The Consul at Basel ( Cochran ) to the Acting Secretary of State
[Received July 12—9:51 p.m.]
Preliminary informal meeting of the leading B. I. S. Directors was held this evening. Luther could not leave Berlin and was represented by his alternate. Reichsbank cover last night was 20 percent based on bank’s own funds. Borrowed credit resources raise it another 16 percent. B. I. S., Bank of England and Bank of France willing to extend along” with Federal Reserve their joint credit which expires on 16th. Neither Bank of England nor Bank of France willing to grant new or enlarged credit, feeling that the matter is no longer one between Central Banks but a political question for governments. Unless unexpected development comes within 48 hours Germans fear general moratorium, at least on private obligations, will be necessary. B. I. S. fears that this would be followed by similar moratorium in Austria, Hungary, Rumania and Jugoslavia.