New-York tribune., 1918-01-21
BY Arthur Richmond Marsh

By Arthur Richmond Marsh
Editor of "The Economic World'
The daily quotations of the cotton
exchanges bear witness to the fact that
the price of cotton forms no exception
to the general rule of abnormaly and,
as some would have it, inordinately
high prices for the necessarics of life
consequent upon the worldwide con-
dltions of war. In all the cotton mar
kets Of the world this commodity to-
day commands higher price than has
been known for some fifty years. To
find a parallel to the present price Of
cotton in the American markets we
must 60 back to August and Septem-
Der Of 1869, when a violent but short
lived speculation produced quotations
slightly higher than those recently reg
istered in this country.
In the cotton markets of Great Brit
ain and of Continental Europc-in so
far as these latter are now open--the
price situation is even more striking,
since quotations equal to or exceeding
those at present obtaining in those
markets have not been seen sin:c the
first months Of 1865, before the Amer
lean Civil War, with it's attendant cot
ton famine, had been brought to a
close. At no time since the early '70s
has the price of cotton, either in this
country or in Europe, been as much
as two-thirds Of the present price; in
but a few years has it been as much
as onc-half the present price; and
there have been numerous years in
which it was but onc-fifth to one
quarter of the present price. Taking
the average price of the more recent
past as the criterion of normality, it
is found that, as against a present
price of middling cotton in New York
of between 80 and SO cents pound,
the average price for the same grade
of cotton in the same market during
the ten years from 1906 to 1915 was
approximately 11a4 cents pound, or
but little more than one-third as much.
Speculation Is Discouraged
In the presence of these facts it is
impossible to deny that the price Of
cotton is abnormally high-at least,
ii the sole test OF normality is that
which has happened within recent cx-
pcricncc. The cotton trade, at any
rate, almost universally holds that the
price of the commodity is abnormal to
an important extent, and therefore cX-
ceptionally hazardous for those en-
gagged in the business. AS a conse-
quence Of this feeling the order of the
day with the trade is extreme conser-
vatism in respect Of all commitments
and Encouragement of
speculative activities perhaps unprec-
edented in the history of cotton-a
commodity to which for a variety of
reasons speculation has been much
drawn in the past.
1t is probable that at no time since
the great cotton exchanges were or
e,"iii"SU, NV uuilC Hall century ago,
has the volume of essentially specu-
lative trading upon them been so small
as it is at present. None of the specu-
lative campaigning that has usually
played a more or less important part
IN extensive advances in the price of
cotton has been in evidence in conncc-
ton with this most extensive odv,,,.
OF all that the existing generation Of
cotton traders has ever witnessed This
is fact of considerable Importance in
connection with the general question
OF the economic propriety and defensl-
Dlllty of the price level to which cot
ton has advanced during the last wear.
or, perhaps better, two years, seeinp
mat the price rise has been virtuallv
continuous, save for brief interrun.
tlons, during this entire period.
Consumers Directly Touched
Not only the cotton trade. but tho
public generally, has been profoundly
impressed of late by the seeming ali.
normallty of the price of cotton. and
not few persons have recently been
demanding that corrective measures
should be applied through an exten.
sion to the cotton markets of the re-
glme of governmental price fxino