Os funding loans brasileiros

Abstract

In three moments during the first period of continuous rise in the Brazilian foreign debt between 1824 and 1931 contractual loan conditions had to be renegotiated. In 1898, when the crisis of the first republican decade reached its climax. In 1914, when World War I broke up. In the peak of the great depression, in 1931. In these three moments Brazil negotiated funding loans with its creditors. This article, using original primary documents, considers the history of these negotiations and, using alternative methodologies, evaluates the performance of these loans having as counterfactuals riskless British and U.S. government consols and bonds. In general these three Brazilian loans had higher rates of return and much higher volatility of rates of return than those of counterfactuals.