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Rh In case the Mexican Congress authorises Mr. Carranza to raise this amount there are but two sources from which it might come. Either American bankers will take the bonds and sell them or the United States Government will loan money to the southern neighbour.

New York bankers will not loan money to Mexico as long as conditions are unsettled and as long as there is danger to American property and American citizens in Mexico. These bankers will not subscribe to a loan as long as they hold old Mexican bonds which have had no interest paid on them in six years and which are selling for fifteen dollars each in the United States to-day. This has been candidly explained to the Mexican authorities.

On the other hand, the United States Government cannot loan money to Mexico because this is forbidden by the constitution unless Congress passes a special act, and it is certain that neither the administration will recommend such a loan, nor that Congress would pass such an act. By the terms of the act which enables the United States to loan money to foreign governments during the war it is particularly stipulated that funds can be loaned only to Allies. This, too, has been explained to the Mexican Government.

The easiest way and perhaps the most successful way out of the present financial difficulties in Mexico would be for that country to break off diplomatic relations with Germany and join the