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SECRET
GOVERNOR, HONG KONG
PEKING
Your telegram No. 1007: Grey.
We are grateful for your analysis of the
possible courses of action and for comments in
Peking telegram No. 765. The problem is indeed a
very difficult one.
While it is possible to go a
long way to agreeing with the arguments and
conclusions in your telegram under reference, we
have to consider the pressures building up here for
some action to be taken. We can expect to limit
these, if we can give a confidential assurance in
certain quarters that we are taking an initiative
to secure Grey's release.
2.
Peking's arguments in favour of unconditional
release as an act of faith are fully appreciated,
but we judge this course to be a gambler's throw
carrying risks that at the present time would be
unacceptable if it failed. Public criticism here
as well as in Hong Kong would be strongly adverse
if we released Hsueh and Lo without getting Grey
/ back.