10 AGRICULTURAL PRICES 



system. Idealistic social workers, representatives of organized 

 labor, and many farmers, would like to do away with the specu- 

 lative system of registering prices. They would like to substitute 

 therefor price-fixing legislation. These people, as a rule, are 

 densely ignorant of the legitimate price-making forces, and it is 

 impossible that they should be able to shape a price-registering 

 machinery superior to that which we now have.* 



One reason for the writing of this book is the belief that organ- 

 ized farmers and organized labor, working in conjunction with 

 certain idealists, will make an effort to modify our present price- 

 registering system. We are heartily in sympathy with such an 

 effort, for the speculative system is far from perfect. But it is 

 such a delicate system of registering prices that we believe that 

 even the most virulent opponents should allow the system to run 

 unchecked for a good many years yet, in order that they may study 

 its functions more carefully. Here is a great field of research 

 for the economists, who for some unknown reason have failed to 

 study Board of Trade prices during the past fifty years as closely 

 as they should. 



Improvement on our present system can be made only after a 

 thoroly scientific and dispassionate study of its strength and 

 weakness. 



*The following defense of the functions of the Board of Trade was com- 

 piled by Mr. John R. Mauff, the secretary: "The Chicago Board of Trade has 

 exclusive characteristics, indispensable to the welfare of the producer and con- 

 sumer. It offers the producer a constant and infallible fluctuating market, de- 

 termined and regulated by the inexorable law of supply and demand. It creates, 

 thru the trading of its large membership, representing the various branches of 

 agricultural and industrial activity, continuous quotations that are collected and 

 distributed generally and without cost to the public. There is thus presented 

 the opportunity for the producer to determine at any time the exact value of his 

 products. A further advantage is that he can dispose of these products at any 

 time by making a future delivery 'hedging' contract to suit his inclination, re- 

 gardless of bad roads or transportation problems. Another benefit is the large 

 and daily open competitive market in which to display his wares before a multi- 

 tude of buyers simultaneously, obviating the otherwise impossible task of com- 

 municating with this diversity of demands by personal effort. Protected at all 

 times by a set of rules and regulations holding its members to a strict account- 

 abilty for their proper conduct as commission merchants; mandatory for sus- 

 pension or expulsion for any violation of the ethics of trade. Having at their 

 disposal a variety of ability only to be found in a large membership, insuring in 

 this way proper handling and attention because a strenuous effort is always 

 masterful and resourceful where competition is rife. Dissemination of statistics 

 relating to agriculture; the benefits of terminal elevators equipped with modern 

 apparatus for the proper care of sample grades. For consumers, car shortage 

 and other transportation difficulties productive of business stagnation overcome 

 by the opportunity to purchase for future delivery the raw material where 

 'short' sales of product call for protection. Consummation of contracts possible 

 at all times thru the machinery of a market for future delivery at continuous 

 prices, reliable to the fluctuations of a small fraction one-eighth of one cent 

 per bushel. In conclusion, and by no means least, the facilities offered for thus 

 establishing value in every part of the United States, with no inequality because 

 of geographical location, and so a death knell to the exploiters of producers and 

 consumers because of this knowledge widely disseminated and so easy of 

 understanding." 



