The old remedy of a new bond issue was to be tried again. The San
Domingo Improvement Company undertook to float the eighth bond issue
of L2,736,750 in bonds at 2-3/4 per cent and L1,500,000 in bonds at
four per cent. With these bonds it contracted to convert all previous
bonds then outstanding, to pay overdue interest and to secure for the
government over $1,000,000 in cash. President Heureaux issued drafts
on this presumption, but it soon became evident that it would be
impossible for the Improvement Company to carry out the contract. The
company blamed the government and the government the company. The
situation quickly became chaotic. Eventually the conversion of the
older bond issues was completed, though at enormous cost. Bonds to the
value of L600,000 were absorbed during the transaction with at most a
cash payment of $250,000 to the Dominican fiscal agent in Europe. In
the meantime the government tried the experiment of a large emission
of paper money in which the customs dues were partly payable. The
paper depreciated as fast as it was issued, the revenues were again
insufficient and the new bond issue suffered default in April, 1899.
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