The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-08-13
TRYING TO UNRAVEL
TANGLE IN COTTON
Local Contract Situation More
Troublesome Than Other
Problems.
POSITION OF LIVERPOOL
Hedging Of Stock Involved i'm
Big Straddles With
New York.
POSITION OF LIVERPOOL

Members OF the Now York Cotton Er-
change are disappointed over their in
ability to make more progress in the
liquidation OF the straddle account with
Liverpool II was hoped that the Eng.
lish market would make some overtures
on the subject with the passing Of settle
ment day on Tuesday Thus far nothing
OF a definite nature has developed.
As matter OF fact. the technical
phases OF the contract situation are CIV
ing cotton men more trouble than some
OF the fundamental problems involved in
tho financing OF the crop and the exports
to Europe Yesterday The board OF man.
ayers held a meeting to discuss the ad-
Visibility of taking all the contracts open
In the various months and grouping them
IN one month on the basis OF differences
prevailing at the time OF the closing Of
the exchange on July 81. Liverpool has
practically adopted this method OF deal
ihs with the situation. and near months
such as August, are being closed out on
the basis OF January +, bruary. No de-
clglvo action was taken on the question
by the board, as the meetins was held
largely for the purpose OF getting opinions
from some of the more experienced
Numbers.
Although there IL an und, rcurrent n,
irritation over tho failure of Llv.rpool
TO lake active steps toward the l!quida
ton or the intermarket straddlo IL Is
felt that the British operators have some
valid reasons for holding back II Is
believed that Liverpool's reluctance TO
take action Is not based entirely on the
calm mat the European commitments are
chiefly for continental account. In tine
OF war II would DO possible for Liver
pool broErs to deal summary with
ihelr continental clients 50 long as th.y
acted IN good faith.
AZ a matter Of fact former Attorney
General Ni"k"-shan, who H. counsel fnr
N" Sew York Cotton ENcnaug, b.s
rendered legal opinion 10 u. ,ommi.tco
de'iiug with continental accounts. ana
HE view il that brokers in this country
ra1 take such action as they SEQ AT re-.
Card.ng continental commitments pro.
N.drd they would act IN a similar fash
ION n the account were their own Tho
biggest problem confronting fivcrupol Us
On" stock ~ cotton In hat market which
* approximately 5000 bales. Hedge
hav" heer sold against this cotton lo
Liverpool. ana unless some big Eugli.n
sp,ning interests could br got together
In ~ coordination 80 take this cotton at
fixed price 1t proba bly, viii no lifH-uIt
to formulate any scheme involving the
reversal OF the New York Liverpool strad-
die
t'nlcss some plan ls Devised 30 open
the Cotton E>chang" before tho heavy
weight % the crop comes upon thr marker
IN" l,ss 70 southern producer, VIII 3.
s'ups0lous. BN this II Is not meant 10
c"'r", tho impression that there VII
hc no slump IN the coutrrct market y
would no impossible 10 p-c.-lt sharp
break II condition, Justify r. Suppos.
'0E. however, for example tho Cotton
Exchange should open and prices should
slump n cents. tho recovery would be
much more rapid than y spot cotton
should 60 2" : cents win O.. contract
markets closed Spn1cls could buy and
finance i've h4'ea ~ contract, where
ihev could finance tho nu~onoss 81 ono