"An omnibus company had a monopoly of the business indicated by its name; the government and people were much dissatisfied with the way its business was conducted, as the vehicles were small, dirty, and insufficient in number, and the fares were very high. The government could not break its word by giving privileges to another company, and the monopolists felt secure. "But an enterprising genius suggested that a company could be licensed to run gondolas in the streets of Rio, and the hint was taken at once. The gondola company placed its vehicles in operation, and, though the old company protested, the protests were of no avail. Who shall say hereafter that there's nothing in a name? "While I've been writing the foregoing, Fred has been looking up the history of the city, and is prepared to tell you about it. I will rest a while and let him have the floor." [Illustration: VIEW IN THE BAY OF RIO DE JANEIRO.] "Rio is a younger city than Bahia," wrote Fred, "as it was not permanently settled until 1555. There were two temporary settlements previous to this--in 1531 and 1552--but they lasted only a short time, the first being abandoned in less than four months after its formation. "The first settlers were French Huguenots, who prospered so well that the king of Portugal ordered them driven out in ten years from the founding of the colony. The governor of Bahia executed the order, and established a Portuguese colony in place of the French one. "The Huguenots got along very well with the natives, but the Portuguese were constantly at war with them; the history of the first hundred years of the colony is full of bloodshed, not only in conflicts with the Indians, but in quarrels among the settlers. Assassinations were frequent, and on several occasions it seemed as though the local dissensions would bring the colonization of the country to an end. "In 1763 Rio was made the viceregal capital, much to the annoyance of the inhabitants of Bahia, which had hitherto held the honor. The transfer of the capital was a piece of good fortune for Rio, which it has maintained without interruption. Its glory was increased in 1808, when the Prince-Regent of Portugal arrived with the intention of making his home in Brazil until the declaration of a general peace in Europe. "The residence of the royal family at Rio was the occasion of public rejoicing, and the people readily surrendered their houses for the accommodation of the sovereign and the retainers of his court. After the declaration of peace, and the return of the king to Europe, their loyalty cooled very materially, and in 1821 came the revolution, which made Brazil independent of Portugal. [Illustration: AN IMPERIAL PALACE.]