The sun. [volume] (New York [N.Y.]) 1833-1916, 1897-08-07
MEXICO'S SILVER CRISIS.
TIE COUNTRY ORGANS UNDER HER
LOAD OF GOLD OBLIGATIONS.

An Outlook for Repudiatiop, Public and Pri-
vats, Unless IN Unforeseen WAY ne FOUND
out or Present Dimcuiies-Coudiions or
Trade. as seen by Those Engaged in It.
CRY OF MEXICO, Aug. 6.-The continual fall
OF the price Of silver and the corresponding rise
In exchange has reached the point where this
country Is brought face to face with what prom
ises to be q serious crisis. No sophistry can hide
the real condition Of affairs here. 1t Is all very
well TO say that Mexico can live within herself,
and can raise on n silver basis natural products
that she can sell abroad on q gold basis. This
would be perfectly satisfactory II there was such
an enormous increase Of wealth resulting from
such condition that property could bear a high
rate OF taxation and thus enable the Govern
ment to meet the interest on its debt without
any extra strain.
OF course every one knows that the tropical
exports of this country. such as coffee, vanilla,
and rubber. are comparatively so small that they
do not cut any figure in q crisis like the present
one. At this moment Mexican bonds are steady
In London, principally owing to the scrupulous
exactness with which the interest has been paid.
These debts are In gold and the interest has to
be paid in gold, and at the present rate Of ex-
change that interest is excessive. 1t is only q
matter Of time. unless there is a favorable
change In the price of silver. when this republic
will DO unable to endure the strain longer.
Reputation has Al ugly sound. but something
very much like it must come IL present circum-
stances remain unchanged for the better.
That the financial policy of this Government
is directed wisely there il no doubt, but all
fnanciers are powerless rs matters stand to-day.
Portions of the American press SEQ only one
hope for Mexico, and that Is the adoption OF q
gold standard. That appears almost impossi-
BILE, and the great bulk Of the population would
not understand 1t. Nobody can foresee what
such a course might lead to. In fact, OF the
course Of procedure in changing a nations
standard of value the masses here know nothing.
II Mexico did not owe a cent abroad, and II there
were no largo foreign companies organized
abroad on Q gold basis and operating here, the
question could be settled easily, but unfortu-
nstely this condition does not exist. The great
railway corporations and other foreign com.
panies here are in identically the same position
as the Government They have to meet interest
in gold with a circulating medium that Is ever
decreasing in value. It does not matter how
great the business enterprises and their earning
capacity may be because the money earned in q
deprecated currency is bound to remain made
quate to their obligations abroad. Unless they
increase their earnings moro than 100 per cent.
which is impossible, the only alternative is te
regard their foreign debt as contracted in silver
-IAAN . ~ bCOAIo ihAiu ~ SOp
here that the credit Of this Government, which
is now SO high, and the excellent foreign invest
ments here should be injured through circum
stances over which they have no control. Blu
facts are facts, and It will be interesting Il
watch what will happen unless there L. . sharI
rally In the price of silver before long.
On the other side it should be said that OF
sting conditions are likely to lead to the found
ing OF many industries hero, but 1t will requtr,
many years under the most favorable circum
staaess to make these new industrlssS 1set The
present ruinous condition Of exchange.
Mercantile business here 10 paralyxed; all or
ders for abroad have been countermanded
The manager OF tho Scotch thread mo
nopoly here has raised prices on threac
25 per cent, and tho French importer,
Of dry goods have followed his example. 4
conspicuous banker said to-day that he believed
exchange would go up to $50 per cent. premium
He regarded the outlook as most serious fol
this country; In fact, he spoke of it as tot
gloomy to be . subject of speculation. A com
mission man said that many commodities
shipped abroad. would bring in more money
He alluded especially to shipments of skins
coffee, and tropical products. He believed
also that the good general outlook fol
the crop this year would do much e
mitigate the hardship resulting from the rat,
of exchange. An ore buyer said the chang,
would increase the price of lead and silver ores
but there was no reason why it should affect tn,
orc business with the United States. Hotel mer
and shopkespers hope the change will brinl
down moro ~tourists- Tho mining interests viii
change their policy only In the ono particular
that they will not purchase machinery. Thu
rise in tho price OF mercury will affect amalga,
nation works. Gold mining will boom because
labor Is paid In silver.