Your telegram No. 308.  The proposal of Knox  and Stimson  has been fully considered by His Majesty's Government in the Commonwealth of Australia.
The profound significance is appreciated and for our part we welcome it as an outstanding sign of America's activity, interest and help. The question is one of nice judgment on very uncertain factors admitting of real difference of view as to what the result of the proposal may be. We are of the opinion, however, that in general terms the proposal of U.S.A. should be concurred in but urge that every step should be taken and the strongest representations made to ensure that America's Pacific fleet should not be reduced below six capital ships with their organization of cruisers and destroyers plus two aircraft carriers. The retention of the aircraft carriers we regard as indispensable.
A subtraction from the Pacific fleet of U.S.A. which leaves in the Pacific a force even greater than this may, we think, well achieve the purpose which the United States Government has in mind. At the same time, we express the strongest concern at the position of Singapore, particularly in its relation to Australia, New Zealand and Netherlands East Indies and we cannot too firmly express the belief that with transfer of United States ships to the Atlantic consideration should be immediately given to release against the event of war with Japan of adequate British capital units to at once reinforce Singapore.