865.51/596a: Telegram

The Secretary of State to the Ambassador in Italy (Garrett)

108. The press has continued with persistent stories to the effect that the United States and France have concluded an agreement not to loan money to countries spending large sums on armaments or that this Government has informally indicated to bankers its disapproval of loans to Italy as a means of bringing pressure in favor [Page 313] of disarmament. When these rumors were called to the attention of the Secretary of State in his press conference on December 1, he replied that they were not true. He called attention to the fact that these rumors had been denied in France and added that there was absolutely nothing to it and no conversations whatever had been held on the subject. As the rumors persisted this morning, the Secretary again said:

“I wish to make it perfectly clear that there is absolutely no foundation for any such rumors. No loans to Italy have been discussed by this Department formally or informally or in any way whatever and I have not heard of any such suggestion or discussion by any representative of this Government.”

The Italian Ambassador has been considerably disturbed by the persistence of these stories and I wish you to inform Grandi of the nature and vigor of the denials which have been given to these reports here.

Telegram repeated to Paris and Geneva.