Warren sheaf., 1907-05-23

It is evident that the reason for such
opinion is based upon the fact that
these exchanges gather together the
buyers and sellers of all grains and
that therefore anyone having grain to
sell naturally goes to these exchanges,
simply because, if for no other reason,
that ali the buyers and sellers of grain
are in the market. 1t is matter Of
convenience as we'll as expedition for
either buyers or sellers to be members
Of either Of these exchanges. Each
exchange provides a definite rate Of
commission to be charged, which is
l cent on wheat and barley and one
half cent on oats, etc., and also pro-
vides that members can do business
for other members at one-half the reg
ular rate, but it is also apparent that
unless transactions are very large the
Interest on an investment of men,
bership being considered and the vari-
ous costs and expense attendant upol
the conducting of the business is con-
sidered, that there is very slight diff
ference as to the costs between being
a member or a non-memher. 1t also
appears that by virtue of the high
standard of business integrity main
tanned by these exchanges, that the
farmer and country shipper can, to
very great degree of safety. rely upon
the honesty of such commission mer-
chant, with whom he does business.
1T also appears to your committee
from the evidence that the movement
of the grain crop of the Northwest re-
quires very large sums of money and
1t also appears that the commission
merchants of these exchanges not only
act as grain receivers, that is, as the
trusted agents of shippers in receiving,
their grain and selling the same, BIT
that they also to very large degrea
advance the money to these shippers
in advance Of shipments: It appear.
ing that At certain times of the year
al amount Of money as great as $10.-
100000 or $12.0oo.ooo is loaned by
these commission merchants of the
two exchanges to the grain dealers at
country points throughout the North
west and at a reasonable rSte Of in
terest. It being impossible for thess
country grain dealers to get the neces-
| sary financial assistance from their
own country banks because of the fact
| that no country bank, and in fact IN
! bank, can loan to any one concern
| only a certain fraction OF its capital
The commission merchants are thee
fore to large degree sustaining grain
dealers at country points in fln2n
cial way and it is apparent that the
commission merchants, who are lika
wise borrowers Of large sums of money
themselves. are enabled to get this
money which they loan in this way
| from the banks of the larger citle'
because of the fact that they are mem
| bers of these exchanges and that these
| exchanges themselves act as stron:
forces in building up proper business
methods and principles and thus in ;
very large degree aid their member:
in their standing with the lendin*
world. The testimony. of the banker
! offered before this committee clearl,
shows this phase of the work of thas'
exchanges. 1t also shows that 1t e''
ables dealers of grain to so hedgt
their deals that at no time are the,
srecu!ating on the market or affected
by the tiuctuation of the markets an
they are thus enabled to show to th'
large bankers that they are at a!
times secure and at no time are the
running risk of being bankrupted O.
account of the sudden change in valHe
ut appears that the chamber G
commerce of Minneapolis expenGs be
tween 100000 and $4,000 every yea
In information which is disseminate
among it's members advising them e
the various facts and situations of tn
markets throughout the world, thu
enabling the producer of grain to ke:'
thoroughly posted as to the marke
conditions of the entire globe.
1T appears that the grain trade
the chamber of commerce Of Minnea'
oils has grown from 100000 bushe]
in 1851 to 130,00o,00Q bushels of graf
in 1906 and the board of trade of d.
luth has seen its grain business gro
from 3,500,O00 in 1881 to so,0oo,o0o
1906. Thus it can readily be seen thu
since the organization of these graf
exchanges the grain trade has deve
oped greatly in the Northwest.
'Your committee feels that, Will
perhaps they have not had the tim
to minutely investigate all the phase
and charges that have been mad
against these different exchanges, "
they feel sufficiently well informed G
the subject now under investigate
to add the following as the deductic
J of the evidence by the different pa
ties who have been summoned to te
tify before this committee.
"A copy of all Of this evidence c
fered and all of the rules, regulation
and bylaws, together with the articl'
of incorporation of both of these e
changes, is hereto attached and mac
q part of this report.
} Your committee, however, althous
} being satisfied that these grain e
} changes have been in their operatio
and are now, productive of great be
efits, yet your committee IS incline