SECRET

GOVERNOR,

HONG KONG

PEKING

Your telegram No. 1007: Grey.

We are grateful for your analysis of the

possible courses of action and for the comments in

Peking telegram No. 765. The problem is indeed a

very difficult one. While fully understanding you

reasons for preferring to postpone action until

November, we have to consider the pressures

building up here for some action now. We might be

able 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. We see the force of the arguments in Peking

telegram No. 765 in favour of unconditional releas

as an act of faith. But we recognise that the

practical difficulties in paragraph 1 of your

telegram No. 1028 are over-riding. Moreover wo

judge this course to be a gambler's throw carrying

/risks

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