-3-                             
 
 
This was most inhuman advice.    While England sits in the
midst of peace and plenty, Germany was being advised by
Englishmen to make war against Eastern countries to divert
her energies from constructive tasks.  Germany did not intend
to do so.
 
 
Lothian
 repeated his arguments that the key to the
solution of Germany's problems in Europe was unreserved accept-
ance of the sovereignty of these nations.  Then as in the
case of U.S.A. and in Great Britain a real economic solution
would be possible and Eastern Europe would be safe under
German protection.
 
 
Schacht
 said that offered no difficulty.  Of course the
treatment of Germans in Czecho-Slovakia was the cause of
serious difficulties, there was Danzig and Austria.  As for
the rest, where should difficulties arise?
 
 
Lothian
 said that there was now so much suspicion about
that there was urgent need of personal contacts between 
responsible people.
 
 
Schacht
 said that he would be prepared at any tie to
come to England.  He though personal contacts should be
between Ministers.  He depreceated long preparation of public
opinion as a prior condition to meetings- public opinion would
be best educated by meetings of responsible people in the
near future.
 
 
Schacht
 continuted: if Germany lived under normal condi-
tions of economic opportunity, all the rather strange ideas,
anti-semitism, racialism, would disappear.  They are the
result of the terrible pressure and privation which the
German population has had to bear since Versailles.  Normal
conditions would bring normal thoughts.  English were wrong
in repressing Germany to become normal first.  When you are
normal we will do something to alleviate the situation.  It
was the other way round.
 
 
We had tried methods of persuasion, of fulfillment, of