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The Grain Futures Act of 1922 and the Dominance of the CBOT

  • Rasheed Saleuddin
Chapter
Part of the Palgrave Studies in the History of Finance book series (PSHF)

Abstract

Congress passed the Grain Futures Act in 1922 soon after the Crisis of 1921, when wheat prices fell more than half. Contrary to the accepted view that the regulation was a failed attempt to control the markets, the legislation was almost fully ‘captured’ by the Chicago Board of Trade (CBOT). The Chicago futures markets benefited substantially from the legislation, gaining legitimacy in the Courts and in Congress, while cementing a protected monopoly that would not be broken until late in the twentieth century. On the other hand, the US government gained the right to obtain hitherto unavailable information about the markets, publish such data and perform in-depth analysis for use by the regulators, Congress and the futures market participants, themselves.

Keywords

Grain Futures Act Market regulation Capture Public interest 

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Copyright information

© The Author(s) 2018

Authors and Affiliations

  1. 1.Centre for Endowment Asset ManagementUniversity of CambridgeCambridgeUK

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