TNAG-1609-FCO40-22131-Minutes-and-Hansards-of-the-Legislative-Council-of-Hong-Kong-1987 — Page 85

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Poon's remarks.

But first I would like to comment on Mr. Peter

He rightly said that the collapse of the

futures market and indeed it would have collapsed had

the market not closed and had we not put the rescue package

together - would have had enormous and far reaching

repercussions on our stock market, the financial sector,

the strength of the Hong Kong Dollar and the credibility of

Hong Kong as a financial centre. His words sum up exactly

the problems we faced. In his speech Mr. Poon went on to

say that the consequences could have been horrific and I

cannot disagree with him in this assessment.

28.

Mr. Poon and Mr. Desmond Lee have referred to the

moral dimension and to the greed and fear that surface in

times such as these. I entirely agree. Both have spoken

of market integrity. Clearly the most important ingredient

of market integrity is the survival of the market itself,

so that participants can continue to trade normally. It

would have been disastrous, in my view, if we had merely

allowed the futures market to collapse. That would have

done nothing to safeguard the interests of investors in

futures and would have done immense harm to the reputation

of Hong Kong as a financial centre.

FC

l

Of course, Sir, we considered the possible

consequences of allowing the Futures Exchange, the Hong

Kong Futures Guarantee Corporation, and market participants

in the Hang Seng Index futures market to find a solution by

themselves. But it was quite clear to me, although