162.00R296/5868: Telegram
The Secretary of State to the Ambassador in Germany (Dodd)
120. Department is informed that the interest payment due October 15, 1934, on the American issue of bonds of the German External Loan 1924 requires payment of about $2,087,000 of which $1,113,000 has been transferred to paying agent, leaving about $974,000 not transferred. Department is also informed that the German Government has made arrangements for the full payment of the October 15 coupons on all tranches other than American, while there is no advice of similar full provision for paying the American coupons.
[Page 386]You are instructed to express to the German authorities the expectation of this Government that no discrimination will be practiced against American holders of these bonds of the German Government. It is unwilling to believe that, having made provision for the full payment of all other bondholders, the German Government will either overtly fail to honor its written obligation to treat all tranches of the loan pari passu, or plead inability to transfer less than a million dollars to honor this obligation.
Leave aide-mémoire of foregoing and telegraph German reaction.