This was the origin of the so-called registered
debts. The largest item was constituted by what was very aptly
denominated the "deferred" debt, created in 1888. Prior to that time
the government had covered its military deficits with money obtained
from loan associations known as "credit companies," which flourished
in the larger towns and which did business at an interest rate that
fluctuated between five and ten per cent a month. When a settlement
was finally made, part of the amount due these companies was paid in
certificates of indebtedness, the law directing with subtle humor that
they be paid from the annual surplus in the budget. There never was a
surplus, nothing was ever paid, and the market value of these
certificates fell to three per cent of their nominal value.
The revolutionary debt above referred to, consisting of claims arising
in the revolutions which brought Jimenez into power, was called
"privileged" because it was assigned interest. To some extent it was,
indeed, privileged, for partial payments were made until the middle of
1903.
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