RISKS OF THE COTTON MARKET 117 



hung around 10, 12, and 14 cents until the 1914 crop. 

 In that year the largest crop in history and the dis- 

 organization in the cotton markets attendant upon the 

 outbreak of the World War broke the market to 6.8 

 cents. In 1914 "cotton brought tears" to the whole 

 South. Increasing war demands again raised the prices, 

 which reached as high as 35 cents in 1919, the highest 

 since the Civil War. In 1920 the price depression car- 

 ried cotton with a crash down to 16 cents. Resulting 

 reduction of acreage and boll weevil damage began a 

 rise which carried it back to 23 cents in 1924. Since 

 then the largest acreages in history reduced the price 

 until it reached 10 cents in 1926, lowest since 1915. The 

 pendulum swung again, and the 1927 crop is estimated 

 to have brought the farmer from 18 to 20 cents. 



The foregoing history of cotton prices indicates that 

 cotton growing is a more or less haphazard game of 

 see-saw between production on one . hand and demand 

 as represented by prices on the other. A generalized 

 type description of their interaction would run some- 

 what as follows: Good prices the first year stimulate 

 larger plantings the next year. The second year the 

 increased acreage sends prices down. These low prices 

 discourage overproduction the third year. Comparatively 

 low acreages plus increasing demands, and new uses for 

 cotton cause good prices and the cycle is complete. "The 

 cotton cycle," writes R. G. Engberg, "is normally two 

 years in length. A large crop is usually accompanied 

 by a relatively low price. This tends to reduce the acre- 

 age so much the next year that unless there is an ab- 

 normally large yield the total crop also is materially 

 reduced. The price therefore rises again and the cycle 



