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Rh the effect upon the creditors was the same as if they had held the notes of a corporation that had become bankrupt and could not pay its creditors in full. It need hardly be said that this is not a way of fulfilling its financial obligations that contributed to the credit of the republic.

The claim so often made in connection with Latin American countries that their revolutions are not to be taken seriously and that they have no important effect on the national economic life, has no application when the foreign loans of Mexico are under consideration. When Mexico has not had a stable government, she has not paid regularly interest on her debts and the principals of the debts have been paid by new borrowings. The only long period in which interest payments were punctually made was in the Diaz régime.

Unless some guarantee of payment of interest and principal can be secured that will be enforceable and that will be enforced by some other government if Mexico fails to do so, the loan of money to any Mexican government that has not proved its stability is a highly speculative venture. The interest rate that the investor will have to demand will naturally be higher, that is Mexico will have to pay more, if there is no guarantee. These are facts, which those who refinance Mexico in the reconstruction period will have to take into serious consideration. It may well be doubted whether the dangers to national independence alleged to attend foreign loans are less when money is borrowed in the open market at a high rate by a weak nation, than when made at a lower rate under the guarantee of a more