838.51/1338: Telegram

The High Commissioner in Haiti (Russell) to the Secretary of State

88. In a long discussion with the President this morning on loan he stated that he had no fear of series B being dumped on the market in the United States and that he wished to issue this series as gold bonds; that many of the bonds and claims to be covered by this series were payable in gold and that he considered it would be illegal to force on holders of such bonds series B payable in gourdes. I pointed out to the President that by making them payable in gold he not only might seriously injure the credit of Haiti but he would be virtually exteriorizing the internal loan to which the Haitian Government had heretofore been strongly opposed. He stated that he also was opposed to exteriorizing internal loan but did not agree with me the payment in gold would do so. Finally in view of his insistence I informed him I would notify Department of his request.

Suggest Department urge Haitian Government to issue gourde bonds but that if it insists on gold bonds that the Department insist such bonds be registered both as to principal and interest.