What is Satan's Bushel? It is the last bushel that the farmer puts on the market that "breaks the price" – that is reduces it to the point that wheat farming is no longer profitable. The puzzle that afflicts the wheat farmers is that they sell their goods when the price is low and have no goods to sell when the price is high. Withholding goods from the market is one answer but why should any farmer do that?
What is the answer to this problem? Working from this premise, then, as implausible as it may sound, but the central figure in this book is the price of wheat. It is the main source of drama. The settings are the wheat pit at the Chicago exchange (circa 1915) and the Kansas wheat fields. Linking those two radically different universes is the mission of this book.
The action further explores the meaning, morality, and utility of wheat speculation. The plot is centered at the turn of the 20th century, a critical period when the agricultural economy was completely giving way to the fully industrialized one, and farmers were panicked about the alleged problem of falling prices. The allegory might equally apply to the computer industry today, so there is nothing lost in the passage of time.
It tells the story of one man's discovery of a brilliant speculator and his relationship with an old and legendary farmer/mystic and his daughter. The mystic embodies both the highest wisdom and the greatest economic fallacies of the day. The question that must be confronted is how to make farms profitable in times of falling prices, and the novel shows that speculation, even with all its human foibles, makes a contribution to stabilizing the market.
Here is one of hundreds of brilliant passages describing the speculator:
"No rule of probability contains him. To say that he acts upon impulse, without reflection, in a headlong manner, is true only so far as it goes. Many people have that weakness. With him it is not a weakness. It is a principle of conduct. The impulse in his case is not ungovernable. It does not possess him and overthrow his judgment. It is the other way around. He takes possession of the impulse, mounting it as it were the enchanted steed of the Arabian Nights, and rides it to its kingdom of consequences. What lies at the end is always a surprise; if it is something he doesn't care for, no matter. Another steed is waiting. Meaning to do this, living for it, he has no baggage. There is nothing behind him. If he has wealth it is portable. He is at any moment ready."In a plot twist that foreshadows the New Deal, one person attempts to destroy the wheat crops with a poisonous fungus, thinking that he is doing the farmers a favor by reducing supply! The reader is confronted with a challenge of coming to understand whether this is really so, and if not, why? Keep in mind that this is written a full decade before FDR attempted the same tactics from the federal level!
Another dramatic scene involves the arrest of an opponent of World War I. Further, there are plot twists that turn on romance, sorcery, criminality, mob behavior, psychological possession, the war, price controls, government interventions, and other surprises and wholly unimaginable things like water witchery and a teak tree in Burma. The central action, however, deals with the core of economics and the place of production and speculation.
And for financial historians, there is the very special treat of observing great drama of the early years of the Chicago commodities market - written from the vantage point of one generation later. There are scenes in the wheat trading pit that just take your breath away. This novel demonstrates yet again that no one can make the stuff of enterprise dramatic, tragic, and heroic like Garet Garett.
The effect is to so closely link the most outlandish and farflung economic activities to human frailties and uncertainties that one gains not only an understanding of how commodity markets worked earlier this century as well as an appreciation of how price movements work in all times and all places, but also a love for the craft.
Several passages provide beautiful insight into how the speculator thinks and how the speculator's actions work to reduce destabilizing price fluctuations. But it is also a very human institution, subject to whim and learning. Also, the government comes across here as nothing short of egregious and destructive.