File No. 861.51/424
The Assistant Secretary of the Treasury (Rathbone) to the Counselor for the Department of Stale (Polk)
Dear Mr. Polk: Confirming my conversation with you and Mr. Miles this afternoon in regard to the Russian situation, I take pleasure in advising you that on the 15th instant the Treasury Department received a demand note of the Russian Provisional Government executed by the Russian Ambassador to represent the interest due on that date on the obligations of the Russian Government theretofore acquired by the United States. I have endeavored to ascertain whether large holders of Russian bonds were disposed to forego the immediate cash payment of interest due thereon in the near future, but the channels through which I have attempted to approach the matter do not seem disposed to take any action in this direction. Purely as a Treasury question, so long as the interest on the obligations of the Russian Government held by the United States are not paid in cash, the Russian Government should not be permitted to use its dollar funds to pay interest on its obligations held by private investors.
I fully understand that there may be political considerations involved, and this Department desires to cooperate with you in connection with the matter. I understand that you intend to confer with the Russian Ambassador and will let me hear from you on the subject at an early date.
Very truly yours,