462.00 R 294/361 Telegram
The Ambassador in Great Britain (Kellogg) to the Secretary of State
[Received August 8—3:55 p.m.]
332. L–203 from Logan.
1. Just received following letter from assistant Belgian delegate:
“I acknowledge your further letter July 29. I observe with pleasure that one of the possible difficulties is adjusted inasmuch as the Treasury of the United States agrees to credit on account of the costs of Armies of Occupation the gold value of the currencies which we turned over to it, such gold value to be calculated at the time of our deposit. I am in accord with you also as to the use which the United States Treasury may make of these funds.
There remains the question of the difference in exchange upon the first sums which we received, a difference which arose between the time when we received and put these funds at your disposition and the time when you accepted the deposit. You do not put any objection to the suggestion that we should not suffer any loss in [Page 151] exchange upon these deposits. This is especially logical because in reality we have acted for and on behalf of the Reparation Commission which in ordinary course would have received the total amount of German payments and would have turned over to you 25 percent thereof so that Belgium on this head would not have suffered any loss or any profit.
The current exchange movements make us hope that no question of loss will in fact arise but we anticipate should there be any loss that the United States will support the Belgian point of view before the Reparation Commission to the effect that the common pool should bear such loss instead of the Belgian Government which is wholly without fault in the matter. On the other hand should the Reparation Commission for any reason consider that the United States should be debited with 25 percent of the funds as of their value when received by Belgium, Belgium would equally support the point of view that the United States should be debited only with what it received and that the common pool should bear the differential.”
2. My letter of July 29 called attention to the fact that we were awaiting answer. Hope it will be possible to act on present Belgian letter. Consider last paragraph principally for home use. Should Reparation Commission at any time endeavor to charge us with more than we receive we can always deny its jurisdiction.