File No. 893.00/2900

The Acting Secretary of State to the Minister in China ( Reinsch)

[Telegram]

The Japanese Embassy informs the Department that the Peking authorities have approached Japanese bankers for a loan for the disbandment of troops, but that the Japanese Government is not disposed to sanction any loan for that purpose lest it should lead to misunderstanding with the Southern leaders. The Chinese authorities stated however that American bankers were ready to make such loan if Japan did not. You will of course discourage any such proposal, if made, and be guided by the Department’s telegram of November 16, 6 p.m., with which the Japanese Government is in accord.

Polk