Tobacco

All the

In April 1607 the London Company founded the first permanent English colony at Jamestown, on the James River, near Chesapeake Bay. English settlers were then only learning the art of colonisation, and most of those who went to Virginia during the first few years of its existence starved to death. Others, however, took their place, and the success of the Virginia plantations was ultimately assured. cultivation was a prominent feature. early colonists were men, but the company encouraged the immigration of marriageable girls, and the settlers soon found themselves bound to the soil by ties of family responsibility. Labour continued to be scarce until 1619, when the problem was partially solved by the introduction of negro slaves. But as a commercial venture, the company was still a complete failure, and in 1619 the London Company inaugurated a new era by granting a modified form of selfgovernment to the colonists. The Company still did not prosper, however. Among the chief causes were the rapid succession of governors, stimulating the rapacity of their dependants; the multiplicity of offices, by which industry was loaded and revenue absorbed; and the inability to conduct successfully a complex and arduous undertaking by a numerous body of men.

Meanwhile the northern company, which had never been satisfied with its rights under the charter that connected them with the South Virginia Company, urged its claims to a new patent so strongly that one was granted by the king, James I., in 1620. This defined the company's territory as extending from the 40th to the 48th degree of latitude. The Virginia Company loudly remonstrated against the new patent, but in vain; Sir Ferdinando Gorges, the governor of Plymouth, Massachusetts, eloquently argued the rights of the Plymouth Company before the English parliament. He urged the value of the fishing trade, which, even while they were disputing on boundaries, might, he said, be monopolised by French or Hollanders, and those who heard him were so satisfied by his representations that, in spite of all opposing influences, the king could not be induced to revoke the patent.

The Pilgrim Fathers settled in 1620 at Plymouth; ten years later, the colony of Massachusetts was founded by the English Puritans, to provide an asylum for themselves and their friends in the event of the struggle in England going against them. The council for the New England Company, as the successor to the Plymouth Company was called, gave them a grant of land, confirmed by the king, who conceded them in addition very extensive powers of government. Before the close of the 17th century all the territory within the original limits granted to the Plymouth Adventurers had been colonised,

119

and the settlers were given large powers of self-government.

The

But the original charters had been abrogated many years before this. In 1624 the Virginia charter was annulled, and the colony became a royal province. With respect to the Plymouth Company, between 1630 and 1635 serious complaints were made in England that discontented spirits full of disaffection to the king, and hostile to the Established Church, were settling on the lands granted by the company. governor, Gorges, was attacked by the Puritans because of his large territorial claims, while in England he was assailed, as the upholder and author of the reputed licence of laws and opinions among the colonies of New England. Gorges felt this deeply after his long and arduous work in forwarding the plantation of English colonies in New England, and he "therefore was moved to desire the rest of the lords, that were the principal actors in this business, that we should resign our grand patent to the king, and pass particular patents to ourselves, of such parts of the country about the sea-coast as might be sufficient to our own uses, and such of our private friends as had affections to works of that nature." This policy was adopted in 1635, and the lands of the Company, lying between the 48th and 36th degrees of latitude, were parcelled out among its members. With this act, the history of the Plymouth Adventurers, as a separate organising and colonising body, came to a close. Company had failed because it was unable to grapple with the religious, economic, and land problems which beset it. The king, being desirous of securing a better regulation government of the plantations appointed in 1635 a commission, with Archbishop Laud at its head, to make new laws and a new constitution for New England.

The

[Bryant and Gay's Popular History of the United States, vol. i.-Prof. Edward Channing in Chambers's Encyclopædia (art. United States).Justin Winsor's Narrative and Critical History of America.-Colonial Charters and other documents issued by the United States Government.]

G. B. S.

POCOCKE, RICHARD (1704-1765), successively bishop of Ossory and of Meath, was one of the greatest travellers of his time. He entered Corpus Christi College, Cambridge, in 1722,

and in 1733 received his LL.D. From 17331736 he travelled on the continent with Dean Milles, and from 1737-1742 visited the East.

In 1743-1745 he published A description of the East and some other Countries (2 vols. fol. London). He made other tours in Scotland, Ireland, and England, afterwards edited from his MSS. by D. W. Kemp. These publications have an interest for the economic student from the insight they afford into the social conditions of that time.

The following is a list of them :-Tours in

120

Scotland, 1747 and 1750 and 1760 . . from the original MS. and drawings in the British Museum, edited by D. W. Kemp, with biographical sketch of the author, Edinburgh, 1887, 8vo. Pococke's Tour in Ireland in 1752, edited with introduction and notes by G. T.

many leading varieties of combination and their appropriate diagrammatic presentation.

The real utility of this method is undoubtedly connected with its application to combinations of ordinary purchases and sales for future de

England of Dr. Pococke, 2 vols., Camden Society, N.S. xlii., xliv., 1888-1889.-The tour of Dr. Pococke... through Sutherland and Caithness in 1760, with introduction and notes by D. W. Kemp.

A. L.

POINDING OF THE GROUND (Scots Law). Where a creditor has a security properly charged against the lands of his debtor and duly registered, or where he is the superior (overlord) and has a claim for feu-duties in arrears, he can, if he be not himself in possession of the lands or entitled to take possession, raise an action of poinding (empounding, pronounced pinding) of the ground, judgment in his favour in which will entitle him to the rents and to execution against all goods found on the lands, provided that these goods are the property of the owner of the land, or else that they are the property of the tenants up to the extent of the rent for the current term and of arrears of rent, if any, due by them at the time and no further. The superior poinding for feu-duties in arrears and for "casualties" is preferred to other creditors, and creditors are preferred inter se according to the dates of registration of their respective rights. A creditor, poinding before the trustee in bankruptcy is confirmed, gets priority over the trustee in respect of the whole movable property in the ground, to the amount of one and a half year's interest.

A. D.

POLEGRAPHY. (Greek, wwλeiv, to sell). In the year 1870 M. H. Lefèvre, in a small treatise entitled Traité des Valeurs mobilières, explained in outline a graphic method of his own invention for the representation of combinations of operations on the stock or produce exchanges. This method was greatly extended and developed in the work Le Commerce, published by the same author some fifteen years later (the date of publication is not shown on the volume itself). Its author claims for it that it greatly simplifies the task of obtaining a clear view for practical purposes of complex combinations of exchange operations, rendering their principles much more evident than laborious illustration by numerical examples, and enabling an instructor to achieve more certain and rapid success with indifferent pupils than could be attained by ordinary methods with those of more than average intelligence, resting his claim on actual experience.

It is proposed to give here such brief outlines as may elucidate the principles of the method, and the range of its applicability, referring to M. Lefèvre's own expositions for more detailed explanations and elaborate treatment of the

or CALL as the case may be. The application to definitive purchases and sales for future delivery is of the simplest, but does not appear to present sufficient advantage to justify the introduction of a new method. When the option or privilege is combined with the definitive purchase or sale, a complex state of affairs results, the outcome of which can be advantageously studied with the assistance of the diagrammatic method. The purpose of the diagram is to determine or to represent the amount of the difference to be paid or received as the result of a series of bargains, and it is sufficient if the gain or loss per unit dealt in be shown per £10,000 of stock, or per 50,000 bushels of wheat for example, transactions involving multiples or sub-multiples of the unit selected being readily adapted to the same diagram, as will be seen shortly.

The only apparatus necessary for the construction of the diagram is a piece of squared paper, a pen or pencil, and a ruler. Along a selected line on the paper is marked the series of possible prices of the stock or commodity dealt in, as shown in the annexed diagram (Fig. 1) where the range of price 102-104 of a stock is capable of representation, each movement upwards of in the price being represented by a movement to the right by the width of one square. If we were concerned with cotton, the width of each square might represent a variation of th of a penny per pound.

vertical through the point on the line of price corresponding to 103 at a distance on the gains side of that line (omitting brokerages for the present). Generally the point at which the line Bb cuts any particular vertical indicates the gain or loss resulting from a sale, at the price corresponding to the position of this vertical, of the stock for which the buyer contracted to pay 1023. A glance at the diagram shows the answer to the question,-"Shall I gain or lose, and how much will the amount of such gain or loss be, if I sell at the current quotation (whatever that may be) the stock bought at 1027 ?”

If we wish to include brokerages it is clear that we must add in the case of a purchase, or deduct in the case of a sale, the amount of the brokerage from the current price before constructing the diagram, or we may calculate these separately.

The line Ss similarly records the position resulting from a sale at 103 for future delivery. The difference to be paid or received when, for the fulfilment of the bargain, a purchase is made at some other price, being indicated by the intersection of Ss with the vertical through the price of the said subsequent purchase.

121

| again. The resultant of the two lines Ss and Bb is Rr, which represents a purchase of onehalf. To draw Rr we need only determine two points on it, since it is a straight line, remembering that it is to represent the sum of the gains or losses involved in the two transactions before named. One point on Rr will therefore be where Bb cuts the vertical through 99, a price which registers neither gain nor loss in respect of the transaction represented by Ss. Similarly a second point on Rr is where Ss cuts the vertical through 100, a price where Bb represents neither gain nor loss, though Ss shows a loss of at this price. The two transactions together are equivalent to a purchase of one-half at 101,-i.e. the operator will lose on the combination so long as the price remains below 101, the amount of the loss being only half as great as if a purchase of a unit of commodity or stock at 101 had been the actual bargain made. Fig. 3 shows the

All this is very simple, and shows no very apparent advantage over an arithmetic record. We proceed, therefore, to deal with a combination of two purchases, and of a purchase and sale where the amounts of the two transactions are not identical. When a purchase and sale of identical amounts are combined, the resultant indicates a definite gain or loss unaffected however the market may subsequently vary. This is not the case when the sale and purchase are concerned with unequal amounts, and when two purchases or two sales are combined.

Fig. 3.-Two purchases of different amounts combined. resultant Rr of the combination of the purchases Bb of a unit at par and Bb, of two units at 99, which is laid down by the same rules as before. It will be found that however many purchases or sales be combined, the resultant is always a straight line so long as the purchase or sale is definitive.

The case of an option introduces a form other than the unbroken straight line for the resultant; and the combination of different option bargains among themselves, and with definitive sales or purchases, affords examples of broken lines of all degrees of complexity.

The diagrams for simple call and put options are shown in Figs. 4 and 5, the line Ss showing the position of the seller, Bb that of the buyer in each case. Fig. 4 is the case of a call option for which the price of per unit of the stock is paid, brokerage being neglected in this preliminary explanation of the diagram. To include brokerage, the lines representing the transactions must be lowered (i.e. moved bodily towards the losses side of the line of price) by the amount of the brokerage. In Fig. 4 then, Bb indicates the position of a buyer, Ss of a seller

Fig. 4. Call option.

illustration). If the price do not rise above 86, the buyer simply forgoes his right and loses his premium, this being the limit of his loss. If the price rise above this figure, the loss of the buyer or gain of the seller decreases, and at prices above 874 the option yields profit to the buyer, who can realise this profit by requiring delivery at 863, and selling again at the price of the day. The seller of the option, if he do not hold the stock, must purchase at the price of the day in order to fulfil his contract, and his gain turns into loss when the price rises above 87, more than the whole of the price received being then required to cover the difference between his buying price and the 863 at which he has contracted to sell. The fact that part of the lines Ss and Bb is horizontal, indicates that over the range of prices corresponding to these parts of the line the loss or gain is a fixed one, independent of the particular price.

In Fig. 5 the case of the put option is

S

Fig. 6.-Straddle. Position of the payer of the premium shown by SsBb.

is a seller. At prices above 93 he is a buyer, as indicated by the part Bb of the line sloping upwards. In fact, if the price be below 931, the payer of the price for the option will buy in the market at the market price and sell, in accordance with his contract, at 93. It is clear that if the price remain between 93 and 94, the payer of the price for the option cannot recover his price for the option by his operations. At any price outside these limits he stands to gain on the whole, his gain more than covering the price paid for the option. Here again brokerages are omitted; if they are to be included, the whole line SsBb must be vertically lowered to the extent of the brokerages involved.

The position of the receiver of the price paid for the option would be represented by the broken unlettered line on the diagram.

Fig. 7 represents the resultant of the com

B

Line of Prices

Losses

Gains

B

Fig. 5.-Put option.

similarly presented, S's showing the seller's position with limited possibility of loss, Bb the buyer's position with limited possibility of gain.

The double option, or straddle, the combination of put and call, is represented in Fig. 6, which shows the position of the payer of the double price for the option. The case represented is that of the payment of a price for the option of per unit (per cent, per mille, etc., as the case may be, the diagram assumes

B

Fig. 7.-Definitive purchase combined with sale of a call option.

bination of the definitive purchase of a quantity of stock, and the sale of a call for the same quantity. The price received for the call is taken at, the price at which the option may be exercised being 673. With this is combined a definitive purchase at 679, and the resultant RRR shows that the combination is equivalent to a purchase of a put at a price for the option of. The combinations of various options with one another, and with definitive purchases and

R