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Question: The secondary property market is virtually at a standstill. Wouldn't a simple way be to revive the economy rather than dealing with quotas of imported labour and that sort of thing, to remove or at least substantially reduce the mortgage ceiling? It's supposed to be a property orientated economy and if property prices are going up everybody feels better off: the stock market goes up, people feel they've got a cushion of financial value behind them, and confidence begins to return.
Governor: I recognise that the property market is an important part of Hong Kong's wealth, but I'd certainly take issue with the proposition that we're a property related economy. If you were just based on property, if you weren't actually creating, as Hong Kong is, real wealth, real extra resources, then property would be pretty worthless. That's why we've got to go on concentrating on things like exports of manufactured goods and exports of services where we are doing pretty well.
I just want to make one substantive point about what you said and that is, we are not only concerned about avoiding a bubble in the property sector, we've also, I'm sure, got to be concerned about the exposure of our banks. We don't want to see our banks getting into the same sort of difficulties that banks got into in Tokyo where they were excessively exposed to the property sector at a time when the property sector came tumbling down. So, I think there are questions of real financial prudence and banking prudence that one has to take account of.
Perhaps I can add, in brackets at the end, yesterday, I was making a Policy Address not a Budget Speech. Some people have said, well, why haven't you done this or that about taxes? Donald Tsang would have been extremely surprised to have woken-up this morning in Washington to have discovered that I'd spent yesterday cutting taxes. I think he'd have had something to say about it. So, there will be a Budget Speech in due course and I'm sure that Donald's first budget will be as excellent as Sir Hamish Macleod's budgets used to be.
Question (in Chinese): I would like to ask the Governor this. About marriage and people keeping a second wife or mistress, what is your view on that?
Governor: Well, speaking as somebody who is happily married and monogamously married as well - I think I've got that right; I hope that translates okay - obviously I think it is difficult for a family when there are extra-marital relationships, whether in Hong Kong or outside Hong Kong. I don't think it's right for me to spend my time giving other people moral advice but, alas, you have to face up to the fact that in government you very often have to cope with the consequences of other people's amoral or immoral behaviour, and that is what we have to do from time to time. But one of the things which has made Hong Kong strong is its family structure and I would very much dislike to see that being undermined.