102.1/4–1547: Telegram
The Ambassador in China (Stuart) to the Secretary of State
[Received April 15—7 a.m.]
809. Last evening before seeing the Generalissimo the Governor of Central Bank called at Chancery on his own initiative. He gave Minister-Counselor résumé of financial-economic situation and covered much of same ground as is contained in Embtel 807, April 15, 9 a.m.34 One additional development he mentioned was that due to disturbing reports he had received in last day or two regarding pressure for higher prices and increased speculative activities, particularly in Shanghai, he had countermanded by telephone a previously agreed announcement permitting holders of exchange to import with their own resources certain categories of goods, since he feared that such an announcement would be seized upon in present circumstances to foster further speculative price rises and intensify speculation in US currency.
Chang Kia-ngau made to the Minister-Counselor the same sort of statement that Foreign Minister had as reported in Embtel 801, April 12, 3 p.m., and was given the same reply, though Chang Kia-ngau was more specific in that he directly referred to a cotton loan, and in this connection Minister-Counselor asked him about plans for mobilizing the admittedly substantial foreign exchange assets of mill owners for partial application to China’s need for increased cotton supplies. The Governor indicated that he intended to institute discussions with this group when he returned to Shanghai with a view to making an arrangement with them without disturbing the general currency situation. He then reiterated his pressing need for help and the importance of the psychological effect it would have in alleviating the pressure for price increases which, if undampened, would lead to further Govt expenditure on supply and, therefore, further increase in note issue.
Sent to Dept, please repeat to Moscow as 13 for personal attention of Marshall.
- Not printed; it gave Chang Kia-ngau’s detailed estimates for 1947 of China’s exports, imports, foreign exchange requirements, holdings, etc.↩