CASH, TO ARRIVE, AND FUTURES: CORNERS 349 



outweighed -its uses. During the Civil War the Quartermaster's 

 Department of the Army bought grain on contracts for future 

 delivery, particularly on the Chicago Board of Trade. This gave 

 a new impetus to future trading. Following the War, there came 

 a period of tremendous speculation in railroads, in lands, and in 

 general commodities. The same wave of speculation hit the organ- 

 ized grain exchanges, and future trading became the football of 

 speculators. Ordinary hedging transactions became completely 

 overshadowed by purely speculative trading. Cornering the 

 market became almost a monthly occurrence, for every month 

 in the year was delivery month instead of four months as now. 

 Not till five years after the Civil War did the Chicago Board of 

 Trade begin to make rules covering future trading and aiming 

 to curb its abuses. This was the beginning of a fifty-year fight 

 against the two serious abuses of speculation, namely, manipula- 

 tion of the market and corners. The Chicago Board of Trade (and 

 the other exchanges where future trading is carried on) f6und it 

 frankly a matter of intelligent self-interest to preserve the benefits 

 of future trading and eliminate its abuses. Rules were gradually 

 added, increasing the number of grades deliverable on contract, 

 so that corners became more difficult. Obviously if one grade 

 only is deliverable on a future contract, cornering is a compara- 

 tively simple matter. At the present time 21 grades of wheat are 

 deliverable on future contracts in Chicago. In case the delivery 

 cannot be made, settlement can be made at a fair market price, 

 not at a "fictitious" price due to the corner. Again, if the grain 

 in the regular warehouses is held by the would-be cornerers, de- 

 liveries can be made on track during the last few days of the 

 delivery month. Again, it may be added that the Supreme Court 

 of the United States has declared cornering the market a crime. 

 Hence the exchanges now stand ready to apply the remedy of 

 expulsion to any member guilty of attempting a corner. As a 

 matter of history, nearly every attempt to corner the grain market 

 was a failure. Only in those few cases where actual market 

 shortage was on the side of the cornerer did he realize a profit. 

 For the natural consequence of accumulating a long line of grain in 

 order to corner the market is to boost the price of the grain bought; 

 and the second phase of the corner unloading the long line 

 has the natural effect of lowering the price more than the buying 

 had raised it. As one trader expressed it, "It is easy to corner 

 the market, but it is hard to bury the corpse." And this is the 

 reason why most attempted corners failed. In the public memory 



