New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1914-01-14
Will Not Meet Interest Fall
ing Due on Its Govern
ment Loans.
FOREIGN POWERS
TO BE NOTIFIED
Huerta's Decision Applies to All
Obligations, Both External
and Internal.
LRr cahl. 10 .rhc r-.bunc J

cign Minister. QueridO MOheno. an
nounced that tho Mexican government
would default in the payment OF all in
terost on the bonds of the internal and
/ external debts which now remains IN
paid or which falls due within the next
! six months. \ heavy payment Of in
terest on the foreign debt will become
que in April.
The full text OF President Huerta's
decree suspending the payment OF debt
/ interest is as follows:
"Victoriano IIuerta. constitutional ad
interim President OF the United Mexi-
can States. to the inhabitants thereof
know ye, that i'm view Of the alb
normal circumstances in which the
country finds itself the ordinary reve-
nue. does not suffice 10 defray the ex-
uenscs occasioned by the national paci-
fcation. and inasmuch as it is urgently
| necessary to continue meeting those
! expenses until the end proposed 10
| itself by the government is attained.
/ now. therefore. by virtue Of the powers
granted TO the Executive by Congress
] in the decree Of December II last,
J have deemed fiji 10 decree as follows:
! article 1-Service of the national
debt is suspended for six months with
the understanding that payments ma
/ turing in that time will earn interest a
the same rate as bonds.
article From the date on which
this decree is promulgated customs
duties must be paid in cash in the re-
spective federal offices.
Wherefore order that this he
printed. published. circulated and duly
enforced.
Done in the National Palace, Janu-
airy T., 1914.
! "VICTORIANO HUERTA."
Article refers TO the fact that hith-
erto customs duties have been payable
in special certificates obtainablc for
cash in the National Bank Of Mexico.
which acted as agent FOR foreign bond
holders. ~ funds hey thus procured
were pledged TO the service of Mexicos
national debt and were used to pay
coupons as they matured.
As a consequence Of the decree, the
government will for the time being re
cover complete control of the customs
revenue. which almost in its entirely
vas pledged as a guarantee for the for
eign debt. Mexico's debt service ap-
serbs over SO.OOO,OOo pesos annually
which the government will now be free
IA uee for purposes OF pacification.
The concerns credited with ADVISING
President Huerta TO default on the
debts are the Bank Of Paris and the
/ Netherlands. Credit Lyonnaise, Comp
toir National d'Escompte and the So
ciet6 Generate. in France; Morgan
/ crenfell e. Co. Speyer Brothers and
/ Glvn Mills. Currie e. Co, OF London.
and the Deutsche Bank, the Dresdner
Tank and the Bank of s. Bleichroder,
/ Of Germany.
The houses Of ]. p. Morgan & Co,
Kuhn. Loeb q Co. and Speyer Broth-
crs. OF New York, are said not to have
taken any part.
uuer-a's decree is regarded as an
outcome Of the failure of the Finance
! Minister. Senor de Ia Lamas. TO raise
money either in Paris or London.
/ The acting Finance Minister, Senior
lima y PARA. said this morning that
| the government hoped. II the work OF
naci0cation progressed satisfactorily.
90 resume partial payments WITHIN
! three months.
If is understood that funds already IN
the hands OF bankers for debt payments
will be paid out 10 coupon holders on
application. as the decree Is not ih'ehu
cd 70 have a retroactive effect.
Comment here on the debt default IS
more animated than on any puoic
tonic for some time past II is gener-
ally recognized that the government
had no cnoice. but II 10 feared tnat il
viii be thought abroad that Mexico is
returning 10 the preporirian state OF
chronic default, which officials declare
/ is not tho case.
! II has been the practice OF the gov
eminent 10 make weekly remittances
"a New York. London and Paris TO ap-
nly 10 its interest obligations in order
/ ,b,t when the payment periods arrived
The money would he In hand. Ihese
weekly remittances have been sus-
nended the explanation being that the
government requires all available FUNDS
for qualification purposes.
/ The Foreign Minister said to-day tnat
he had been instructed TO notify all
foreign governments Of the default
Bankers in the financial district eN-
I dressed doubt yesterday that the Mex
! icar dictator would dare pursue such
9 drastic course as 10 default on IN
forest pavments They pointed out
that the Mexican debt was secured by
the customs receipts. and that In the
event q, its reputation those receipts
would he subject to seizure by nations
- hicb are creditors Of the republic.
II was stated that until further de-
tails we're known bankers and officials
- tho National Railways OF Mexico
mould moi know whether the per cent
bonds Of the company, which are guar
od rrincinal and interest by the