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Rh the present Government. In May, 1916, paper money fell to 1½ cents American gold to the peso in the rate of exchange, whereas Government desired to compel a value of 10 cents gold to the peso. This caused almost inextricable confusion in business circles, which it is doubtful if decrees or any such measures will correct. It has caused the food question to again become the paramount one, and everywhere the people are unsuccessfully trying to find sufficient staple food-stuffs to supply their needs. Not a sack of flour or a pound of sugar could be purchased on the streets of the city, and bread of any and every kind was almost lacking; meat is far too expensive for the poor to use; and the same is true of potatoes, with the exception of those which are so small as to be practically worthless. Maize, the principal food of the lower classes, has almost entirely disappeared from the market. The commission for regulating prices, on which so much hope has been placed, is heard from each day through the papers, but with a constantly weaker and more uncertain sound. Like most of the reforms, it was of mushroom growth, and will soon be only a memory.

This state of things caused the Government to enter the market to buy, for Mexican gold and silver, the bills of the old issue of paper money at the exchange price; they advertised half-a-dozen points, at which they had established offices for this purpose: buying their own notes, for which they received from the people full value in labour, goods, or other real value, at a price which was practically equal to repudiation. It is not clear what motive was behind this action, whether thus cheaply to get rid of as much as possible of the floating indebtedness, or with the idea that such a course would cause confidence in the money and increase its market rate. Probably neither of these results will be realised, as there is no evidence that any appreciable amount of it was exchanged, the reason being that no one wished to sell at such a ruinous rate, especially to the Government which had so recently, repeatedly, and strenuously proclaimed against