The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1917-05-02

sas State Grain Dealers association,
defended the board of trade. He ex-
planned the terms, futures, hedging
and speculation in grain transactions,
so often criticised.
Futures said Mr.. Smiley, "are the
contracts for the purchase and sale
of grain to be delivered during some
future month. The only option fea-
ture in connection with this contract
is the option which the seller has
of selecting any one day during the
entire month on which to make the
delivery.
THE purpose of hedging is to avoid
a risk, known as the speculation
risk" which attaches to ownership of
any kind of property, including wheat.
On grain this speculative risk can
be shifted by those engaged in the
actual handling of grain, upon Spe-
cial class, known as speculation, and
this is done by means of sales for flu
ture delivery as before mentioned.
This system of selling for future de-
livery enables the farmer, elevator
company, the Independent dealer and
the line elevator companies to avoid
the speculative risk which would eX-
list in case their cash purchases are
not hedged."
Stanley Christopher, son of M. C.
Christopher, prominent Kansas City
grain dealer, read a letter on the food
situation written by his father. The
letter. written to E. j. Smiley, in part,
follows:
Smiley WorthiIy Complimented.
AS you say, am a veteran in the grain
trade of Kansas City, having engaged in it
forty years ago, and you. like myself, are
a veteran of the organization and you have
attained reputation in this respect, that
may now be considered national, more
nearly So perhaps, than any other man in
the United States, and it is partly due to
your untiring efficiency and work that the
a ~ rain tnffA has
reached its present state of usefulness and
Incompatible development
1t has now become almost a recognized
fact that the last tremendous advance of
go to 20 cents per bushel has been caused
by the frantic and hysterical buying of
housewives and heads of families all over
the United States. This had caused gen
eral rush to buy flour, in some instances
taking the capacity of the mills. and they
in turn have caused the tremendous premi-
! ums for cash wheat that exist all over the
country to supply their immediate needs.
The character and financial standing of
any applicant for membership in this board
is now rigidly Investigated and every safe
every transaction: Any shipper to this
| market with glance at the newspapers
can tell whether his grain was sold at a
| proper price, and he can always ascertain
| thru the secretary of the Board of Trade
| to whom the grain sold, even for
weeks after the transactions was made,
and the same regulation regards transac-
tons in futures, in fact. there is not a
| loop hole or escape left for the dishonest
|
enforced
Boards Essential
Regarding the functions of the Board
! of Trade. 1t is as much an established
| institution now as our banks live stock
/ exchange, and | cannot imagine such a
chaotic state of affairs as would exist if
! Capitalization of capital at the various
! primary centers which is necessary to
| stocks of wheat, and it is also a neces-
sary adjunct to the banks in making loans
to carry this wheat, and to finance ex-
porters. millers, shippers, receivers. etc.
| Criticisms are continually being made
by uniformed persons and the public gen
orally regarding speculative transactions
enemy of manipulation. and have helped
enforce rules from time to time in pun
ishment for these offenses.
"On the other hand l am not certain
but what certain amount of speculation
| is almost Indispensable. Even the specII-
lator 10 an important spoke in the. balan"t
| wheel OF values, and without some specula.
ton It would be difficult for shippers and
purchases of wheat. and their sales ut
flour. Supply. and demand conditions
however, are the main factors in price
making.
Il have always believed that a man who
works in the heat and dust of the fields
cannot be too highly compensated fol
anything he produces. FCrop failures an,
other disasters work innumerable hard
be overlooked. In other words, the in
terest Of the producer deserves equal con
s1uerauon, II not more so IN my opinion
than that of the consumer
Newspapers Seek Truth.
Frank P. MacLennan, editor of tn,
State Journal, defended the newspa
pers for articles printed concerning
food shortage and food speculation
Every effort is made by newspaper
to gather facts. Mr.. MacLennan de
, clared, and if they do not obtain then
! it is because those informed do no
furnish them to newspapers. Mr.. Mac
Lehman referred to his advocacy o
the manufacture of whole wheat breat
! against white bread now in use. Mr.
MacLennan's speech.sin part, appear
on another page of this issue
David Bowie of the Thomas Pag
Milling company was called upon t,
defend the manufacture of whit,
bread against the manufacture o
whole wheat bread advocated TO