The Birmingham age-herald., 1923-04-29
CHICAGO EXCHANGE
 WANTS TOEXCLUDE RUbE SPECULAT0R
Only Those Who Know Game Should Play
 Board

CHICAGO. April 2S.-(By Associ- ated Press.) s.)-The Chicago board of trade recognizes the existence of two kinds of speculation. That of the competent it wants and encourages that of the incompetent, 1t does not want, according to the annual re- port of Robert McDougal, president of the board.
 Speculation by the incompetent Is contrary to the policy of the board, says the report. Care will be exer- cised by board members to prevent such persons as are incompetent from speculating. Under the term | incompetent are included all persons in positions of trust. such as cash : iers and bookk eepers; all persons fi- nancially unable to bear the losses which they risk mourning; all per sons lacking in a study and under standing of grain market condi- tions: all persons whose families or dependants may be injured by such speculation.
 "The board of trade welcomes speculation from the competent and from them only" the report contln- ues This class includes men with intellectual and financial ability to
  who can, if necessary, bear losses without injury to themselves or others.
 "The United States supreme court has said that speculation by compe- tent men has value in avoiding or mitigating catastrophes, equalizins prices and providing for periods of want"
 In discussing the subject Of snort selling, President McDougal says in the report: short selling, being an indispensable feature of future trad ing, ought to be defended and eX- plained. It is almost universally ap- proved by economists and practical grain men. The chief benefit to the market of short selling is to put on the brakes against any undue fall or rise in price, thus keeping prices on a more even keel. It is beneficial to all interests to have the big fluctua- tjons thus eliminated, for grain can then be handled at smaller risk, on smaller margins. that is more to the producer and less to the consumer
 "Without short selling there could be no effective future trading and IT short selling should be abandoneu' future trading would vanish with It, which would be costly step back ward"
 President McDougal is of the oDih- ion that farmers are generally either uniformed or misinformed as to the board of trades nature and functions. He says:
 Not one farmer in thousand knows the fact as established by lh- strumentalites of the federal govern ment that the middlemen's toll on grain through the marketing term nals like the Chicago board of trade are under open and free competition, lower than on any other agricultural product Farmers are not our friends only because they don know all the facts. Representatives of farmers companies. who wish to use our facilities for marketlns their grain ought to be encourages and invited to join the board when they are of the right character ana credit, and will agree to obey our rules and follow established practices in letter and spirit, the same as all others. ...,a,ad
 ITO admit them on privilegeo terms would be to destroy the pres ent market and turn the grain DUST ness from the hands of the many on very small margins over to the hahos of a few on wide margins. with re sultant lower prices to the producer and higher prices to the consumer