THE PRICE OF WHEAT 147 
money and exercise his privilege of not delivering. The 
‘‘eall’’ is the exact reverse. By it a person acquires the 
right to receive from another individual a certain amount 
of a commodity at a stipulated price. If the price has 
fallen the buyer will not exercise his privilege of demand- 
ing delivery, but will lose his ‘‘call’’ money. But in 
the event of a rise in price he will demand the goods 
and profit by selling them again at the higher price. 
By means of ‘‘future dealings,’’ ‘‘spot’’ transactions, 
and ‘‘privilege’’ contracts, speculation relieves trade 
of the risks of fluctuating values by the organisation 
of a special class who stand ready to take or deliver 
commodities at market price. In so doing, this class 
performs a service to society by directing commodities 
to their most advantageous uses. This directive influence 
is exerted through prices, and it is necessary to examine 
the influence of speculation on prices before dealing 
with the assumption of risk by the speculating class. 
(c) Beneficial Effects of Speculation.—The idea that 
speculation determines prices ‘‘regardless of the law 
of supply and demand’’ is erroneous, and based 
upon a misconception of the nature of value. ‘‘The 
more free the competition between buyers and sellers, 
the more minutely is price regulated by demand and 
supply, and nowhere is competition more free than on 
the exchange.’’* It is through demand and supply, 
which are themselves speculative, that the forces of 
speculation operate. By carefully watching conditions 
controlling demand and supply, operators in the ex- 
changes are in a position to make fairly accurate esti- 
mates of future prices. The speculator makes his offers 
to buy and sell entirely on his estimate of future values. 
In these circumstances it is essential that the closest 
serutiny of all the factors that may influence future 
*Emery, ‘‘Speculation.’’? Page 113. 
