Brazil's Half-Billion

Brazil, whose wealth lies in her aromatic coffee beans, over-produced them abundantly and is now busy destroying them (TIME, July 13). In the past 44 years she has sold 25 bond issues abroad, most of them payable in pounds, French francs or dollars. Last week her consul general in New York, Sebastiao Sampaio. announced his country had suspended cash interest payments on about $500,000,000 of this external debt. Cash will continue to be paid on only three small issues, all payable in pounds. U. S. investors hold about $152,000,000 of the bonds, purchased through syndicates headed by Dillon, Read & Co. For the next three years investors will have to content themselves with scrip issued in lieu of cash. The scrip will bear interest at 5%, was divided into two classes; first half redeemable in 20 years, remainder in 40 years.

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