The Birmingham age-herald., 1909-01-18

produced, which was only 11,571, ,916 bales, and these figures are by Secretary Hes ter, the recognized standard authority, and since their issuance have been veri- fed
 Spinners were able to depress prices by utilizing their reserve stocks, commonly known as the invisible supply, also be- cause they knew bearish laws that per mitted free selling but prevented free buying had become effective.
 Farmers last spring, discouraged from further holding by good crop prospects then in evidence also forced to action by bankers or merchants whose necessities were urgent, relinquished hope and fur ther effort.
 The spinner then advanced his (the spin ner's not the farmersD cotton $15 per bale in four weeks; for illustration, July New Orleans cotton on April 2S, 1908, was S,47c, and on May %, 1908, was life. This oc- cured about as promptly as could be ex- pected and proved conclusively the intrin- sic value of actual cotton, even under laws that permitted bearish manipulation, but prevented bullish speculation or buy ing on a credit.
 The entire south was honeycombed with bucketshops and unfortunately Texas mad at one time 157 of them, and beyond any
 
 cause of infaming public sentiment and the fight against bucketshops should be continued but Legitimate speculation IS q necessity.
 The majority of people do not under stand the reason for or details of specula- ton, consequently were unable to dis tinguish the vital difference between a bucketshop and a legitimate brokerage office, so they obliterated both as lar as in their power, and the result is now ap- parent to everybody.
 The Chicago board of trade, actuated undoubtedly by self-interest, labored faithfully and succeeded partially in caus- ing the enactment of laws in various grain states of the middle west that abol- ished bucketshops but allowed free buy ing or selling. speculative or otherwise.
 This has enabled farmers last year and this season to market the largest grain crops of recent times at the highest aver age prices of a decade, and present high prices for wheat and corn, when com pared with low prices for cotton, should cause food for reflection and create an appetite to search or the reason.
 The elimination of futures from any commodity of yearly growth tends to ere ate monopoly. For example, sugar or tobacco and night riders in cotton this fall, while wrong, were in the minds of many only an echo of what may come unless unwise laws are changed.
 The magnitude of the cotton crop, also absolute necessity of cotton exchanges or market centers where buyers and sellers can operate without restriction, is real ized when the present cotton crop, even at the lowest prices that have so far prevailed, will sell for S520, GOO, oo0 at the gin house.
 There are apparently few who fully com prehend why prices for everything "ex- cept labor proportionately' have so great ly advanced in recent years, and the cause is overproducton of gold, which until about 1900 had been normal for centuries, but was $425,0o0,000 last year. Tn 1S4O 1t was about s1200O,000''
 This decreased the purchasing power of the gold standard dollar and explains why small crops of cotton sold at low prices years ago and our very largest cotton crops brought high prices as they re- gently did when buyers and sellers were equal and the question of gold produc- ton in connection with money standards seems one of the gravest problems con fronting humanity today.
 The abuses of legitimate speculation are of regrettable rather than prevent able nature, as they to a certain extent still exist.
 Since the Texas anti-option law became effective farmers have sold approximately 20,0o0,000 bales of cotton at a virtually proven price from to 8 cents per pound below it's intrinsic value, and the loss to farmers on this cotton has been from $2O0 O00,000 to $500, 100000 and of two evils choose the least
 During the past IS months America has had an object lesson both ways. First, the high prices for grain, with legitimate speculation, and second the low prices for cotton, without fair amount of spec ulation, as while brokers can be pre- vented within any state, it requires na- tional legislation to stop interstate bus mess or sending orders to other states, though this fact is not fully understood.
 Germany as a nation legally tested an- ti-option laws, and found them directly contrary to the welfare of the German farmer, who forced the Berlin bourse and speculative trading in grain to be re- established.
 The revision of rules regarding the de- livery or acceptance of cotton on contract, which I understand is now in progress. should be forced as a well balanced op- tion equally fair to buyer or seller tends to build up instead of tear down, and future agitation, both literally and actual ly, should be toward improvement in every direction.
 Speculation as commonly known is a