The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1910-07-02
THO COTTON SITUATION.
SPOTS TO GO HIGHER IN july
AND AUGUST.
"A Review of the Recent Struggle For
Control OF the Market, and How the
Bears Lost Millions.


worldwide talk of over production
with the approach Of the new mar
keting season. as has been the case
almost every year for two genera
tions, other issues of moment and i'm
portance have been made to confront
him through the indictment of his al
lies who have been charged by the
Federal government with conspiring
to advance the price of cotton. The
Importance of this move against cot
ton is far-reaching. But superficial
interest attaches to it because during
all the years in which concerted at
tacks by spinners and bear specula-
tors have been made on the value of
the South's chief crop the govern
ment has never raised q hand in de-
fense of the farmer
Among the indicted men are
Messrs. Hayne, Brown and Scales,
Southerners by birth and in spirit.
Every year these men take up the
cudgel against cotton's enemies. Dur
ing recent years they have won sew
eral splendid victories and have great. g..
ly aided the South in securing good
prices for her crops. In 1904 they
| secured control of the entire stock of
cotton at New York, and by shipping
1t out to the spinner, broke the con-
troll over the market exercised by the
bear spectators there.
In January, 1910, a raid was made
on contract prices by bear specula-
| tors, and future contracts for May
delivery at New York declined $3.50
per bale. Knowing that the crop was
short the requirement large, and that
| spot cotton could not be purchased
in the South except at much igher
| prices, Messrs. Hayne, Brown. Scales,
Patten and few others began buy
ing New York contracts for May de-
| livery. Some Southern mills which
were in close touch with the spot
markets saw in such contract pur-
| chases way to secure relatively
cheap supplies. Thus the bull lead
ers and the Southern mills came to
| an understanding, the basis of which
was that the bull leaders would aid
the mills in securing all the cotton
they needed provided all of such cot
ton would pass into consumption to
be spun into yarn and woven into
cloth, and that none of 1t would be
| permitted to find its way back into
the hands of bear spectators to be
used by them in depressing the mar
ket. In other words, the purpose of
the bulls seems to have been to Gre
| ate condition that would promote
| the purchase Of cotton from the far
| mer and facilitate the sale of it to
the spinner. The victims of this ar
| rangement were the bear spectators
who sold at deprecated values con-
tracts calling for hundreds of thou
sands OF bales which they did not
| possess. and which finally they were
forced to buy in the open market at
relatively high prices
How serious the situation is for
the bear spectators and how much
they would welcome any development
that would restore old time bearish
control Of the cotton market are
shown by recent occurrences.
During May, the bull leaders fore
ed the bears to deliver some $4,000
bales of cotton on future contracts.
for which they paid some $4,000, 900.
The bears had to buy this cotton
from the farmers, from merchants.
and from Interpolation anybody,
in fact. who had it. The bulls who
received 1T from the bears have been
shipping it to spinners all over the
world as rapidly as possible in order
that all might pass into consumption
without delay.
This means that the bears must
buy more cotton from the farmers
and spot merchants with which to
fulfill their outstanding contracts in
July and August. Since only about
100000 bales of unsold cotton now
remain in the country, the supply is
very limited and a very high price
must be paid if any thing like as
much cotton is to be rendered in July
or August as was rendered in May.
OF the bear attack on the cotton
market in January last, which reduc-
ed future prices way under spots and
opened the way for the bulls to buy
cheap contracts and demand valuable
actual bales thereon, Congressman
Lever, of South Carolina, In a speech
on the floor Of the House Of Repre-
ScntatiEpS unOtpH ID