Messersmith, G.S., Vienna. To the Secretary of State [Cordell Hull], Washington.

Attended Music Festival at Salzburg during last weekend; saw premiere of Die Meistersinger in which Charles Kullman of New Haven sang leading role; America should be proud of him; many notables from all over world present, including distinguished Americans; Miss [Frances] Perkins arriving today and Mr. and Mrs. [Wilbur J.] Carr; was fortunate in securing good seats for them; tourist season best since end of war; will mean great increase in foreign exchange holdings; August a quiet month in Austria politically; Chancellor and most of ministers vacationing; preliminary negotiations for improving Austro-German trade relations have come to nothing, but pressure from Germany will continue and may affect U.S. interests; Germans would like to have contingents put on American goods to provide increase in German exports; Chancellor's retirement still rumored, but nothing to rumor; with [Ernst von] Starhemberg out of picture Germany will make effort to undermine position of Chancellor; regrets in some ways Starhemberg's passing from picture; not as bad as he has been painted, but he is a Fascist; likely to be changes in Cabinet; [Fritz] Stockinger, Minister of Commerce, and [Ludwig] Draxler, Minister of Finance , slated to go; both able men, but reported to have sticky fingers; will probably be replaced by some of the nationally minded element; internal situation such that opinion unjustified that accord of July 11 handed Austria over to Germany; [Franz] von Papen since elevation to Ambassador, pressing to assume first place in diplomatic corps in Austria; Foreign Office may be forced to give him precedence; [James] Haislip plane, which he sold or turned over to Cathcart Jones [John Owen Cathcart ?], former British Air Officer, stopped at Innsbruck and held by Austrians until instructions are received from Department about present ownership; plane was carrying some of Alfonso's aides interested in arms traffic; [Joachim von] Ribbentrop reappointed to London; London Times speaks kindly of his appointment, but makes clear that British-French friendship remains fundamental and no arrangement with Germany can disturb it; organization of German Foreign Affairs strange; [Konstantin] von Neurath remains Foreign Minister but has little authority; Ribbentrop maintains political bureau in Berlin; [Alfred] Rosenberg's foreign political office of Nazi Party, [E. Wilhelm] Bohle's Nazi Party organization for influencing opinion abroad, and Propaganda Ministry of [Josef] Goebbels all striving to direct foreign policy; visit of [Baron Robert Gilbert] Vansittart, permanent Undersecretary in London, to Berlin worthwhile; Vansittart has no illusions and maintains proper perspective of German situation; events in Spain diverting attention from Danzig, but suggests watching that spot, where coordination with Reich is to be brought about through expression of "popular will"; Olympic Games will doubtless be reported great success by Americans returning from Germany; organization was excellent, enormous stadium in fine setting, and the Games themselves a great spectacle, but these Americans see only the surface; financially, the Games a failure for Germany; not as many foreign visitors as expected; foreign control over Austrian financial institutions about to end; on death of head of Creditanstalt, International Committee in London agreed to appointment of principal Austrian subordinate