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hard times

K

Kccca

Member
I just read the post below re: The Great Depression. I don't mean at all to take anything away from that, but how many of you recall the tough times in the early 1980's when interest rates went to 20% +, corn was $1 per bushel, fall harvest was extremely wet and muddy, combines stuck in the field because banks were demanding their notes and farmers were driven to trying everything they could to get the crops in. I had a friend in Ohio who mired his combine to the belly, hooked a dozer to it and pulled on it till lots of pieces came apart from the hard pull. He felt he had gone his limit and committed suicide that night. Left a 12 y.o. son and 14y.o. daughter and a dear wife. Sad times.
 
I remember fall of 72 bein wet & muddy. Combines got stuck & pulled by the back axle.A lot of them were in two peices.Sparktrician don t remember that far back. HEHE. RB
 
I remember hearing about somebody pulling a combine in half and committing suicide back then. I wonder if it was the same one?
I sure remember those hard times though for sure. When the milk check came,it was honest to God a choice between paying the electric bill or buying groceries. I lot of auctions around here nearly every week for several years.
 
I think the 80s hit the corn belt harder then anywhere else. Out here were I farm/live in Montana, you didn't see farms going under on a monthly basis or farmers commiting sucide. Some guys around here even expanded in the 80s including us. Both dad and grandpa bought land in 1983. Farming was different out here with ou wheat/fallow. Inputs were low since we used our own seed, made one pass over the crop with chemical, and didn't fertilize. Fuel was probably the biggest expense since you had to go over the fallow 5 times a year to keep it clean. Don't get me wrong things did get tight with dry years and hail storms. But only a few farms had to sell out. But they would went under anyway if wheat was $10 a bushel due to poor management. I know one farm back around 1980 bought two new Yetter no-till drills that were $100,000 a piece. Then they bought two new Big Buds and those were over $100,000 a piece. So they had almost half million dollars into their seeding setup. We had about $75,000 into our Versatile 950, 48ft plow, and 8 JD LZB drills. Those guy eventually lost the farm and sold it to the LDS church and then they leased it back. One thing that did change around here is a lot of CRP went in mostly on the smaller farms so maybe they were either at the breaking point or just tired of it all.
 
I remember helping a friend chop corn it was mud and we had one IH 806 on the two row chopper and I was on the other one with a long cable hooked between lots of times the chopper was down in the mud not good. Shortly after my friend lost the farm. Before that the backers were wanting him to add siloes and add on to the barn add cattle then every thing changed. that is when I learned never trust a banker. Randy
 
Hey Randy. Did you ever miss the milk check after ya quit milkin. Dad always said he never once missed that check. Richard
 
Not really. I had quite a few springers and open heifers. I started selling those off as soon as they started to freshen. They kept the cash flow pretty good for the next two years. I'd been keeping my bull calves for a year before I sold the cows too,so I had those to sell when they were finished out. I already had a cow/calf herd too. I bred all my beef heifers and fed out the steers,so the money never really stopped coming in.
Selling them wasn't a spur of the moment thing. I'd been planning it out for a few years.
One thing I did find out as soon as they were gone though,all my bills dried up too. I sold them in late November 2003,and by the following February,I actually ran out of deposit slips before I ran out of checks for the first time in my life. I figured out quick that most of the milk check had been going to the electric company,the feed store,the vet and to the kids for their labor.
 
I started farming in the 70's and remember the 80's. What you need to remember the 80's were preceded by many very profitable years for farmers just as today's farmers experienced some very profitable years. My dad always said you need to average out the bad years with the good years and the farmer will survive. The main problem is when profits were are high many farmers would go on buying binges for both machinery and land and also run up rents thinking the good times will never end and wind up getting themselves in trouble. This is exactly what's going on today.
 
Dad wasn t spur of the moment.He d bought 3 bred gilts several years before and he had bred hiefers for beef. At one time we farrowed 90 sows a year.
 
I think that's the big difference between 1930 and 1980/today. During the Depression, almost no one was unaffected, VERY few had the opportunity to profit from the troubles of others. IN the 1980s and today, there are some in tough shape, but many with little or no debt that can survive, and quite a few able to improve their lot. I think the inability to manage the operation and the inattention to detail in doing so are culled out during periods like we have today.
 
Wonder how I managed to dodge that bullet?

No, I was not farming then. That was a few years before my time. I use a fair amount of equipment from that time though. Some of it looks like it has been thru he!!. :)
 
The 1980's I remember very well. I was in high school at the time and yes, if you were borrowing money, the interest rate was around 20 percent. If you had money in the bank and it was on Certificates of Deposit, the interest rate on those topped out around 16 percent. My mother had a job in town and my father and his youngest brother were on the farm. We lost our local JD dealership where we had purchased equipment for some years. The family could no longer keep the doors open with the sales volume they had. Our family farm was kept intact by hard work, work off the farm, and pinching pennies. My father in law's farm was held together in the same manner. Neither had overextended itself, but there were tight times. Neither was considered "too big to fail" so neither received any sort of a debt re-structuring or write down. I will never forget what happened with most of those people who DID receive a write down or restructuring. They bought a new line up of farm equipment, a new pickup truck, and a new family car. They showed up to church on Sundays and sat in front so every one who paid their bills and "sucked it up" could see them. It does frustrate me how these people who were deemed, "Too Big To Fail" were given a tremendous opportunity to start fresh. I guess at least I can say that what I have today, I worked hard for it and I don't owe my soul to the devil.
 
I started farming in late 70s. Got loan for very old machinery and paid 100% of operating costs out of pocket. Had to make a 3 year business plan. I based on $2.00 corn. Banker approved loan, "because corn would never get below $2.50." I survived because I planned well and did not listen to nonfarmer banker.
 
Jimmy Carter's Russian grain embargo was what ended those decent prices. That's why some of us who lived through that disaster are so dammed nervous about what's going on right now. That came right out of the blue. Cousin Jimmy Earl came on TV one night,made a speech announcing it and that was the end. Near 20 years of misery in the ag sector followed.
Way too much fear of Deja vu.
 
I had gotten a good off farm job in 1975 and was making pretty good money and farming with dad part time,all our equipment and farms we paid for.When grain prices went up I thought about
going back to farming full time,he said absolutely NOT for me to keep my job.He was right when prices crashed I was able to buy equipment/tractors to work with that I'd only dreamed of owning before.Finally quit the job in 2000 after 25 years there and went back to full time farming by then almost all the equipment we were using was mine anyway.
 
I graduated high school and went to college during the 1980's. Things were tough for quite a while here after 1982. I remember nobody wanted to talk business if it meant borrowing money. I was between a rock and a hard place as I wanted to both get started and help out but needed my education to run its course. The area economy went into a steep decline around the same time so the job pickings were lean to say the least. I'd like to have been able to make a run with a good paying manufacturing job instead of taking bottom of the barrel service sector jobs. Western New York is a great place to live in a lot of respects but it takes a great amount of luck to land a good paying job.
 
I remember it well. Tenneco bought IH and then the new company thought every dealer that survived the cut, should update their facilities to promote the "NEW IMAGE" should make very costly capital improvements with new facilities, new signage and a new costly computer base operating system.
There were major issues with the animosity of new heavily IH management team against Case dealers that made the cut.
There was no way we could build all new facilities with interest rates in the high teens when we were clearing profits below the interest rates. We closed our family business after 54 years and 3 generations of operation
Loren
 
I too lost my job at Harvester. My Dad had just quit farming so I planted our farm in corn. It was so dry in Maryland that year that most of it never got over my waist. While working out of our shop I was doing maintenance for an elevator company's truck fleet. They offered me a job. I joined the union and went to Washington D.C.. Best thing i ever did. Thank you Pres. Carter
 
I bought my 1st farm in 1979. Then we had the bad drought in 1980. Interest rates were skyrocketing. I had bought 150 beef cows and was working for the local feed mill delivering feed to the local dairies. I survived the 80 drought and stayed afloat for a couple of years and then we had another drought in 1983. I had to sell the farm most of the cows as well as most of my equipment. It was a tough time but I learned a valuable lesson, slow and steady.
We were delivering feed to about 70 dairies that were less than 50 cows each. by 1987 all but just a few were shut down.
I started renting pasture and buying cows out of my hip pocket. It took 17 years but I finally grew to the point that I could quit the town job.
 
Deere was after their dealers to build new facilities during the 1980's also. A bunch of them gave up around the same time. A lot of popular IH dealers got closed around this area after the merger. The black eye Deere got for some of their dealers closing got cleaned up as a result of the CaseIH merger fallout. It helped that the 4X50 row crops debuted around the same time.
 
"There were major issues with the animosity of new heavily IH management team against Case dealers that made the cut."
In my county, there was one Case dealer and one IH dealer when the Case-IH merger occured. The IH dealer was much larger than the Case dealer, but the Case dealer was one of the oldest in the state. Case/IH came in and yanked the dealership away from the Case dealer and gave it to the IH dealer.
There are still hard feelings over that decision at the former Case dealer who now sells MF.
 
The 1980's destroyed a lot of good farmers, to say nothing of a lot more who were already in trouble for one reason or another. Walked out of bankruptcy court in the spring of 1986 with $35 in my wallet and no job. If I'd had any sense, I would have filed about 4 years sooner.
 
We didn't loose any JD dealers during the 80s around here. Lost about every other dealer though with the exception of two NH dealers and one IH or CIH dealer. We did have two JD dealers close during the mid to late 90s though. But it was more of just too many dealers and not enough farmers. We can't support dealers 60 miles apart of the same brand out here unlike the corn belt or the east.
 
Actually, those hard times began in the late '70's where the A.R.M (Adjustable Rate Mortgage) originated as a gimmick to try and get people to purchase homes to help spur the economy. Adjustable rates that ballooned at least a point every year so that within a couple of years, those that did...could no longer afford their forever rising mortgage payments. Oil embargo, long fuel lines. Telling everyone to turn down their thermostats and put on sweaters. Things like that.

I think a huge difference between the times of the Great Depression, the late '70's and early '80's and now, is that how do people feel financial strife IF the government extends unemployment to say...five years? True, one brings home less $$$ in unemployment relief and food stamps, but when it comes in regularly, its much easier to pallet than standing in soup lines, literally. Think of it like putting a lobster into a pot of cold water and turning up the burner. The lobster doesn't notice being slow cooked. $20 TRILLION deficit later with an ever dwindling group of those taxpayers flipping the bill...eventually lobster is served up very well cooked. Time to change that.

Mark
 
I left town and built my current home in the country on some land in 1979. I read Howard Ruff's "How to Survive the Coming Hard Times" and
took it literally. Had 30 days vacation and took a 30 day leave of absence as things were slow at work. Never looked back.
 
I am thinking that close to 10 Deere dealers closed within an hour of us but do not know how many were due to hard times or Deere. I know that some of the Deere dealers were smallish in terms of buildings and maybe in a good year sold 6-10 farm tractors. Deere did find replacement dealers for a few locations and did not for a few others. Deere ran an ad in the area farm paper trying to recruit new dealers for a few locations in Western New York. IH lost over 10 in the same general area and that is without knowing what was going on at the outer limits of the one hour range I mentioned. Ford lost probably ten but did not have a merger or tough corporate management to blame. Poor product selection for dairy and grain crop country left their dealers withering and gave up before the merger with New Holland happened. AC rolled the dice on combine sales and discontinued a lot of dairy farm specific equipment which hurt dealers without significant side lines. The more fortunate ones picked up FNH to replace former Ford locations shortly after the Deutz-Allis merger.
 
In the 80's had a small beef cow herd and working in town. Started building a new house in 79 and by the time I got it done in 1980 the interest rate was in the teens. Then the banker calls me and wants to know if I would want to buy the 120 acres that joined me. Seems my neighbor that milked cows was going to lose it. Told him no not with interest rates that high. Then in fall of 81 I got laid off. Wife was a stay at home mom till then, she had to get a job. With a lot of faith in God we pulled through.
 
that mess also affected some cheese factories when smaller dairy farms started going out of business the cheese plants weren't far behind. i had some friends that never did get paid for all of their milk.
 
Randy the grain market dropped BEFORE Carter enacted the grain embargo. I was blaming the Embargo too until I looked at the market records of the time period. The prices dropped several months before the embargo.
 
He owed you something for throwing that embargo on Russia. I dang near lost my keister on that stunt.....
 

We were in a drought from '66 till '76, so I think my dad had already tightened the pocketbook before the 80's hit. I remember him saying the bank was after him to expand in the late 70's, but he didn't take the bait. He had paid off the mortgage around '74 and had pretty good savings by the 80's and was able to take advantage of the downturn in the economy. I left for college in 76 and that was the start of some of the best crops on the farm. I remember going home on weekends to cut silage and the corn was over 10' tall. He bought a new forest green Ford F150 in '79, his first FWA, a Hesston in '83 and a new Chevy diesel in '84, so things were pretty good in SD in the 80's for him. He also had to buy back my mom's 320 acre "inheritance" after her brother stole it from her and sold it to another guy...so I think he did ok. He was also happy earning 12% interest on his CD's. I didn't really feel the pinch as I was working off the farm, but did get a good deal on a neighbor's farm just up the road in '89, eventually sold 40 acres w/buildings to my brother and he has rented the rest over the years.
 
IIRC. the prices were low because of a large harvest the year before. The Russians were buying a large amount of corn that year and prices were looking up as the government said to " plant femcerow to fencerow". Seems to me that corn sagged about 50 cents overnight not too long after we planted to hit 100 bpa on about 120 acres. Pioneer seed was $17 a bag (56#!) and most of our rent was $20-30. Sure took a bath that year......
 
I got out of ag college in 84.My uncle had broken his heel so he hired me to milk his cows and help my grandfather put up the hay.I had just rented a barn and filled it with sows.By the end of summer you could hardly give feeder pigs away.The price of corn hit new highs in Ontario and many hog finishing barns stood empty that summer.I was also paying as much for dry sow feed in August as pig starter was costing in May.The milking and haying money plus the last bit of my savings kept the sows going until October 1 even with me negotiating an interest rate cut at the bank.The landlord and I made a deal to let me out of the barn lease as he had other plans for the building and everybody got paid but it set me back alot.On the plus side it made me much more cautious too.
 
I was in high school in the early 80's and it was wet. we would get up at 3:30 am, go and combine with our 535 Oliver until it got to greasy and soft. We would put just 2 dumps on the wagon and pull it to the yard. Then I would go to school. Once we put too much on and sunk it to the axles. So we had to get the small elevator and unload it too two wagons, that was a long fall. But in the end my Dad lost his farm a few years later. We had milked cows for years but in the 70's milk prices where so bad he decided to sell out an we got into farrowing hogs. We put the farrowing barn inside the old milk stalls and something did not agree and we lost all the baby pigs for a couple of years, we had 1.5 pig average. The local vet could not figure it out. We eventually moved the crates to our old calf barn and had better luck, but it was too late. So sometimes it was not just because farmers over extended, bad luck played in as well.
 
You'd better check again. The CBOT had to close for a week to stop the hemorrhaging after Carters speech.
 
My BIL was caught in the squeeze like many others......we seemingly could do no wrong in the 70's, could do nothing right in the 80's.
He was feeding cattle and was an excellent manager but from the time he filled the feedlot in the fall and when those cattle went out as finished steers the interest rate on them had almost doubled. I remember them receiving a check for a load of finished steers and dropping everything to make an hours+ trip to the bank to get that money against the operating loan.
He bought a JD 4440 in the spring of '80. Its here in my shop today for some service, it will head back onto much of the same land is has covered for the last 37 seasons, despite 12,000 hours.
That tractor toughed it out in the tough times too, probably a lot of the reason he still owns it.
 
I'd need to check,but I think they were only buying wheat from us at that time. It was wheat that Jerry Ford urged us to plant fencerow to fencerow. When the price of wheat crashed after the embargo,it dragged the whole CBOT down with it because the world didn't see us as a "reliable source" of grain anymore if a president would use it to play politics.
 
yes ,, I recall hearing about that ,, very sad,,. poor guy was in a desperate defensive position , similar to what a soldier mite find himself in during a standoff in a war battle , proper military training keeps a mans mind on task so he can come out ALIVE . at least that's what they taught soldiers in ww 2 and veitnam .. // don't know anything at all about the fella,, perhaps he had military training // ,trouble is he probably felt he was on a deserted island with no one to help or turn to , and the whole world had a front row seat to his failure . , the despair and shame of failure and realizing his terrible mistakes was too much and he chose to end his life ,,.very sad day when a man gets on that island ,,. I ,TOO ,have been there more than once in my life , and every time I chose life and managed to escape and find a brighter and better day
 
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