rum constitute the exportations of a country in which cotton and
indigo grow wild, and where sugar and rice could be made to yield
large revenues.

[Illustration: FOUNDRY AT IBICUY, DESTROYED DURING THE WAR.]

The lack of money and of banking facilities in Paraguay has made the
process of buying and selling, in reality, but not professedly, a
matter of exchange of commodities. For instance, a shopkeeper will
barter his imported cotton stuffs, his demijohns of wine, his candles,
etc. for the tobacco grown by the natives. The merchants also endeavor
to buy as much tobacco as possible, when the crop is first in, for
specie. Usually, large profits are derived from this course, as the
planters have pretty well exhausted their receipts for the crop of the
previous year, and hence are disposed at that time to sell at a
sacrifice. The money thus obtained returns to the merchant in the
usual way of business, and thus the latter is enabled to buy more
tobacco. The result is, that in the end the merchant gets the
planter's cash as well as his tobacco. It is a curious fact, however,
that the Paraguayans do not admit the principle of exchange. They must
touch the value of their wares in the shape of coin before parting
with them. Thus, no woman of the country will exchange outright a
quantity of yerba, large or small, or any product of her industry, for
cotton or thread. She will first insist on holding in her hand, even
if it be for a moment, the price in silver of her wares, and with this
money she will pay for what she obtains from the merchant.

During his sojourn in Villa Rica, M. Forgues purchases a house there,
to the great gratification of the community, who, in the simplicity of
their hearts, see in him the pioneer of European immigration, the