COMMERCIAL "CORNERS."

Auckland Star, Volume XVIII, Issue 203, 31 August 1887, Page 4

COMMERCIAL "CORNERS."

No regret will be felt at the announce, ment made in our cable despatches today that the Californian wheat "ring" has collapsed. The object of the organi. sation was, by purchasing all available consignments of that staple to run up the price and enrich the members of the " ring" at the expense of the consumers. All trade monopolies are bad, but the worst form of all is that assumed by those artificially-forced monopolies in the necessaries of life, which the command of money enables men to embark in. It is no compliment to the world's advancement in morals that^ this form of commercial swindling is becoming alarmingly prevalent. The 'cute citizens of the United States appear to have learnt the trick from the despised Chinese, who have completely mastered the art of combination for the achievement of a common end, and are not at all punctilious as to the means employed in pursuing their object. The fashion has spread to Europe,, and German and other merchants are busily forming themselves into " rings " and " syndicates " with a view to creating a " corner " in one commodity or another. They are playing with fire—an amusement which has a peculiar fascination^ for a certain cast of minds; but it will most probably end in their getting burnt, and they themselves will be the only ones sorry at the result. The story of the collapse of a wheat " ring " recently formed in Chicago is told in American papers received by last mail, and gives an instructive insight into the rash, ruinous, and immoral nature of such speculative trading. The Chicago " ring " bought up twenty millions of bushels of wheat from the producers and held it in the immense stores of Chicago until the market price rose considerably. There followed the usual wild speculation —men bidding wildly in the hope of getting a share in the gams, audfortunes being won and lost in a few moments of time. The inflation went on until at last the inevitable bursting of the bubble took place, and on summing up the results it was calculated that the principals in the " ring " lost about five million dollars, while their followers and tools lost a like amount, making a total of £2,000,000 sterling wasted in vicious interference with the course of trade, which, while bestowing chance benefits upon a few, spread diie ruin among many. A contingent result of the collapse of the Chicago wheat ring was the failure of the Fidelity National Bank of Cincinnati for The officials of that bank had been seized with the speculative mania, and had largely risked the money of depositors in wheat speculation at Chicago; and they allege that the Chicago brokers in turn " sold" them by making a wrong use of the money. Thus one misappropriation frequently leads to another, and a career of commercial immorality, once entered upon, is certain to end in disaster. It would be well if bankers and merchants would learn that breaches of the moral law bring their Nemesis as certainly in the commercial sphere as in any other. When a few more " corners" end, like those of Chicago and California, in the speculators getting badly " cornered " themselves, we may hope to have a higher code of ethics adopted by civilised merchants, who ought never to have dabbled in the shady methods of the "heathen Chinee."