893.51/2084

The Acting Secretary of State to the American Group

Gentlemen: Late advices from China seem to justify the belief that decided steps are being taken to bring about a reunited government. Also that such a government may be able in the reasonably near future to render the guarantees upon which any financial assistance to China must be based. It has been suggested that one of the first necessary steps in such a reorganization would be the disbandment of troops and the formation of an adequate force of military police. This would no doubt necessitate a preliminary advance, pending the completion of the working details of the new consortium, which it is hoped may be speedily effected. The option for the currency loan has recently been extended for six months.

In light of the above facts, would it not be advisable for the American Banking Group to send a representative to Peking to inform himself fully as to conditions existing and arising, consult and advise with the representatives of the banking groups of the other interested powers already on the ground, and with authority to act when the opportunity and necessity arises?

Should this course of action meet with your approval, it is suggested that your representative might with advantage come to Washington for an interview with this Department before going out to China.

I am [etc.]

Frank L. Polk