The Anderson intelligencer. [volume] (Anderson Court House, S.C.) 1860-1914, 1883-08-30
Undue Speculation.

Since the civil war there has grown up
in this country enormous speculative
dealiugs in cotton, grain, provisions, pc.
troleum, and other articles of commercial
consumption. For every one bushel of
wheat actually grown there are probably
two hundred bushels dealt in. This
trading takes the form of bets on the fu-
ture price OF the article, the better set
Ting the difference of the quoted market
value when the contract OK pires. Now,
dealing in options is not in itself immor.
al; indeed, it is indispensable in tho
transactions of modern commerce. The
cotton planter in the South rarely has
money of his own. He is forced to bor.
row in order to buy seed or hire labor to
work his cotton plant. This he does by
selling contract TO deliver certain
quantity of cotton eight or ten months
ahead. Then the Lowell manufacturer
or the Manchester spinner, to insure
himself full supply of cotton at low
price, purchases the option Of receiving
All this is speculation, but it is perfectly
Legitimate, and serves useful purpose.
But here atep in the great speculative
gamblers, and they sell or agree to re.
ceive, what has aptly been termed
phantom" cotton, that is an option to
buy or sell that article at a definite figure.
In the New York market the actual
amount of cotton handled does not much
exceed 100000 bales per aunun, but On
the Exchange the sales annually amount
to over 35,000,00 bales Only once in
our history has over 100000 bales been
grown in this country. The speculation
does not really enhance the price of the
cotton permanently, although it occa-
slonally brings about "corners" in Ger.
tain months. Take the year through, it
is supply and demand, production and
consumption, not speculation, which de-
termines the market value of cotton.
This illustration, drawn from that fiber,
is also true of grain and provisions, as
well IS petroleum. In the month of May
last, in New York, $50, 100000 barrels Of
petroleum were dealt in speculatively.
Yet the total production of coal oil since
frat discovered would not reach that
enormous figure. Chicago, however, Is
the great headquarters for the epecula.
ton in food products. Millions of bush
els Of corn, wheat, and oats are traded
in, where not more than hundred
bushels are actually handled. "Corners"
are tile natural result of th... wild dealing,
which frequently results in the ruin of
the cornerers. A person named Geogh
undertook to corner" all the lard of the
country, that is to say, to ariifcially
enhance its value. He was ruined in
the attempt, as he deserved to be. His
operations were 30 gigantic that his fail
produced partial panic in the wheat
and provision markets, and even affected
the stock exchange. While these spec.
ulative dealings do not on the whole
advance the price of food, they give
birth to many evils. They lock up mon
ey which could be more productivity
employed in general business, while they
tempt our whole mercantile community
to become gamblers. The great exchan.
ges OF the country have become convert
ed into huge faro banks, where business
men bet their money, not, indeed, on
cards, but on the price of the products in
which they are interested. Congress
ough. to esx speculative sales, and pub.
lie opinion should everywhere frown upon
thes? intrinsically illegltimate and i'm
moral ransactions.-F'on, Democrats
Monthly for august.