Commercial notes and scientific information. 57 



commodity in question make it difficult to obtain a survey of its true position, such 

 a strained state of affairs usually ends in a catastrophe, because only a minority of 

 the speculators are capable of forming any correct judgment of the article at all, and 

 the majority, like a flock of sheep, blindly follow the bell-wether. During the last few 

 years a large firm in Messina had played the part of bell-wether to the speculative 

 herd of operators in the oil market, and fortune appeared to smile upon its undertakings. 

 At any rate it is certain that within the last three years those speculators which 

 followed the firm in question made very fine profits, and that their good fortune caused 

 the herd to grow larger year by year, for everybody was anxious to secure his share 

 of the golden bounty that could be had so easily and with so little trouble. It cannot 

 be explained in what manner this firm, previously so intelligently conducted, came to 

 misapprehend the difficult statistical situation of lemon oil, and thereby to lead the 

 colossal local speculative movement in Messina into the wrong lines, but this much 

 is certain, that the export-firm in question, together with the majority of local specu- 

 lators, has entered upon bear-operations of great magnitude. 



We have therefore witnessed a repetition of the usual occurrence, namely, that 

 with small supplies of old oil, scarcely sufficient to carry the trade forward to the 

 new season, and with relatively good crop-prospects, a few Messina export-houses 

 made large uncovered sales at low prices both for export and to dealers on the local 

 market. A large number of manufacturers and local speculators associated themselves 

 with this movement, until in the end the Messina market had entered into engagements 

 which exceeded in amount the whole of the new season's oil-output. And v/hen, in 

 the course of the summer, owing to unfavourable climatic conditions, the prospects 

 of the new crop grew worse and worse, both old oil and new oil for delivery rapidly 

 advanced to a high level of prices. 



Old lemon oil rushed upwards from 13 cM in June to 17,50 ^// at the beginning 

 of September; new oil for delivery rose from 12 c4t in June to 16 &M, in the first days 

 of September. When the supplies of old oil were practically cleared, the bear-party 

 in Messina made another strong effort to depress the value of the oil for delivery. 

 The attempt failed, all that the operators were able to accomplish being to lower the 

 quotations for delivery for a few days to the extent of about 1 <?#, after which the 

 market immediately recovered and the previous top-figure of 16 cJl was surpassed. 



While experienced judges of the market formed the impression that the early, 

 heavy and continuous rains of September would have an unfavourable influence upon 

 the oil-content of the lemons — which of course would have made the position of the 

 article still more precarious, — the mass of operators continued to job gaily on, until 

 an event occurred which no one had foreseen, but of which the effect was to shake 

 the market to its very foundations. 



One of the principal and oldest export-firms in Sicily, the very firm which had 

 taken the lead in the bear-speculation mentioned above, and which had sold enormous 

 quantities both locally and abroad, found itself unable to carry out its commitments 

 and, as already hinted, suspended payments, declaring itself unable to supply the 

 goods it had sold. As these sales had been the fulcrum of the whole local speculative 

 movements, the entire structure thereof collapsed, and a panic ensued which was 

 increased by the news that in working up the first parcels of lemons of the new crop, 

 it had become evident that the oil-content of the new fruit was much smaller than 

 that of the two previous seasons. 



To add to the complications of the Messina market it became apparent that 

 numerous buyers abroad had placed faith in the reports of certain local firms in 



