[58 ECONOMIC PRINCIPLES

nominal right of affecting the amount of that risk by infAuencing
 the selection of the policy to be followed. The
application of the term “profits” to the income secured by
the exercise of such a function does not confuse the risktaking
 of the speculator in bonds with the risk-taking of
the owner of an industrial enterprise. There are sufficient
analogies between the two cases, and it is significant that
the term “profits” is applied to the speculative gains of
the buyer and seller of stocks and shares,
A significant trait in some recent developments is the
tendency to acquire, on behalf of a definite capitalist or
group of capitalists, the majority of the shares of various
concerns, with the deliberate intention of shaping the policy
of the concerns. The common neglect of shareholders to
exercise their rights might have made a discussion such as
the preceding seem wide of the mark, had not a good deal
of emphasis been laid on the essential points by actual
proceedings in the business world. It has some of the
appearances of a reversion to the type of business organisation
 in which the responsible owner hired capital and other
agents, and directed his enterprise. The later phase is one
where the responsible owners will have less to do with the
detail of management than in that earlier private ownership,
but not less of assertion of their right and intention to
determine the general methods to be adopted and the goals
to be aimed at.
As some reference has been made above to speculation,
some slight further discussion as to the nature of the function
performed by speculation may be in place here. It may be
acknowledged that every producer for a future market, that
is to say practically every producer, is to some extent a
speculator. He anticipates what will be wanted, at what
prices and in what quantities, and sets to work to provide a
supply in accordance with those anticipations. If his
anticipations turn out to have been sound, he profits, if
otherwise, he loses. The adjustment of the different parts of
the productive force of the society, to the satisfaction of its
various needs, depends in very great degree on the correct
formation of these anticipations.