When goods are charged out, the bills are payable to the commission house, and so, as far as the customer is concerned, the commission house is the principal in the transaction. In many cases certain modified arrangements are made, but in most instances the business is conducted as herein described, and it may fairly be said that the bulk of the dry goods of all kinds produced in the United States finds its way into the market through commission house channels. Making Plain Goods for Future Orders It is the policy of most cotton mills, and certainly of those making plain goods, to run steadily all the year round, and thus the commission agent, whether he has secured advance orders on the goods or not, has constantly flowing into his hands an assured stream of merchandise which must eventually, when sold, pay him a commission. Thus the securing of a good account means an assured source of revenue to the commission agent. There are no more important selling organizations for textiles than these dry goods commission houses, many of them having an immense and profitable turnover, and their businesses are conducted on a very high plane of efficiency, and probity, although, in itself, there are many evils attendant upon this method of the distribution of merchandise, and which exercise at times a most adverse influence upon the well being of the mills whose product is thus disposed of. Strength of Agents Makes "Paper" Acceptable It is evident that no ordinary capital would be sufficient for the supplying of money on call to mills in the immense quantity needed, and it is here that the banker's capital is called into use. The commission house is usually a concern of substantial means, sometimes very rich, and nearly always of a financial standing, which will give it, on its own account, an assured credit. At certain times of the year the calls for money from the mills are greater than at other times, and as shipments come forward, and advances are required, the commission house, in order to put itself in funds, will issue a series of its own notes in convenient sized amounts, $5,000 to $10,000 each, for instance, and will offer these for sale, through its note broker. This paper, which commands an advantageously low rate of interest, and which is issued for convenient periods of time, averaging perhaps four months, is much sought after by banks and other institutions in primary markets and throughout the country wishing to invest current funds in a safe and not unprofitable medium. This paper is so acceptable to banks not only because the credit of the issuing firm is behind it, but also because it is known that the money which is obtained for the notes will be lent out to mills on ample collateral. The issuing house is in a position so entirely safe that hardly ever can a question arise as to its ability to take care of its borrowings. CHAPTER V Financing Cotton and Cotton Cloth