Delaware gazette and state journal. (Wilmington, Del.) 1883-1902, 1895-07-18
OBJECT LESSON FOR SILVERITES.
BraziPs Poor Currency, With Its
Fluctuatlna Value.

BraziFS POOR Currency, with ltS
Fluctuatlng Value.
Foreign Bankers Make I,ich Gains Ont OF
the Financial situntion--C onsui-Generai
Townes' Interesting Report
WASHINGTON, July 15.-Consui-Gen-
cral Townes, at Rio dc Janeiro, Brazil, !
has sent to the State Department an in
teresting report on port customs attpat
place. The report is of especial value
to shippers and masters of vessels. Rio
is collect port only for sailing vessels,
all freight being prepaid by steamers,
and his Information is largely for the
benefit Of the former class of vessels.
Ho gives in detail what masters of yes
sells may expect in all matters pertain.
ing to landing u cargo. The most i'm
portant of the report is that relating to
exchange and the receipt of money for
cargocs. 1t is especially Important II
says, to look carefully into exchange
rates Of all countries having deprecated
currency "a
Such rates are liable TO huctuate vio-
lently and suddenly when the currency
unit Of Brazil had an exchange value Of
between and 10 pence; one-eighth OF a
pence difference in the rate Of exchange
averages about 6 cents United States
gold on each pound sterling, and on
1000 pounds would be $50. Mr.. TONNES
says: Exchange rates are monstrously
tickle throughout Central and South
America. The gold value Of the cur.
rency being far below its face value,
there is an irregular, spasmodic fiuctua-
ton in the value of money in the hands
of the people from hour to hour and
from day to day. The business of buy
ing and selling money itself is by far
the most important business in this
country. The three English and one
German banks doing business in Brazil
have made vast sums out of the anon
alous situation here. The two leading
banks have combined paid.up capital
stock of NC, 100000 They have already
made and passed to their surplus ac-
counts $5,000,000, and during the last
two years they have been earning about
% per cent annually. But few individ-
nals have proiited by these exchange
fluctuations. The banks have done so
because they have made commissions in
both buying and selling. T.
"Currency in circulation here has no
certain value of itself, and its values Is
fixed only so far as it has debt-paying
value. That Is fixed by legislation OF
the country. Its purchasing power is
such an unknown factor that no con-
sentative calculations can be made by
merchants, and the result is that all
merchandise is sold to the people at a
large percentage Of increase over cost.
The merchant is forced to do this or he
may find that after buying his goods at
a fixed sum and paying for then'with
a sum having certain gold value at
that time that when the goods are sold
by him the currency he has received FOL
: them has SO deprecated in its exchange
value that he is poorer than when he
commenced. He therefore sells at a
profit large enough to cover possible
contingencies.
"rhis constant fluctuatiou of the value
of the currency of the country has not
been produced by unfavorable legisla
ton. On the contrary, the government
has done its best to make the currency
good for its full value by giving II full
debt-paying power. The giving ofsuct
a debt-paying power to currency which
commerce has declined to accept excep
at constantly dopreciating value ha:
resulted in this country in loss BY
creditors of about 66S per cent Of theil
credit assets and corresponding gaiI
| to creditors, as they can pay gold debt
with currency actually worth to-day
only about 33h per cent of its face value
But let no one presume for momen
that the poor laboring classes have beef
benefited. On the contrary, they have
suffered, and beyond the creditor classes
as they have felt the effects in persona
suffering, while the creditor classes hav,
felt them only in pocket. am well ad
vsed as to the conditions of the poo
both in Brazil and Argentine, and an
positive, from the light of facts befor
me, that in neither of these great coun
tries, one Of which is greater in arei
than the United States, has skilled o
raw labor been paid in late years com
mensurate with the depreciation in th
currency in which laborers receivel
their wages. All costs of living havI
been advanced as currency value de
preciated. Iu consequence of havinl
been paid with greatly deprecated
currency at rate of wages immsterialll
increased, and having to pay increased
prices for commodities consumed, all
labor has experienced the greatest SUI
fering and no outlook for its relief i
apparent. Any currency SO founded a
to be liable to fluctuations in value add
another element Of uncertainty to bust
ness and il becomes tho great disturbing
element of commerce. II becomes al
article of traffic to I've bought and sol
both public and private and there re
mains no fixed measure on any articl
of commerce. At least such is the ex
perience Of this country"