"Secretary of State [Von Jagow] informs me that immediately on receipt of Prince Lichnowsky's [German Ambassador in London] telegram recording his last conversation with you he asked Austro-Hungarian Government whether they would be willing to accept mediation on basis of occupation by Austrian troops of Belgrade or some other point and issue their conditions from here. He has up till now received no reply, but he fears Russian mobilization against Austria will have increased difficulties, as Austria-Hungary, who has as yet only mobilized against Serbia, will probably find it necessary also against Russia. Secretary of State says if you can succeed in getting Russia to agree to above basis for an arrangement and in persuading her in the meantime to take no steps which might be regarded as an act of aggression against Austria he still sees some chance that European peace may be preserved.
"He begged me to impress on you difficulty of Germany's position in view of Russian mobilization and military measures which he hears are being taken in France. Beyond recall of officers on leave—a measure which had been officially taken after, and not before, visit of French Ambassador [Jules Cambon] yesterday—Imperial Government had done nothing special in way of military preparations. Something, however, would have soon to be done, for it might be too late, and when they mobilized they would have to mobilize on three sides. He regretted this, as he knew France did not desire war, but it would be a military necessity.
"His excellency added that telegram received from Prince Lichnowsky last night contains matter which he had heard with regret, but not exactly with surprise, and at all events he thoroughly appreciated frankness and loyalty with which you had spoken.
"He also told me that this telegram had only reached Berlin very late last night; had it been received earlier chancellor would, of course, not have spoken to me in the way he had done."
Ambassador Bertie telegraphed from Paris to Grey the report of Germany's request to Russia to be informed on what conditions Russia would consent to demobilization.
"The answer given is that she agrees to do so on condition that Austria-Hungary gives an assurance that she will respect the sovereignty of Serbia and submit certain of the demands of the Austrian note, which Serbia has not accepted, to an international discussion."
SIR EDWARD GREY REFUSES TERMS OF NEUTRALITY
Grey telegraphed to Ambassador Goschen at Berlin in answer to his telegram of July 29:
"His Majesty's Government cannot for a moment entertain the Chancellor's proposal that they should bind themselves to neutrality on such terms.
"What he asks us in effect is to engage to stand by while French colonies are taken and France is beaten, so long as Germany does not take French territory as distinct from the colonies.