106 TEXTILE FIBRES. 



per Ib. to be allowed for between it and the samples of actual cotton 

 redrawn at the port of discharge. 



"Arbitration, upon shipments sold to average any particular grade, 

 shall be settled by classing the different lots, placing grades or fractions 

 of grades above, against grades or fractions of grades below and passing 

 whatever part turns out, an average of the grade guaranteed, making 

 an allowance on the remainder. 



"In case of any inferiority of quality or irregularity in shipment, 

 the cotton to be taken at an allowance, and this, or any other dispute 

 arising out of this contract, to be settled by arbitration according to 

 the usual terms of the Liverpool Cotton Association, Limited, without 

 penalty. Application for arbitration with regard to quality to be made 

 within ten days from last date of landing. 



" No allowance to seller unless arbitration be demanded by the 

 buyer, in which case the contract shall be subject to mutual allow- 

 ance, etc." 



Cotton Futures. This is a system of buying cotton by contract 

 to be available for delivery at a certain date for the spinners' use, 

 at a price in the Cotton Brokers' lists that has been previously agreed 

 upon. It serves as a kind of insurance to the spinner, and enables him 

 to accept certain orders for yarn that he will be able to execute with- 

 out running short of the raw material, or altering or reducing the 

 quality and strength of the yarn he has agreed to deliver to the 

 manufacturer. When the dealing in futures is resorted to only for 

 actual covering of yarn contracts, it may be regarded as a legitimate 

 system of cotton buying ; but when it is only intended for speculation 

 it often ends disastrously, and the sudden excessive losses incurred by 

 some unfortunate limited cotton-spinning companies has been due to the 

 system of buying futures without due consideration. Briefly stated, 

 futures are always sold in lots of 100 bales. Each lot is provided with 

 a docket, which is lettered ; this serves as a kind of scrip or guarantee 

 of the contract, the staple and price at which the bargain has been 

 struck. If the cotton futures have been bought to be delivered in a 

 month, it must then be sold at the striking price at which the futures 

 are quoted, when the bell rings, say, at one o'clock in the day or at 4 p.m. 

 Generally the prices are struck twice a day, and the price indicated 

 must be paid by the buyer or the firm he represents. 



Mr. Charles Stewart, Cotton Broker, of Liverpool, read a paper on 

 "Futures" before the British Association for the Advancement of 

 Science, on 26th September 1896, from which the following is a 

 quotation : " If any of you ever think it worth your while to look 

 at a Liverpool market report in the columns of the daily or weekly 



