COTTON PRICES AND MARKETS 47 
of the belt, have been equipped during the last few years with ware- 
houses. In these markets the farmer often drives directly from 
the gin to the warehouse and leaves his cotton there. The ware- 
houseman draws a sample from the bale and gives it to the farmer, 
who takes it to the market square and bargains on it for the sale 
of the bale. 
SALE PKOCEDTJRE 
When the farmer receives his bale of cotton from the gin, he often 
takes it immediately to the market square for sale. By the time the 
wagon has stopped, a cotton buyer usually asks " What do you want 
for that cotton ? " The farmer may set a price, but ordinarily he 
asks what the market is and how much the buyer will give. The 
buyer makes an offer. If it is satisfactory, which it rarely is, the 
bale is sold without being cut. If it is refused, the buyer samples the 
bale and makes a second bid. If this is refused, the farmer may 
make a counter offer, and a direct or compromise bargain is reached, 
but often he says he will " look around." 
The next buyer sees that the bale has been cut, so he asks " what 
have you been offered for that cotton ? " The farmer tells him- his 
highest bid. The buyer draws another sample and raises or refuses 
to raise it. The amount of this dickering depends largely upon 
the farmer. Bargaining is done in terms of cents and fractions 
of a cent per pound. The fractions are usually expressed in terms 
of points or hundredths of a cent. Thus, an offer is written 25.40 
where the price is 25.4 cents per pound. 
When the sale is made, the farmer is given a "ticket," which 
states the date, name of purchaser, number or gin mark of the 
bale, and price paid. The farmer takes the bale to the cotton yard 
or local warehouse. It is weighed by a public weigher and a weight 
receipt is given him. These receipts are taken to the bank or other 
place designated by the buyer, and the amount to be paid is cal- 
culated and paid to the farmer. 
FINANCING LOCAL MARKETS 
The buyers in the local market are financed by the local bank. 
The buyer is required to deposit cash or other readily convertible 
assets with the bank sufficient to margin the volume of business he 
expects to do. The amount of margin required depends on many 
factors such as the personality of the buyer, the banker, {he price, 
and the extent and rapidity of price fluctuations. In addition, the 
banker holds the warehouse receipts or other evidence of ownership 
and the insurance policy covering the cotton. 
FUNCTIONS 
The primary or local markets perform several important func- 
tions. (1) They begin the assembling process which is completed 
in the centralizing markets. (2) They offer the farmer a market 
with the least delay and trouble to him. (3) They give him some 
idea of the desirability of the cotton he is growing. (4) They give 
him an opportunity to bargain individually in the sale of his cotton. 
