28 THE HIGH COST OF LIVING 



whose universal use makes it the easiest of all things 

 in which to speculate. 



Chicago, with its railroad-lines stretching out into 

 all sections of the countiy, is the headquarters of 

 the trade in produce. Yet only a negligible part of 

 the wheat of the country finds its way to this centre. 

 In 1915, out of 1,000,000,000 bushels only 50,000,000 

 bushels were actually received in Chicago. But the 

 board of trade fixes the price of all wheat, either 

 directly or indirectly. It sells paper wheat in its 

 daily speculations, and the quotations of the pit are 

 the market prices of the country. Prices of other 

 commodities are fixed in the same manner. And 

 the prices quoted from day to day have no relation 

 to supply or demand, although the reported supply 

 is used as a justification of the speculators' prices.^ 



For instance, in 1916, when the price of wheat and 

 flour rose to a high figure, the crop was large enough 

 to cover all domestic needs and leave a surplus of 

 122,000,000 bushels for export. Since the begin- 

 ning of the wheat year, July 1, 1916, down to De- 

 cember only 68,000,000 bushels of the surplus had 



* The Chicago Board of Trade, which with the Minneapolis and 

 Milwaukee organizations is the chief grain-pit of America, specu- 

 lates daily in about twenty-five million bushels of wheat, which ia 

 about twice the amount of actual wheat received in Chicago in a 

 year. Members of the MinneapoUs Chamber of Commerce gamble in 

 about ten biUions of futures every year, the actual receipts of that 

 city being about two hundred million bushels a year. For every 

 bushel of wheat actually sold on the exchange at MinneapoUs fifty 

 bushels of paper wheat are sold on speculation. See 63d Congress 

 hearing before Committee on Rules of H. R. 424, pp. 31, 57, 158, 

 and 159. 



