893.51/7445: Telegram

The Ambassador in China (Gauss) to the Secretary of State

348. Sale of savings deposit certificates convertible into United States dollars commences April 1. Response for 3-day period has been disappointing. In Chungking deposits approximate 10 million fapi [Page 504]which includes on[e] [depo]sit of 6 million. Chinese officials and bankers are not optimistic with regard to voluntary response, and public appears apathetic. Some form of pressure on Chinese holders of liquid and other forms of capital is contemplated in connection with commodity control and general mobilization administration. It is said that Chinese businessmen and prospective private investors have noted that redemption of savings deposits and bonds in United States dollars is not guaranteed by the American Government and are inclined to be skeptical of Chinese Minister of Finance with regard to fulfillment of conversion and redemption terms. The Embassy will report more fully on the situation as it develops.