by extension Brazil, fell into depression, there were perioding epidemics in Brazil throughout this period and in 1693-55 the discovery of gold far away from Pernambuco disrupted the economy and further raised costs. Pernambuco was recovering, but at a glacial pace. Pernambuco in the Golden Age of Brazil The discovery of gold in Minas Gerais in 1693-95 and later diamonds (sometime before 1726) had the predictable result of starting a gold rush. No part of Brazil or the Portuguese world was unaffected. So many people rushed to the goldfields with so little preparation that some starved for lack of food. Food when available sold for 25 to 50 times its price on the coast. Although Recife was far from the goldfields, Pernambuco was not unaffected. At this time the Captaincy of Pernambuco encompassed about four or five times as much territory as does the modern state of Pernambuco and extended far into the backlands including interior lands that would later be attached to other states. The sertão (backlands) already was used for cattle ranching and in particular, the valley of the São Francisco River became a popular route feeding would-be miners, equipment, and supplies to the goldfields. The mining boom inevitably diverted both free men and slaves from all Brazilian coastal areas including Pernambuco and drove up prices. While Stuart Schwartz observes that "...even at the height of the period of gold production, earnings from sugar were always greater than those from gold or any other commodity," the gold rush severely impacted the sugar industry in the first half of the Eighteenth Century. For example, the price of slaves one of the principal costs in the sugar economy went from 40 milreis before the discovery of gold to 200 milreis in 1723. Thus the sugar-producing areas of Pernambuco struggled against inflation getting relief mostly when there were wars in Europe. War of the Mascates The eminent Twentieth Century historian C. R. Boxer, in describing the coeval accounts of the War of the Mascates commented, “So much hard lying is involved in this conflict of evidence that the exact truth is probably unascertainable....” The War of the Mascates evidences the tensions between the planters and senhores de engenho (the landed elites) in colonial Brazil and the mascates (merchants) of Recife. The “War” (there was considerable shooting but little loss of life) has elements of class struggle. After the expulsion of the