A STORY OF COTTON 43 



Under present methods, the banker, on his part, may F'AIL 

 TO LEND sufTicient money to the borrower, not Ivnowing tlie 

 value of the cotton represented by the warehouse receipts that 

 are presented to him as colhiteral for a loan. 



On the other hand, the banker may err in lending TOO 

 MUCH, to some one in whom he may have great confidence, 

 simply on the statement of the borrower, that the particular 

 grades of cotton, as represented by the negotiable warehouse 

 receipts, are of a SUPERIOR grade or staple and entitled to a 

 greater loan than would be made on the average grade of mid- 

 dling cotton. 



When warehouses are operated as. United States Bonded 

 Warehouses, the weight and, at least, the approximate grade 

 of every bale of cotton deposited in the warehouses, appear 

 on the face of the receipt that is issued by the United States 

 Bonded Warehouse. 



Thus, ALL of the RISK, that is taken by the banker, is 

 immediately removed. 



The borrower is enabled to receive a NEARLY full value on 

 his cotton. 



We are not considering the values relative to LONG 

 STAPLE, which values, the banker may easily substantiate, at 

 any time. For, when he, the banker, holds the negotiable 

 warehouse receipt of the borrower, properly endorsed, he natu- 

 rally becomes the owner of the cotton. He can, at any time, 

 upon presentation of the negotiable warehouse receipts that 

 are in his possession, and paying the warehouseman for his 

 labor of sampling, DEMAND from the warehouseman a sample 

 of the cotton represented by the negotiable warehouse receipts, 

 and thus ESTABLISH the values, relative to staple. 



The fact of the cotton being graded at the warehouse, in no 

 way, prevents the cotton merchant from handling the com- 

 modity according to his, the cotton merchant's judgment of 

 the grades. 



The matter of weighing and grading at the warehouse is 

 simply for the purpose of safeguarding the banking interests 

 of the country. 



The subject of a CHAIN OF WAREHOUSES, of the most 

 modern character, and with the lowest possible rates of insur- 



