The Birmingham age-herald., 1920-07-14
COMER POINTS OUT HO W EXCHANGES
 MANIPULATE PRICE
Saws It Is Absurd to Assert That Cotton Mills Would Shut Down to Depress
 Prices
I'd ths Editor Of The Age.lerald

To the Editor of The Age e-Herald;
 Your editorial of July 13, quoting from the New Orleans exchange:
 '"Tbe feature of the trade this week was the claim of the curtailment of output among American mills and the announcement that some eastern mills had decided to close at least two weeks during July because of the lack of new orders;" and you headline this editorial, Producers Should Watch the Spinners Closely" the original article prompted by the New Orleans exchange, shift ing the depressions of the New Or leans exchange market from their manipulations to the spSnners.
 The New Orleans July contract cot ton basis middling closed the 12th at sS. 2oc, 4c per pound below the price of spot middling, and New York, the same day, was s9.S5c, 1c below the price of spot middling. The New Or leans exchange is due the country to explain why their July contract basis middling is 365 points below New York contracts and 400 points below spot middling What species of jugglery did the New Orleanse exchange use to make this great difference between their contract price and the New York contract pElC6, duu bVtWCch SOAAtAeA~S price and spot price?
 Every holder of July contracts who had beeN induced to hedge sales on their exchange has been swindled by at least Sc per pound. s15 per bale, and this in the face of the Smith-Lever bin which was enacted for the pur- pose of making exchange contract price function on spot price, and which they contend is a protection to the cot for ha cotton dealer.
 If the Conner amendment to the Smith-Lever bill, requiring one-half the delivery middiing and above, had been adopted these swindling opera tions could not happen.
 There are just two classes of bus1- ness on the cotton exchanges, legih- mate business and gambling business. the interest of the legitimate dealer and the interest of the gambler. The conduct of the present law protects the F am blers in the most nefarious opera tions and he is enabled within the law to manipulate the exchange prices just as he is doing now. When futures contracts for the spot month vary as much as 4c from spot cotton, lower there Is swindling going on and when in New Orleans, supposed to De spot market, the contract price varies from the New York price 3Hc and the New York price is still fc lower than the spot price, then there is swindling going on, swindffng in which the pro- ducer. the manufacturer and the con sumer are the victims. The interests of these three are together and no amount of eamouflaging will hide the Gernanized conduct of the exchanges and that conduct hurts the farmer the most.
 To charge that cotton mills are shut ting down to depress the price of cot ton. 1t might just as well be charged that the lumber mills are shutting down to depress the price of timber. No character of business closes down when successfully running and 1t Is exchange islander to associate cotton mills, or blame on the cotton mills, the gambling conditions of the cotton market.
 The cotton mills, every legitimate interest want a stabilized. firm cot ton market, one based on supply and demand, one the least subject to the terrible downs such as the exchanges are now making. It is an outrage on every class of business that the ex- change price New Orleans can be m manipulated so as to be 400 points be- low the spot price and 365 points below the New York exchange price the same day Again asserting that if the Conner amendment had been passed, this thing would not be possible and should not be possible.
 Every one knows that a firm cotton market establishes a trading basis de- sirable to the manufacturer and mer- chant just as weak cotton market destroys the confidence in values and makes cotton manufacturing and mer- chandising difficult and unsatisfactory.
 I have been a manufacturer of cot ton for twenty years, have been inter ested in the growing of cotton all my life and my fathers before mo. I know