24 TE OD BE -A Bab vole Ww 
In the same way in the urban real estate line, houses and land changed hands at ever 
increasing prices, as high as $100.00 per square meter having been paid for raw 
residence property in Havana’s favorite residence district, the Vedado. One real 
estate subdivision, located some six miles from the City of Havana, opened up only 
in map form, and in which no improvements had as yet been made, was sold complete 
in a week, at the opening price of $6.00 per meter. It goes without saying that a very 
large percentage of the lots thus disposed of will be turned back to the sellers, and 
that the purchasers will lose the instalments paid in, while in many other transac- 
tions in which numerous instalments have been paid, adjustments will have to be 
made, 
Reference has already been made to the freedom with which our merchants placed 
orders for merchandise of every description. This has undoubtedly been one of the 
principal causes of the financial events which have since happened. The prosperous 
condition of the country, the undoubtedly favorable future of itss principal industry, 
and the remarkable freedom with which credits were granted not only in Cuba but 
by foreign firms, had led to the formation of many small concerns here with limited 
capital. Notwithstanding the smallness of the capital of these firms, they had been 
able to place orders for merchandise to the value, in many instances, of many times 
their capital. Other firms of long standing and large resources had placed orders for 
very large quantities of goods, and under ordinary circumstances would have been 
able to take care of these orders without difficulty. The tremendous increase, how- 
ever, in imports into the Island without a corresponding increase in the port facilities | 
required for taking care of such an additional quantity of cargo, brought about port 
congestion in those of our ports where our general cargoes have in the past been 
mostly received, that is, in Havana, Santiago de Cuba and Cienfuegos. In addition 
to this port congestion, the transportation difficulties of the North, in fact of nearly 
all countries exporting to Cuba, are well remembered, so that frequently shipment of 
merchandise would be very much delayed. This resulted in a considerable number 
of cases in further orders for goods of the same nature being placed with firms whose 
representatives stated positively that they could secure immediate shipment from the 
North. Instances have come to the writer’s knowledge, in which a third order for 
the same goods had been placed without the cancellation of the two previous orders, 
and it so resulted that when transportation could be secured for the third order, the 
same was possible for the first and second, so that the merchant found himself in 
the embarrassing situation of receiving simultaneously three orders of practically the 
same character. Undoubtedly also advantage was taken by foreign shippers to send 
to Cuba in fulfillment of orders very large quantities of merchandise which had not 
been sent previously due to the possibility of sale to others at higher prices than 
those mentioned in contracts with the Cuban merchants. Then the period came when 
the drop in the price of merchandise of practically every character began in the North, 
with no immediate prospect of recovery, so that doubtless they thought that it would 
be better to ship the goods to Cuba and trust to their being received by our merchants, 
notwithstanding the difference between contract price and market price at the date 
of shipment, rather than for the shippers themselves to risk carrying the goods for 
their own account. Our merchants in many eases received without a murmur the 
goods thus shipped, but the losses represented by the difference between market price 
and contract price finally became so great that trouble began. The failure on the 
part of our merchants to receive and take out from the customs warehouse these 
goods increased the normal congestion due to the unusually heavy shipments, with 
the result that millions of dollars were tied up in the fixed assets represented by 
this merchandise. 
There is no doubt whatever that certain of our financial institutions had made 
heavy loans on sugar, based upon prices in instances as high as 15e per lb. The rapid 
drop in price after the break in May soon left these sugars at the mercy of the bank- 
