Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1913-11-21
Local Cotton Deliveries.

The A" S0clated PreSS report VI oeh
ator John l. McLaurin's speech before
the New York Cotton Exchange, last
Tuesday, is brief; but there Is" enough
of it to indicate that Mr.. McLaurin got
close to the bottom of very important
question and pointed the way to day
light for those who really want to i'm
prove badly abused conditions.
: There is a wide difference Of opin-
ion among business men as to the real
economic value Of the speculative cot
ton exchange system as conducted In
New York, New Orleans and else
where, to say nothing Of the moral
principles and tendencies involved, ana
this difference Of opinion is the basis
of the SO far ineffective agitation that
has been going on in congress for re-
form.
However defensible the exchange
system may be theoretically, the exist
ing condition under which unspinable
cotton may be delivered on contracts,
is one that cannot be defended practi-
cally. For instance the exchange rules
which provide for the purchase and
delivery of future contracts, and for q
basis of settlement in case the actual
cotton is not delivered. fail to require
that deliveries must be made in usa-
BILE cotton, and herein is worked great
hardship on the cotton producer, be-
cause of the fact that prices are often
governed by other than the real COM
modify traded in.
The one great justification OF the
speculative exchange system is that le-
gitimate spinne-s are thus enabled to
buy for future delivery, supplies that
could not be obtained from other
sources, and even though the actual
commodity traded in may not be forth
coming on demand, the seller makes
good the difference in prices and the
buyer is enabled to save himself whole.
But herein are several bitches. How
ever 1t may be with ordinary specula-
tors, the actual spinner must have act
ual cotton. Futures cannot be spun
into yarn. So when the spinner buys
a thousand bales Of cotton for future
delivery, when the time comes he
wants the actual cotton. II he has
bought at 13 cents and on delivery day
cotton is worth 13i cents, he is clearly
ahead Just that much margin II he
wants to take his profit; but If in
stead of taking his profit, he wants the
actual cotton, and the rules Of the ex-
change allow the seller to deliver cot
ton that is not ft to spin, then the
spinner is worse off than If he had not
bought the contract
1t is generally understood that dur
ing mcny years past there has been In
New, York many thousands Of bales: Of
worthless cotton that has been used
solely for the purpose Of bluffing spin
ners who make profit on their con-
tract purchases and who want actual
cotton instead Of margins. This worth
less cotton Is offered to them, and as
they could not use 1t II they had 1t, they
have to shave their profits by taking
less than would have come to them
otherwise.
The purely gambling nature Of this
proposition is apparent.
Now In order to get rid Of the most
serious objections to the present sys-
tenn, Mr.. McLaurin wants the govern
ment to provide that every contract
dealt in must specify deliveries Of
spinable grades and enable the buyer
to compel the delivery Of actual cotton
in accordance with those grades. In
asmuch as this Is clearly impos-
sible under an arrangement that re-
quires deliveries to be made in the city
Of New York as now, he would change
the rules so that while the trading may
still be done in New York the actual
deliveries must be made in the states
in which the cotton is produced, and
that enlarges the benefits Of the ex-
change idea to the whole Of the south
ern cotton crop instead of requiring
that all prices be based on the few
thousand bales Of rotten cotton being
held in New York purely for price fix
ing purposes.
Another striking feature Of the
speech is the very logical plea to the
members of the New York Cotton EX-
change to this effect: Now you see
that the people Of the whole country
are becoming aroused to the injustice
and wrong of this whole system and
they are going to compel a change.
You might think you will be able to
stem the tide, but you can't. II you
let things go on as they are you will
eventually be overwhelmed; but If you
gracefully yield to the inevitable and
take the lead in this reform, you will
not only be able to take better care OF
yourselves; but you will be able to help
shape the new system In such manner
as will confer the greatest benefits on
all concerned alike, the producer as
well as the spinner and the consumer.
Clearly in the speech also may De
seen the now prominent outlines OF the
state warehouse plan, embodylng the
idea Of officially weighed, graded and
certified cotton, held by the owners
thereof in the form Of certificates
quickly and easily negotiable, either
for purposes of loan or sale. And OF
course the whole thing carries with II
the idea that with warehouses in all
the states, the warehouse officials In
charge of the cotton responsible to the
people, pressing for the full value OF
their commodity, prices would be
pretty nearly up to actual values.
- Spartanburg, November 20: The
Spartanburg county grand jury today
nresented the names of four men,