Commodity

Markets
By Megan Albania

Thesis Statement
Although the viability of Chicago's commodity markets was challenged
during the 1920's and Chicago's commodity markets entered the
1930's in a weakened condition, the commodities markets made a
change during the Civil War Chicago's commodity markets and recast
themselves as futures exchanges for financial instruments and other
commodities by the end of the twentieth century.

What is a
commodity market?
(Definition)

A commodity market is a
market that trades in primary
economic sector rather than
manufactured products. Soft
commodities are agricultural
products such as wheat, coffee,
cocoa and sugar. Hard
commodities are mined such as
gold, silver, and oil.

Commodity Markets Back Then

(Early 1900s to Early 2000s)
According to http://www.encyclopedia.chicagohistory.org/pages/317.html

Commodity Markets Back Then

The completion of the Illinois & Michigan Canal in the fall of 1847 and its opening in the spring of 1848 inspired the
formation of the Chicago Board of Trade, the city's first voluntary association of businessmen. The Illinois Constitution
of 1870 placed railroads and elevators under the control of a Railroad and Warehouse Commission. The commission
had the power to regulate rail and storage rates and to inspect public grain elevators. Ira Munn, an elevator operator in
Chicago and a former president of the Board of Trade, challenged the legality of the commission in Munn v. Illinois. The
case was appealed to the U.S. Supreme Court in 1876. In the spring of 1877, the Supreme Court affirmed the
commission's power as being in the public interest.

The Board of Trade sued to prevent the unauthorized use of its quotations in Board of Trade v. Christie Grain and Stock
Company (1905). Justice Oliver Wendell Holmes, Jr., wrote the brief for the majority affirming the board's ownership of
its quotations and speculation as a means that an economy adjusts to changing conditions. By legitimating speculation,
hedging, or shifting risk to speculators by merchants, was recognized. During World War I, representatives of
Chicago's commodity markets staffed the government agencies created to procure, handle, and distribute the nation's
food supplies. The federal government established grades for wheat, corn, and oats while in control of the grain trade.
The futures market was closed from September 1917 until May 1920.

Albania, Megan. "Chicago's

Trading Floors." Bloomberg.com.
Bloomberg, 5 Jan. 2016. Web. 05
Jan. 2016

Albania, Megan. "Chicago's Trading

Floors." Bloomberg.com.
Bloomberg, 5 Jan. 2016. Web. 05
Jan. 2016

Chicagos Trading Floor Graph

Trading Floor- Trading

Floor Stock Photos and
Images http://www.123rf.
com/stockphoto/trading_floor.html

Commodity Markets Today

Online Commodity Markets

Nowadays, technology had taken over and had made our lives much
easier than as it was before. Commodity markets now take advantage
of this uprising of technology and had gone digital, for convenience of
consumers. While soft commodities still exist, hard commodities are
far more popular. In the U.S., there are several oil bankruptcies spiked
by 379% a year.

Online Commodities

Left: Shown in this graph is a representation of Right: Shown in this graph is a representation
percentage changes for light crude oil in one of percentage changes for heating oil in one
month.
month.

Board of Trade v. Christie

Grain and Stock Company
(1905)
http://caselaw.findlaw.com/ussupreme-court/198/236.html

Decree in No. 224 reversed.

Decree in No. 280 affirmed.
Mr. Justice Harlan, Mr. Justice Brewer,
and Mr. Justice Day dissent.
- See more at: http://caselaw.findlaw.
com/us-supreme-court/198/236.
html#sthash.gBVsroek.dpuf
dissent- disagreement of one and one others
opinions

Conclusion

In conclusion, Chicago's commodity markets recast themselves as futures

exchanges for financial instruments and other commodities by the end of
the twentieth century. Their position in world markets might not be as
dominant as it was at the end of the nineteenth century. At the beginning
of the twenty-first, they must successfully challenge the competition to
their floor-based, open-outcry trading system from foreign exchanges
and from electronic trading.