378 W. R. LAWSON 



existing. But eliminate the speculator, and the grower of 

 produce, the dealer, and the transporter will find that they 

 have lost their means of reinsurance. They must now bear 

 all their risks themselves. If a country like the United 

 States, raising enormous quantities of agricultural, mining, 

 and other produce which have far to travel to a market and 

 many accidents to encounter by way, were to restrict itself 

 severely to the ordinary course of trade, it would often be 

 caught in disastrous fluctuations. In such circumstances 

 the farmer would have to choose between selling his crop 

 early — perhaps at the lowest price of the season — and holding 

 it for a better price, which he perhaps might not get after all. 

 No trader would buy it from him except at a price which 

 would leave ample margin for future contingencies. 



Thus the farmer, in deciding whether he shall hold or 

 sell early, incurs the risk of a wrong decision; in other words, 

 he speculates. The trader who takes part of the risk off the 

 shoulders of the farmer also speculates. Between them and 

 the professional speculator there is no essential difference. 

 Is is only a question of degree in any case. If a distinction 

 had to be drawn, it might be said that the farmer and the 

 grain merchant only undertake risks incidental to their busi- 

 ness while the professional speculator goes out of his way for 

 them and undertakes them voluntarily. That may be, but 

 the vital point is, that there must be a large amount of risk 

 in the marketing of such produce, and that some one must 

 bear it. The professional speculator may argue that better 

 many should share it than that one should bear it alone. 



Under the present commercial regime, wherever there 

 are business risks to face there will be speculation as well as 

 so-called legitimate trade. Moreover, the dividing line be- 

 tween the two will never be easy to draw anywhere, and most 

 difficult of all in the United States, where risks are great in 

 proportion to the enormous amounts that have to be handled. 

 Speculation that simply spreads these heavy risks over a 

 larger area requires little if any apology. On the contrary, 

 it may be claimed that the better it is organized and con- 

 trolled the more justifiable it will be. The Americans have, 

 after long and thorough discussion, concluded that a certain 



