Report of the Commissioner of Corporations on Cotton Exchanges (Paperback)

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1909 Excerpt: ...exchange to eliminate such gambling feature. They add an unnecessary element of complexity to calculations of buyers (and at times to the calculations of sellers as well), whereas the function of an exchange is to simplify conditions. Furthermore, fixed differences obviously tend to give trading in future contracts more or less of the aspect of a mere game, which is played by set rules and not governed by conditions of supply and demand. The application of fixed differences to a basis contract, therefore, artificially confers upon the seller an enormous advantage, and an advantage which, in view of the complete option of the seller as to the selection of grades for delivery, is distinctly unjust. That the effect of fixed differences has been to make the New York market a seller's market rather than a buyer's market is not only a general belief among cotton producers, but is, moreover, admitted by members of the New York Cotton Exchange itself. Thus, at a session of the special committee of the New York Cotton Exchange, a member of the exchange, when asked whether he considered the suggestion of permanent differences based on so-called spinning values" worthy of consideration, replied: I certainly think that in this matter everything is worthy of consideration, because it would be just as detrimental to the New York Cotton Exchange to make this a buyer's contract as it would be to make it a seller's contract--such as it has been for the last eighteen years. Again, at another session of the committee another member, when asked whether he considered the New York contract a buyer's or a seller's contract, said: I consider it a seller's contract, that is, it gives the advantage to the seller; I speak not from the speculator's standpoint; I eliminate him alt...