Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1882-12-16
WHAT jar soGLD krows
About Corners-A Peculiar Argument
in Justification of Speculation in
General and Corners in
Particular.
Nrw YoRx Dec TX

The Senate committee on grain corners
met again today. Among the witnesses was
Jay Gould. He said he was in the railroad
business as a manager Of railroads and had
been such during twenty years. He was IA
miliar with operations in stock, but not with
grain except that which he used only for his
own consumption. He was familiar with
making corners in stocks and also in the
dealing of futures in stocks. 1.-The roads
am interested in," he said, "are those which
reach the producing districts. Our roads
run through Indiana Ohio. Illinois, Nebras-
ka, Kansas, Texas and Iowa. The effect of
making corners on transportation is to make
an uneven transportation. Corners are
made every little while, but l can't remem-
Der the last one. The system of making
corners does not injure the transportation
interests. as it makes large markets. On
the whole, think it helps for it gives pro-
ducers better prices, and the men who make
corners lose. Consumers may pay more,
although spectators sutfee.'
The corner engineered in Chicago some
two years ago is reported to have lost mil
lions Farmers kept back their grain and
they made money. Western railroads are
not materially affected one way or the other
They deal without regard to fictitious trans
action. l recollect a recent cornering trans
action in stocks. The Hannibal & ST Joe
resulted disastrOucly to the man who made
it, for when he got through with his corner
he found he had lost his fortune. l was in
terested in the Chicago & Northwestern cor
ner. 1t was selling at IS or 80. l thought
it cheap at that price, and my brokers had
orders to buy all that was sold, and when it
got short the price ran up. 1t resulted in
carrying the price up to So so, and then fell
back again to so. think was induced to
part with some at So. so. don't think this
corner had the slightest effect upon the COM
munity in general, although it may have
hurt the private fortunes of individuals. The
road was not affected in the least. l can't
recall any other corner in particular. The
Harlem Corner was before my time.
The effect of dealing in futures of stock up
on the general welfare is insignificant, owing
to the fact that few options are dealt in. l
think that speculation tends to do good, as
it brings money to this country. The freer
your markets are the more freedom you give
to capital. / would be careful what restric-
tons l put either on stock or grain for the
reasons mentioned.
1t would be gambling, but until such time
as legislation says it is to he. Supply and
demand should govern these speculations.
| think that large explorations of grain
the produ ction.
| do not think that any transaction which
draws capital from every center in Europe
here can be said to be illegal. l don't know
whether l would designate the system of
bucket shops public evil. People will
speculate from your minister, barber and
baker down.
People won't deal in chance. don't
think there is the amount of gambling done in
the city that formerly existed. | am sure
speculation in grain benefits home produc-
ers."
Referring to corners in the money market,
Gould said: Such corners soon regulate
themselves, although while they last the
market is depressed. do not think trade is
much affected by it. OF course business
men become more circumspect in their deal
ings. Corners in the money market are al
ways pressed by capitalists locking up their
money. At the fall Of the year there is al
ways a scarcity of money. Generally speak
ing, corner dealings in futures and panics
have alike good and bad effects upon COM
merce in general. 1t afterwards effects to
make people more economical and more en-
terprising l do not think it possible to pre-
vent corners, etc., by any act of legislation,
and l do not think any national legislation
practicable, although some restrictions
might be put upon these speculations-say a
limit to the prices of things.
If the board Of trade were to adopt con
situations which would provide that the set
thing price should not exceed 10 per cent of
the selling price these extensive fluctuations
in corners could not exist. | would. in
every other particular, make New York as
free as the wind.