hall arise in Southern
Brazil. It is immaterial whether it remains part of Brazil or
constitutes an independent State or enters into close relations with
the German Empire. But without a connection guaranteed by battleships,
without the possibility of Germany's armed intervention in Brazil, its
future would be jeopardized."

[5] 1050 million francs.

[6] _Op. cit._, p. 120.

It is the Monroe doctrine that is commonly credited with thwarting
these designs on South America. But as a matter of plain fact, it is
to the British Navy and to nothing else that the credit is due. Were
it not for the known resolve of the British nation to co-operate in
case of need with the American people in their exertions to uphold
that doctrine against Germany, the Berlin Cabinet would long ago have
formally established a firm footing in Southern Brazil and the United
States Government would have been powerless to prevent it.[7]

[7] An instructive article on the subject by Mr. Moreton
Frewen appeared in the _Nineteenth Century_ of February,
1916.

CHAPTER III

GERMANY AND ITALIAN FINANCE

It was in congruity with those principles and methods that the Banca
Commerciale, which had its headquarters in Milan, set itself to
discharge the complex functions of a financial, industrial, commercial
and political agency of German interpenetration in Italy.

To German customers and those Italians who imported German goods, the
Banca Commerciale allowed long credits and easy means of payment. To
all who were in need of implements, machinery, or materials for a new
enterprise, the bank "recommended" German houses, and those who were
wise construed the "recommendation" as an ultimatum. For if it was
ignored, their names were inscribed on the black books of the bank,
and by means of an efficacious system of secret dossiers, handled by a
confidential information bureau,[8] they found themselves thrust into
a "credit vacuum," boycotted by finance and condemned to bankruptcy.
All banks shunned them. Their bonds became mere scraps of paper.
Every enterprise to which they set their hands was blighted, and
nothing remained for them but to abandon their avocations or surrender
at discretion.

[8] This secret information bureau is everywhere a potent
engine of attack in German hands. It renders deliberate
libellers and defamers immune against the action of the law.
The victims feel the effects but cannot poin