Monitor

THE LAST big experiment I remember in stock exchange trading hours was just over 20 years ago, when Wednesday afternoon trading was suspended for a time to help brokers catch up with their mid-week paperwork.

The new management at Jimmy's Kitchen recently referred to that era as the time of 'champagne' lunches. Strange. I remember the preferred tipple on those Wednesdays as port. There is no mistaking, however, that the result was the most liquid lunches Jimmy's ever served.

So if it was sobriety the exchange had in mind when proposing a two-hour extension of daily trading hours, I could see some reason for it - even if this would still put the exchange behind the times as usual. Stockbroking is no longer so liquid a profession.

But I can see no other reason for it and, in fact, I have a better suggestion for improving things at Exchange Square, a way of killing two birds with one stone.

You may have noticed that Chief Secretary Donald Tsang Yam-kuen was also on the front page yesterday defending the Government's intention to cut civil service pay by 4.75 per cent and bring down civil service staffing.

Why not save yourself some trouble with your employees and be a little more selective, Mr Tsang? For instance, I cannot remember how much Kwong Ki-chi - your appointee as stock exchange boss - got in his package but it was eight figures and he certainly had a big grin on his face when he bagged it.

Move your decimal one position to the right and cut his pay by 47.5 per cent. Take another 47.5 per cent off his package and you could remove the threat of pay cuts and redundancies from hundreds of other civil servants.

What is more, it might make Mr Kwong unhappy and then he would just sit at his desk with his arms folded and offer no more unusual ideas on stock trading, which many members of the exchange might see as a definite plus. Just think of it, two birds with one stone and so easily done too.

When will this branch of the civil service that now runs the exchange realise that securities trading takes place these days over communications cables or satellite links and the only real value of a physical trading floor is its potential use as a prize exhibition site once this truth can no longer be ignored?

There is no direct link between the number of hours that trading clerks are forced to sit at their desks and the propensity of investors to put money in stocks. A few small punters may be induced to deal more often but it is unlikely to be enough even to cover the extra wage bill that stockbrokers will face.

It is as easy to deal at 2am as it is at 2pm if you really want to do it. All you need is a telephone or an Internet connection at your bedside. You can always get a price for a Hong Kong stock somewhere in the world and if the broker you contact at 2am treats you with disdain, he is no less likely to regard you as small fry if you do it at 2pm.

Nor does the exchange lose any turnover. It all goes through its books the next day as normal business, unless your taste runs to fancy derivatives that would not show up in its books in any case.

If the exchange wants to curry favour with investors, its first course of action is to cut back on the hundreds of millions of dollars it spends on administration when a good computerised system consumes only a few watts of electricity. But you have not heard even a peep of comment on this score from Mr Kwong, have you?

It is enough to drive brokers back to the port. A good portion of the day's trading was always done at Jimmy's anyway.