893.5151/497: Telegram
The Secretary of State to the First Secretary of Embassy in China (Salisbury), at Peiping
Washington, August 22, 1938—6
p.m.
222. Please repeat the following telegram to Chefoo and ask Chefoo to repeat to you its telegram of August 12, 1 p.m., to the Department.61
“Reference your telegrams of June 13, 10 a.m., and August 12, 1 p.m., and despatch No. 10 of June 2462 in regard to the currency situation in the Chefoo consular district.
[Page 41]- 1.
- As ‘Federal Reserve notes’ are not the lawful currency of the recognized Government of China, every endeavor should be made to avoid any official action which might be construed as promoting the circulation of these notes.
- 2.
- Department of course realizes that circumstances may require the Consulate and the American business community at Chefoo to use ‘Federal Reserve notes’ in meeting necessary local expenses.
- 3.
- Please report by telegraph on the following matters: When and for what reason did the Yokohama Specie Bank in Chefoo cease foreign exchange operations? Is there no agency whatever in Chefoo willing to accept American currency in exchange for ‘Federal Reserve notes’? Is it not possible for American merchants in Chefoo to evolve some method of meeting their currency requirements as for example by negotiating at Tientsin for exchange of American currency for valid Chinese currency or ‘Federal Reserve notes’?”
Hull