The Indianapolis journal. [volume] (Indianapolis [Ind.]) 1867-1904, 1892-02-05
BENEFICIAL TO THE FARMER
Opponents of the Anticipation Measure
Argue Strongly AgainstIts Passage.
Future Sales Made on Boards Of Trade Do Not
Injure the Grain-Grower, So a Chicago
Man Says-The Elevator Business

who were engaged in the business of sup
plying the demand for grain.
Mr.. Aldrich, of the Chicago Board of
Trade, said the board was heartily in favor
of the bill so far as it related to options as
designed in the first section Of the bill re-
lating to fictitious dealings That kind of
trading had always been illegal and never
was recognized, and the board had spent q
great deal of money trying to procure the
enforcement of the low of the State pro-
hibiting gambling contracts. He admitted
that there was. in such q large board as
that of Chicago. considerable trading of q
kind that could not be upheld If the best
members of the board conlda find . way by
which such thlngssas tsRardridqe has the
market and is o great short seller
could be made things of the
past, they would be glad to do so. The
system in operation was the sesult of a
great many years of experience. 1t was
not something devised specially to give
an opportunity for dealings in futures. TIE
boards of trade, like the bank clearing
houses, were commercial convehiences for
exchanges. Yesterday the statement had
been made that the offers to sell were many
times greater thar the offers to buy. That
could not be, MI. Aldrich said. They were
nearly equal. The declines which came. as
q rule. were Legitimate. and due to the sup
ply exceeding the demand for the crop. A
very large decline in grain prices had come
recently. but it could all be explained
without resort to offers to sell short. Pard-
ridge or some one else may have sometimes
sent the market down, but the declines in
the long run were because the markets for
immediate consumption had been over
supplied. At times prices were temporarily
advanced by special buying, and, In fact.
the fluctuations were greater on the one
side than on the other-the short side.
Continuing, Mr.. Aldrich said that If the
bill under consideration was passed 1t
would be the most disastrous thing for the
farmers that could happen and would de-
prive them of their system OF exchanges.
The consumers were 80 per cent. and the
producers As per cent. OF the population.
and unless the consumers were prosperous
and got their grain delivered without
great cost. the farmer could not be pros
porous. 1t took q great deal OF money to
move the crops.
NOT MICH Up IN
The statement had been made yesterday
thas more money was mp in the grain ex-
changes in margins that was necessary to
move all the farmers crops. 1t took $685.
600, 600 constantly employed to carry farm
products thrown upon the market. There
was no such amount of money up in New
York. st. Louis snd Chicago, where nearly
all the grain business was done 1t would
be probably an overestimate to say that
s.. GOO. 600 was up in Chicago in margins at
one time. The margin business was not .
growth Of the last eight or ten years. as
had been stated. 1t WAS no new thing
twenty-five years ago. when he, went into
the business. In Chicago 100000 bushels OF
grain were daily received formed. the
basis on which business on the Board of
Trade was done. If that grain were di-
close of itself without Regulation.
Mr.. Hatch asked what were the average
daily sales, including fictitious sales.
Mr.. Aldrich replied that he had never
made an estimate. but the sales were very
much larger than the quantity of grain re-
ceived.
Mr.. Hatch-Are all your sales on the
Board of Trade recorded
Mr.. Aldrich-No. sir.
Mr.. Hatch-Is 1T not q fact that the Board
Of Trade declined TO record the sales simply
because they did not want the country to
know how many fictitious sales were madei
Mr.. Aldrich-No. sir.
Mr.. Hatch-lHas not that METER been dis
Cueoe0 In the D0arQ 1Or year8I
Mr.. Aldrich-I never heard it discussed
and never knew of it. The board could not
make such reports without putting an i'm
mense amount Of work on the brokers.
Mr.. Hatcn-n this committee was to re-
port a bill simply doing away with fcti:
ti0us sales, would it meet the approval of
representatives of the Board of Trade at
Chicago? 81
MIR. Aldrich-I have not b doubt of il.
Now. in regard to these privileges. If a con-
&-a4 - h.a21 ~ n $500
before the board. it is thrown out at once.
Privilege trading is dangerous, and no one
could enforce such q contract as one of
Pardridge'scalls. Such sales were not per-
mitted in the board-room, but were sold
outside.
Mr.. Hstch-And yet. by unwritten custom,
a man who pleads q gambling contract
stands in the same relation as q gambler
who goes back on q gambling debit
Mr.. A~idrich-1es. SIT.
cent commission was very likely to break
both sides, and that he had always advised
his friends to keep out of speculation. 1t
might happen, Mr.. Aldrich said. as 1t did
last year when the armer got an immense
amount of extra money for their corn, and
. New York operator failed, that prices
might for q few months be depressed or
elevated. but speculation in the long run
did not govern prices. a .sGz
HOW ELEVATOR z DO IT. sew
A. j. Sawyer, one 81 the largest elevator
men In MINNEAPOLIS, then expla ined the
system of marketing grain. and said he
would make no attack on the bills. but be-
fore the present method Of handling grain
was destroyed. he would ask the committee
to devise some substitute by which 1t could
be better handled. He traced. the method
of handling wheat in the Northwest. The
farmer sent the wheat to the elevator from
the thresher, and the buyers had to advance
the money. The first day wheat camein $780,
600 would be absorbed. The railroads and
the farmers compelled the elevator men to
be ready to receive the offerings. He had
to borrow money. and as cars could not be
had immediately, it was som days, at
least. before they could get 1t to Duluth.
made to sell it to the millers et Buffalo,
Minneapolis. or abroad. They could not
take all the daily receipts. and SO the ele-
vator men went into the markets and
bought options to cover themselves from
loss. He would not do the business unless
he could protect himself by means of these
options. or in some other way; there would
be too much risk. Tho 5000 bushels of
wheat received III any day, which he could
not sell to the trade without breaking the
price. ne threw on the market. The gam
blers took care of that. and they also paid
the carrying charges How they protected
themselves was their lookout.
Mr.. Moses asked If he would be satisfied
with some method by which the farmers
could hold their wheat and not sell it until
the trade was ready TO take II.
Mr.. Sawyer-Yes. because then the farm
ers would be the gamblers; they would be