several tranches have not yet been definitely determined, but it is not expected that the amount offered here will exceed $100,000,000 par amount of bonds or $85,000,000 effective proceeds; and it is expected that a substantially equivalent amount will be issued in France.

I am [etc.]

[Signature illegible]

862.51/2879

The Secretary of State to J. P. Morgan & Co.

WASHINGTON, May 22, 1930.

SIRS: The receipt is acknowledged of your letter of May 21, 1930, regarding the contemplated issue of bonds of the German Government. The Department does not desire to interpose objection to the proposed financing.

Very truly yours,

H. L. STIMSON

AGREEMENT PROVIDING FOR THE DISCHARGE OF GERMANY'S WAR INDEBTEDNESS TO THE UNITED STATES, SIGNED JUNE 23, 1930 28

462.00R294/785

The Secretary of State to the Secretary of the Treasury (Mellon)

WASHINGTON, June 13, 1930.

SIR: I have the honor to refer to the recent oral request of Mr. Redpath of your Department for an expression of this Department's view as to whether the proposed agreement between the United States and Germany for the settlement of the indebtedness of the German Reich to the United States on account of the awards of the Mixed Claims Commission, United States and Germany, and the costs of the United States army of occupation, and the notes to be exchanged between the two Governments at the time of the execution of the agreement, if signed by the German Ambassador under the power of attorney given to him by his Government, will constitute valid and binding international obligations of the German Government. The agreement provides in paragraphs numbered 9 and 10 as follows:

9. Compliance With Legal Requirements.-Germany and the United States, each for itself, represents and agrees that the execution and delivery of this Agreement have in all respects been duly authorized, and that all acts, conditions, and legal formalities which should have been completed prior to the making of this Agreement have been completed as required by the laws of Germany and of the United States respectively and in conformity therewith.

28 For previous correspondence concerning this agreement, see Foreign Relations, 1929, vol. II, pp. 1083 ff.

10. Counterparts.-This Agreement shall be executed in two counterparts, each of which shall be in the English and German languages, both texts having equal force, and each counterpart having the force and effect of an original.

In witness whereof, Germany has caused this Agreement to be executed on its behalf by its Ambassador Extraordinary and Plenipotentiary at Washington thereunto duly authorized, and the United States has likewise caused this Agreement to be executed on its behalf by the Secretary of the Treasury, with the approval of the President, pursuant to the Act of Congress approved all on the day and year first above written.

It appears that the proposed agreement and the notes to be exchanged have been approved by the Congress of the United States by an Act (Public 307) approved by the President on June 5, 1930,29 and by the German Parliament by law of March 13, 1930. (Reichsgesetzblatt, Part 2, No. 7 of March 19, 1930.)

In addition to the German law just referred to, this Department is in receipt of a power of attorney signed under date of March 15, 1930, by the President of the German Reich and the Minister for Foreign Affairs, authorizing the German Ambassador at Washington, Herr Friedrich W. von Prittwitz und Gaffron, to sign the agreement and the note to be delivered by Germany. The full power reads textually in translation as follows:

FULL POWER

The German Ambassador in Washington, Herr Dr. Friedrich W. von Prittwitz und Gaffron, is hereby empowered to sign in the name of the German Reich the German-American agreement initialed in Berlin December 28, 1929, together with the note pertaining thereto.

The Department considers that the agreement and note to be delivered by the German Government, if signed by the German Ambassador as authorized in the agreement and confirmed by the power of attorney just quoted, will constitute a valid and internationally binding obligation of the German Reich.30

The original of the power of attorney is hereto attached. A photostat copy has been retained in the files of this Department. Very truly yours,

HENRY L. STIMSON

462.00R294/788b

The Secretary of State to the Ambassador in Germany (Sackett) No. 124

WASHINGTON, July 1, 1930.

The Secretary of State transmits herewith, for the information of the Embassy, a press statement issued on June 23, 1930, as well

29 46 Stat. 500.

30 The Secretary of the Treasury was authorized to sign the agreement on behalf of the United States.

as the Agreement between the Governments of the German Reich and the United States of America, relative to the complete and final discharge of the obligations of Germany to the United States in respect of the awards of the Mixed Claims Commission, United States and Germany, and the costs of the United States Army of Occupation."

[Enclosure]

Statement Issued to the Press by the Secretary of the Treasury (Mellon) on June 23, 1930

The Secretary of the Treasury announced the signing to-day of the Agreement authorized by act of Congress approved June 5, 1930, providing for the complete and final discharge of the obligations of Germany to the United States in respect of the awards of the Mixed Claims Commission, United States and Germany, and the costs of the United States army of occupation.

In brief, the agreement provides that Germany agrees to pay 40,800,000 reichmarks ($9,700,000) for the period September 1, 1929 to March 31, 1930, and the sum of 40,800,000 reichmarks per annum from April 1, 1930 to March 31, 1981, in satisfaction of mixed claims, and for the period from September 1, 1929 to March 31, 1966, an average annuity of 25,300,000 reichmarks ($6,000,000) in full liquidation of our army costs. As evidence of this indebtedness Germany is to issue to the United States, at par, bonds maturing semiannually. Under the agreement the United States will receive on account of army costs over a period of 37 years approximately $250,000,000 and on account of mixed claims awards over a period of 52 years, approximately $505,000,000. The payments to be received on account of army costs include interest at the rate of about 3% per cent per annum on all payments deferred over a period longer than would have been necessary to liquidate the army costs under the Paris agreement. The mixed claims awards bear interest at the rates specified in such awards up to January 1, 1928, and the settlement of war claims act specifies a rate of 5 per cent from that date until paid.

The payments to be received on this account include, therefore, interest which shall be paid on the awards. While the annuities are stated in terms of reichmarks, payments are to be made in dollars, either at the Treasury or at the Federal Reserve Bank of New York. The exchange value of the mark in relation to the dollar shall be calculated at the average of the middle rates prevailing on the Berlin bourse during the half monthly period preceding the date of payment. The German Government undertakes that the reichmark shall have

31 For text of the agreement, see Annual Report of the Secretary of the Treasury 1930, p. 341; or League of Nations Treaty Series, vol. cvi, p. 121. 32 Signed January 14, 1925; Foreign Relations, 1925, vol. 1, p. 145.

...

and shall retain its convertibility into gold or devisen as contemplated in the present Reichsbank law and that the reichmark shall retain the mint parity defined in the German coinage law of August 30, 1924.

ADMISSION TO THE UNITED STATES OF GERMAN STUDENT LABORERS

811.111 Colleges 62/13

The German Embassy to the Department of State

Since about five years a number of German students of technical and economic sciences have been coming over to the United States in order to work in industrial and agricultural plants in this country for the purpose of acquiring practical experience in American social conditions and working methods. This activity has been organized and sponsored by the "Wirtschaftsbeihilfe der Deutschen Studentenschaft", (German Students' Cooperative Association) in Dresden, an independent students' body working with the support of leading German industrialists and with the endorsement of the educational authorities in Germany. The students are selected according to their merits and suitability and, at the recommendation of the Association, represented by the executive office in New York, granted a so-called Student Laborer Visé for one year by the United States Authorities, which is generally extended for a further 12 months.

In February 1926 this institution was, after having proven its practicability and value, placed on a stable basis by a written agreement between the Association and the Department of Labor in Washington, to the terms of which reference may be made. In 1928 the organization was made reciprocal, so that American students could avail themselves of the same possibilities and opportunities in Germany as vice versa, and the institutions have since then worked in a most satisfactory manner although, as yet, the number of American students availing themselves thereof has been considerably smaller than on the German side.

A few days ago the Department of Labor informed the executive Secretary of the German Association, Mr. Herbert Boehmer in New York, that the agreement must be discontinued on account of the recent development of the unemployment situation in the United States, as a consequence of which the German students at present in this country who have been expecting the extension of their visé in the customary manner since January are to be refused such and a group of 32 students about to sail for the United States will not receive the necessary permit to enter.

The German Embassy is fully appreciative of the grounds which have prompted the Labor Department to take the decision mentioned

and all German parties, official and private, which have heretofore cooperated in organizing and carrying out the student exchange, as described, are sincerely conscious of the hospitable and helpful attitude of the United States authorities which made this institution possible. The new ruling has, however, brought about a situation of greatest hardship to the students involved which, it is felt, might be alleviated without prejudice to the principle of the ruling, and it is also submitted that methods might be found by which the termination of an institution of such intrinsic value as this present exchange could be presented without encroaching upon the statutory provisions involved. The students at present waiting on their extension have made all arrangements for the next year on the bona fide assumption that such extension would be granted. They will now be forced to return to Germany immediately although they have no position there available and no funds held in readiness for their passage home. They will thus come into serious financial difficulties and find it very hard to find employment on their return; many of them have even contracted debts for equipment and passage which they had hoped to pay off through the work of the coming year but which now will be added to further obligations necessitated through the present decision. It is a serious, in many cases almost insoluble problem, which thus confronts these students-mostly of impecunious parentage-and there appears no other solution therefor than the extension of the visés as provided in the original agreement. A similar situation exists with reference to the group of students at present awaiting their permit. They have made all preparations for their journey, incurred considerable expenses for equipment etc. and given up their present situations, so that the cancellation of the plan will mean for them indebtedness and unemployment.

In view of this situation the German Embassy would be sincerely grateful if action could be taken to extend the permits of the students here in the customary manner and to permit the small group awaiting their visés to carry out their preparations. Such action would be deeply appreciated by all circles in Germany, whilst the negative alternative would be felt as most distressful.

Beyond such action to relieve the immediate hardship of the present situation, it would be much appreciated if the question of finding a form for the continuation of the Student Exchange on the heretofore basis could be taken up with a view to maintaining an institution which is undoubtedly of equal value to both countries in respect of international, industrial and economic education, and the abolition of which, on account of a transitional situation, would be deeply regretted by all.

WASHINGTON, March 21, 1930.