The Savannah morning news., 1904-12-19
WEEKLY MARKET REVIEW.
Cotton Holds Steadier-AnaIysis OF
the situation Leads to the Belief
That Prices are Too Low.

cotton Holds Steadier-AnaIysfs OF
the Situation Leads to the Belief
That Prices are Too Low.
Although there was fair interest in
the cotton market during the past
week, fluctuations in prices were mar
row, and the close shows scarcely any
change from the figures of the week
before.
This steadiness in the market, fol-
lowing the recent period of demoraliza-
ton, leads to the belief that the de-
cline has run it's course. A month or
so ago cotton was around Zoe and
the trade calculated on a crop of about
ll,25O,OO0 bales, certainly a drop of &c
to 212c fully discounts all possible con
sequences of crop of say 1000 600
balcs more. In fact, l am convinced
the bearish crop figures have been
more than discounted, and that cotton
is now abnormally low, and should
nave material reaction.
In the first place, we are by no means
certain of a commercial crop of as
much as 100000 bales. Granting that
such crop has been grown, the move
ment to date does not argue that as
much as that will he marketed Pres
crt prices are not tempting enough,
Secondly, even if the crop exceeds
l2O00.O0O, an increase of that kind
ought not, the first year, to result in
a drop to current prices. At 711 to
&c very much more cotton viii be used
than at 10c or above. The world was
aghast year ago because we had
grown, presumably, only about O5OO-
600 bales, actually about 10000, OO0 1t
meant actual cotton famine, and the
most ridiculous theories were exploited
as to the why in the matter. Insects,
deterioration of seed, exhaustion of
lano, all were cited as causing the re-
duced production of cotton. All of a.
sudden, because We now appear to have
crop 100000 to 100000 bales more
than a famine crop, the price is cut
in half, and the cry is "stiH lowerl"
In all reason, is not this preposterous?
Thirdly, supposing that we do carry
over surplus of 100000 or 1000, 900
Dales next season, which, as we have
seen, is as yet merely a vague possi-
Dlllty, that is no reason why cotton
now should sell below Sc, if it should
at ALL We know nothing yet about
the next crop, but have two strong
presumptions: First, that the acreage
Will be smaller, and next, that the
boil weevil will still be with us We
made the present crop only on a very
large acreage and with exceptionally
favorable weather conditions. With a
reduced acreage, increase of weevil and
less favorable season-the first two
reasonably assured, and the last at
least probable-we can have no kind
OF assurance that next years crop will
be much. if any, over 100000 bales,
IN the face of these legitimate SUPPOSE
lions, why should not the trade this
year be able easily to take care of
any possible surplus at the end of the
season at a fair price?
AS soon as the trade settles down IN
normal conditions am convinced that
1t will be recognized that prices have
been unduly depressed, and a material
reaction will result. For that reason
l am now in favor of buying cotton
on all favorable markets, and consider
the risk as small as it ever gets to
be.
The leading New York bear circular
writer, also noted for his lightning
changes. has been recently issuing
characteristic literature. I think The
above remarks demonstrate the fall
laciousness of his argument, and T
venture the prediction that he will he
a rampant bull in less than thirty
days. He is now only trying to make
a soft spot to buy on and cover shorts.
w. 7. Williams.
Savannah, Dec. 10, 1904.