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THE INDIA RUBBER WORLD 



[Si i i EMBER I, 1903. 



FINANCES OF A RUBBER STATE. 



THE details of the new fiscal arrangements of the state of 

 Amazonas (Brazil) can be stated more fully than has 

 been done hitherto in The India R< BB1 R WOR1 n, since the 

 appearance of the official report of Dr. Porfirio Nogueiro, sec- 

 retary of state of Amazonas, who visited New York some time 

 ago for the purpose of placing the new state loan. A total 

 issue was authorized of ,£1,500,000 [ = $7,299,750], 5 per cent, 

 thirty year gold bonds, one half to be devoted to the purchase 

 of public utilities in the city of Manaos, and the remainder to 

 refunding the outstanding state bonds and cancelling the float- 

 ing debt. Holders in New York of ten year Amazonas bonds 

 payable in currency, amounting to 382.500 milreis, exchanged 

 them for ,£11,475 ' n g°'d bonds, indicating that the basis of ex- 

 change was the valuation of the former at 60 per cent., which 

 would effect a reduction of 40 per cent, in the obligations of the 

 state. 



Dr. Nogueira placed in New York bonds to the extent of 

 ^498,560, at 85 per cent., yielding $2,055,890.78, including the 

 gain on the sale of a few bonds ex expired interest due January 

 1 last. The proceeds were applied to the purchase of the Man- 

 aos railroad (including a contract for supplying the city with 

 water) and the electric lighting plant — enterprises promoted 

 originally by New York interests with which Mr. Charles R. 

 Flint is identified. Bond proceeds in New York were applied 

 as follows : 



Manaos city railway. . .. §1,724,863.70 



Arrears of subsidy due same 178,955.30 



Electric lighting plant 82,450.00 



Arrears of subsidy due same 61.C66.17 



Surplus remaining 7.955 6' 



Total $2,055,890.78 



The remainder of the bond issue was deposited in the state 

 treasury at Manaos for use in refunding operations, and to pro- 

 vide for further public improvements. Besides scaling the 

 state debt 40 per cent., Dr. Nogueira points out that the 

 state is a gainer by becoming owner of the public utilities, with- 

 out the payment of a cent of cash, since the yearly charges will 

 be less than the subsidies paid hitherto, while the revenue from 

 the railway and electric lighting will provide an ample sinking 

 fund for the bonds. One-thirtieth of the amount of each bond 

 is to be retired annually through the medium of a coupon ma- 

 turing on July 1, and the whole issue is secured by the hypoth- 

 ecation of the export duties (on rubber, mainly) and certain 

 other revenues of this state. 



The Manaos Railway Co., in 1S99, succeeded the old Viacao 

 Suburbans) Urbana Manauense, founded by Frank Hebble- 

 thwaite, an Englishman. In the year named the steam line was 

 superseded by the overhead trolley system. The office of the com- 

 pany is at No. 25 Broad street, New York— the address of Flint & 

 Co. — and at a recent date the directors were : Anthony N. Brady, 

 Charles R. Flint, F. H. Hebblethwaite, Edmund C. Converse, 

 Frederick Stewart, John W. Scott, W. D. Walker, \V. W. I.add, 

 Jr., and A. J. Moxham. Fifteen miles of single track narrow 

 gage road are operated, on five different routes, employing us- 

 ually about twenty cars. The fare is 250 to 1000 reis— 6 to 24 

 cents— according to distance. The plant is reported to be in 

 good condition. The capital of the company, $1, 400, 000, was 

 transferred on the basis of 9434'' per cent., and the mortgage 

 bonds of the company, nominally §687,000, were valued at 

 $295,165.70. 



Dr. Nogueira presents figures to show how the state will ben- 

 efit through the cutting off of the subsidies paid to the railway 

 company, while taking charge of its earnings, which are here 



converted to terms of United States money on the basis of 12 

 pence to the milreis, as follows : 

 hunt::/ Saving : 



Payment for water $ 84,079.60 



Railway subsidy 45,050.40 $129,130.00 



Annual K, venue : 



Passenger receipts $'55185365 



Freight receipts 19.74200 175,595.65 



Aggregating $3°4. 725-65 



Less Disbursen: 1 



Stall and emplojes $97,247.27 



Coal 48,847.50 



Renewals 17,560.00 163,654.77 



Net revenue $141,070.88 



The point is overlooked, however, that the " payments " 

 above referred to were largely only promises to pay, and that 

 the railway company has finally obtained its subsidy in the 

 shape of thirty year bonds. 



In 1895 a concession for an electric plant in Manaos was ob- 

 tained by Heliodoro Jaramillo, who proceeded to develop the 

 same. Three years later the contract was transferred to Red- 

 man & Brown — a New York firm composed of John C. Redman 

 and George F. Brown, with Charles R. Flint interested. The 

 company was hampered by inability to collect promptly the 

 payments due from the state, and finally the management was 

 assumed by the local authorities. There are 1600 street lights, 

 of the arc system, and 700 or 800 incandescent lights for private 

 users. The company had also the privilege of selling power. 

 Dr. Nogueira gives its sources of yearly income thus : 



Lighting of the streets $78,893.10 



Lighting of public offices 4,877.15 



From private customers 14,599. 5° 



Total $9S,3 6 9-75 



The maintenance of this service by the authorities is figured 

 at $73,873.47 per year, which would leave $59,273.97 for the state 

 to pay after deducting the receipts from private customeis. 



The Brazilian Review understands that the holders of the 

 state's obligations were not obliged to surrender them for the 

 new bonds, and that "the great majority of the holders were 

 not only glad, but anxious to exchange." 



"RUBBER" FROM GREASEWOOD AGAIN. 



IN regard to recent newspaper reports that the rubber indus- 

 try was about to be revolutionized on account of a " sub- 

 stitute " obtained by " experiments being secretly carried on " 

 with a product of a shrub known in the west as " greasewood," 

 in the factory of The B. F. Goodrich Co. (Akron, Ohio), Mr. B. 

 G. Work, vice president of that company, informs The India 

 Rubber World that he never heard of the matter until he 

 saw it in the newspapers. In other words, "the story was made 

 out of whole cloth." One of our correspondents intimates that 

 the writer who first gave publicity to the story was the victim 

 of a j Dcular young rubber man in Denver. At the same time 

 The India Rubber World has a letter from C. M. Fueller, a 

 mining engineer at Denver, Colorado, saying : 



We have made a few very crude experiments with the bark of the 

 plant you mention. The bark of the roots of the plants gives a rubber 

 like gum, soluble in all solvents for rubber. The gum increases in 

 elasticity when heated up to a certain point, and seems to possess the 

 quality of vulcanizing. We expect to experiment further with this plant, 

 as our time and business will permit. The plant grows wild in large 

 quantities and we hope eventually to wo.k out a commercial product. 



"Greasewood" is one of various low shrubs prevalent in 

 saline localities in the dry valleys of the western United States. 



