868.51/11–645: Telegram
The Ambassador in Greece (MacVeagh) to the Secretary of State
[Received November 7—1:50 p.m.]
1255. Mytels 1248, 1250, Nov 5. Finance Minister Kassimatis invited Rankin to his office again this morning. Representative of Greek Ministry Supply present but no British. Kassimatis produced figures show determined effort being made balance budget. Instructions issued all Govt depts prepare new estimates minimum needs. Supplementary tax legislation already drafted in part. Allowing 50% increase pensions as unavoidable Minister believes new taxes and increased prices UNRRA supplies will cover 93% expenditures. Hopes improve this figure.
Minister raised again supreme importance psychological factors and particularly new tangible evidence Allied support. His discussions with Economic Council, Minister of Supply and others convinced him more than ever of vital part played by gold in present Greek monetary situation with majority money in hands public consisting gold coins and consequent importance limiting fluctuations drachma-sovereign rate as prerequisite budget balancing. Minister confident gold requested would accomplish this end and stated Greece willing pay dollar value and undertake not actually sell without prior approval Govt furnishing gold. Much prefers sovereigns but other coins or bars acceptable if actually shipped this country for deposit vaults Bank Greece. Minister firmly believes psychological effect arrival this gold if accompanied by budget balancing and reasonable credit Eximbank would change entire Greek financial picture but that all three steps essential.