817.51/1739: Telegram

The Minister in Nicaragua (Eberhardt) to the Secretary of State

66. Diaz government, desperately in need of funds, will today make still another effort to secure loan for which Diaz will offer bankers all stock in railway and bank and lien against all revenue produced by recent law. It is hoped that the terms may be such that the Department can and will approve. Otherwise Diaz sees no alternative but an emergency emission of cordobas which sound bankers unite in declaring will result in inflation and disaster to Nicaraguan finances.