The Financial Secretary has been urged to convene a meeting with academics to discuss how big the reserves should be. Mr Tsang has said that about 12 months' reserves are needed to deal with day-to-day cash flow and rainy days. About 25 per cent of the money supply is needed to stabilise the exchange rate. Therefore the present $445 billion in reserves falls within the desired level. During yesterday's debate, Dr Law Cheung-kwok, of the Association for Democracy and People's Livelihood, questioned Mr Tsang's philosophy on the right level. 'When the economy is sound, they say there is no need to use the reserves. When the economy is bad, they guard against using the reserves,' Dr Law said. 'The result is the reserves will never be used once they enter the Government's pocket,' he added. He suggested that Mr Tsang should talk to economics academics on finding the right level. Independent Eric Li Ka-cheung also queried the methodology. He said the money markets and government spending were two separate concepts. 'It would be a pity and it would increase the social cost of the linked exchange rate by putting aside hundreds of billions of dollars in reserves,' Mr Li said.