121.5767/3: Telegram
The Secretary of State to the Minister in Iran (Dreyfus)
441. Your 863 August 20, 5 p.m. From Secretary of the Treasury for Gunter. In your 863 in which you set forth draft of proposed Iranian law authorizing Ministry of Finance to enter into stabilization agreement, the draft of bill treats the transaction as an advance and repayment. Treasury would prefer regarding the transaction as a purchase and repurchase and therefore suggests the following language as being preferable to that submitted by you:
“The Ministry of Finance and the Banque Mellie Iran are authorized to enter into an agreement with the Secretary of the Treasury of the United States for the purchase from the United States Treasury of not to exceed in the aggregate U.S. dollars thirty million against rials, for the purpose, among other purposes, of strengthening the currency of Iran. Such agreement may be made upon such terms and conditions as may be deemed appropriate, including the repurchase with U.S. dollars of all rials acquired by the United States Treasury [Page 597] under such agreement. The Ministry of Finance and the Banque Mellie Iran are further authorized to take such action directly or indirectly as may be necessary or desirable to carry out such agreement.”
Treasury is prepared to begin discussions of such an agreement with the Iranian Minister in Washington. [Morgenthau.]