More than once a fall of exchange in Brazil has, by an anomaly, actually saved industries from something near bankruptcy. This is readily understood when it is realized that exporters of such products as rubber and coffee, cacao and hides, selling in the markets of London, Paris, Hamburg or New York, are paid in gold, while they pay their day labourers in paper. To the Brazilian interior it is of little interest that the bankers of Rio say that it takes another milreis paper to purchase a gold pound sterling; the country markets do not reflect such _nuances_, unless, indeed, a fall should be heavy and continued in which case it must in course of time react upon the whole country. But a temporary depression does not affect the amount of black beans or mandioca that can be bought with a milreis, and neither the rubber collector of the Upper Amazon or the more sophisticated worker upon a _fazenda_ of coffee or cattle will demand a rise in wages because exchange goes down for a time. To the exporter the fraction of a milreis makes all the difference between prosperity and ruin, and both rubber and coffee have benefited thus by temporary low rates of exchange; the present crisis has certainly been smoothed to the agriculturist, the producer and exporter, of Brazil, by the fall in exchange since the middle of 1914, the paper receipts of the country showing marked inflation due to the larger number of milreis bought by the foreign gold paid for these products. Low prices received abroad for coffee and rubber are thus compensated, and when, as has happened since the war began, prices have been better than had been predicted. It is not to be wondered at that there is a feeling of prosperity in Brazil and that money is abundant among certain classes in spite of administrative difficulties. The people who really suffer from fallen exchange are, besides the governments owing sums abroad which must be paid in gold, the importing houses which have bought in gold and must sell in depreciated paper, and which cannot always adjust paper prices to fit the monetary market; the transportation companies, too, whose rates are fixed now find themselves with paper in hand of a lowered value abroad; it is true that their obligations to employees are paid in paper, but since most carrying companies are owned or leased in Europe, and dividends must be paid in gold, earnings are very much reduced when large quantities of additional paper are needed to buy bills on London. Every railway, port company, street-car line and lighting and power company which derives its capital from outside Brazil has seen its dividends cut down during the last two years even if earnings have been larger and expenses reduced. [Illustration: Ministry of War, Rio de Janeiro Avenida Nazareth Belem (Pará) ]