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Detroit Anniversaries
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Richmond & Backus Company
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1901 Time Capsule
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- This 7-page letter was handwritten in black ink on slightly yellowed paper by William Carson, president of the Detroit Board of Trade. The paper is printed with light red lines and has the watermark, "The Richmond & Backus Co., Detroit, Mich." It was placed in a white paper envelope and was sealed with red wax that was impressed with the reverse side of a U. S. Quarter Dollar coin. The text of the letter has been transcribed as follows: "Detroit, Michigan. Dec. 31st 1900 To the people of Detroit in the year 2001. Greeting. The progress of trade in this city and in the entire country during the century just closing has been unparalleled in the history of the world. One hundred years ago railroads, steam vessels, telegraphs, telephones, electric lights and electric motors were things unknown and undreamed of. The old stage coach, for those who could enjoy that luxury, or the horse and wagon and ox team, for those less prosperous, were the only means of travel by land, while the slow going sailing vessel or the canoe furnished the only means of transportation by water. Mail communication was effected by post-riders, and a month or more was required for communication between Detroit and New York, while from the seaboard it took several months to reach Europe by sailing vessels. Now we communicate with New York by mail in fifteen hours, and with Great Britain and France in six days, while communication by telegraph and cables lines require less than the same number of minutes. The slow going horse cars, instituted in our larger cities over half a century ago, have been replaced by the electric cars of the present time, and the time of transit has been reduced over one half. Every branch of industry has shown marvelous advancement and the grain trade of the country, through the medium of Boards of Trade and other commercial organizations, has kept pace with the march of progress. Fifty years ago such organizations were practically unknown, but today they occupy a most influential position in the commercial world in handling the enormous grain and provision products of the country. Through the influence of its members the large elevator interests of the country have been established, and developed, as the necessity was felt for increased facilities for handling the grain crops. The construction of immense elevators at all the principal railroad terminal points in the country and along the lines of railroads penetrating the vast grain fields of the west, has enabled the grain merchants of the United States to accumulate enormous stocks of grain, of all kinds, at various points in the country, but principally at Chicago, the greatest grain mart, and at Minneapolis, the greatest milling center in the world. These elevators are filled up at a time of the year where the grain crops are moving from farmers hands most freely, just after harvest, and without these facilities for storage the grain would have to be moved forward to the seaboard for export or to milling centers at such prices as it might bring at the time. Whereas by the present system those who buy the grain at country points from first hands, may ship it to their agents or commission men on the different Boards of Trade, who stores [store] the grain in the elevators and look after it until such time as the market price may warrant the owner in selling it. In this way the pressure of wheat, and other cereals, on the market is regulated and holders are not obliged to dispose of their property at a sacrifice at a time when the movement of the crops is the heaviest. Dealing in grain and provisions for future delivery, that is for delivery from one to three months after the time of purchase, is another great innovation made in the commercial world within the past fifty years. By means of this system of trading a buyer of grain may provide for his future requirements without being obliged to tie up large sums of money. For instance, an exporter may want 100,000 bushels of grain to be shipped to Europe one or two months hence, or a miller may wish to provide wheat for this mill for a time when the demand for flour may be the most urgent. In these cases instead of being obliged to invest large sums of money for their future wants, they simply instruct their broker on the Board of Trade to buy the amount of grain they may want for future delivery, and on this they deposit with the broker, or with the secretary of the Board, a margin of five cents per bushel to be kept good against any decline in the market until such time as their contracts mature, when the grain is delivered to them and paid for in full. The seller of the grain is also required to deposit a like sum of five cents in like manner to protect the buyer against any advance in the market, and in this way both interests are protected against any market fluctuations in price. The broker in these cases receives a commission of from 1/8 to 1/2 cwt per bushel for his services. The grain to provide for these contracts is bought and stored in the elevators by grain merchants who have large capital to employ for this purpose, and what they may not have of their own can always be obtained from the banks, as grain collateral with insurance policies attached as accepted are recognized by the banks as the most desirable security. The grain merchants of Detroit and the Eastern country stand as a rule, very high in the Commercial world, and the amount of capital employed in the business runs into hundreds of millions of dollars. The very nature of their trading places them on their honor and a man who is found to be tricky at this looses [loses] caste among his fellow members on the Board of which he may be operating. Heavy transactions are made and recorded by a simple memorandum made at the time of sale or purchase and in not one case in a thousand does a dispute arise as to their correctness. A grain merchant who cannot meet his obligations with his fellow members or who fails to deposit proper margins on his trades, whose called upon, is at once debarred from the priveleges of the Board on which he is trading, and all open transactions for his account are closed at once. Many attempts have been made by speculators to "Corner the Market," on certain commodities, that is, to buy up all offerings of grain, provisions or other articles of produce that might be made by reckless operators who sell for future delivery what they do not possess, hoping that a turn in the market, in their favor, may enable them to buy back what they have sold with a profit, but in only a few instances during the past fifty years have any such attempts proved successful. The last attempt of this kind of any magnitude was made in Chicago a few years ago by a reckless operator named Joseph Seiter, but unlike the historic corner in corn by Joseph in Egypt, his attempt proved a disastrous failure and resulted in a loss to him of about ten millions of dollars, but all his creditors were paid in full. The drift of the grain and provision trade, like that of many other branches of business, shows a slow but steady tendency towards centralization in a few hands, and it will not be surprising if the next decade or two shows that the grain and provisions products of the country have like the iron, coal, petroleum, copper, manufacturing, navigation and many other large industries, passed into the hands of gigantic monopolies or trusts similar to that which now control the fresh meat products of the country. Railroad property during the past fifty years has been concentrated in the hands of a few multi-millionaires whose enormous wealth defies competition by men of equal energy, but smaller means; and it is safe to predict that unless the Congress of the United States is forced by public sentiment to take control of all the railroads, telegraphs, telephones and other necessary adjuncts of trade, as they have the mail service, that there will result a strife between capital and labor that may shake the fabric of our republic to its very foundation, if not change our entire system of government. Labor organizations have grown very rapidly during the past fifty years and they have developed astonishing strength both numerically and financially by their close organization, and have reached a point, even now, when their financial backing and shrewd management is a source of uneasiness to the manufacturers, builders and corporate institutions of the country, such as ruining companies and railroads, and it may depend very much on the class of men who obtain control of these labor organizations whether a prolonged strife for supremacy between capital and labor can be averted, but it must be our fervent hope that our Heavenly Father, the Supreme Architect of the Universe will watch over the destinies of our beloved nation as He has in the past, protect us from strife among ourselves or with other nations, and that when the glorious sun of the Twenty first century breaks forth it may shine on "Old Glory," resplendent as of old, floating over a nation of contented people, never conquered, and with its union enlarged by the addition of twenty-five stars representing that number of new additions to the glorious sisterhood of states. The Detroit Board of Trade is one of the oldest commercial institutions in the west having been incorporated in 1856. The business transacted by its members is very large considering the small limits from which supplies are drained. Receipts of flour for the past four years were 1,086,805 bbls [barrels] valued at $5,034,020. 14,763,142 bushels of wheat, valued at $15,000,000. 11,836,731 bu of corn valued at $4,730,692. 8,107,505 bu of oats, valued at $2,432,131. 2,478,473 bu of rye, valued at $1,336,160 and 3,990,000 bu of barley valued at $2,593,544, a total of $31,130,552, while the speculative business done on the Board aggregates fully $25,000,000 per annum. The milling interests of Detroit is quite large for a city depending on a circumscribed area for its supplies. The mills of David Stott does a business of $1,500,000 per annum. The Commercial mills owned by Robert Henkel does a business closely following this, while the oat meal and feed mills of Jacob Buck and Son does a business of over $500,000 per year. These institutions are closely indentified with the Board of Trade and look to it for their supplies. The Elevators of Detroit consist of Elevators, A & B, the Detroit Rail Road Elevator, and the Union Elevator, in all comprising a capacity of 3,750,000 bushels, and during seasons of large crops they are often taxed to their fullest capacity, but owing to the very light corps in Michigan and adjoining states during the past two years, stocks of grain are now very light, these bring only 480,000 bu of wheat, 208,000 bu of corn, 34,800 bu oats, 45,000 bu rye and 16,000 bu barley, representing a value of $525,000 which is carried by the members of the Board of Trade. William Carson President Detroit Board of Trade."
- Date Issued:
- 1900-01-01T00:00:00Z
- Data Provider:
- Detroit Historical Society
- Collection:
- Detroit Anniversaries