There breaks forth periodically from prudish but well-meaning people a protest against all forms of speculation in stocks ox commodities. Appeals are made regularly to the legislative arm of the Government to put a stop to speculation through the enactment of repressive laws. These outbursts of public temper usually arise out of a speculative debauch or result directly from abnormally high prices, which speculators are charged with bringing about.

These outcries are typical of restless human nature. The public as a whole sometimes acts as one big machine, permitting itself to be propelled unthinkingly hither and thither by some forceful leader or set of agitators who momentarily have caught the popular fancy. These risings are sometimes successful and laws to curb or wholly suppress speculation are framed.

Nor is this tendency peculiar to the American people, who are, anyway, a cosmopolitan nation made up of many races. It breaks forth among the peoples of other nations. The Germans, stolid as, they are, rebelled against the speculation in grain, declaring that it enriched only the millers and placed a heavy burden upon consumers. A great outcry arose in Holland following the insane speculation in tulips centuries ago. England felt the clamor frequently and most pronouncedly after the collapse of the South Sea Bubble, while France was rent with the protest of the populace against speculation twice, in a way to become historic: the first time, when John Law's grandiose Mississippi Bubble burst, and the other, when the De Lesseps Panama Canal scheme smashed.

With us, hardly a year passes but that there are introduced either in Congress or in the assemblies of our different states, laws to stop margin-trading, as speculation in stocks is called, or dealing in options, either in grain or cotton. But up to the present time no laws have been enacted to interfere seriously with speculation. Our more sober intelligence has so far checked any attempt to construct bars against a practice which serious thinkers realize is the very incentive of our material progress.

Germany once succeeded in stopping speculation in grain. The farmers and the consumers soon felt, as a result, that the burden fell upon them and not upon the traders, who formerly dealt in this commodity on the bourse. Without a public market on which a price for their grain could be made through free and open bartering, the farmers, had to sell for any price they could get and never knew whether the price was standard. The millers had the price-making power for flour wholly within their control. It was not long before the Germans were as anxious for the restoration of trading in grain on the bourse as they had been a few years before to put it down by force of law.

Intelligent speculation is no crime. It is not gambling. It is merely pitting human shrewdness against the uncertainties of the future. For that matter, life itself is a speculation in which ministers, prudes, and agitators hope to avoid sickness and accident and live their allotted span of life. Between speculation and gambling there is as much difference as there is between night and day. Speculation commands the exercise of the greatest measure of acumen, where gambling trusts chiefly to luck and the turn of a card. The ultimate distinction between gambling and speculation is based on ethical and economic considerations. Society generally condemns the former because in its judgment the gains to the successful gambler far from compensate the harm which results to those who lose. Gambling is condemned because it serves no useful economic purpose.

Experience has demonstrated far too convincingly that wherever speculation has been leashed by the iron bonds of the law, the effect has been almost an immediate stoppage in the material progress of the country. Market places where average prices are created are destroyed, which in itself is a great detriment, as the sellers cannot know whether or not the buyers are paying them a fair price for their products. The price-fixing policies and the commandeering of supplies resorted to by the European countries during the great war did, of course, limit speculative opportunities, but those examples do not prove by any means that governments can successfully maintain such economic policies in normal times.

Almost Everyone Speculates

A man believes that a corner store in his neighborhood is a good location for a dry goods business. He leases the store for a year or a term of years at a good rental. He contracts for a large bill of goods. He has his store substantially fitted out. In fact he has invested considerable money in his enterprise and made himself liable to wholesale merchants for a stiff bill of goods, before he has even sold a paper of needles, all because he has arrived at the conclusion that the location he has selected for his business is favorable for the development of a good trade. No one would dare charge him with speculation. If anyone did so, the man would be regarded as a hare-brained crank. Yet the storekeeper is speculating just as much as if he had bought so many shares of a stock whose earnings would justify the belief that there would be an enhancement in value. If people failed to patronize his store, and if sales were insufficient to bring a profit, he would have to suffer losses represented in the difference between what this stock cost and what it brought, and his loss of time and rent until he could rent the store to someone else before the expiration of his lease.

Fond parents, when they send their children to college to acquire an education to fit them for their struggle of existence, may not realize that when they invest their money upon the education of their loved ones, they are speculating upon the children's using the opportunity properly. Their boy or girl may absolutely waste the opportunity in frivolities and leave college even less fitted for life's battle than other young people whose parents' circumstances were such as to make it impossible for them to obtain a college education.