The sun. [volume] (New York [N.Y.]) 1833-1916, 1914-11-24
EXCHANGE BLAMED
FOR SAG IN COTTON
Protest From Houston. Tex,
ELECTS Detailed Explanation
From New York.
EFFECT OF LONG CLOSING

There was considerable irrerularity In
cotton yesterday. with times when the un-
dertone was inclined to he easy. owing
to the tendency of local traders to accept
small profits on long cotton and to take
short side on bulges. The volume OF
business is 50 small that II is hard TO
gain much Of an idea regarding the ten
dency and until something develops 10
arouse activity the market is likely TO
be characterized by ms gnihcant fuctua-
tons.
The news 50 far as spots were con-
cerncd is more encouraging. Exports yes
terday were b5.5s7 bales, the largest re-
ported for any one day since the begin
ming OF the war. Liverpool cables stated
that spinners were calling cotton. The
spot sales amounted to 1000 bales when
is fair average under present condl-
lions The New England advices ro-
ported that there was no pressure from
tho South to sell
The most important feature OF tho cot
ton situation since the resumption Of bust
ness by the exchanges has been the at
ttude Of Southern cotton interests. This
came TO light yesterday through the
publication Of a telegram sent 10 the
president of the Houston Cotton Exchange
by certain member. Of the New York
Cotton Exchange. including Robert c.
Cairns, Arthur r. Marsh. William =.
jerks. Leopold 5. Bache and Charles u.
Freeman.
The following paragraph OF the te,e-
gram TO Houston will explain the occa-
sion for IN" message:
Yesterday We were advised OF the do
cson OF the Houston Cotton Exchange 20
call a meeting 10 consider the advisabiliiy
OF taking some action recommending tie
closing Of the markets for future con-
tracts. mainly on the theory that since
they reopened they have been the causes
OF decline in the price OF cotton. 1t
seems eXpedient at this time that state
ment be made to our friends not familiar
with the difficulties with which New York
has had TO contend IN order TO reestablish
Itself as an open market"
The telegram then gave a full and de-
tailed analysis OF the cotton conditions
both as to spots and contracts produced
by the war and the steps which were
taken by the organized cotton exchanges
TO make poss.bl resumption OF busl-
ness
There :. no-hirE in the telegram which
should not have been common knowledge
20 every well informed man interested IN
cotton. The trouble appears TO lie In the
failure Of the South 10 grasp fully the
function performed 10y the contract mar
k.ts. II the critics Of the eNcnanges
would only dig beneath the surface they
| would see AZ once that the very failure
OF the reopening OF the cotton Exchanges
10 bring about "A rise in prices Is
demonstration Of their Indispensable eco
| nomic utility.
The make; s'uce the resumption Of
business has lacked buoyan"y for )nst
one reasou-tnat IN" exchanges "'r'
! closed f{om July 81 to November l6 IN
| that perioi n.re-teu:hs Of N" crop -
/ usually hedged by sales. and millions OF
! haIes are sold short 10y spectators.
Prices might or might not have some -
I low a. they are now, hut one tA.nG IS
certain, the buying power from trade ann
| sn,culat,ye shorts would have been ire
| rn.ndous Moreover. the average specu-
lator who might have made money sen
/ Ing short from II cents 10 80 cents
u,o,,d have been likely TO turn buyer
around present prices. III,
AZ matters now stand, however, with
| The normal short interest practcalIy a
| nullity. owing to the iact that 'he usu'I
| faculties for hedging and short se!NnS
dId NOT exis,. the only buying power must
| cor,a from the investor or the Spectator.
This buying power Is hardly factor a,
present , -,
the cotton exchanges 10 cause an iihi"eu,
ate boorn in prices might just as well
| exnect "A locomotive with a tested speed
capacity Of seventy miles an hour 10 reach
its maximum velocity at the first turn OF
! the wheel
/ owing to circumstances beyond the con-
| troll OF any person or set or persons IN
he cotton trade the market is now al a
| dead centre" ard II will take time Tor
the cotton exchanges 10 assert the'r nor
nal influence ~,
The mere fact that prices dec'ineo WIN
the reopening Of the exchanges only goes
10 show tina. the South took advantage OF
the nrst opportunity 70 put out hedges
against holdings OF cotton. The service
thus performed Is fully as valuable As
the boosting OF prices TINS lh'e, w
co,,a ir time particularly ~ the South
does It's share in the reduction OF acreage
Futures closed steady.