Mr. Hay to Mr.
Combs.
Department of State,
Washington, March 21,
1904.
No. 104.]Sir: Referring to your dispatch No. 131, of
January 11 last, expressings your views regarding the effect of the
decree issued on
[Page 348]
December 22
last by the President of Guatemala legalizing the payment in silver or
bank notes, etc., of gold debts demanded judicially, I inclose herewith
a copy of a letter from the Secretary of the Treasury, expressing his
views of the decree.
I also inclose a copy of a letter from Messrs. G. Amsinck & Co.,
calling the Department’s attention to the decree.
The Department would be pleased to know whether there is anything in the
correspondence inclosed herewith that tends to modify your views as
expressed in your No. 131.
I am, etc.,
[Inclosure 1.]
Mr. Shaw to Mr.
Hay.
Treasury Department,
Washington, March 12,
1904.
My Dear Mr. Secretary: Replying to your letter of March 9, inclosing a
copy of a dispatch from the United States minister at Guatemala, and
a copy of a decree issued by the President of Guatemala, in regard
to the relative value of the currency of that country, and asking an
expression of my views on the decree, I have the honor to report;
The decree is in the following language:
- “Article 1. When any sum in gold
is demanded judicially, the debtors can cancel their credits
in silver or bank notes, or of the Comite Bancario, as
provided for in the decree already cited, and at the
exchange that gold has in relation to silver.
- “Art. 2. The exchange may be
either that fixed upon by experts, or the current rate at
the banks.”
If I interpret the decree correctly, it simply provides that decrees
of courts, payable in gold by the terms of the decree, can
nevertheless be paid in silver at the market value of silver as
fixed by experts or by the banks. If this interpretation be correct,
this Government is certainly in no position to protest.
* * * * * * *
Very truly, yours,
[Inclosure 2.]
Messrs. Amsinck &
Co. to Mr. Hay.
New
York, March 16,
1904.
Sir: We herewith take the liberty of
inclosing a copy of the decree (639)a as it was published on January 7 last in
the “Guatemalteco,” the official organ of the Government of
Guatemala.
When in 1899 the Government of Guatemala issued the decree No. 595,
it established that all debts contracted in silver could be paid in
paper money. Now it argues that whereas the paper money has taken
the place of silver, all debts contracted in gold, if settled
through intervention of the courts shall be paid at the same
exchange existing between silver and gold—about 2½ pesos silver to
$1 American gold—whilst at the present rate of exchange it would
cost about 15 pesos to buy $1 American gold. Consequently the
Guatemala law gives a debtor the right to settle obligations
contracted in American gold at the rate of about 2½ to 1 instead of
at about 15 to 1.
Shortly after this law was passed it was intimated that in some way
it would be modified. However, so far no changes have been made. We
understand that in consequence the German Government has already
vigorously protested, whereas the others have so far remained
silent.
As our firm has large commercial interests in Guatemala we hereby beg
to ask you, if in the event of a dispute the United States
Government would
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uphold
American firms residing in the United States in their claims, or
whether it would admit them to be compelled to accept, at the same
ratio of silver to gold, the inferior paper money in settlement of
obligations contracted bona fide in gold?
Thanking you beforehand for any information which you may give us on
this subject, we are,
G. Amsinck & Co.
