316 CORN 



OTHER EXCHANGES. Aside from the Exchange at Chicago, 

 there are others of prominence located at Minneapolis, Duluth, Winni- 

 peg, St. Louis, Kansas City, Omaha and Toledo. Almost every city of 

 any size has a grain exchange, but they are chiefly of local importance. 

 These markets named are termed "Outside Markets" by the Chicago 

 trade and their price movements are received by telegraph throughout 

 the session and posted on blackboards. 



SPECULATION.* "The German Economist Cohn, defines spec- 

 ulation as 'the struggle of well equipped intelligence vsrith the bHnd 

 power of chance.' Or, as Justice Holmes puts it, 'It is the self-ad- 

 justment of society to the probable.' In simpler English, it is an act 

 or series of acts based upon calculation, whereas gambling is simply 

 an act based upon blind chance." 



It is a fundamental economic principle that all productive industry 

 at the present time involves a certain amount of risk. By the leaders 

 of the modern system of marketing, speculation is declared to be a 

 necessity for the following reasons : 



(1) Production imposes ownership and ownership is inseparable 

 from risk. This is true of live stock, grain, real estate or articles of 

 almost any kind. Risks are innumerable and ever present. 



(2) No one knows the future. With all merchantable products 

 the thought of possession is usually the increase in value. In dealing 

 with the future needs of mankind one cannot foretell with absolute 

 certainty all conditions affecting demand and supply. 



(3) In the case of grain crops, harvesting is confined within rather 

 narrow limits with respect to time, while the demand for these prod- 

 ucts is continuous. One can not harvest the crops simply as needed. 

 At the time of harvesting there must be a surplus to meet the demand 

 until the next harvest. This surplus must then be adapted to the 

 future demand. In addition to this a large per cent of the farmers, 

 including tenants and those who have heavy obligations coming due 

 at a certain time are forced to sell promptly after harvest. 



(4) Shippers cannot ship grain at once. For instance the country 

 grain buyer pays cash for grain. He is not able to ship this at once 

 so he must depend upon a future market. Without a definite future 



•Board of Trade Book, 1910. 



