By 1915, when Alvarado arrived in Yucatan, the system of paper money which Carranza used to finance his revolution had already engulfed Mexico. Carranza had recently issued his famous dictum that if Gresham’s law (one of the fundamental laws of economics, which holds that bad money, in any quantity, inevitably drives out good money) was interfering with the circulation of the Carranza paper, Gresham’s law should forthwith be repealed by executive decree. Billions of Carranza paper had been printed, and it was already the circulating medium in Yucatan; gold and bank bills were in hiding. Alvarado decided that the time was ripe for a currency of his own, and issued, before he had been long in the state, the Reguladora paper money, ostensibly guaranteed by hemp in storage in Yucatan and in the United States. By decree, this money had to be received at the old value of the silver peso, two for one American dollar. It was a beautiful idea, except for economic law. The bayonets of Alvarado’s soldiers helped keep up values for a while, but slowly the theory that power can achieve anything the “proletariat” wants was blasted by fact. Alvarado had promised to redeem his Reguladora paper in gold or in New York exchange, but he did not bother to back up his promises by a limitation of the currency to the amount he could redeem, so that at one time he had $34,000,000 in paper in circulation, against henequen stores of half the value, stores which he could not liquidate. The currency’s value dropped, cent by cent, then by groups of cents, and finally it was almost waste paper, like that of Carranza. There was not enough henequen in New York, nor enough gold in Yucatan, to redeem the paper, and the political nostrum for the economic ill of bad paper currency failed. The failure was colossal enough, in any case, without the financial complication of the currency. Alvarado had closed the ports to all hemp from the interior that was not consigned to the Reguladora. That beneficent monopoly allowed no shipments by rail, and before he got through Alvarado had to close the roads with soldiers, so that no carts could reach the port. Meanwhile, he had been boosting the price, deliberately and virtually by decree, until, as I have said, it reached more than 19 cents, as against less than 7 cents a pound which had been its price before the Reguladora took charge of the market.