Mr. Loomis to Mr. Hay.

[Confidential.]
No. 329.]

Sir: It is impossible to forecast the situation at this time or to give a very intelligible notion of it, for the reason that this is a season of intrigue and conference rather than one of military operation and fighting.

Eight days ago a suspension of hostilities was agreed upon. The armistice expires Monday evening next, but may be prolonged a few days. General Castro is encamped at Valencia and is governing the city. He is credited with the maintenance of good order and a very fair degree of discipline.

The Government troops are at Victoria under the command of General Mendoza. He seems to be feared by many people here, and it is rather generally believed that if he is defeated by General Castro he will fall back on Caracas and loot the city and levy many forced loans. General Mendoza’s record is said to be such as to justify these fears, but what he would do should his army enter Caracas is wholly a matter of conjecture. President Andrade’s friends profess to have no fears regarding him, and the President is sending him troops and arms daily.

I am informed by a member of the Cabinet, whose relations with the President are of a close personal, family, as well as political nature, that the President is willing to resign if General Castro will wait till the assembling of Congress, in order that he may be chosen President in a regular and lawful manner. President Andrade is reported to have said that he will renew hostilities rather than submit to the establishment of a dictatorship by General Castro. It has been proposed to the President to withdraw in favor of the Vice-President and let the letter govern till the meeting of Congress in February, and a compromise of this nature is not improbable.

I was invited the day of my arrival here to accompany a special commissioner of the President on a visit to General Castro, but deemed it wise to decline the invitation. In an unofficial and friendly way I have done what I could to find a peaceable solution of the situation.

I have, etc.,

Francis B. Loomis.