Evening star. [volume] (Washington, D.C.) 1854-1972, 1900-12-20
Interesting Facts From Minister Lii
monteur's Report.
MONEY SUPPLY At A Low EBB
ANaturaI Reaction Resulting From
Overproduction.
PROBABLY DIAz's SUCCESSOR

The annual report of the Mexican minis
ter of finance. Senior Limonteur, calls atten-
ton to the remarkable service performed
for his country by this most interesting
man. He is the leading exponent in the
Mexican cabinet of what is known as the
Diaz policy, one which has encouraged for
eign investment and protected home indus
try. Should President DiaZ die unexpected
ly, Mariscal, the present minister Of foreign
affairs, would succeed him under the pro-
visions of the Mexican constitution. l$aris-
cal was at one time minister to the United
States, speaks English fluently and has an
American wife. These things, taken with
his own agreeable personality, have made
him the best known and the most popular
Mexican in the United States. He has not,
however, a great following in Mexico and is
not looked upon strong politician or
leader. Limonteur, on the contrary, While
not very well known in the United States,
has the entire confidence of the foreign
ca ptalists and property owners of the Mex
lean republic.
He is a comparatively young man, but
has shown more originality in his handling
of public questions than any one outside
of the president himself 1t was Minister
Limonteur who originated and carried into
effect the modern system of national bank
ing recently adopted by Mexico, much 10
the advantage of her monetary and COM
mercial interests. For many years Mexico
had been harassed with a lot of deprecated
paper money, of which the people were
always suspicious, and in many localities II
was absolutely refused as medium OF eX-
change This money has now practically
been retired from circulation and In ITS
place has appeared system OF natlonal
bank notes issued by the main concern
at the capital and by branches in the larger
cities.
Money Supply mt Low Ebb.
Tho racent renort of the minister of
finance estimates the cash holdings of the
neonle of Mexico at about SOC, 100000, 500
600 coo of which is in the banks. AS nine
tenths of the people never use anything but
silver in their commercial transactions and
there is no gold in circulation 1t Is evident
that the money supply of the republic Is at
a low ebb; in fact, so low that the per
capita circulation is less than 81 rms
would be most alarming condition in a
country like the United States, but 1t is
not nearly SO significant in Mexico, Tor OF
the 100000 people in the latter country
nearly II 600 600 are Indians, and thousands
upon thousands of families do not handle
as much as So in cash in an entire year
The cause of this decrease in Mexican Sill
Yer at home is due to the increased activity
in the orient and other places where Next
can dollars constitute large proportion OF
the medium of exchange. The silver output
of Mexico has been very large and the cost
of minting the Mexican dollar has lately
With all this however, the expectations
have been heavy as to bring the supply
of domestic silver money 10 or II per cent
below the normal.
Minister Limonteurs report also calls at
tention to condition which is the result
of a prohibtive protective policy. During
the past few years Mexico has been Won
derfuliy prosperous and her development
along commercial lines has been extremely
rapid. Hitherto her exports have been en-
tirey of raw material and her people have
imported nearly everything consumed at
home. To stimulate home manufacturing
Mexico has freely granted concessions to
capital which carried with them a prohib-
tive tariff on articles manufactured. This
is notably the case with cotton goods, the
staple article of consumption In the cloth
ing line. The result has been tremendous
rush of investors into cotton mills 1t has
been freely predicted in the past that Mex
ico's policy was beneficial SO long the
production did not exceed the consumption,
but that as soon as it did disaster would
follow.
This point has apparently been reached in
certain lines of business, for the minister
of finance in his report refers to what he
calls "a natural reaction" resulting from
overproduction in manufacturing Mexico
Is the most extreme example of a pater-
nalistic government in matters of encour-
aging home industry. There is no question
that this paternalsm was wise in the
earlier stages of commercial development,
but present conditions would indicate that
Mexico would soon be compelled to read
just her economic policies to meet success.
fully the same influences which prevail else
where throughout the civilized world and
which are now affecting Mexican enter
priSeS.
President Diaz's Ability.
No Latin-Amercan leader has ever shown
the ability of President Diaz in the govern
ment Of Spanish-American people He has
brought his country from a condition of po-
nd oil
tematized prosperity. Two principles have
governed this president or rather this die