Memorandum by Mr. Spencer Phenix, of the Office of the Economic Adviser

Mr. Ralph Crews, Counsel for the National City Company, telephoned this afternoon to say that representatives of the Czechoslovak Government desired to negotiate with the National City Company in connection with certain loans desired by them. Mr. Crews stated that the Czechoslovak representatives informed him that they had signed an agreement for the funding of the indebtedness of Czechoslovakia to the United States, but in view of the Department’s correspondence last summer with the National City Company, he desired to have definite advice as to the Department’s position with respect to such negotiations. I told Mr. Crews that I would endeavor to telephone him an answer to his inquiry during the afternoon.

I spoke with the Secretary about this matter and was informed by him that he had discussed the general question with Mr. Mellon and Mr. Hoover and that all three had agreed that no objection would be offered by this Government to negotiations looking to Czechoslovak financing in this country. Accordingly I telephoned Mr. Crews that the Department had no objection to negotiations between the National City Company and the Czechoslovak Government.

S[pencer] P[henix]