The watchman and southron. [volume] (Sumter, S.C.) 1881-1930, 1914-04-01
SMITH EXPLAINS BILL.
DISCUSSES HIS MEASURE TO
REGULATE EXCHANGE.
South Carolina Senator Points to
Popularity of Traffic in Cotton.

Washington, March Ex-senator
Smith Of South Carolina in bringing
up his bill to regulate the sale Of cot
ton on the New York cotton exchange
today made speech in which he out
lines just what the bill would do if
enacted. The measure seeks to COM
pei the exchange to adopt the gov
ernment's standardization. which in
effect would result in the grade of
cotton contracted for delivered instead
of an inferior grade as at present.
Senator Smith said:
There is perhaps no commodity
that is fraught with so much interest
to the American people, and possibly
none as little understood and appre-
ciated. The members Of the senate
ought to know. as perhaps most Of
them do know. that the balance Of
trade of this country with foreign
countries depends entirely upon our
expectation Of raw cotton. 1t has
grown from 100000 to 5000, 900
bales in 1860 to between $4,000, 900
and 100000 bales in the last de-
cade.
The practice Of selling cotton and
the method by which it is sold is
peculiar. Possibly it is the only COM
modify that is sold under the peculiar
methods which characterize the sale
of cotton. The method has become
SO thoroughly established that we are
absolutely dependent upon the ex-
changes for the fixing of the price of
our cotton. That is the reason for
the Introduction Of this bill, and it is
our hope to regulate this method.
Il have heard discussions here on
the floor as to the regulation Of in
! terstate traffic, as to the regulation
Of commerce, but none of these forms
Of organization and corporations have
taken from the people the profits that
the people as producers were entitled
10. Common carriers and manufac-
turers may have and doubtless do
charge eXOrbtant prices for services
rendered, bur the cotton exchanges
really take from the producers the
profits to which the producers are en-
titled.
"In 1870 the New York cotton ex-
change was organized under the laws
of the state OF New York. On the
New York exchange from January l
to August 81, 1869, the sales of
, future contracts were 101,G63 bales,
and the spot sales were 673,653 bales.
In 1870, the New York cotton eX-
change had future sales amounting to
591,55G bales and the spot sales wero
6lG,41O bales. One year later. when
they had fully organized and got the
idea of the future contracts. the sale3
Of futures were 100000 bales and
the spot sales were 733,9O5 bales.
Since that time the spot sales have
dropped to negligible qua.,i,y No
statistics have been kept accurately,
but it is alleged that the sa;1 of spot
cotton during the last year was some
thing over 100000 bales, while for the
last few years the sales of futures
have amounted to from 100000, 600
to 4OO.OOo,OO bales"
Senator Smith called the attention
OF the senate to the fact that cotton
Is divided into certain grades on ac-
count of color. foreign matter and
strength of fibre. The practice of
fixed differences" is a comparatively
recent practice.
$50 long as the exchanges are al
lowed to sell one thing and deliver
another, at q difference in price fixed
by the seller" said Senator Smith,
the man who enters that market is
at the mercy Of the man who owns
the machine and runs the system"
Senator Smith called attention to an
article in the New York Commercial
which. he said, characterized the
practices on the New York cotton cx-
change as ''buncO game" and stated
that they blackjacked any man who
dared to go there to demand the de-
livery OF cotton
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