The history of Cotton is the history of the industrial revolution which many do think about however in the book Cotton by Stephen Yafa, Penguin Books, 2005. there is a very good argument made. Cotton came from India and silks from China and one of the reasons the British took over India is the fabric industry. Cotton was known for many years but the ability to remove the threads from the seeds was a hard manual work which meant not much cotton could be produced. With the invention of machines to do the work in England developed by Richard Arkwright, the machines soon meant England was selling cloth to India. In the US, Samuel Slater with financial backing from Moses Brown (Brown University in Rhode Island)  help start the great factories in Lowell, Massachusetts near Boston, Mass. The financial investors were from Boston and this translated into many of the highly reputable institutions near Boston receiving their endowments from the cotton trade. The other aspect of the trade is many parts of the Southern US has ideal growing conditions for cotton. The invention of the Cotton Ginny by Eli Whitney allowed farmers to plant as much cotton as possible and to work the lands – slaves were imported from Africa. The ability to produce more when the world was demanding more cotton fabrics, allowed for increasing prices and produced great wealth in the Southern US, the Boston/NY area and the mill owners in England.

Linking to dividend paying stocks, one of the reasons to invest in them is the wealth they generate, but usually wealth generation has a price somewhere. In the case of cotton, the price was cheap labour in the factories and slave labour to look after the crops. Once the cotton left the factory, few people questioned how it was arrived in the stores except for the demand for the product was high. Hopefully the companies you invest in most people are achieving wealth creation including yourself.

There are more questions than answers, till the next time – to raising questions.