Yorkville enquirer. [volume] (Yorkville, S.C.) 1855-2006, 1914-01-23

us more than half way in its proW-
sions as to bills of exchange drawn
for agricultural products.
The price Of cotton can only be
maintained when the supply and de-
mand are evenly balanced; an avail
anche Of cotton in the fall runs the
market down and there Is no way to
prevent q fall in price except to hold
it off the market until 1t is needed for
consumption, and this cannot be done
without warehouses and access to
cheap money. Spectators will never
borrow money and hold this cotton for
an advance until 1t gets so low that II
| Is regarded as an investment, and that
means around or below the cost OF
production, while there Is no profit In
| il to the planter. The price OF cotton
once the anti-option law passes, Will
depend almost entirely on withholding
such cotton from the market as Is IN
excess Of the current demand. This
cotton must be carried by some means
entirely outside Of the open market
You cannot regulate this condition by
congressional legislation and not con-
fict with the Constitution. Congress
has gone as far as 1t can go In the
currency bill and we must provide our
machinery to take advantage OF 1t.
What would like to see would be Tor
this legislature to pass the warehouse
bill, then let congress place tax ON
every contract made for future denv-
cry of cotton, except where that cotton
Is delivered in a state growing say ten
per cent Of the crop. We can dispense
with purely speculative trading In an
open market If the surplus supplies
can be cared for, and for that reason
the practice should be suppressed.
Then the classified stocks in any
standard or state operated warehouse
in the south would with proper frelgnt
allowance, become at once deliverable
on a contract in any place by delivery
to the carrier, which Is delivery Dy
law to the consignee.
II ia frequently asserted that prices
for cotton are made in Liverpool, do
not know that this Is always true, but
I do know it Is so at times, and 1t
ought never to be true. And II 1t Is
true at any time 1t Is because a defec-
tive system Of marketing permits II.
The price of cotton should at all times
be made In the home market and the
producer will never get justice until
this Is done.
I ask you, what would manufac-
turer say to his selling agent II he al
lowed his customer to make the prices
on a non-competitive article, (and cot
ton is non -competitive), because the
south has a practical monopoly in Its
production What fools we are to per-
nit others to name the price of every
thing we buy or sell. / am willing for
the other fellow to fix the price on his
goods but let me fix the price on mine.
The foreign market dominates the sit
liation for the reason that nearly al
ways the supply Is greater than the
demand. When you add to this actuai
cotton, the imaginary cotton that Is
traded in at the rate Of 150 million
how little voice the producer has In
fixing the price of his cotton.
/ have bill here which II congress
will pass, 1t will force this $50 million
bales Of paper cotton, gambled In
around the ring, to pay the expenses
of grading every bale Of cotton grown
in the south, without one cent OF ex-
pense to the grower Of that cotton. TO
that extent 1t will pay the carrying
charges and make it very cheap to hold
cotton in a state warehouse.
There Is bound to be some way to
protect the uufacturer in the pur-
chase Of raw lotion against his sales
of goods for future delivery. This Is
done through "hedge" sales on the
exchange and unless some other means
are provided, the result will be disas-
trous to the farmer and mill man
What is needed is q market where the
consumer can buy his requirements
ahead and be sure that he would get
| the cotton for which he makes the
contract. Under the warehouse sys-
| tenn, he would pay no carrying charges
| and be at no expense save broker.
and a small fee for changing his hold J.
ings from period to period. He would
be relieved from wide fluctuations In
price and heavy calls for margin ac-
count. This would enable him to pay
a higher price to the producer.
Purely speculative trading Is induc-
ed by expected profit resulting from
| fluctuations in prices; 1t has the ef-
| feet Of increasing activity In the mar
ket; but it Is artificial because 1t does
not absorb supplies, and the reaction
Is as depressing as over stimulation
from whisky is to the individual.
How New York Works the Game.
Last November, the Columbia cham
ber of commerce requested me to ac-
company Mr.. M. c. Heath and Mr.. L.
B. Stackhouse to New York, to pro-
pose that the New York cotton ex-
| change amend its rules so as to per-
NIT cotton contracted for through the
exchange to be delivered at certain
points in the south. The exchange has
| practically agreed to accept Columbia,
Augusta and Memphis for this pur-
pose. Undoubtedly this will to some
extent relieve the situation, by enlarg-
ing the basis of actual supply, but un-
less the imaginary cotton dealt in can
be made to share in the expense OF
carrying the actual cotton / do not see
that there is much in the proposition
| to the cotton planter. It will be good
| thing for the banks and commercial
welfare Of these cities. The benefit to
the producer will save about five dol
lars a bale in expense.
Prices in the New York cotton ex-
change are controlled by manipulation
of the small stock in New York. This
| is of low grade practically unfit for
spinning. AS many as twenty-eigh
different grades may be rendered on
contract for 100 bales.
| When a tender Is made no one can
afford to receive 1t, and speculative
commitments are dumped in on the
market with a great slump in futures.
| Now the moral effect Of this decline In
futures is felt in the price Of spots in
every town in the south where cotton
is sold. The manipulators who con-
troll this stock are the great spot buy
| ers, who under present methods must
keep their hands on it TO prevent the
gamblers from clubbing them to death
but when they want cheap cotton for
export, it is not in human nature for
them not to club the planter. say that
no coterie of men in New York should
be allowed to defect the price Of a
great crop from its normal value, so
that millions of people suffer. It Is
time to call halt and believe con-
gress is ready to act hope this con-
gress will pass an anti-option bill
forcing every bale Of cotton sold
through any Of the exchanges Of the
country to be delivered in the south.
What Can be Done.
II the legislature passes the ware
house bill and prepares to carry the
surplus cotton, then the next congress
can amend section (13) Of the curren-
cy bill and give distinct recognition to
receipts for cotton stored in state
warehouse.
Under such a condition speculative
transactions would be based on the
total of the supplies Of cotton in the
south, not a small stock Of dog tall
cotton in New York Warehouse re-
ceipts would be traded in on the in
vestment, not the speculative basis.
They would be delivered on contracts
anywhere. The surplus Of cotton would
be in the hands Of the farmers and his
| f,;a ho 70 AZ fn, 70 he