Grand Forks herald. [volume] (Grand Forks, N.D.) 1916-1955, 1920-07-17
WHEAT TRADING.

WHEAT TRADING.
Trading in wheat futures has been
resumed in the great centers, and the
farmer, the miller, and every other
person interested in the course of
wheat prices will not only be able to
know what is the price Of wheat to-
day. but may learn what is the judg-
ment of the trade as to the prices
which will prevail some months hence.
In this connection the following dis
cussion of trading in futures by the
Northwestern Miller will be of inter-
est:
Many years ago the theory was ad-
vanced that trading in wheat futures
encouraged speculation to the detri-
ment Of the public interest, and legis-
lation was proposed to put a stop to
1t. 'Grain-gambling' it va called,
Inc of course, to a certain extent, it
afforded opportunity for the gambler,
and on occasion he employed it to dis
turb and distort the legitimate situa-
ton.
ION the other hand, it was the
means of stabilizing values and pro-
tecting legitimate industry from ex-
cessive fluctuations in the price of the
raw material. In consequence, it was
possible to operate on a narrower
margin of profit. and the public was
thereby benefited.
1.-THE experience of the war period
has, most ef~fectually and tor all time.
disposed of the fallacy that future
trading in wheat is opposed to the
public interest. It returns to the
American exchanges with a new dig
nifty and without the vague stigma at
tached to- it's past. The simple pro-
cess adopted by men Of business as a
necessity for self-protection has been
justified on the sound basis of eco
nomic wisdom and desirability.
1T has been shown conclusively,
not only hat the grain and milling
trades can exist without future trad
ing, but that they necessarily profit by
Its elimination, and are actually COM
PEELED to do 30 in order to ave them
selves from loss. The method is re-
stored, therefore, not out Of consider
alton for the future welfare of the
grain handler and flour manufacturer,
q much as for the benefit of the con-
/ sumner.
Before the war, the hazards OF
fluctuations in the price Of wheat be-
ing removed by the ability of the, buy
err to protect himself: in the markets,
! wheat n flour wer handled on the
~rarrowest possible limits OF " profit
| During and since the war these haz-
ards. being uninsured against, were
| u~navoidably andf necessarily, added to
Fthe cost, and ultimately paid by the
consumer of the finished product.
Being. great, and each chain in the
link from producer to consumer BEING
exposed to them, the burden became
heavy, and was reflected in the price
OF hour. Nc n could afford to taxi
anc of a decline; c~onseouent-
~ each protected himself by the only
means left to him. that Of passing on
risk to the next purchaser. Even
so. n danger of a sudden and sharp
decline was always imminent, and mn.
avofdable. Fortunately for those en-
gagged IN wheat dealing and milling,
the price of wheat, contrary. to expec-
tations, advanced instead of declining
and they made profits accordingly
although the process was often nerve.
racking.
Had wheat declined, in spite Of nj
efforts to protect themselves. those
concerned would have made heavy
losses. AS it vas, they escaped. but
the public paid the price of the risk
fthey were obhged.to assume through
the suspension Of future trading md
III consequent protection from vio,en,
fluctuations.
TIL restoration Of this = privtleet
means for those engaged TN, the mill.
ing and grain trades a relaxation
from n high tension of the pastsva,
years; the responsibility of risk is re.
moved from their shoulders and n,ac.
ed upon the wheat markets. wh.r.
It u divided and assumed by the man,
VIC buy and sell and take their in.
dtvidual chances.
1T follows that, az soon "A tia ma.
cnanery Of future trading is fully re-.
established and in working order
Whatever excess in profits was found
necessary In order to protect tho.<
concerned in the handling of vbea,
n Its products will be eliminated
from the price charged, and thus. N
public interest and for Soma 900.
nonic reasons, future trading in vh..,
Is re-established rs a necessity. and
the will again, as In pre.
war times, find the relation betvear
he producer and himself. on . mar.
rover and closer basis Of ~intervenin.
Epr0fh. 70 hts own advantage ana -
sstablifntion Of the price az Il.
products OF wheat on q peace basis
A FISHERMAN.
4 hsherman's = Teller who
Loves running streams an, skya. :,
blue; -,
q nsnerman's . chap who sees
tIeeI pictures In the willow trees.
An, hears, without the need 81 vnrd.
roc anthem In the song or birds.
~ hsherman's . man who knows
Just where the sweet arbutus erov..
"a nsherman,ssA Teller who