VOObyM

Reminiscences of a Stock Operator
very deeply into the particular problem of the coffee market. They fixed on a maximum
price for raw coffee and also fixed a time limit for closing out all existing contracts. This
decision meant, of course, that the Coffee Exchange would have to go out of business.
There was only one thing for me to do and I did it, and that was to sell out all my
contracts. Those profits of millions that I had deemed as certain to come my way as any
I ever made failed completely to materialise. I was and am as keen as anybody against
the profiteer in the necessaries of life, but at the time the Price Fixing Committee made
their ruling on coffee, all other commodities were selling at from 250 to 400 per cent
above pre-war prices while raw coffee was actually below the average prevailing for
some years before the war. I can't see that it made any real difference who held the
coffee. The price was bound to advance; and the reason for that was not the operations
of conscienceless speculators, but the dwindling surplus for which the diminishing
importations were responsible, and they in turn were affected exclusively by the
appalling destruction of the world's ships by the German submarines. The committee did
not wait for coffee to start; they clamped on the brakes.
As a matter of policy and of expediency it was a mistake to force the Coffee Exchange
to close just then. If the committee had let coffee alone the price undoubtedly would
have risen for the reasons I have already stated, which had nothing to do with any
alleged corner. But the high price which need not have been exorbitant would have been
an incentive to attract supplies to this market. I have heard Mr. Bernard M. Baruch say
that the War Industries Board took into consideration this factor the insuring of a supply
in fixing prices, and for that reason some of the complaints about the high limit on
certain commodities were unjust. When the Coffee Exchange resumed business, later on,
coffee sold at twenty-three cents. The American people paid that price because of the
small supply, and the supply was small because the price had been fixed too low, at the
suggestion of philanthropic shorts, to make it possible to pay the high ocean freights and
thus insure continued importations.
I have always thought that my coffee deal was the most legitimate of all my trades in
commodities. I considered it more of an investment than a speculation. I was in it over a
year. If there was any gambling it was done by the patriotic roasters with German names
and ancestry. They had coffee in Brazil and they sold it to me in New York. The Price
Fixing Committee fixed the price of the only commodity that had not advanced. They
protected the public against profiteering before it started, but not against the inevitable
higher Prices that followed. Not only that, but even when green coffee hung around nine
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