File No. 838.51/418.

The Acting Secretary of State to Chargé Davis.


Your September 21, 4 p.m. Aside from the question as to the advisability of the issuance of so large an amount of paper money, the Department understands that the law passed by the Haitian Congress for this purpose violated the contract with the National Bank of Haiti, whereby the Bank was given exclusive privilege to issue bank notes, and also contravened the stipulations of the 1910 loan contract. It was therefore a matter of considerable satisfaction to learn through your cable of September 14, 8 p.m.,18 that it was the intention or the Haitian Government to obtain the repeal of this law; moreover, the Department consented to use its good offices to arrange for the temporary loan desired by the Haitian Government for $1,500,000 on the express understanding that there would be no further emission of these gourdes. The Department likewise undertook to obtain an immediate advance of $100,000 for the pressing needs of the Haitian Government, upon ratification of the treaty.

The Department believes that a further issue of this paper money would be unwise and further complicate the financial situation and render still more difficult efforts for the rehabilitation of the finances of Haiti contemplated in the treaty signed on the 16th instant.

The Department, therefore, desires you to consult with Admiral Caperton to the end that the cases of gourdes be held for the time being and should their delivery be requested by the Haitian authorities, you may bring the foregoing to the attention of President Dartiguenave and obtain his consent to their retention either in the manner suggested in the Department’s instruction of August 12, or in some other way which would ensure their safety.

  1. See Conclusion of a Treaty, etc., p. 446.