14th March, 1929
PERSONAL AND CONFIDENTIAL
(Due to arrive Canberra 13.4.29)
My dear P.M.,
I am sending by this mail, in another letter, what I hope is about the last of the C.I.D. papers on Belligerent Rights and the Anglo- American Arbitration Treaty.  This final report on Belligerent Rights is being taken by the Cabinet in this next week. I do not imagine that they will come to any conclusion on it but I anticipate that a selection of papers on these two subjects will go to all Dominions in the course of the next month, on which they will be asked to give their views.
I thought that these papers would have gone officially to you some time ago, but delay is inevitable on subjects of such magnitude.
On the question of Belligerent Rights, without having had any opportunity of discussing this matter with yourself or anyone else holding the Australian viewpoint, I should imagine that you will be on the side of high Belligerent Rights-and for two reasons.
Firstly, because anything that tended to reduce the effectiveness and force of the British Navy would be to the detriment of Australia.
Secondly, if freedom of the seas were to become the order of the day, then there would be but little excuse to maintain an effective imperial cruiser strength, which would again be against Australian interests. There may be many finer points than these from the Australian point of view, but it would seem to me that these two major facts will be conclusive in themselves.
However, it is unlikely that any decision will be come to on either Belligerent Rights or the Anglo-American Arbitration Treaty prior to the Election. In fact, every effort will be made to postpone decision until the next Imperial Conference.
Sir Hugo Hirst's  first action on his return has caused rather a flutter. He found that, in his absence, the heavy buying of his General Electric shares by United States citizens had resulted in 60% of the shares being held by Americans and that the price had been forced up to a point that he considered fictitious. However, this buying had begun before his departure for Australia and he had defended himself by getting a resolution passed which eliminated other than British shareholders from voting rights-so that his control was secured. But, in spite of this, the intense American buying had gone on, and, on his return, in order to spike the guns of the Americans, he made an issue of new shares at 40/- (the market price being 55/-) to British nationals only. This has caused great annoyance to the Americans, and an active press controversy is under way. He thinks that his action is the forerunner of similar moves on the part of many British companies, who desire control of their enterprises to remain British, and to have a predominantly British share register for the purpose of maintaining British and imperial interest in their products and their prosperity.
I enclose copy of an article by Harold Cox  in the 'Financial Times' of 13th March, inspired by the Industrial Mission's Report.
American capital has flooded into the London securities market in this last year. This is to the good, I suppose, in that it helps the exchange and supports the price of good securities here, but it is bad to the extent that it links up this fairly stable securities market with the volatile New York market, and brings non-assessable factors into the investment business here.
I talked to the Imperial Defence College on Australian External Affairs yesterday for an hour, and managed to get away with it with reasonable success. Anyhow, they have asked me to talk to them again.
I have met Shedden  (Civil Servant from the Commonwealth Defence Department), who has been on the Imperial Defence College course and who is now doing a course at the London School of Economics. He seems a very good type and should be a welcome addition to our Civil Service on his return. He would, I think, be a useful man either in the Treasury Department or the Prime Minister's Department.
I enclose an article from this week's John Bull', entitled 'Fifteen Invisible Men'-in which the heads of Government Departments are described in a chatty way-including Hankey  and Tom Jones.  This is almost certainly by Sir Wyndham Childs who recently resigned from being second-in-command at New Scotland Yard to go on the staff of 'John Bull'. I am afraid that I never had much of an opinion of Childs (who was an ex-Cavalry officer of a swaggering and rather stupid type), and this was confirmed when he prostituted himself by joining 'John Bull'.
I hear on fairly good authority that the Prince of Wales has not shown any very pronounced filial feeling during the King's illness, and that he has been to see him very little. I believe that it is true that the King remonstrated with him for spending such a great deal of his time in hunting, at which rebuke the Prince went straight off in a pet and sold all his hunters. And again, he has not been very regular in his attendance at the Council meetings at which he and other members of the Royal Family, the Prime Minister, the Archbishop of Canterbury, and others are representing the King during his illness.
The story is going about that the Prince of Wales is going to marry Lady-Wellesley , daughter of Lord Douro and granddaughter of the Duke of Wellington. But I don't know if any reliance can be placed on the story. She is only nineteen.
There is a regular but unofficial quotation each day on the Stock Exchange here whereby one can bet on, or insure against, the results of the General Election. Today's quotation is:-
Conservative 274, Labour 260, Liberal 82. The system is that you 'buy' say a 'Conservative return' of 274 by agreeing to pay 274 for it, and on the results you get or pay a difference of 1 per seat above or below 274. There is some small jobber's turn' that you pay in any event. No money actually passes until after the Election.
Chamberlain  told a story to the Cabinet in this past week which it was thought interesting enough to have recorded in the Cabinet minutes. Stresemann  and Hindenburg  were in conversation and the latter said that the man who won the war had just died. Stresemann asked him which he meant-and was told that it was Haig , at which Stresemann expressed surprise.
Hindenburg said that from the moment Haig made the decision that he would subordinate his own command and work under Foch , the war was as good as won for the Allies. 'For', said Hindenburg, 'it is a great thing to conquer one's enemies, but a greater thing to conquer oneself.'
I am, Yours sincerely, R.G. CASEY