The Birmingham age-herald., 1920-06-04

This Bill was offered to the Senate and referred to the Agriculture Commit tee and is intended as an Amendment to the Smith-Lever Bill and the entire pur- pose is to stabilize the futures cotton contract prices on spot cotton, having the Exchange quotations index true com mercial prices.
 The original Conner Amendment trying to accomplish the same purposes was passed in the Senate and defeated in the House; defeated because of the instant adverse propaganda gotten out by the Cotton Exchanges misdirecting the intent of the proposed Amendment, particularly that it would have g. bad effect on off grade cotton; that it was spinners s contract and would enable the spinner cotton in the market; would disorganize and eventually destroy the cotton fti- lures contract business.
 Full discussion of the questioHY was made by me in the Congressional Record March 25. 30, April 1, 3. IT, 2s, 30, May s and F, and every interested party should read it. Attention is particularly called to the discussions .on April F and May F. copies Of which will be mailed upon request to me at Washington D. c.
 The Cotton Exchanges are in no sense of the word clearing house for cotton; less than 10000 bales were delivered through the New York Exchange last season and less than 25,0OO bales through the New Orleans Exchange; millions of bales of futures were sold in both mar kets. The Exchange is intended to in- dex the price and furnish a reliable hedge for operators on the Exchange market, buying and selling, and the more truly the Exchange price repre- sents the spot price, the more beneficial it is to every legitimate interest.
 The Cotton Exchanges since 1890 under the protection of the law, have practiced great dishonesty in the making of prices and profit, and by depressing prices, making it out of that poorest of our fell low citizens, the cotton farmer I say dishonest as when seller under con- tract delivers to buyer that which he knows he does not want; that which he knows he cannot use and at price he cannot realize on. that is dishonesty, legal dishonesty. Every species of camou- flage to conceal the nefariousness of this practice has been used
 Oscillating prices on the Exchange, are accomplished by assembling from the tenderable grades such an arrangement as will least suit the buyer and at diff ferences in value fictitious; slow and uncertain of adjustment, productive of an uncertain and unreliable price, mak- ing of the Exchange. market a gambling condition.
 The multiplied interests in cotton in- volving millions of dollars and millions of people. deserve a better fate than to have it's value so shuttlecocked around.
 The power within the law to destroy or even to divert temporarily the usu- fruct of the law of supply and demand is injurious to every legitimate busi- ness.
 Cotton is bought or sold on the Ex- change for two distinct purposes. with distinct sets of interests. The producer, the dealer, the manufacturer, buy and sell as hedge to insure the safe con- duct of their business the gambling in- terests operate on the Exchanges for the purpose of making money out of yaria- tions in price. The more stabilized the middling. the greater the benefit to the business. class; the less stabilized the price. the more 1t can be factitiously changed, the greater the interest of the gambler.
 The producer and the manufacturer are the only ones that give value; the dealer is a convenience. the gamblers add noth- ing of value, do not increase the supply a bale, do not decrease the supply bale. and is useful in giving an index as to what the value is and will be. If this knowledge comes from correct data and skilled prognostics. from natural and demand conditions, correctly judging same, then it is useful; when it comes from any false. fictitious combinations. exercising an unnatural influence, an ephermeral influence, then it is bad.
 The Exchange creates no value, and when it does not truly index value, when the prices are manipulated, then the farmer, dealer, and manufacturer ar the sufferers. The spinner is the one consumer of cotton. It is his purchases which make the demand; the farmer is the one producer of cotton, it is his pro duction which makes the supply These two interests meet on the broad field of supply and demand. and if you add to this consumption. then you have the only