The Richmond Virginian. (Richmond, Va.) 1910-1920, 1915-08-29
CLEAR VIEW Of COTTON

-.
spons,biifty. They are In close and
Intimate contact with the producers
throughout the cotton belt. and are IN
! the best position TO advise and assist
! them in taking the steps necessary
10 protect their interests, which are
| also the interests OF the whole South.
/ For the second time within recent
years we have seen q large crop sell
ier far less money in the aggregate
than q moderate crop brought the pre-
ceding year. You have an opportunity
of conserving the values of the
South's greatest single asset--its cot.
ton crop---and upon you, bankers and
merchants of the South. rests the re-
possibility of the veal or woe of
great agricultural section during the
next twelve months, and perhaps for
wears. Leading flnanciers of the
country, In commenting upon present
conditions, which are due in part 10
the European war, freely express the
fear that the sudden prosperity that
has developed In some sections ana
'ong certain lines of industry VIII be
followed hy a period of wild sperula-
ton and infraciion. The banking re-
serves of this country are now very
large, being considerably more than
1000. geo, 900 in excess of legal re-
auirements The gold holdings OF the
United States. over So, 000, 00e, goo, are
larger than those of any other two
countries combined, Our trade bal
aBces are piling up at an unprecedent-
ed rate, and will probably amount 10
81. 900. 000, 600 during the last six
months of 1915, Rates for The best
commercial paper are very Tow. pc
cent or less. and the southern banks.
Should they he able to collect within
the next sixty days the amounts which
they have out directly or indirectly on
Gotten, will he at an absolute .oss Ia
fnd /, safe and profitable investment
for thtir funds. What better security.
therefore, could Il Southern bank ask
than the obligation of merchant or
farmer which he has been carrying on
z crop not vet existent--what hetfes
or more liquid investment, say. 'could
a Southern banker find than 10 carry
this same obligation along for few
months If necessary, secured by the
actual cotton. properly warehoused
and insured, and certain of mar
ket" Such general action on the part
Of southern banks would greatly IA
,,iiitatt the orderly and natural mar
keting Of the crop and would, n >
great degree. relieve what IL caller
distress cotton" by which term
forced sales of cotton, regardless OF
market conditions, have come 10 ne
known. While the rule IT, not In
variable. 1t very often happens. never
thcitss, that after the producers an
the country merchants. who have had
most 10 do with growing the crop.
have sold their cotton. that the price
advances 80 that by planting time the
STERN resolve made by the farmer
few weeks previous 10 redure MS cot
tor acreage SO per cent Is modified
under the influence of the higher
prices that he hears about. with inc
result that the reduction IT, very small
During the acute depression in cot
ton last fall. perhaps all the farmers
were determined to plant bns little
cotton this year. and In one Stats the
LEGISLATURE placed drastic restrictions
upon the amount OF land That could
be planted in cotton, which restric-
tons however, were afterwara re-
moved at a later session win the
Improvement that came in January,
February and March, the tee:iagss oi
the farmers underwent d change.
Sales of cotton were made at nine
cents, and even higher. and, forget
ting their recent plight. the farmers
of the South, despite their bitter ex-
perience and regardless of all the ad-
vice and warnings OF the Department
OF Agriculture, the banks and tie
merchants, reduced their GOTTEN acre.
/ "A. p
! perience last winter should convince
every one that the economic law OF
supply and demand is inexorabls and
unntterable The situation at mat
time WAS indeed a most ssrlouS ore.
and many desperate remedies were
proposed which seemed to be tnstiftea
I by conditions then existing. Nalortza :
! ton schemes we're proposed and much
pressure was exerted upon Congress
J =. h. hA x1fAy 20 t3Dk-
eminent of large amount OF cotton
at 10 cents per pound. When this
proposition, however. was referred
back to some OF the States for separ-
ate adoption on their part, 1t de-
veloped that there was but little pub
liz sentiment behins 1t. The situa-
/ ton last year. as was to be expected.
finally worked itself out along natural
and economic lines. only ~ per cent
Of the crop came In sight by Decem-
her 81. against 10 per cent in ordinary
years. aud ~ the amount in sight.
perhaps so per cent was held unsoid
for account of the producers or the
country merchants. A demand
gradually developed for cotton and
the price advo esd, The situation TINS
fall is totally different from that
which confronted us a year ago. The
present crop can be handled success
fully only along economic lines, and
If we are really suffering from an
overproduction Of cotton. the true
remedY to be applied Is curtai'ment OF
production. Experience has shown
thnt the farmer Is not impressed In
the spring OF the year by figures show
ing large amount OF cotton In sight
unless he himself owns some of this
cotton If the banks and merchants
will carry cotton for farmers this fall.
the advances that they will make
should prevent a repetition or the
chaotic credit conditions and general
trade depression which resulted last
year, and il satisfactory arrangements
for marketing the crop can be made
before spring; that will be good EVIL
/ dence that there has been no over
production IL. on the contrary. a
considerable portion of the crop has
TO be carried until planting time for
the farmers and the country mer-
chants. IA corresponding reduction In
acreage will almost certainly result.
The farmers will not be disposed to
plant heavily II they have a consider
able amount of cotton on hand when
the planting time comes, and sharp
reduction in acreage next spring
would most probably result in de-
mand for cotton and a corresponding
advance in price. for the cotton spin
ner makes Ii his business to antici-
pate rtnp future and TO study carefully
all the conditions relating to the pro-