THE FAKMER AND THE SPECULATOR. 177 



they have contracted to deliver. They will be compelled to 

 buy, and desire to buy cheaidy. They therefore promote low 

 prices by circulating facts and rumors indicating an excess 

 supply of the commodity. ''Bulls," or "longs," are specu- 

 lators for a rise in prices. "Bears," or "shorts," are specula- 

 tors for a fall in prices. 



As speculation is commonly conducted, the speculator for 

 a rise does not actually receive, pay for, and store the com- 

 modity which he buys. This, if done on any important, sale, 

 would require far more capital than speculators usually pos- 

 sess, and would also involve the expense of actual delivery, 

 storage, and insurance. He therefore merely contracts tliat 

 he will receive, at some definite time in the future, a given 

 quantity of the commodity at a price named, the seller con- 

 tracting to deliver. Although, in these cases, actual delivery 

 is contracted and can be demanded by either party, neither 

 usually expects it to be made. At the maturity of the contract 

 the one who would lose by its literal fulfilment pays to the 

 other the amount of that loss. 



A "corner" occurs when the speculators who have contracted 

 to receive the commodity secure control of the entire stock 

 available for delivery at the time and place agreed upon. 

 Those who have contracted to deliver to them can buy for 

 delivery only of those who are to receive it, who set their own 

 price, which is usually the highest which it is estimated that 

 sellers can pay. They do not compel general bankruptcy, 

 since that would defeat their object. When actual and com- 

 plete control of a commodity has been obtained by the bulls, 

 the bears have no recourse but to accept the situation and settle 

 as best they can. Complete control of any of the most im- 

 portant farm products, like wheat or cotton, is impossible. 

 At most, control can be obtained only of the supplies, which, 

 at reasonable expense, can be delivered at the time and place 

 where the contracts mature. Outside these limits there are 

 always supplies available, and if prices are raised so as to 

 admit of it, these will be purchased and rushed in and tendered 

 for delivery. These additional supplies must be taken and 

 paid for in cash, or those attempting the corner will fail, and 

 12 



