XN000022-1974-01-09 — Page 5

Wednesday, January,

1974

"Although this sum still exceeds the amount which the stock exchanges

said they were prepared to subscribe, a fund of this size is, in the view of the unofficial members, necessary to demonstrate internationally that Hong Kong has provided a realistic safeguard against the possibility of default

by dealers," he said.

Wolcoring the additional protection provided to investors, the Hon. Wilson Wang expressed the hope that legislation covering mutual funds would

by passed in due course.

By providing protection to innocent investors, the bill would make Hong Kong exchanges safe institutions and, in the long run, strengthen the

financial structure of Hong Kong, he added.

Had it been introduced one year earlier when laissez faire really prevailed "the debacle of the Hong Kong stock market in 1973 which cost the majority of investors, salaries and wage earners alike, two-thirds of their fortunes and savings, would have been averted," he said.

Another speaker, the Hon. G.M. Sayer noted that the old laissez faire methods of marketing securities were no longer suitable and needed to be brought up to date to cope with the different circumstances prevailing today.

"The bill provides one aspect of what is needed and the stock exchanges can help by encouraging their members to become technically competent in selling their services and handling the needs of their constituents," he said.

is no place for amateurs anymore.

14

There

It was also important, he stressed,that the operations of the stock exchanges should be the responsibility of the members themselves. "Free enterprise should be seen to work, but also be seen to be accompanied by self-discipline."

In his opinion, the bill provided safeguards without imposing unreason-

able restrictions.

The Hon. Hilton Cheong-Leen suggested that after the bill was passed, a simpler, non-legal version should be compiled in both English and Chinese so that stockbrokers and investors alike could be made aware of their rights and obligations.

In roply