Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1920-10-23

NEW ORLEANS, Oct, 21.-In a
statement prepared at the instance
of the cotton exchange directors
and made public Wednesday night,
exchange and for fifty years regard
| ed as an international authority on
matters pertaining to cotton market
ing, declared there is mo reason for
rushing for federal financial aid" and
asserted there was nothing the
matter with the south beyond an
unreasoning scare in cotton"
The statement, prepared "for the
benefit and encouragement of those
who are not fully informed" fol-
lows:
THE drastic decline that has oc-
Cured in cotton since the first of
a bale, or about 4S per cent, has
cen mainly due to the pressure to
sci Ion a shrinking market, under
mining confidence of both sellers
and consumers, accentuating the
the reluctance of the latter until
hey practically abandoned the mar
ket except at constant concessions,
which in the aggregate probably
constitute the greatest drop that
has ever. taken place in the staple
in any like period. In the past ten
weeks more than a million bales of
spot cotton. have literally been
thrown overheard without rhyme
or reason. Nearly three-fourths of
have been rushed to market and
| while other sections have sold more
sparlngly, the reported sales at
three leading Texas centers have
amounted to more than 100000
bales. Futures have perforce fol-
lowed spots, the pressure having
been accentuated by sales to hedge
| spots.
"Tight Money" Blamed
"Various theories have been adj
vanced for the scare, mainly the
question of financing, unfavorable
attitude of the federal reserve bank,
and tight money. Neither of these.
precipitated practical panic. Calm
thinkers considers there was no more
reason for rushing for federal aid
than during the 'buy-a-bale' period
of 1914. they argue, and justly
so, that we marketed in part and
the heavy remnant of the most stu
pendous crop produced that year
in the face Of the inauguration of
a worldwide war and at a time
than at present. They knew then not
only that cotton was selling many
cents per pound below the cost
of production. but that it was bring
lIS less IIdH us actual market val
ue, even in face of adverse European
war conditions and the promise of
an abnormally large production
(Which finally proved to be 1900
600 bales) and they knew that the
panic could only be temporary. War
Or no war. the world needed our
cotton and that if the channels of
way would be found to open them
in the near future. And. what did
we do? We marketed that year
more than, was ever marketed in
any year in the history of the trade
and If, we. did rot get as much for
we laid the foundation for an up
ward trend that brought more
money into the south, fairly earned.
in the years that followed than had
eyer before been obtained in our
history.
why. then, should we. after four
seasons in which our raw cotton,
including the seed, has exceeded in
value $7,970,000,000, balk at carrying
/ few million bales pending tenn
oorary lull in demand? Has not that
very lull been heightened by the
producers? Of course, everybody
knows that the governmental efforts
to reduce the high cost Of living
have exercised some influence, but
mat has been by no means entirely
responsible for the cotton panic.
Let US look at the government
figures for the months of August
and September, 1920. In face of all
the talk about reduction of consump-
ton, we find that the mills north and
south consumed of American cotton
from August l to September 80, 1884,
900 bales, against $4,000 the same
time last year. a decrease of only
$4,000 bales. This, then, was not
where the shoe r:nched, as far as