SPECTROSCOPY. 428 SPECULATION. don, 1S77) ; Roscoe, Spectrum Analysis (London, )8(jt>) ; Schellen, Spectrum Analysis (New York, 1S72). See Light. SPECTRUM. See Light; Dispersion; Spec- troscope ; Spectroscopy. SPECTRUM ANALYSIS. As is explained in the article on Spectroscopy, the spectrum of a definite substance under definite conditions is always the same. The spectrum of the radia- tions emitted by iron vapor, for instance, when rendered luminous, is characterized by certain definite trains of waves, or, as ordinarily ex- pressed, by certain 'lines.' If the conditions under which the spectra are produced are varied, for instance, if for one case the spark was used, and in another the arc, there are differences in the spectra, consisting mainly in variations in the intensity of the lines. Further, if other sub- stances are mixed with the iron, or if the iron exists as an impurity in some other substance, or if the pressure of the surrounding atmosphere is varied, there are corresponding alterations in the iron spectrum. But under definite conditions there are definite lines which are characteristic of iron. Extremely small traces of a substance may be thus made evident b.y the presence of its spectrum ; and in a mixture of many substances tlie presence of the various parts may often be ascertained by a study of the spectrum emitted. This constitutes the science of spectrum analysis and has proved useful to the chemist in many cases. In fact the discovery of several elements, viz. cesium, rubidium, and gallium, was due to the detection in certain spectra of lines which could not be ascribed to any known substances. T)ie application of spectrum analj'sis to the study of the spectra of the sun, stars, and other heaven- ly bodies has proved most important, and some of the results of various observations and investiga- tions are given in the article on Spectkoscopy (q.v.). SPECULAR IRON ORE. See Hematite. SPECULATION (Lat. speculnlio, explora- tion, contemplation, from spcculriri, to view, watch, spy out, from specula, watch-tower, from specere, to see). Buying and selling of property chiefly with a view to securing a profit through changes in the price of that property. There is a speculative element in a great variety of busi- ness transactions; but the term is usually con- fined to those in which the element of risk is relatively important. In former times specula- tive activity was largely engaged in seeking to take advantage of differences in price in dis- tant markets. Foreign trade 100 years ago was highly speculative. Improvements in transporta- tion and in means of communication have re- duced such differences to a matter of exact cal- culation. Speculative business has, therefore, come to be confined almost exclusively to trans- actions involving the time element. In its simplest form time spcctilation involved the buying of property outright, and the holding of it in anticipation of a rise in price. This practice is as old as civilization, and until late times has usually been regarded as socially in- jurious. Toward the end of the seventeenth century the practice developed in Holland of buying and selling the products of fishing voy- ages before the results of the voyage were actu- ally known. In the early part of the eighteenth century speculation in grain, coffee, etc., was very active in Amsterdam, developing many of the practices of modern exchanges. In all of these early forms of speculation, however, what was bought and sold was the right to a particular lot of goods. A"ith the development of warrants and the grading of goods speculation received a new impetus. It thus became possible for a man to sell goods which he did not possess, since he could at any time secure identical goods upon the market if he could pay the price. It is largely to this principle that the phenomenal develop- ment of speculation in recent years is due. For the extent of speculative dealings and the prac- tices of modern exchanges, see Stock Exchange. EcoNOJiiG Function of Speculation. When the supply of any commodity is subject to great imcertaiuty, as, for example, the products of agriculture, it is manifestly to the advantage of society that it should be properly distributed through a period of considerable length. A class of individuals who study the conditions of de- mand and suppl.y endeavoring to buy such com- modities when they are abimdant and cheap, in order to sell them when they are dear, serve to bring about such a distribution of consumption and thus render an important social service. Again, some commodities, such as iron, are sub- ject to great fluctuations in demand, and hence in price, thus introducing a large clement of uncertainty into all of those forms of industry whieh make extensive use of them. The specu- lator, by making contracts to deliver the article at a future date at a fixed price, frees the con- sumer from that uncertainty. Legitimate specu- lation thus serves as a means of insurance against certain classes of risks. It may be, however, that the speculator is mistaken in his estimates of future supply and demand. In that case he exaggerates the evil which it is his function to minimize. Thus specu- lation may keep prices abnormally high for a period, only to render prices abnormally low for a succeeding period. Speculation may thus bring about a crisis (q.v.) with its attendant indus- trial stagnation. A more serious evil results from the fact that speculation is carried on not only by those who are conversant with market conditions, but by a large class of individuals who engage in it without the jiroper equipment of technical knowl- edge. Unscrupulous operators, through false re- ports, or through, their own apparent eagerness to buy or sell, often lead such unsophisticated speculators to their financial ruin. Such influ- ences tend to increase business uncertainty, and hence diminish considerably the net social gain from speculation. Popular sentiment in England and America has generally been hostile to speculation, and laws have frequently been passed to prevent it. An act of Parliament was passed in 17.33. "To prevent the infamous practice of stock-jobbing." The act had no effect and was repealed in 1860. In America an act was passed in 1S64 to pre- vent speculation in gold, but its operation was so imsatisfactory that it was repealed in two weeks. In several of the States laws have been enacted aiming to prohibit speculation in one form or another. These have proved quite in- effective. Bills were introduced in the Fifty- first, Fifty-second, and Fifty-third Congresses
