Tuesday, September 17, 1985
Daily Nebraskan
Page 3
WEASEL MOTORS
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WEASEL
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Report outlines troubles
in state's farm economy
One in six not owned
Gene ReiserDally Nebraskan
Leasing of autos on upswing
By Jody Halbrook
Staff Reporter
Driving a new car is a lot more fun
than financing it. That's why many
prospective car owners are signing
contracts to lease rather than to buy.
Although some local car dealerships
have been leasing cars for as long as 20
years, the trend is developing rapidly.
Today one in every six vehicles in the
United States is leased. Ten years ago
one-tenth of the cars were leased,
according to Money magazine.
"More cars will be leased as their
prices become higher," said Lenny
Davis, sales representative of William
son Oldsmobile-Honda. "By 1990. with
inflation, the price of a new car will be
$20,000."
"The biggest advantage is that you
can put less down and have lower pay
ments than you have with a loan," said
Brad Rank, sales manager of Dean's
Ford Inc.
In these aspects, leasing a car works
like renting a house.
"At the end of the lease, you can
walk away from it," Davis said. "Yet at
the end, you have a pile of 36 months
worth of receipts, and you end up own-
ing nothing."
He said the lessee actually owned
only the time he spent driving a new
car, because dealers only lease new
cars.
Davis said his company won't con
tract anything older than a 1984 model
because, as mileage increases, the
car's value becomes harder to deter
mine. Drivers may lease from one to four
years with payments averaging from
$250 to $350 a month depending on the
car's value. The lessee pays all insu
rance and maintenance costs, said
Rosemary Dillow, accountant for M-K
Leasing.
Most people who lease cars are
young couples and business people,
she said.
"They're mostly salesmen and busi
nessmen who need a car because the
lease serves as a tax write-off," Dillow
said.
The dealers said they don't lease
cars to college students.
"You have to have better credit to
lease a car than to buy one," Dillow
said.
She said drivers must choose whether
to buy an older model or lease a new
model.
No one will know that the sleek, new
model is only a rental.
But, as Dillow said, "it's not yours.
It's still ours."
By Kim Vavrina
Staff Reporter
Even with about 30 percent of
Nebraska's 58,000 farmers operating
with no debt, the financial problems
facing the farm economy will not quickly
disappear and could take well into the
next decade to resolve, according to a
mid-year report from the UNL agricul
tural economics department.
Bruce Johnson, associate professor
of agricultural economics, reported on
the financial instability of Nebraska's
farmers in a recent departmental report.
In determining financial instability,
economists use a debt-to-asset ratio,
which compares the dollars of debt to
dollars of assets. Generally, Johnson
said, more than a 40-cent debt for every
$1 of assets signals probable financial
problems in agriculture.
Nebraska's debt-to-asset ratio aver
ages 35 percent, he said, even though
17,500 farmers have no debt at all.
Another 4,800 fanners operate with
small debts, only a 10 percent debt-to-aset
ration.
Johnson said the figures show that
about 23,000 Nebraska farmers are try
ing to carry a debt-load above the
recommended level.
Of this indebted group, 13,000 farmers
have debts equaling about 40 percent
to 70 percent of their assets, he said.
The remaining 10,000 farmers have
debts equalling 70 percent or more of
their assets, Johnson said.
Farmers with debt-to-asset ratios of
more than 40 percent hold the majority
of unpaid loans in Nebraska, Johnson's
report shows.
According to the report, even farmers
with little or no unpaid debts suffer
because of the economic situation.
Declining values of assets affect all
farmers.
With the estimated debt of Nebras
ka's farming sector totaling about $9.6
billion, "uncertainty clouds the eco
nomic horizon," the report said.
Johnson says in the report that
adjustment to current economic condi
tions must come. The kind and size of
adjustment depends heavily on farm
income.
"Change will be inevitable, and not
without pain," the report said.
Police Report
The following incidents were reported
to UNL police between 1:12 a.m. and
9:21 p.m. Sunday.
1:12 a.m. Knee injury reported
near Mueller Tower. Person was taken
to the hospital.
5:13 a.m. Vandalism reported to
a window at Pound Hall.
2:01 p.m. Hit-and-run accident
reported in Parking Area 16 north of
Nebraska Union.
2:37 p.m. Car-bicycle accident
reported at 16th and S streets. No injur
ies were reported.
7:52 p.m. Two computers report
ed stolen from Bancroft Hall.
9:21 p.m. Money reported stolen
from Abel Hall.
it 93S "0" Street
SHOT-KICK IN" TUESDAYS
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LONG SLEEVE TEE'S s7." HAWAIIAN SHORTS $15."
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INTRAMURAL UNIFORMS 5." ,,,no
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