The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-11-10
PLANS FOR COTTON
CLEARING HOUSE
Tentative Proposal Made Public
by the Exchange Board
Of Managers.
CENSUS GINNING REPORT

| Developments followed one another 50
I rapidly in the local cotton situation yes
terday. all working toward a definite OBJ
ject. the reopenlng of the exchange that 1t
would surprise no one IL formal an
nouncement OF the date OF resumption
should be forthcoming some time to-day.
The scattered details of the corporation
syndicate plan are being cleaned up. and
/ 1t is expected that the bankers furnishing
the sl,JO0,O00 TO take care of the long
contracts will give immediate approval
TO the manner in which the programme
has been adopted by the members of the
exchange. The board of managers com
pleted their examination OF the tentative
clearing house plan, and this will be dis
cusscd at a general meeting OF exchange
members tomorrow on Thursday there
will be conference In Washington be-
tween officials OF the New York Cotton
Exchange and representatives of the
Treasury and Agriculture departments 20
consider methods of the conduct of bust
ness under the new cotton futures act.
There was n great deal Of interes; In
the clearing house proposal II is proposed
to establish "A corporation to he known as
the New York Cotton Exchange Clearing
Association. with 200 or more shares OF a
par value ~ $40 caoh. The shares may be
owned by any member Of the exchange or
any firm desiring TO clear its contracts
through the association. The management
will rest in five directors. and in order
rhat the control of the association shall
remain In the hands OF those who clear
their contracts each shareholder IL to rs
sign his share In blank to the directors
and agree that this may be sold at par at
any time he may cease TO be a member
OF tho Cotton Exchange. discontinue clear
ing or form partnership with other
members OF the association
guaranty fund Is TO be furnished
by subscriptions OF $4,000 each and n
Zee of 10 cents Is to be charged for each
contract cleared. The earnings are TO
10 toward defraying expenses and any
balance IL to 20 to the surplus fund. In
case Of defaults through failures the con-
tracts OF such firm are to be closed out
on the floor OF the exchange and the
losses are to be paid as far as possible
out of the surplus fund. Any additional
loss is to be assessed as follows: Fifty
per cent TO be obtained pro rata from each
member Of the association and the re-
naming 80 per cent to be- assessed
against the members holding the con-
tracts Of the failed firm in the proper
tton that the net amount Of their con-
tracts with the failed firm bear TO the
total amount OF contracts liquidated at
a loss. In case OF such assessments a
special clearing fee will be charged and
. . credited to special surplus account.
the amounts contributed pro rata and,
second, the amounts contributed by mem
, bers in proportion to- the net interest
, with the failed firm.
Following are the provisions relating
TO the deposits Of original margins:
. + "lA Each member shall maintain a
deposit as original margin upon his net
interest with the association (elther
, bought or sold, as may appear each day.
. AN amount not less than is prescribed in
. the following schedule
, Upon a net interest OF 10000 bales or
less, SO per bale.
Upon a net interest in excess OF so 900
bales, but not over 100000 bales upon
such excess 81 per bale.
'On all contracts In excess OF 100000
bales, 50 per bale.
When. In the opinion OF the committee
on clearlngs. additional margin is deemed
= desirable II shall upon tweuty-four hours
previous notice declare that All members
shall keep with the association an original
margin of not less than 50 per bale on
, their total ret interest with the associa =
ton When once declared this So mar
ginal basis shall remain In force until
withdrawn by the committee,
. "(B) In addition TO the margin re
qu!red above on the net position OF each
r member with the association an original
margin Of so cents per bale on each
, month viii be required on all straddles
When the committee on clearinGs con-
, siders that any increase in a members
commitments with tho association might
: be hazardous or against the best interest
OF the exchange the committee may after
examination fix n maximum beyond which
such member shall not be allowed to eX-
tend his open contracts with the assoca-
t!on or Il may require an additional mar
gin OF not over SO per bale on all excess
c over said maximum az II may deem wise
subject TO right of appeal to the board OF
. managers within twenty-four hours"
Tho plan was not seen by all the mem
bers, hut those who examined IL were
: enthusiastic in their approval The need
for such an institution has long been rec
, ognlzed and Its funlment is bound tC
= mark new era In the affairs of the eX-
o change. The committee Is composed OF
, some OF the ablest members of rlre eX-
: change, who are qualified by reason OF
n special financial experience to frame an
adequate working plan. They evidently
have taken the most desirab BILE features
70 OF several plans OF this character and
fitted them TO the needs OF the local ex.
z change.
a Cotton IL steady in the South. but nc
+ marked changes were reported. The cen
: sus report confirmed bumper crop Ideas by
= giving the amount OF cotton ginned &c
a November l as 9.S2s,695 bales, against
. s,S39,OO0 last year and 100000 In the
y big crop OF 1911.
: Following are the figures on the export,
d OF yarns and cloth from Great Britain
n according 20 the figures OF the Board OF
{ Trade The figures are for Ooctber ant
y the season thus far with comparisons
IS They show a tremendous falling off, a!
n was TO be expected
n October Season,
:, Yarns pounds S.ocSooo l5o,3s5, 30
| y, II 4