THE LANSING PAPERS, 1914-1920, VOLUME I



general staff and the Ottoman statesmen who made the pilgrimage to
the capital of William II a few months since.
  It has long been known that the German Kaiser covets control of
Palestine and the Holy Land, as a fruitful field for German col-
onization, an impulse for expansion that is denied to him in the
Western Hemisphere by the detested Monroe Doctrine.
  If the German Kaiser has the empire-building ambition with
which he is credited, it is but reasonable to believe that he could
supply a son to rule over the Turks, besides placing another on the
throne founded by Mehemet Ali.
  But does not King Ferdinand see himself in triumphal progress
at the Kaiser's right hand to Stamboul to wear an imperial diadem?
This is the belief of sapient persons in Vienna, and the Bulgarians
have no hesitation in saying that this is to be a reward for espousing
Austria's and Germany's cause at the psychological moment.
  But Napoleon, who may be the Kaiser's model in world-conquering,
gave thrones to his own kin before considering the claims of others,
be it remembered.
  I have [etc.]                          FREDERIC C. PENFIEI)

763.72/2252i
The Ambassador in Austria-Hungary (Penf/eld) to the Secretary of
                             State

                               VIENNA, Novemnber 11, 1915.
                                      [Received November 29.]
  MY DEAR MR. SECRETARY: In both Austria and Hungary the Third
War Loan closed a few days since, and it was successful to a remark-
able degree. The aggregate figures as semi-officially announced are
5,500,000,000 crowns, which sum in ordinary times would be more
than a billion dollars. The first loan, made when the Russians oc-
cupied the most of Galicia and were well through the Carpathians,
was not very successful. The second loan, occurring a few weeks
after Italy entered the fray, was but moderately successful. But
this new loan, to run fifteen years and netting the holder about six
and one-quarter per cent, has been a veritable triumph in financing.
  Great corporations and firms and municipalities subscribed lib-
erally. The Archduke Friedrich appears on the subscribers' list for
12,000,000 crowns, and his brother Archduke Eugen is down for
2,000,000 crowns. The Wiener Bank Verein claims to have placed a
tenth of the loan with its clients.
  If one could know the inside facts it might be discovered that the
loan's success is more apparent than real, especially when intelligent
Austrians assure one that perhaps half the gross amount has been



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