File No. 3691/51.

Chargé McCreery to the Secretary of State.

[Telegram.—Paraphrase.]

States that President Diaz is in receipt of a telegram from the President of Nicaragua saying that he would accept mediation only in case Honduras first gives satisfaction. Says that the department may have received a telegram in the same sense. States that no answer has yet been received from Honduras; that Minister Mariscal wishes to know the opinion of the department, and suggests that the United States and Mexico propose the withdrawal of the troops of Honduras to distance of 20 leagues from frontier and the withdrawal afterwards of the troops of Nicaragua to an equal distance from the frontier, after which a tribunal of arbitration could be installed to decide pending questions; that President of Salvador has telegraphed to the President of Mexico that he has exhausted all means in his power to bring about peace, and suggests that in his opinion the only course to secure peace would be earnest mediation by the United States and Mexico.