COTTON 237 
troubles incident to movement, storage, insurance, 
and other risks. 
So far then we have found no objection. Spec- 
ulation you may call it, but legitimate; since a 
commodity has been purchased for real actual con- 
sumption. But at this point a new actor struts 
upon the stage—one not concerned with the pro- 
duction, consumption, or movement of cotton; it 
is the professional speculator who sees an oppor- 
tunity to take advantage of a peculiar condition of 
trade, and who, if he is careful and wise, is certain 
to profit by his anticipation of the way in which the 
law of supply and demand will likely operate; he 
will meet this condition by ascertaining in advance 
in every way possible, the probable direction this 
fundamental law will take. 
THE COMING OF THE COTTON EXCHANGE 
So great was this new feature in the movement 
of cotton from producer to consumer that it became 
necessary to bring form out of chaos: it must be 
organized, else it might break itself into pieces. 
And there was too much good, too much intrinsic 
worth in it, for this to happen. 
Consequently in the early 70’s Cotton Exchanges 
were formed in New York, New Orleans, Liver- 
pool, operated under rules and regulations intended 
to protect their own members and facilitate the 
trade of buying and selling cotton. The central 
idea in these exchanges was to provide machinery 
that might facilitate the dealings in “‘options”’ or 
“futures” as they have always been called. 
And what do these terms mean? We will ask 
a member. He says: “They are called options 
because the cotton contracted for is deliverable at 
