811.20 Defense (M) Spain/650: Telegram
The Minister in Portugal (Fish) to the Secretary of State
[Received 5:01 p.m.]
1377. I venture to suggest that Department obtain from British Embassy Washington copies of telegram 77 which British Embassy in Madrid addressed to Lisbon under date of June 10, together with Lisbon’s reply 90 of June 22 which was drafted by both British and American Missions here. As Department is no doubt aware rate of acquisitions of wolfram in Spain thus far this month will undoubtedly [Page 633] result in a record purchase, financial implications of which are so serious as to require immediate action, particularly Treasury’s authorization to the Embassy at Madrid to offer gold to the Spaniards without attached conditions.
I need not point out that established trend has been for gold to flow into the peninsula, primarily from the Axis, and that even in the hypothetical event the gold in the peninsula should fall into hands of Axis it would then have no neutral place to go. Furthermore, it is quite likely that if no limitations of action are placed upon the Spaniards they may well lose inhibitions which our past policy has done so much to induce and in due course begin again to request earmarking facilities.
Informal advices via Embassy in London indicate that British Treasury not only will refrain from advancing any objections but positively favors in present circumstances the use of this and other resources to better our financial position in Spain.
Repeated to London and Madrid.