File No. 861.00/1789

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

[Telegram]

The Chinese Government is greatly concerned because of reports from Harbin that General Horvat has issued a government proclamation and that he has concluded a loan with a Japanese bank secured on the Harbin [omission] Chinese Eastern Railway, the proceeds to be used in recruiting troops.

Semenov intends to take Chita first and supervise but not suspend railway traffic. There is a large secret organization of officers and troops at Changchun who are ready to join him.

Reinsch