File No. 817.51/535.
Washington, March 5, 1913.
Department’s March 3. The bankers now say:
Weitzel fails to take into account our liability to provide $400,000 for the currency fund from time to time as required. The total is therefore $800,000. He also fails to recognize that our security has shrunk: (1) the Ethelburga-London fund, originally about $1,800,000, is no longer available because it has been collected and applied to various purposes; (2) the priority of the annual interest and sinking-fund charges on customs, about $375,000, in favor of 1909 bondholders, was formerly questioned by Nicaragua but is now admitted by Nicaragua and by us. Nevertheless, in view of the urgency, we today cabled the Nicaraguan Government as follows:
“In view of Nicaragua’s urgent request and of the representations of the Government of the United States, we withdraw all offers made thus far and instead authorize the Government to draw on us immediately for $150,000 subject to Ethelburga rights and fixed charges. We also agree to place at the Government’s disposal all customs receipts now on hand in Nicaragua and not yet remitted, and all customs to be collected up to June 30, 1913.”
The above meets Weitzel’s second suggestion, giving the Government sufficient funds for its needs until June 30 and leaving us free to consider new proposals.