New-York tribune., 1892-01-09
FINsNCIIL AFFAIRS ~ BRAZIL.
RATHER GLOOMY LETTER OF 4 CORRESPONDENT
~ RIO JANFIRO.

RATHER GLOOMY LETTER OF 4 CORRESPONDENT
~ RIO JANEIRo
\ firm Of this city, extensively engaged in the South
American trade have received from their representa-
tive In Brazil letter dated Rio Janeiro, December 10,
1891. reviewing the general situation Of affairs In that
revolutionary Republic The writer, among other
things. SAYS:
Beyond giving you in condensed form the opinions
Of representative merchant, Of lon. residence in Brazil
10 the immediate prospect Of a settlement OF tho
political and commercial situation. there will be no
use in my rehashng events that are being chroniced
in the daily papers of New-Sork AS they happen
Exchange keeps about the same level that marse' is
when Fcnsecas dicts torShlp thrown by the
action Of tho Navy which action In its turn
prompted and animated by the hostile attitude OF Eio
Grande do sui
The bank legislation which marked the first two
years Of the Republic Is Of such nature that moth
ing short Of miracle viii suffice TO run exchange
up b. point where IL last year and thus lnfuse
vigorous life into the trade oi the country. The
London and Brazilian Bank heads the list Of solvent
ones.
The majority Of the banks are considered shaky,
and all hanging more less 10 the skirts OF the
Banco da RepHbllca. bank that created b.
favorltes Of the late Fonseca Government and In
vested with special privileges to issue paper money
without an adequate bullion reserve. This bank Is
said u hold the securities Of nearly every Wild cas
bank that has started in Rio. well as thoss
Of many emprezls. etc, that have sprung up with
the establishment Of the Republic for every con
cevabls and incOncevable purpose, which securities
Of course are ~ worthless a. the great bank Itself.
1t Is even generally believed. and II has been
openly claimed, that only Illegal issue of bank
hs enabled the Banco dn Repubhca TO uds
over recent dincutes. This gives Sou al idea oi
the situation affecting the mO,ey interests ~ tls
republic and ii will explain 70 You why exchange ~
crawling up slowly day 10 fall back 10 low
water mark the next IL j. simply case oi mlstus.
and expectancy the pagt of ever Ooly tnst
tremendous crash In certain quarters Il inevitable.
ON the other hard. the merchants of Brazil
are, a, a rule. well t. do. The Banco da Repubhca
and it, minor creations seem TO have absorbed all
that there In the country belonging 10 the
wildcat. speculative element. The great majority u
the merchIu,s aud OF the people. are Conservative
but arr II course suffering fOm the general effect
cnspndered by the bank legislation Of the past tw1
years. How long this state Of affairs may last DO
Que can tell Much depends on the action Of tho
next Congrc>S and on whether or not the county
will be generally free from baby revolutions u tho
provinces, The volatile temper of the Latin race
does not furnish stable basis upon which 90 make
any reliable forecast In this direet0n.'
Later dispatches show that the new Governmcn,
In Brruu has much enhanced the securities Of the
republic. ana II Is certain fact that the trade 10
tween this country and Brazil has Increased wonder
fully since the reciprocity treaty was made.