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22. ALL IN ALL, THE POSSIBLE COST TO GOVERNMENT IS STRICTLY FINUTE, WITHIN A TOLERABLE BOUND.
POLITICS AND PRESENTATION.
23. THERE SHOULD BE NO POLITICAL PROBLEM IN IMPLEMENTING THIS SCHEME. CHINA HAS CONTINUALLY BEEN CALLING FOR ACTION ON THE EXCHANGE RATE AND CAN HARDLY BE CRITICAL OF THE FUXING OF THE Cik RATE BY REFERENCE TO THE U.S. DOLLAR AND BY IMPLICATION AGAINST OTHER CURRENCIES - SINCE CHINA HITSELF QUOTES MOVABLE PEGS AGAINST THE U.S. DOLLAR AND OTHER CURRENCHES. NT CAN BE EXPLAINED THAT THE U.S. CURRENCY S USED SIMPLY AS A VEHICLE AND REFERENCE POINT, AND NOT IN ANY CONSTITUTIONAL SENSE: F NECESSARY AT CAN BE ARRANGED THAT THE EXCHANGE FUND WOULD ACCEPT OR PAY ANY OF A NUMBER OF LEADING CONVERTIBLE CURRENCHES AGAINST CS, AT PREVAILING RATES BASED ON THE ANNOUNCED U.S. DOLLAR RATE.
24. IT HAS BEEN SUGGESTED THAT THE PEG SHOULD BE SET AGAINST STERLING, FOR CONSTITUTIONAL REASONS, BUT THIS DOES NOT SEEM NECESSARY AND MIGHT BE MISINTERPRETED POLKTIÉCALLY.
25. THE SCHEME WOULD HAVE TO BE VERY CAREFULLY PRESENTED SO AS TO ACHIEVE MAXIMUM ДMPACT ON CONFIDENCE. AN OBVIOUS POINT OF EMPHASIS WOULD BE THAT THE FOREIGN CURRENCY RESOURCES AVAILABLE TO THE EXCHANGE FUND ARE VASTLY GREATER THAN THE LIABILITY NOW BEING EXPLICHTLY ACCEPTED IN RESPECT OF CMS, AND THAT THESE RESOURCES ARE IN VERY LIQUID FORM. T HAS BEEN SUGGESTED THAT, ADDITIONALLY, THE BANK OF ENGLAND SHOULD VOICE SUPPORT TO ASSIST WITH PROVIDING LIQUIDITY, IF NEEDED. IF POLITICALLY FEASIBLE, THIS WOULD CERTAINLY HELP, BUT AT IS NOT ESSENTIAL.
26. THE ANNOUNCEMENT WOULD HAVE TO STRUKE A CAREFUL BALANCE BETWEEN EMPHASHISHING THE CONVERTIBLUTY AND ASSET-BACKHAG OF THE HK DOLLAR AND AVOUDING ANY ENCOURAGEMENT FOR PEOPLE ACTUALLY TO CONVERT: AND MT WOULD HAVE TO BE MADE CLEAR THAT THE EXCHANGE FUND CONTINUED TO DEAL ONLY IN CUMS WITH THE NOTE-ISSUING BANKS, SO THAT THE RATE OF EXCHANGE TO THE PUBLIC WOULD NOT NECESSARILY BE IDENTICAL TO THE PEGGED RATE (THOUGH IT WOULD IN ALL LIKELIHOOD BE CLOSE).
27. AS NOTED EARLIER THE SUCCESS OF THE SCHEME IN RESTORING THE STABILITY WITH THE MINIMUM OF MONETARY SQUEEZE DEPENDS ON HITS CREDIBILITY. THUS THE UTMOST CARE HAS TO BE TAKEN IN ITS
PRESENTATION.
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/CONCLUSION
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