File No. 817.51/503.
The American Minister to the Secretary of State.
Managua, September 23, 1912.
The Government is fast losing control of the situation. It is extremely unfortunate that additional loan mentioned in my September 101 has not been agreed to by the bankers. There is immediate need for $50,000, but the Government has no means of raising it except through the bankers or by levying contributions; the latter was the rebels’ method and should be avoided by the Government.
The President offers three alternative propositions: (1) an advance of $50,000 gold from customs revenues, the bankers to reimburse themselves from some source under the supplementary contract; (2) exercise by the bankers of their option on 51 per cent of railroad under an agreement to advance $100,000 monthly for five months and the remainder at a time to be agreed upon; (3) an advance of $100,000 monthly for five months and an option on the remaining 49 per cent of the railroad at a valuation of $1,000,000.
- Not printed; see September 14.↩