New-York tribune., 1919-02-11
Mexican Finance
Minister Confers
With Bankers Here
Terms on Which Financial
Aid May Be Given Dis
cussed; Regard Carranza
Government as Bankrupt

Rafaelo Nieto, Mexicos Acting Sec
retary of Finance. who is in New York
to get financial aid for the refunding
of the republics national and railroad
debt, yesterday began a series Of CON
versations on the subject with leading
bankers. A member of the firm of J.
P. Morgan e. Co. participated
Although no public statement about
the conference was made, it was re-
vealed that the tinanciers told the Off
would be possible. The bankers regard
the Carranzsta government somewhat
as banrupt corporation, unable to pay
its Obligations and anxious to rehabili-
tate its debt, and consequently it's
credit by compromising with its credi-
tors.
The holders of Mexican government
and railroad bonds might consent to a
settlement on basis of less than 100
cents on the dollar, the bankers iudi-
Gated, it,, first, the issue of new Mcxi-
can money were guaranteed, preferably
by the United States; and, secondly, ii
in regard to the collection of tariff
customs in Mexico, possibly by a joint
commi sson.
If the two FOREGOING conditions were
met. it was indicated that Americans
might be willing to waive some of their
claims for damages to their property
which resulted during the recent revo-
lutions.N The abandonment of the "con-
tiscatory plans" of the Carranza gov
eminent in respect particularly to oil
properties, and also to mining, and the
Af a
Of amity between the United States end
Mexico, which would clearly define the
rights of foreign investors in Mexico,
were other conditions suggested. Mr.
Nleto told the bankers, it was reported.
that satisfactory solution Of the oil
controversy ought to be reached at
the special session of the Mexican Con-
gress next April.
1t was explained that the Acting
Secretary of Finance did not come to
New York so much to consummate a
loan as on an "eXpedition of inquiry"
Ambassador Fletcher, who is now in
Washington, is expected in New York
this week, and it is understood he will
confer with bankers here on Mexican
conditions.
Bankers interested in Mexico dis
agreed as to the stability of the rres-
ent Mexican government. Some con-
tended That the COnStlutlOnallSt regime
CT Carranza had come to stay, whereas
others held that it would be impos-
sible to extend large credits to Mexico
until the present leadership was
changed. 1t was learned that at least
cnc important Wall Street institution
had within the last year extended com
raratively small loans to the Mexican
government, but they were secured by
American securities as collateral.
In describing the muddle into which
Mexican finances have drifted, a lead
ing banker said that strengthening out
Mexico's debt would be harder than
bringing order out of chaos in the
Rock Island affair.
Mr.. Nieto, it is understood. will have
an interview to-day with representa-
tives of another group. He purposes
to gather as much data as possible on
what conditions will be necessary to
restore Mexico's credit in foreign
money markets. and it is understood
that on his return to Mexico City he
will submit a full report to the Presi-
dent. He will remain in New York
about five weeks longer
decline Of nine points since the
last sale was registered Yesterday in
the purchase of a $1,000 u. S. Of
Mexico 5s, due 1915, on the Stock Ex-
change at 81.