The Secretary of State to the Minister in China (Schurman)
297. Your 393, November 13, 11 a.m.
While the Department is not disposed to insist that the Chinese Government accept terms which are distasteful, it nevertheless desires that the Legation shall lose no opportunity to impress upon the Chinese Government the opportuneness and desirability of concluding with the least possible delay an arrangement whereby that Government’s outstanding financial obligations in this country will be fully satisfied. You may remind the Chinese Government that the Pacific Development Corporation loan soon falls due and that if this loan is also defaulted Chinese credit in this country will be impaired beyond any reasonable hope of early recovery. It is becoming increasingly difficult to interest the public in Chinese securities and another default at this crucial period would be disastrous. The Department feels that it cannot over-emphasize this important phase of the matter. The Chinese Government doubtless knows that practically all of the Continental Bank loan notes are held by individuals, many of whom are pressing for payment. Department earnestly hopes that you will be able to report a satisfactory solution within the next few days.