832.5151/788: Telegram

The Ambassador in Brazil ( Gibson ) to the Secretary of State

3. Department’s 2, January 3, 6 p.m. Minister of Finance informs me Rothschilds have communicated to him that their idea has been to arrange a $5,000,000 credit for payment of American claims through Guaranty Trust Company but that latter states it will undertake the operation only if requested to do so by the Department of State.

Minister of Finance yesterday telegraphed this information to Brazilian Ambassador in Washington35 with request that he report as to the Department’s attitude.

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The Minister states he does not anticipate the Department will feel warranted in making a specific request of this character and that in that event this method of dealing with the problem would be eliminated. He added that this did not cause him any concern inasmuch as under the existing authority of the Government it was able to negotiate an entirely satisfactory arrangement under other conditions, alluding apparently to what is known as the Boucas36 plan for Bank of Brazil notes.

I gather the impression that the Minister is distinctly relieved at the prospective elimination of financing this arrangement through London and that he prefers such direct agreements as can be made here.

As there are various reports circulating as to the Department’s attitude I should appreciate full information.

  1. Oswaldo Aranha.
  2. Valentim F. Boucas, member of the Brazilian Foreign Trade Council.