Atlanta tri-weekly journal. [volume] (Atlanta, Ga.) 1920-19??, 1922-11-23
DIAL PLEADS FOR
COTTON FUTURES
TRADING REFORM
South Carolina Senator Tells
Commercial Congress
Present Rules Are Injustice
to Producer

CHICAGO, Nov. 22.-The present
cotton futures contract law ere
verses the laws of common sense
and the customs of merchandising
by permitting the seller to deliver
any one of ten grades to the buy
ers, Senator N. B. Dial, of South
Carolina, declared Tuesday, in an adj
dress before the Southern CONNER
Zeal congress.
Senator Dial urged amendment OF
the act to give the purchaser rights
equal to those of the seller Under
the present system, he said, the
grower suffers because purchasers
sell out their hedges rather thar
accept delivery of inferior grades
and the consequent heavy sales de-
press the price.
He cited figures to show that in
1920 only 13,340,OO0 bales of cotton
were grown in the United States,
while there were contracts sold for
12S,907 500 bales. From August 1,
1920, to July 81. 1921, the actual
number of bales delivered at New
York was only $1,000, and at New
Orleans 1O6,6OO.
Under the present practice" Sen
ator Dial said, ''even the lowest
grades of cotton are not sold at theft
value because you have not brought
the right parties together.
Drove of Sellers
'Unless the mill could use that
kind of cotton it would not care
to purchase it, pay carrying charges
and dispose of it as best it could,
hence the result is a great drove OF
sellers of contracts. The maturity
day will be approaching, and when
the seller realizes that he has 60
choice OF selection, and not want
ing to tie up his hands, necessarily
he VIII sell out, and this depreSses
the price of the actual commodity.
He will not necessarily want high
grade cotton, on the contrary, the
kind OF cotton that suits his pur-
pose.
Furthermore, the prices quoted
or the exchanges do not reflect the
price of the market. For example
on March %, 1920, March contracts
in New York were 1852, spot 40
cents a pound; in July spots 4375,
contracts $3.50.
Another objection that could DE
urged is the unlimited amounts OF
contracts that are sold. The ten
years average of the cotton crop
in the United States is 13,5OO,OO
bales. After all that is grown has
been sold, it does seem that the sac
of contracts should cease, and this
would be the case If anyone We're
dealing in the actual cotton ami
hedges. But take the example Ct
the year 1919. There were some
hing like 93,O00,O09 bales of cot
ton sold by future contract over the
amount produced. In other words.
every bale, Of cotton grown IN the
United States was sold more than
nine. times. Artificial supplies are
created at the pleasure of the sell
ers of contracts without charging
the demand The law of supply and
demand is thus hobbled. Whoever
nuts up the most margins can carry
DTlc6S MS way. cllIl 1IOl CAANNSA'OA
ing to legislate value into a com
modify. This could not be attempt
ed. To my mind, the foregoing
clearly demonstrates the inequality
of the present law, and its unjust
operations against the grower.
Suggests Three Remedies
81 suggest either one of three rem
edies, which 1 am satisfied VIII
greatly improve conditions, but urg4
the last one, te-Wlt:
First: Require the specific grade
to be specified at the time the con
tract is made.
Second: Allow the purchaser
and the seller of a contract each to
select half of the quantity; but IN
order to avert the possibility OF
corner, either up or down, let them
divide each half Loyalty IN two OF
even three grades.
'"Third: Do away with the mlu'
ding fair as one of the grades ten
derable and divide the other nine
grades into three classes, to-Wlt: A,
3 and C with three grades in each
class, and make the middle class
the basis. with a discount for
Grade below and a premium for a
grade above.
At have introduced amendments IN
the senate along the lines suggested
above. but l am told that the task
ia TOO monumental to be accomplish
ed. and that it would cause a reVo-
l1,tion in marketing. l believe Ill
revolutions when they are neces-
slry to accomplish justice. Becaus
the practice is old is no reason why
i. should not be changed. l am nos
asking favors, but simply demand
ing Justice. Congress has the good
of the people at heart, and am
satisfied when we all look into this
subject we will agree along the lines
of the above suggestions. There IS
no use telling farmers to make q
living at home, diversity their crops.
b11ild warehouses, organize cO-opefa-
five marketing associations, hold
meetings in Washington and else
where. to do other things which are
essential, and then for us to stun
ble around like a set of blindfolded
school boys, processing not to know
the real reason why our section
O; the country does not prosper. The
cotton industry is in bondage and
every one knows that something Is
wrong. but they do not realize the
exact trouble nor the remedy"
Goodyear Raincoat Free
II