deficit in her budget of something like 1,000,000,000 francs, or
$200,000,000, per annum.

It was proposed last January that the government should consolidate its
indebtedness and put its financial house in order, by an issue of
long-term securities; but Caillaux opposed the programme and defeated
it for many months. This postponed the issue of the Balkan States'
loans.

To-day Caillaux is about the most hated man in France. Although he is
financially well-to-do, the people believe that his connections and
sympathy with Germany were too close. The German press took his side
in the famous Calmette shooting affair and the trial of Madame
Caillaux, and all this record now stands forth most threateningly in
the French blood.

I may perhaps be permitted to say that M. Caillaux has been under
arrest, and that the police of Paris have declared they would not be
responsible for his safety. It has, therefore, been diplomatically
arranged by the government that he should be now in Brazil upon a
semi-diplomatic and trade mission.

The French loan just before the war was not a popular success. The
reason is now obvious. It was sold short from other European capitals
where it was better known that war was in the air.

When a famous "bear" operator reappeared upon the Paris Bourse after
his return from Vienna, whence he had conducted his attack on the
French loan, he was greeted with a storm of hisses. The French Bourse
is a government institution and must support the credit of France and