The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1922-11-03
THE GRAIN FUTURES LAW

The grain futures law became eff
fective yesterday, but before that
date the exchanges had started pro-
ceedings in the courts to test its con-
stitutionality, and tire Toledo, Ohio,
exchange had announced a suspension
Of business.
The present law is the second of
its kind passed by congress. The first
was passed by both branches of con-
gress In the summer of 1921, during
the special session, but it was declared
unconstitutional by the United States
supreme court. Immediately a second
bin was started thru the congress,
which eliminated the unconstitutional
features of the first one. Concerning
the second law, Secretary of Agricul-
ture Wallace issues the following
statement:
1.-The new law takes the place of the
regulatory provisions OF the Future
Trading Act OF August "a, 1921, which
were declared unconstitutional by the
supreme court of the United States
last May.
I'm substance, the new law is the
same as the old. but the new law is
based on the power OF congress to
regulate interstate commerce, while
the former statute was based on the
taxing power OF congress. AS all of
the exchanges were fully acquainted
with the requirements of the former
law. there should be no difficulty or
delay in complying with the new law.
The exchanges affected are those at
Chicago. Minneapolis, Duluth, Kansas
City, St. Louis, Toledo, Milwaukee,
San Francisco, Los Angeles and Bal
timore."
ThiS law it is pointed out does not
interfere with hedging transactions on
the boards of trade. Neither does it
interfere with ordinary speculation in
the buying or selling of contracts for
future delivery. If. however. there
should be evidence of undue manipu-
iation, or attempts to corner the mar
ket, or of the dissemination of false
or misleading information about crop
or market conditions by members of
the exchanges, such conduct would be
inquired into and promptly dealt with
as required by the law In addition,
it, prohibits the exchange from dis
eliminating against cooperative asso-
Citations of grain producers, who may
desire membership in order to obtain
the use of the facilities of the grain
exchanges. The secretary of agricul-
ture also is given the requisite au-I
thority to examine the books and rec
ords of the members of the exchanges
and to require such reports as may
be necessary to carry out its provi-
sions.
THE reports that this law will put
the grain exchanges out of business
or interfere with their legitimate
functions" says the secretary, '.are
without foundation. Tt will not in
terfere with the proper operation of
such exchanges. No one will be per-
secuted No proper business win be
harassed. The law gives us an op-
portunity 30 observe and inquire into
the operations on grain exchanges
and to put a stop to improper prac-
tees, if-guch exist. 1t gives oppor-
tunity to study this whole system of
registering prices of grains. In a
year or so we should be able to speak
with authority concerning grain ex-
change dealings. Nobody can do that
now.
an the administration of this law
am confidently expecting hearty CO.
operation from legitimate dealers in
grain and from all others who favor
free. open and competitive markets"