The Farmer in a “Corner.” Herd Milk for Babies. 
“CORNERING WHEAT” AND OTHER FARM 
PRODUCTS. 
WHAT IS A “COBNHB”? 
How “Options ” Injure the Farmer. 
Wheat a Favorite. —Attempts to “ corner ” -wheat 
and other farm products are outgrowths of the modern 
system of dealing in “ options” and “ futures ”, this 
method being applicable only to such products as can 
be classified in distinct grades of practically uniform 
quality. For instance, cattle cannot be graded in an 
exact manner, because of individual differences, and 
are, therefore, never subjected to the “option” deal¬ 
er’s pernicious practices; but such secondary farm 
products as pork, bacon and lard, being susceptible of 
exact classification, the “option ” dealer is able to and 
does affect the price for swine, and corners are “ run ” 
in lard, “ribs”, and mess pork. 
Wheat is, from the ease and safety with which 
it is stored, its adapta¬ 
tion to close grading, its 
universal use among 
peoples of the Caucasian 
race, and because of the 
constant and practically 
uniform demand for 
given quantities by some 
520,000,000 bread-eaters, 
made the object of per¬ 
sistent gambling opera¬ 
tions upon the produce 
exchanges, and is the 
product especially at¬ 
tractive to the would-be 
“cornerer”. It is more at¬ 
tractive than other farm 
products, because there 
is no substitute accept¬ 
able to consumers, even 
at a much lower price, 
while substitutes for 
maize, pork, and oats 
are readily accepted 
when those articles be¬ 
come scarce and rela 
tively high in price. 
Wheat has become an 
article of necessity with 
the civilized popula¬ 
tions, and any natural 
or artificial scarcity, and 
even the fear of it, at 
once causes an advance 
in its price—and this be¬ 
cause though one may, 
with comfort, wear last 
year’s coat, no one is able 
to subsist upon memories of even last week’s dinners, 
no matter how satisfactory they may have been. 
“ Corners” Usually Fail.— So far as I know, all 
attempts but one to corner sjny of the great farm 
staples have ended in failure, and, in most cases, in 
the ruin of the “ cornerer ”. The one notable excep¬ 
tion is the Hutchinson wheat “ corner ” of September, 
1888. The Hutchinson “corner” was, probably, suc¬ 
cessful because “ run ” just after harvest, when dealers 
with contracts outstanding for the future delivery of 
wheat believed that supplies of the contract grade 
(No. 2) were most abundant, and took no steps to 
bring such grain to Chicago for deliv^-y day—Septem¬ 
ber 30, 1888. Mr. Hutchinsor, however, took most 
effective measures to prevent large quantities from 
being brought in, by buying all he could find in the 
Northwest. In other words, the dealers were “cor¬ 
nered” because ignorant that the greater part of the 
wheat crop was below the contract grade in quality. 
Corners rarely or never result from premeditated 
action, but a speculator operating on the market in 
his usual way, coming into possession of contracts for 
the future delivery of great quantities of some prod¬ 
uct, thinks—comes to think—that it would be a very 
easy and profitable matter to secure the control of all 
of that article of the spe:ulative grade, and force the 
other fellows to pay him a large sum or sums in the 
way of settlement. 
A Rocky Iioad.—When it becomes evident to other 
speculators that such a deal is in contemplation, the 
would-be “ cornerer” is forced by enormous offers of 
product to protect the market by maintaining the 
price in the face of these offers, and he usually does 
this for months in succession, at the end of each 
month taking the actual product tendered, in com¬ 
pliance with the contracts he holds. In this manner, 
he accumulates an extraordinary quantity of the 
actual product, while continuing to buy contracts for 
still further deferred deliveries. While he may have 
had means to pay for the product delivered to him for 
one, two, and even three months, yet his pile of 
“ futures” (paper contracts) continuing to grow, and 
having to put up margins of from 2 to 10 cents on 
every bushel he has contracted to receive, if the other 
party requires, as he usually does when a corner is being 
run, he is forced, no matter how wealthy, to hypothe¬ 
cate his real wheat to protect his marginal deals 
This involves the ultimate use in a corner of more 
money than any individual has ever had in the “ cor¬ 
nering ” business. As time progresses, more and more 
real wheat comes monthly into his hands, and he gets 
it at prices which, as in the Leiter deal, force him to 
ship it abroad, and at the same time, hold it at a price 
above that demanded by Russian and other sellers of 
actual grain. These conditions place him eventually 
in the hands of the banks, and this necessitates his 
preventing any break in prices that will incite them 
to call their demand loans. In other words, after the 
corner has run a few months, the wealthiest of oper¬ 
ators is between the devil and the deep sea, and only 
a decided world scarcity can save him from ruin. 
Tlie “ Option ” Comes In. —An ever present 
menace to the “cornerer” is the very “option’’sys¬ 
tem which makes a corner possible, as the men whose 
contracts for the future delivery are held by the 
“cornerer” are persistent in efforts to break the 
price, thereby breaking the corner, and thus saving 
themselves from ruin. On this side of the deal are to 
be found the great elevator owners with their immense 
command of money. Whenever these wa-eheusemen 
buy 100,000 bushels of wheat, more or less, and place 
it in an elevato.-, they do not assume the ordinary 
merchant’s risk of property in stock, but, aside from 
ordinary insurance, put out what is known as a 
“ hedge ”, being neither more nor less than a con¬ 
tract to sell and deliver an equal quantity of wheat at 
some future time, usual¬ 
ly from three to nine 
months distant. With 
these contracts out¬ 
standing, they are as¬ 
sured interest on the 
investment, insurance, 
and the ordinary charge 
of storage, also, that the 
wheat will remain in 
store until the storage 
is earned. In the mean¬ 
time, they have several 
rr onths in which to take 
advantage o f market 
fluctuations to buy in 
such of their contracts 
as afford the desired 
profit, while in the event 
that there is no fall 
permitting this profit¬ 
able course, the advance 
in the value of the wheat 
offsets any loss sus¬ 
tained in buying back or 
settling their contracts. 
It is a very rare thing, 
however, that there are 
not such fluctuations in 
the market as to p;rmit 
the buying back of the 
contracts or the buying 
of similar contracts for 
the delivery of like 
amounts, before the 
stipulated delivery day. 
In other words, this 
options system enables 
the elevator men to merchandise as well as store 
wheat without any risk whatever, while with more 
contracts outstanding than wheat in store—as is so 
often the case—it makes them enemies of corners that 
might advance the price. That is, they are usually 
interested in more bushels of paper wheat than bush¬ 
els of actual wheat, and all their influence is, as a 
rule, against advances in price, as falls will affect 
more bushels (be they even paper bushels) favorably 
than will price-advances. 
Some Far-Reaching Effects.— As corners imply 
rising prices, at least until the collapse comes, these 
warehousemen are, with the aid of the banks with 
which they do business, and of which they are often 
part owners, able most effectually to fight corners, 
and bring “ cornerers” to their knees, as they did the 
young millionaire who attempted to manage the 
corner of 1898. Probably, a corner will never be suc¬ 
cessful until some one undertakes it who has monej 
A “HEADER” AT WORK IN A NEBRASKA WHEAT FIELD. Fig 165. See Page 415 
