Risk Rating of FSA’s Guaranteed Loan Portfolio

Risk and Uncertainty,

Determining Default Probabilities for FSA Direct Loans

A binomial logit model was used to analyze relationships between financial characteristics and loan performance for FSA direct borrowers receiving direct FO or OL loans in fiscal 2005. Not surprisingly, the results indicate a strong and direct relationship between many key financial variables and probability of default. Production specialization, however, was indicated to have just as important an impact on probability of default as many financial variables. Other strong indicators included farm size, membership in a targeted group, and the ability to obtain credit from commercial lenders.FSA credit programs, loan defaults, credit risk models, risk rating, Agricultural Finance, Financial Economics,

The Competitiveness of Farm Credit Markets in a Deregulated Environment

Despite the proliferation of banking offices occurring since banking deregulation, about one-third of all counties in the US were still considered to have little competition with respect to agricultural credit. Counties considered less competitive were located in regions where farming is less prevalent; Northeast, Mid-Atlantic, Appalachia, and Southeast. There was no evidence that farm interest rates charged by commercial banks were higher regions with less competition. Higher FCS interest rates in counties with less competitive suggested that full-time commercial-size farms may be disadvantaged by a lack of credit market competition.Agricultural Finance,

Explaining Regional Demand for Federal Farm Credit Programs: An Ordinal Probit Approach

Demand for federally subsidized farm credit varies regionally, with farm borrowers in some regions very dependent on USDA credit programs. Counties are grouped based on their level of demand for Farm Service Agency (FSA) direct farm ownership (FO) and farm operating loans (OL). Ordinal probit techniques are applied to analyze factors influencing county-level variation in the use of the loan programs. Results suggest that counties with the highest level of demand are more likely to have a Farm Credit System branch office, are more likely to be dependent on farming, have a greater share of farms owing debt, and have fewer guaranteed FSA borrowers and racial and ethnic minorities.Agricultural Finance, Demand and Price Analysis,

DOES FCS ASSOCIATION SIZE AFFECT CREDIT AVAILABILITY?

An analysis of the characteristics of farm businesses by size of FCS direct lending association suggests that further consolidation of FCS lending should have limited negative impacts on credit availability. Commercial-sized farm businesses with FCS real estate debt appeared similar to those who obtained credit from competing lenders, but smaller associations and those with fewer stockholders per branch appeared to serve larger and more wealthy commercial-sized farms.credit availability, direct lending association, Agricultural Finance,

The Financial and Professional Impact of Anterior Cruciate Ligament Injuries in National Football League Athletes.

BACKGROUND: Anterior cruciate ligament (ACL) injuries can have negative consequences on the careers of National Football League (NFL) players, however no study has ever analyzed the financial impact of these injuries in this population. PURPOSE: To quantify the impact of ACL injuries on salary and career length in NFL athletes. STUDY DESIGN: Cohort study; Level of evidence, 3. METHODS: Any player in the NFL suffering an ACL injury from 2010 to 2013 was identified using a comprehensive online search. A database of NFL player salaries was used to conduct a matched cohort analysis comparing ACL-injured players with the rest of the NFL. The main outcomes were the percentage of players remaining in the NFL and mean salary at 1, 2, 3, and 4 years after injury. Cohorts were subdivided based on initial salary: group A,$2,000,000. Mean cumulative earnings were calculated by multiplying the percentage of players remaining in the league by their mean salaries and compounding this each season. RESULTS: NFL athletes suffered 219 ACL injuries from 2010 to 2013. The 7504 other player seasons in the NFL during this time were used as controls. Significantly fewer ACL-injured players than controls remained in the NFL at each time point (P \u3c .05). In group A, significantly less ACL-injured players remained in the NFL at 1 to 3 seasons after injury (P \u3c .05), and in group B, significantly less ACL-injured players remained in the NFL at 1 and 2 seasons after injury (P \u3c .05). There was no significant decrease in group C. Players in groups A and B remaining in the NFL also had a lower mean salary than controls (P \u3c .05 in season 1). The mean cumulative earnings over 4 years for ACL-injured players was$2,070,521 less per player than uninjured controls. CONCLUSION: On average, ACL-injured players earned $2,070,521 less than salary-matched controls over the 4 years after injury. Players initially earning less than$2 million per year have lower mean salaries and are less likely to remain in the league than uninjured controls. The careers of players initially earning over $2 million per year, meanwhile, are not negatively affected. This demonstrates the degree of negative impact these injuries have on the careers of NFL players. It also indicates that a player\u27s standing within the league before injury strongly influences how much an ACL injury will affect his career

Analysis of alternative grain procurement and storage strategies for Tennessee hog producers

Minimization of the total cost of procuring and storing grain is an important management consideration for the slaughter hog producer. This research evaluated various corn procurement and storage strategies for a typical Tennessee hog feeder to determine the optimum size grain storage facility and most efficient grain procurement strategy. The various storage facilities and procurement strategies were represented using simulation models which approximated a 1440 head market hog producer\u27s operation during the 1971-1980 period. Storage capacity options were simulated which maintained storage capacity for a week\u27s, month\u27s, quarter\u27s, half-year\u27s, and year\u27s requirement of grain. Procurement strategies which were analyzed included: regular cash grain procurements in amounts equal to storage capacity (cash, buy), grain procurements based upon expected prices (futures strategy), and hedging of future grain requirements. Optimum grain procurement based upon perfect knowledge of all future prices (optimum strategy) was determined to provide a benchmark for comparison purposes. Expected prices were determined based upon corn futures quotations. The patterns of procuring and storing corn for the futures strategy and for the optimum strategy were determined using a linear programming model. Mean cost per bushel was used as the primary criterion for comparing the various procurement and storage strategies. The primary results of the simulations showed that in general larger storage capacities were associated with lower costs per bushel. The annual storage facility produced lower costs per bushel than the other storage capacity options. A comparison of the procurement alternatives showed that the cash buy and futures strategies came closest to the optimal strategy in cost. The hedging strategies generally produced the highest cost in each circumstance. These results indicate that for situations in which the producer was not constrained to the existing facility, he could lower costs by building storage equivalent to annual requirements and following the cash buy or futures strategy. If the producer was constrained to the existing facility he would utilize the cash buy or futures strategy