New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-03-28
KENYON Discovers Drastic
Joker in Measure Which
Passes Senate.
NOT LIKELY TO BE
APPROVED AS 1T is
Under Its Provisions Sherman
Anti Trust Law Would Not
Apply to Pools.
From The Tribune Bureau. ]

WASHINGTON, March 27.-Scenting joker
in the cotton exchange bill, which passed
the Senate to-day which would make the
Sherman antitrust law inapplcable to
pools or agreements organized for the
purpose OF cornering the cotton market,
Senator Kenyon laid the groundwork for
a fight tomorrow by entering motion
70 reconsider the vote by which the meas
ure was passed.
This drastic bill, made up Of measures
proposed by Senator Smith, OF South
Carolina. and Senator Smith. Of Georgia,
for the regulation of cotton exchanges,
was passed by the Senate to-day without
the formality OF a rolcall and with
scarce quorum Of the Senate present.
So stringent are the provisions Of the
measure that the prediction was made
that the New York Cotton Exchange and
the exchanges of other cities of the coun-
try would eventually have TO go out of
business. The advocates Of the measure,
on the other hand. contend that 1t will
prevent the evils OF cotton speculation
and result In higher prices for the cot
ton grower.
One provision OF the bill legalizes cot
ton pools or agreements, such as that for
which Frank B. Haynes, w. T. Brown
and others we're prosecuted by the gov
eminent as being In violation OF the Sher-
man antitrust law. The section reads:
ut is hereby declared TO be legal for any
number of men or corporations TO agree
10 purchase lint cotton and 70 further
stpulate that the same is not to be sold
by or through n cotton exchange which
is engaged in selling futures" Combina-
tons Of capitalists, it is asserted. could
under this provision, buy all the available
cotton of a particular grade, and put an
exchange out of business by demanding
delivery i'm the grade specified.
The bill in general requires that the
members of any exchange engaged In
contracts for the future delivery of cotton
must use a contract in accordance with
the terms specified in the Dill. This con-
tract must specify the delivery of the cot
ton within standards or grades fixed by
the Department OF Agriculture. II the
cotton sold is middling and delivery Is
made Of another grade Of cotton the price
is to be adjusted according to the COM
mercial difference between the two
grades, and not by an arbitrary difference
fixed by the cotton exchange itself, as is
now the case.
The use OF the mails is forbidden 70
those engaged in the business Of conduct
ing an exchange for future delivery who
do not use the form of contract required
by the bill. The use Of the mails and
telegraph lines Is likewise denied for
sending out quotations OF exchanges
which DO not use the required form Of
contract. A fine CT $500, or twelve
months imprisonment, is fixed as the
penalty for violation Of the terms of the
bill
The denial OF the use OF the mails or
telegraph for sending quotations Is the
remedy proposed in the pending stock ex-
change bill for the suppression OF stock
manipulation and gambling.
There is much doubt that the cotton
exchange bill will be finally approved in
its present form.