Section Stalin short
September 1930 disclosed that market activity in the wake of the stock market and the 1929 collapse of the futures market, the economic situation is how the confusion. Sharp decline in the prices of most agricultural products, and trading activities are increasing, indicating a large number of short sellers during the transaction if the Exchange does not restrict short selling, then the legislators will know what to do. Grain Futures Act quoted is very difficult, because its provisions are preventive, and not punitive. captured a dealer over trade must be conducted in a real transaction occurs mm, if not impossible, is a very difficult task, because the CBOT and other exchanges of large transactions are opaque, but This does not stop the debate. has long been there, the debate about the value of the futures market heating up again, this time, people value and hedging discussed the evils of speculation, which is not seen in the past. From the issues raised in the above incident is very simple, these problems are inherent, or Washington's political leaders to the deteriorating economic situation looking for a scapegoat?
during World War I and 1920 early, pit relatively calm, however, the price movement since 1924 and the CBOT's internal development incentives to attract new equity transactions, such as Hutchinson and Leiter joined speculators when the outside people think that pit without incident, the transaction does increased by problems caused by international gold prices led to deflation, suggesting that the volume will be reduced, although pit *** Dealers recognize that lower prices is to buy an empty signal. is that they lead to a massive short-selling it? causes and results of the market is very volatile issue.
stock market crash within a year, short as Washington, Wall Street and Russell Street to discuss a hot topic. is short sellers caused the decline in stock market prices , and then crash it? they forced the stock price fell, the latter because there is no support for the new force had to decline. is short contracts pit *** Dealers Blame it? the price of most agricultural products have been on the decline, their behavior is nothing short of insult to injury. the problem is still the old problem, but the discussion was no doubt the environment is unique if the dealer really pit *** short contracts, instead of their greed is what patriotism? market should stabilizing function instead of using the deteriorating economic situation for profit? It is not easy to answer, but Washington has never been a lack of perspective.
the debate about short selling by the Minister of Agriculture Arthur M. Hyde in September 1930 initiated in consultation with President Hoover, Hyde to CBOT President John Bunnell sent a telegram to require the investigation of the Soviet Union short CBOT trading. Hyde that the Soviet Union in forcing wheat prices. Bunnell responded that to him that if Hyde investigation of specific allegations, he was very happy to do this. Both sides entered the food bill futures fuzzy areas. who know exactly what pit *** dealer positions and their customers? Hyde hinted that he has the necessary information to to prove his point, but he added that disclosure of their transactions is the primary responsibility for the CBOT.
of view, he wrote, Lord had to bear the pain of falling prices, as these short sales are fulfilling the contract. millions of eggs into the French market, the French claim that the eggs of the public health threat they fear that these eggs were re-marked for domestic and imported, as if the source of these eggs is produced in France. As for wheat, the situation also similar when it was discovered that the Soviet Union in the short selling of wheat, they rented the boat in Italy, the United Kingdom and the United States to export wheat export plan was quickly canceled. even if they successfully completed the export of wheat, and foreign sales, delivery the actual cost is much higher than the high mm mm shows the real price of the CBOT site behavior is only speculative short selling short selling, rather than for hedging purposes. no intention of hedging, it seems It has been found short of the Soviet Union, to promote the fact that wheat prices.
However, Bunnel feedback is fuel and he was a group of reporters seeking comment on the feedback, hinted, company agents engage in commercial transactions. In Chicago, 50,000 bushels short in wheat, but he claims are involved in these transactions is not due in September when the wheat, but is normal hedging operations. CBOT average daily trading volume of 50 million bushels (short) of wheat is not Belitzky strengths, as his company name as shown. textiles is his daily business.
Belitzky that, in general, he is pure cotton buyers in the past few years, he purchased $ 250 million worth of cotton, ironically, he wrote, willing to criticize the Soviet Union that the Soviet Union is a market manipulator, although the Soviet Union only sell empty negligible r l of wheat wheat added.  but really, what is hedging it?
the Soviet Union's political and economic situation that belies this interpretation. the Soviet Union under Stalin's leadership is in the collectivization of the early, farmers are against Stalin's plan is questionable, especially in the Ukraine region, they have begun to destroy their crops, as they do later, as this will cause a serious shortage of wheat in the coming of the 1930s In those days, the general excess supply of wheat, hedging explanation is unreasonable. seems to have plenty of wheat, the Soviet Union, however, when the Soviet government food rationing has been implemented, so the Soviet Union, the nature of the local market have become blurred, but , the Russians could not simply more realistic delivery of commodities hedging, but hedging the price in the price of hedging, the short selling of goods who has not really want to delivery of goods, but want nothing to maintain the current price. the face of this strategy on the Russian government's criticism of Hoover is very meaningful, however, it seems the real target of this criticism is the CBOT.
Smith Brookhart of Iowa with a comment this event gives his own interpretation, this view in subsequent years was reiterated many times. Because the criticism they have endured for decades now, by implication, their help and support the view that foreign political and economic system destroyed the U.S. economy.
all these allegations and counter allegations of wheat behind the downward spiral of prices in January .1930, spot trading prices of wheat per bushel $ 1.38 in September that year, the price of wheat fell to 79 cents per bushel. Obviously, short sellers for the decline in wheat prices is difficult speech the blame, so the Russians, of course not the only short sellers.  However, the government's pressure eventually won in Hyde comments within one week after, CBOT decided to stop short selling in the exchange of foreign governments, because no one is aware of any other government in short, the ban mainly for the Soviet Union and all members of the exchange companies (other than a company) should be reported to the Commission their positions. CBOT eliminates the erroneous practice of all traders should bear the responsibility, but admitted that short selling is immoral and should be prohibited when talking about the initiative at the CBOT, Hyde commented, Short selling is also the Committee on Agriculture (Farm Board) Chairman Alexander Legge's statement on the cover of .1930 of wheat in September, Legge that the United States to foreign exports of wheat and wheat to feed livestock use up too much, domestic consumer demand is almost can not meet the, when import tariffs pegged to the price of wheat is 42 cents too low the market price of wheat, so that the local market report claimed that and relatively low price, the Russians in the pit *** dealer with the help of hedging and not speculation is impossible.
Russians angry and did not quickly quell .9 end of the ban into effect, short end of the day Russians offices in New York seems to have smashed things to do, because the situation is already evident at that time, he also holds a different grade of wheat is very difficult, these different grades of wheat are not mutually for the. people's sight, the short selling problem has only just begun.'s easy for politicians to find a hot topic in order to publicize their interpretation of the market prices of other problems are brewing and some traders still believe that their futures position is not necessary as the food bill as required by public, even when the CBOT require the disclosure is true.
1931 年, Arthur Cutten is a few refused to fully disclose their trading positions, one of the few. It is widely suspected and other traders involved in the event of Russian short, but difficult to obtain evidence of this early as February 1930, people suspected of Cutten short the market when, Hyde minister sent him a telegram, message said, can cancel this action, will help thousands of people during the Depression if my report is not accurate, please do not put the anxiety of my mind on this matter The reaction is typical, he told Hyde his information is inaccurate, there is no need to worry about, he claimed was not active in the exchange, however, reveal such information then the statement is completely false. against him subsequently started legal action, especially every time his position when more than 500,000 bushels. position of 50 million bushels must be reported. Another trading company sued the Ministry of Agriculture Grain Futures Act to prevent Cutten disclosure in accordance with, the company claims that information disclosed only on the CBOT as an effective institution, does not work for individual traders, but the federal judge to support this bill. Grain Futures Act requires 50 million bushels of positions must be reported. Cutten's case dragged on for almost 5 years until 1936 High Court to make a final decision. This decision on the futures market has a multiplier effect.
1931 year-end, a deal has become well known, but because the participation of mysterious Cutten that year in November, Chicago and temperature Lake Winnipeg Stock Exchange accumulated a huge amount of long positions, thanks to Cutten's team, who already joined the Winnipeg Stock Exchange, Chicago Stock Exchange because he hated asking him to report large trading positions, but one year later, he returned to Chicago legend of the Soviet Union no longer international high export of wheat, with a year ago they hold opposite positions wheat closing of the transaction or the cash badly, has been below cost of production. Cutten's associates said he After studying the market fundamentals hold long positions, almost more than he is the only one to see when he negotiated with the Agricultural Commission, the cause of the widespread suspicion. Agricultural Committee holds a lot of food, but it can only be reasonably stable market produce committee chairman James C. Stone acknowledged prices good for everybody, but he refused to let Cutten to buy wheat. His comments signal the sale of food.
Russians events short selling before exposure to the general public, proves that this is only exposed to a range of stock and futures markets cast a shadow over the behavior of the end of the beginning of .1930 and the beginning of 1931, traders and government officials on the country's economic situation is still a lot of different views, the debate is still very clear the stock and commodity exchange officials continue to insist that the market and the economy will correct this situation, the problem is only temporary. legislators seem beyond this short-sighted argument, see further economic downward trend began to suspect that short selling is the core of the problem. Unfortunately, the exchange officials and legislators seem only in the Titanic deck chairs on how to place to argue, although the real economic problems buried very deep, short selling became a newsworthy topic.
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