first year the total transactions only amounted to 141,000,000 marks. In 1907 this figure had risen to 13,281 millions ( £044,000,000), and wrs still rising when war broke out. There is not a village in the Empire in which the small trader, the farm laborer, the peasant proprietor cannot borrow his hundred marks. The system is elaborate, and the value in days of peace undoubted. But in war, what guarantee is there that these small loans will ever be repaid? The savings of the depositors are locked up in mortgages on property which has depreciated, and in national loans which cannot be sold. The network of credit societies, in which one-half of the poor have put their money and the other half borrowed it, depends for its solvency upon peace and progress. Their elaborate regulations never conceived a day "when factories would lie closed, members 'shut d(i\vn, and export trade at an end."