The commercial. (Union City, Tenn.) 190?-193?, 1921-05-20
Mr.. Hoover Advances an Idea.

There can be no doubt that spec
ulative trading on the exchanges
would be made entirely agreeable
to the farmers and their champions
if some way could be found to fine
those that sell short" and subsidize
those who buy long" Long buy
ing, according to the casuistry OF
the farmers, is the virtue which con-
trasts with the vices of short selling
The moral quality of speculative
trading is thus determined by the
side of the market Oh which one
trades. But the effort to contrive
things in a way which would give
the virtue it's reward and the vice
its penalty would obviously be
attended by considerable difficulty
One end of the teeter-board must
go down if the other is to go up.
Short selling is not more ineluctably
the consequence of long buying,
One can not be prevented nor i'm
peded without correspondingly pre-
venting or impeding the other.
Nevertheless, the idea that some
thing can be done in this direction
seems to have found lodgment in
the mind of Mr.. Hoover. Mr..
Hoover has been writing to Sena-
tor Capper of Kansas on the subject
of the farmers welfare. Senator
Capper had apparently asked Mr..
Hoover what could be done to make
speculative trading harmless to the
farmer The full text of Mr.. Hoo
ver's response is not given to us in
the press dispatches. But it is. to
be gathered from the synopsis Of
his letter to Senator Capper that
what is needed is a national mar
keting board. The chief function
of the marketing board would be
"the formulation of regulations or
voluntary agreements with h e
produce exchanges, so as not to I'M
dermine the very necessary process
of hedging, but at the same time to
control that type of speculation
which is able, through powerful
drives on the market, to crush the
weak holder of grain and force him
upon the market"
The language doesn't put the idea
under a very strong illumination,
but one can make it out by looking
hard. 1t is, apparently, that the
board should be author
lied to call halt on the market
when prices have descended to the
lowest level which sense of eco
nomic propriety allows, and that the
officers of the exchanges should
execute such an order when issued
by the marketing board. Thus the
board would be empowered to fix a
minimum on the speculative price
of wheat or other commodity. The
apparently, would have
no limit. The "bears" would be
left to the mercy of the bulls" but
the bulls" would enjoy the certain
ty of rescue if unhappily they should
be driven into a corner. One would
be allowed to pocket the utmost it
might be possible to make by play
ing on the "bull'' side of the mar
ket, but only so much profit as the
board might be moved
to vouchsafe by playing on the
bear" side of the market. The
bear" side would be exposed to all
he natural dangers of speculation;
The bull" only to those which a |
board, animated by a ten
Ter solicitIde for the farmer might |
leem meet. The "bull' would go
INTO the market pit armored with |
he marketing boards zeal for his
the bear would be made |
% enter naked
That specializing under such a
regulation would ordinarily be at
ended by less risk on the "bull"
han on the bear" side of the mar
Iet is manifest. But it must seem
llso that by as much a. the odds
ire artificially made to favor specu-
alive buying, they must discourage
peculative ceiling, so that it must
eem to many of us that Mr.. Hoo
1er's idea will not become practi-
able until a way shall be found to
,uy more wheat on exchanges than