File No. 861.51/395
The Russian Ambassador (Bakhmeteff) to the Counselor for the Department of State (Polk)
My Dear Mr. Polk: Pursuant to our conversation on the question of payment of interest to the United States due on the 15th of November, I have discussed the matter with Mr. Leffingwell and Mr. Rathbone, who appeared to adopt a sympathetic attitude and seemed prepared to give favorable consideration to a recommendation coming from the Department of State with regard to a. postponement of the payment.
We have also discussed the question of payment to private bondholders in December and January. While naturally the Treasury officials are in general reluctant to the idea of giving preference to private bondholders, nevertheless, the point was emphasized of the importance of upholding the idea of Russia’s credit with the American public, and in particular, owing to the latest developments in Russia.
Mr. Leffingwell and Mr. Rathbone seemed to be rather in favor of the idea of arranging a conference with the committee of bondholders and of having them agree to postpone, the presentation of the forthcoming coupons. With such an arrangement, one would have to pay probably only a very insignificant amount of interest on outlying bonds held by the public, while the principle of credit would be maintained.
With kindest regards [etc.]