The Bridgeport evening farmer., 1915-12-10
THE FARMER: DECEMBER 10, 1915
NICARAGUA ONCE AGAIN ON SOUND
 FINANCIAL BASIS
New. Monetary System Estab- Iished With Gold Reserve
 In New York.

monetary conversion of Nicaragua oS which a mass of paper money with nothing behind it save the impaired credit of the government has been converted into a currency backed oy a gold reserve, was completed on Oc-. tober 31, by the expiration of the time in which to change Che oio PapeA into the new money.
 The conversion was begun in a pre- liminary way in 1911 by the provision al government which succeeCed the regimes of Zelaya and of Madrtz, the president whom zelaya left when ne fled It was entered into actively in 1912 was interrupted and set back year by the fierce revolution Of that year, was resumed in 1913, and al- though retarded by the business de- pression that fell upon the country was making fair headway in 1911 when it was again set back by the European war. Notwithstanding these obstacles the present government, which. succeeded the provisional off, ciaIs after the elections of 1912, has steadily kept at it and now consum- mates its plan, much to the benefit of f business, commerce and industries. When President Ze1aya. who kept himself in power and dictated Near agua for seventeen years. from 1893 to 1909, first assumed office, there was a silver currency. During his first
 
 but small amounts of paper. Tn 1901 and 1902 he issued 5,200,6A pesos in
 paper currency and the country at once went from silver to a paper l basis, the gold exchange falling from the silver rate of 2.08 in 1900 to fluctuating rate of to 6 in 1902 and ! to 8 in 1903. No further paper is
 sues were made for some years, in
 fact some was retired, the exchange , rate falling to $50 or 6.
 His last two years. 1908 and 1909. were turbulent and revolutionary.
 Over three million pesos more paper were issued, the rate jumping to. g. Gdis temporary successor, Dr. MadriZ,
 found no money and a first class
 revolution. He issued e15 ,00o,0O0 pesos
 gained possession in September, 1S1O,i
 had no money and at first no reven-
 ues and issued 24. .0oo. GOO during 1911 1 to pay the expenses of their revolu- 1 ton and other things The rate f1uc-
 tuated from 12 to 2, averaging 16-
 Then they began the monetary con-
 version. The services of the late Charles A. Conant of New oYrk and F. C. Harrison of London, late Treas
 urer-General of India, two of the best
 experts in America and Eng'and were secured to devise the reform. group 1 of New Y ork bankers were interested ] through the State Department on fn- i vitation of Nicaragua and financed
 the conversion. It cost Nicaragua ap- I proximate1y two millions besides much
 financial distress at times, but though I often bitterly discouraged the gov
 ernnent stuck to it. as they wanted to
 get their country on sound money basis and now they reap their re- i ward
 The new money. of which the cor i doba is the standard, equal to an Am
 erican dollar in value, went into force 1 March 2S. 1913- The gold reserve Is
 kept in New York All went well ex- change remaining at par. until the l war in Europe broke out. Then. fright ened unduly as 1t has since turned out; but along with the rest of the tworlds the government passed a mora toriun law and the sale of gold ex- change stopped. Cordobas went to a,
 discount, at first of five to eight
 points Then assisted by local specu-
 1ators who wanted to return to the
 halycon days of wild fluctuations, cor i dobas fell and rose, and fell again
 at one time reaching 25 per cent. dis count. Early this year the favorab1e
 reaction set in, assisted by one of i the local banks, and the cordoba has sgradually risen till now, cofncident with the conversion of the last o d
 paper money, 1t is practically at par again, and the government and the
 bankers say it will be maintained 1 there at all cost.
 l C4AO tSlICStS OA INO WAT
 on finances. and that it cut Nicarag- uan commerce into half, and also con- 1 sidering what has happened to the
 pound sterling and the money stand
 ards of Europe, Nicaragua's feat of Bringing it's money to par is very
 creditable. It has had good ffnan- cfal advice and assistance. and has ] persevered- It should be the first step towards a revival of it's commerce and
 business. The retirement of the last
 of the paper currency and bringing
 the new cordoba back to par is hailed as a financial feat President Diaz and Minister of Finance Cuadra are
 naturally much elated.