Gambling in Farm Produce . 31 1 
and not one may have any intention of handling the grain. Any 
buyer can insist on delivery, it is true, and this is all that the 
much-vaunted rule of the Exchanges or clearing-houses amounts 
to. The fact remains that the vast majority of dealings in 
options or futures in America, Liverpool, or London are settled 
without delivery. I have before me the rules of the Liverpool 
and London Clearing-houses in relation to grain, and in both 
settlement without delivery is clearly provided for. Mr. C. W. 
Smith, who has operated in Liverpool for many years, says that 
95 per cent, of future contracts are settled without any transfer 
of produce ; and one of the highest authorities in London tells 
me that in the London Produce Exchange the business done 
nominally in grain is “ purely an option business.” “ Any 
buyer may demand delivery,” he adds ; “ but no one does.” The 
options are simply hedges against actual imports, or purely 
gambling ventures. 
Another argument of the defenders of the system is that it 
multiplies the number of persons willing to buy the farmer’s 
produce, and that therefore it must be beneficial to him. To 
say the least, this argument is neutralised by the counter con- 
tention that the system puts an enormous amount of fictitious 
grain on the markets, which, per se, must tend to depress 
prices. 
Now let us consider the contention of those who declare that 
in the long run the option system makes no difference to 
prices, or that if it tends to depress them in periods of plenty, 
it also tends to enhance them in a corresponding degree in 
seasons of scarcity. 
At first sight it might appear to anyone not conversant with 
the details of the option system that, as in every contract there 
must be one person interested in a rise of prices and one inter- 
ested in a fall, as far as that particular contract is concerned, 
and that therefore in the whole mass of contracts there must be 
as many interested on one side as on the other, the influences 
of the two sets, so far as men have power to affect prices, must 
precisely neutralise each other in the long run. I have never 
seen the argument put in this form by defenders of the 
system ; but it has occurred to myself as the most plausible of 
any that they could possibly use. Its fallacy lies in the fact, 
previously alluded to, that in the speculative market the “ bears ” 
in the long run must be stronger than the “ bulls.” One reason 
is, that a great number of those who rank on the “ bull” side, 
such as millers who purchase corn for manufacture, and 
merchants who import it for distribution, are not, as a rule, men 
who make a business of manipulating the markets. Those of 
