Evening star., 1934-05-31
COLLECTION OUTLOOK DARK
Eleven Nations Expected to Default
on June Payments.

Eleven Nations Expected to Defaul
on June Payments.
By the Associated Press.
The United States was faced to.
day with a slender chance of collect.
ing millions Of dollars owed this Gov
eminent or American citizens by
debtors all over the world Diplo-
matte efforts to collect approx.
mately a half billion dollars were ap-
parently fruitless.
Summary of Situation.
Summarized, the American deb
situation is:
l. OF the 13 debtor nations with
war debt installments falling due
June is only Great Britain-asidt
from prompt Finland-held out any
promise of partial payment. Othel
debtor nations. barring financia
miracles, were expected to default.
2. Negotiations with Soviet Rus
sia for debt-funding agreement COW
ering loans made to the provisional
Kerensky government, imperial Rus.
sian bonds f1oated here before the
World War and private claims, were
momentarily stalemated.
3. Germany, despite vigorous pro-
tests by the United States, announced
a further reduction in its interest
payments to approximately $50, ,O0C
holders Of $600,000,000 in German
bonds.
Hull Sees Roosevelt.
Definite official information con-
corning action by the United States
or any of the European creditor ma
tions in the debt question was lacking
Secretary Hull and Undersecretary
Phillips conferred with the President
for nearly an hour before he left yes
terday, but neither the White House
nor State Department disclosed the
nature of their talk.
The President has told newspaper
men he expected to send the war debts
message to Congress tomorrow. He
has given no hint of its nature. ex-
cept that it contained nothing which
would require legislative action by
Congress.
A tentative debt funding agreement
under which Finland would receive
materially reduced interest rates, has
already been negotiated, but the
Presidents statement indicated he
might not send it to this session o1
Congress for ratification.
Despite the fact Finland is the only
nation which has met its obligations
in full on due dates, considerable op-
position to the refunding agreement
was said to exist in Congress, due
chiefly to the precedent it might set
for similar debt adjustments with
other nations.
President, Roosevelt has made II
clear repeatedly the United States
would not participate in any genera
debt conference. He has offered sew
eral times, however, to discuss pos
sible readjustments with any one
creditor nation.
U. S. Submits Terms.
Despite press reports from Moscow,
State Department officials insisted to-
day Soviet-American negotiations for
a debt-funding agreement had not
broken down. It was learned, how
ever, the United States has submitted
terms for a settlement which have not
yet been accepted by the Soviets.
Omcials here explained negotiations
were still in progress and that an
amicable settlement was expected. Re-
ports that the negotiations had gone
on the rocks" because of demand
that the Soviets be granted large
cash loan, or credits, were not con-
frmed at the State Department.
Germany's virtual moratorium on
interest payments to American bond
holders was decided upon despite
strong American opposition. The
United States, when the question was
first raised, sent Germany two
strongly worded notes, protesting the
reductions and the discrimination
against Americans by larger payments
to Swiss and Dutch bondholders.