The Stock Market Roller-Coaster Tsunami in China

July 22, 2015

The Chinese are finding out what it’s like be Americans, who have suffered repeatedly from the roller-coaster of land speculation and the fluctuations of the stock-market in the U.S.

Wikipedia lists twenty-two stock market crashes in the United States since 1772—about one every ten years on average (the next one should arrive in about two years in 2017). Most of the names of these crashes begin with the word “Panic”, and Business Insider gives us “The Complete History of US Real Estate Bubbles Since 1800” revealing that the real estate market in the United Sates peaks and crashes about every 18 years. “The world’s worst downturns are always preceded by land speculation (the chasing of the economic rent) fueled by misguided credit creation courtesy of the banks.”

The Guardian in the UK says, “Real estate agents in Australia, Britain and Canada are bracing for a surge of new interest in their already hot property markets, with early signs that wealthy Chinese investors are seeking a safe haven from the turmoil in Shanghai’s stock markets.”

Should we warn wealthy Chinese that it might be a bad idea moving from the stock market to real estate—like leaping from the frying pan into a fire?

A Market Watch Op-Ed piece alleged, “China’s stock-market crash is just beginning.”

The Wall Street Journal, “China’s leaders are clearly freaked out about the (Chinese) stock market. Global investors need to wonder how nervous they should be, too.”

CNN Money reports, “China’s stock markets are suffering their worst crash since the global financial crisis.”

This is where it helps to pause and remember that the global financial crises started in the United States. “August 2007: The Landslide Begins: It became apparent in August 2007 that the financial market could not solve the subprime crisis on its own and the problems spread beyond the United States borders.” – investopedia.com

For China, where did this all start? To find out, let’s begin with Shanghai’s public schools.


This Al Jazeera English news segment aired June 23, 2007.

On December 9, 2010, a CNN Go Asia headline said, “Shanghai has the world’s smartest teens”.

If you heard the news of Shanghai students beating out 65 countries in student scholastic performance tests in three key categories of ability, the Al Jazeera English video embedded with this post may provide part of the answer of how that happened.

While many American students are applying makeup, drinking sodas, eating candy and French fries in class while texting friends and ignoring teachers let alone reading or doing homework, Al Jazeera reports of twelve year olds in Shenyang, China learning how to be stock brokers.

These students buy and sell and learn how to get the latest information on global stocks.

One Student, Ding Chuan, was asked how his investment portfolio (a class assignment where the students don’t actually buy stocks) was doing, and he replied that last year his investments hit 10,000. Now, his portfolio is at 20,000. He wants to be a millionaire when he grows up.

Xiu Shu Jun, the headmistress for the school, says, “We decided to do it because we wanted to give the children a more realistic and practical financial education.”

I wonder if that realistic education includes the part where you lose all your money.

Tony Cheng, the Al Jazeera reporter, says, “It is ironic that the largest Communist nation in the world has become obsessed with this capitalist pastime.”

Cheng says, “Stock trading goes against about every principal Chairman Mao stood for, and he would be pretty horrified to learn that there are now more registered (stock) traders in China than there are members of the Communist Party.”

Mao’s statue in Shenyang is surrounded by banks. After all, Tony Cheng says, today to be rich in China is glorious.

I say, What Tony Cheng doesn’t tell us is when Deng Xiaoping came to power by arresting those that would have continued the Cultural Revolution, China’s central government repudiated revolutionary Maoism and launched a Chinese style of socialist-capitalism.

Meanwhile, outside of school where children are being indoctrinate into capitalistic tendencies, China’s citizens bought stocks hoping to get rich quick not realizing that this is the same as going to the casinos of Macau, Monte Carlo and Las Vegas and throwing all of your money on the roulette table.

It seems that the Chinese are learning the hard way that in a capitalist economy what goes up also comes down.

______________________________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

#1 - Joanna Daneman review posted June 19 2014

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China

China’s Holistic Historical Timeline


China’s Sweet Mooncake Mania

July 21, 2015

September is right around the corner and that means Mooncake Mania in China.

Back in 2010, I wrote a post about China’s Mid-Autumn Festival, which is also the time of year for giving and eating mooncakes. At the time, I had no idea that Haagen-Dazs sold the most sought after modern version of this Chinese traditional treat.

My wife learned from a friend in China of the popularity of Haagen-Dazs and mentioned the mooncakes, so I did some scooping for this post. Mooncakes are traditional gifts to friends, family and clients during the Chinese mid-autumn festival, and Haagen-Dazs’s Mooncakes have shown a 25% annual growth in sales since they were first introduced in 1997 and represented 28% of Haagen-Dazs’s revenue every year!

Fast forward to 2015 and over 50% of the Chinese people have now heard of Haagen-Dazs—that’s more than 650 million people or more than twice the population of the United States.


Mooncake Mania for China’s September Holiday

Kai Ryssdal reported for American Public Media’s Marketplace that China’s mid-Autumn Festival and tradition of eating mooncakes has become an underground business possibly worth billions.

Marketplace’s Shanghai correspondent Rob Schmitz says mooncakes carry about a thousand calories and most of the cakes bought are gifts as a way to show respect to business partners and people you want to be close to.

Imagine the size of the market—more than 1.3 billion people, which explains why Starbucks, Nestle and Dairy Queen got into the business of selling mooncakes in China too. In fact, Starbucks offers espresso and hazelnut mooncakes; Godiva promotes a chocolate variety; Häagen-Dazs features cookies-and-cream ice cream mooncakes.


2009 Haagen-Dazs Chinese Mooncake Commercial

Industry groups estimate that mooncakes bring in $2 billion in annual sales in greater China, accounting for 200,000 metric tons (about 220,400 tons) of production each season. – New York Times

______________________________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

#1 - Joanna Daneman review posted June 19 2014

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China

China’s Holistic Historical Timeline


Local & Foreign Entrepreneurs in China: Part 2 of 2

July 8, 2015

In the PBS documentary of foreign entrepreneurs in China we discover (when the US financial crises hit the world causing more than $64US trillion in global loses while those who caused the crises walked away with fortunes) China experienced a slowdown in economic growth in 2008.

One foreign entrepreneur, Ed Hung, talks of the clothing store he co-founded, NLGX Design, which opened in Beijing in 2008.  He said rent was still increasing.

Ed Hung was born and raised in San Francisco. His business partner, Michel Sutyadi, was born and raised in Germany.  They met in Beijing while studying Mandarin in 2005.

Ed Hung says modern Beijing is becoming a consumer culture.

Then Doug Ma, a co-founder of Go Tour-ING, talks of how the global financial crisis (which was started in America) has affected business.

In the spring of 2008, Dough Ma left his job at an investment bank to travel. He wrote a post for Jet Set Zero in July 2009, and said, “It has been quite a challenge starting up Tour-ING (looks like this business didn’t survive). For one thing, it has been a tough year for the tourism industry. Less people are traveling due to the global economy and the outbreak of swine flu has hindered a lot of travel plans.”

Brian Sloan, CEO of Robotic Blow Job (want to be shocked and/ or LOL, click on the link), says the toys he manufactures and sells seem more popular in hard economic times since people spend less money going out and stay home more so they need a method of self-entertainment.

In addition, in October 2013, Forbes ran The Rise Of Self-Made Billionaire Entrepreneurs In China, And What It Means For The Future Of Chinese Corporations, and said, “Anyone who has followed China’s business billionaire lists in recent years will probably have noticed an encouraging trend: self-made entrepreneurs are climbing the charts. Six out of the ten billionaires topping this year’s list are genuine entrepreneurs.”

Then in August 2014, The Diplomat.com said, “China has long been preparing the ground for entrepreneurial revolution. … Starting in the 1980s, the Chinese government actively encouraged entrepreneurship across the country, by introducing the first patent law, allowing state-owned enterprises (SOEs) to go bankrupt, and creating a more investor-friendly environment for private entrepreneurs.”

And in May 2014, TechNode.com offered The Top 3 Tips For Foreign Entrepreneurs Starting Up in China:

  1. Find a Local Partner
  2. Don’t confuse market size for adoption speed
  3. Learn the language and culture, and hire locals

Start with or return to Part 1

______________________________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

IMAGE with Blurbs and Awards to use on Twitter

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China

China’s Holistic Historical Timeline


Local & Foreign Entrepreneurs in China: Part 1 of 2

July 7, 2015

“Young and Restless in China” was filmed over a period of four years starting in 2004 for the Public Broadcasting Service (PBS).

Paris Franz, a student, blogger and writer with a passion for history, art and travel, wrote a post about “Young and Restless in China” for Suite 101.com.

This two-part segment is about foreign entrepreneurs in China. I plan to also feature other segments of this PBS Frontline documentary because it demonstrates how much China is changing. The more I learn, the more it appears that there is more freedom in China than most people outside China are aware of.

Franz wrote, “The film highlights what is unique about China at the beginning of the twenty-first century.

“The entrepreneurs – starting up tailoring, hotel and internet café businesses – are full of optimism, supremely confident that their hard work is going to make them rich. As one of them says, China today is “the land of opportunity.”

Part One starts with “there is this misconception of China that it is not modern, that it is still changing, but if you come and see with your own eyes you will discover that (urban) China (where about 600 million people live) is as modern as any city in the world.

One entrepreneur says, if you visit Beijing and see the architecture, you will see that it is leaps and bounds ahead of the US.

Another entrepreneur says, China is a melting pot for all types of entrepreneurs in Beijing … For young entrepreneur it is cheap to start something new in China compared to the US.

In fact, as the economic tide turns against the west, younger, foreign talents are taking their entrepreneurial ambitions to China because the market is right for starting a business.

One American entrepreneur says he graduated from law school at Penn State in 2005. He then talks about how he arrived in China to create, manufacture and sell his own brand of sex toys and fetish clothing.

Continued in Part 2 on July 8, 2015

______________________________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

IMAGE with Blurbs and Awards to use on Twitter

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China

China’s Holistic Historical Timeline


The Return of Technological Innovation to China

June 30, 2015

Last year, a friend from China who works in China’s investment banking industry in Shanghai came for a visit. She earned her MBA in the UK, and speaks fluent English. While in California, she decided to see how efficient America’s Amazon.com was compared to China’s Alibaba, and when it took more than a week for the average order to arrive from Amazon, she declared Alibaba the winner, because when she ordered a product in Shanghai through Alibaba in the morning, it was delivered to her front door that same afternoon and without the use of drones.

The rest of this post is mostly about Zhongguancun, China’s Silicon Valley, which is located in Beijing’s Haidian District and was first developed in the late 1990s.

Here are a few pictures of the concrete, glass and steel canyons of Zhongguancun taken by Steve Hsu, a professor of physics at the University of Oregon.

Recently I have read several times on Blogs and in Op-Ed pieces in the Western media that China doesn’t have a chance to match California’s Silicon Valley, because China lacks freedom.

This is simplistic and flawed thinking.

The Chinese have every economic freedom that many Americans have and the few that they don’t have are not economic in nature—for instance, freedom of religion and limited political expression. It isn’t as if these few limits to freedom are a secret since they are part of China’s Constitution, which is taught in the public schools. In China, the people are free to follow five officially sanctioned religions: Catholicism, Christianity, Buddhism, Taoism and Islam. In comparison the U.S. has about 313 religions and denominations to choose from.

Other than that, since money and freedom are linked, the growing Chinese middle class has as much freedom to live the same consumer lifestyle as many Americans do, but in the United States poverty is on the rise and with poverty comes less freedom unless you include hunger and being homeless as an example of freedom.

For instance, in 1985, the poverty rate in the U.S was 14% (33.3 million of 237.9 million people), and today (2015) Stanford.edu reports that the mean poverty rate in the U.S. is 15.13% (48.5 million of 321 million people). How does that compare to China? In 1985, the poverty headcount rate in China was 30.7% (317 million of 1 billion people).  Today, the CIA reports it’s 6.1% (about 79.3 million of 1.3 billion people).

In addition, if democracy is so precious, why do so many Americans not vote? A 2010 survey by the California Voter Foundation found that 51 percent of nonvoters (in the U.S.) grew up in families that did not often discuss political issues and candidates. Does that mean in the U.S., we are also free to give our freedom away?

Where is the evidence that total freedom of religion and/or political expression is necessary for entrepreneurial innovation? Good luck, because you won’t find that evidence, but in the next few paragraphs you will find evidence that shows that total freedom of religious choice and political expression are not necessary to prosper and innovate.

“Shenzhen has never hidden its ambition to be China’s answer to Silicon Valley. Last year (2014), the city saw more than 64 billion yuan (HK$80.46 billion) invested in research and development, accounting for 4 per cent of GDP, only matched by South Korea and Israel.” – South China Morning Post


This 2008 video takes us to a lab in Tsinghua University in Beijing where students are discussing solar technology.

Ye Yuming, an award-winning student at Tsinghua University said, “China lags behind other countries in the solar power industry. The solar PV will help us improve and break the monopoly held by foreign businesses. The solar PV has great market potential, especially in China. The market size is huge.”

What Ye Yuming said in 2008 was true, but two years later, China became the world’s largest solar power manufacturer.

Bloomberg Business reports, “Along with the new companies, China is also experiencing a surge in technological innovation. The country had more than 660,000 effective invention patents last year, up 12 percent from a year earlier …”

And The Wall Street Journal says, “Increasingly, China’s own technology companies are challenging market leaders and setting trends in telecommunications, mobile devices and online services.”

In conclusion, British scientist, historian and sinologist Joseph Needham proved with his Science and Civilisation in China Series that China led the world in technological innovations for about 1,500 years until the 16th century. Then the West led the world in innovation. Is that about to change again?

______________________________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

IMAGE with Blurbs and Awards to use on Twitter

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China


China’s curious link between Opium, Christians, Cults and Cannon balls

January 27, 2015

Organized religions and cults such as the Falun Gong have been in China for centuries, but have never played a major role in the culture until the 19th century when Christianity and opium was forced on China.

C.M. Cipolla, in Guns, Sales and Empires, wrote, “While Buddha came to China on white elephants, Christ was born on cannon balls” paid for by the profits to be made from opium. Cipolla obtained his first teaching post in economic history in Catania at the age of 27. In 1953, Cipolla left for the United States as a Fulbright fellow and in 1957 became a visiting professor at the University of California, Berkeley. Two years later he obtained a full professorship.

The treaties that ended the two Opium Wars—first Opium war (1839-1842) and second Opium War (1856-1860)—required that China’s emperor allow Christian missionaries free access to all of China to convert the heathens. The treaty also opened all of China to the opium trade. Christianity and Opium might seem a strange partnership but that’s the way it was.

Then there was the Taiping Rebellion led by Hong Xiuquan, God’s Chinese son and a Christian convert, who was responsible for 20 – 100 million deaths over a period of 14 years (1850 – 1864). Hong claimed to be the younger brother of Jesus Christ, and millions of Chinese believed him, but the Taipings were against the opium trade and that led the Christian countries to support China’s emperor against the Christian Taipings proving that profits come before God.

Then in the early months of 1900, thousands of Boxers, officially known as Fists of Righteous Harmony, roamed the countryside attacking Christian missions, slaughtering foreign missionaries and Chinese converts.

Confucius and Lao-Tse have influenced the foundation of Chinese culture and morality, and these two along with Buddha offer more of a blended influence on Chinese culture than Christianity or Islam.

Thanks to Confucius, China’s mainstream culture understands the importance of people within the family and society more so than many other countries and cultures. This may explain why China is a powerhouse of industry today.

_______________

Lloyd Lofthouse is the award-winning author of My Splendid Concubine [3rd edition]. When you love a Chinese woman, you marry her family and culture too. This is the lusty love story Sir Robert Hart did not want the world to discover.

Honorable Mentions in General Fiction
2012 San Francisco Book Festival
2012 New York Book Festival
2012 London Book Festival
2009 Los Angeles Book Festival
2009 Hollywood Book Festival

Finalist in Fiction & Literature – Historical Fiction
The National “Best Books 2010″ Awards

 E-book_cover_MSC_July_24_2013

Subscribe to “iLook China”!
Sign up for an E-mail Subscription at the top of this page, or click on the “Following” tab in the WordPress toolbar at the top of the screen.

About iLook China

China’s Holistic Historical Timeline


Let’s take a close look at how many deadbeats there are in the United States living off welfare

October 13, 2014

If you live in China and you think the streets in America are paved in gold, take a close look at how many deadbeats there are in the United States living off welfare, and you might be surprised who the real welfare queens are.

First, a few numbers to get started: there are more than 316 million Americans and 150.8 million are between the ages of 18 to 65—the primary working years for adults. In 2013, 47.1 million Americans lived below the poverty level; 73.6 million were under the age of 18, and 44.6 million were age 65 or older.

Wow, and in September 2014, there were 146.6 million Americans who were working at paid jobs.

But, a few, far-right billionaire oligarchs—for instance, the Walton family and the Koch brothers, and the fools who swallow their propaganda—think that more people in the United States are on welfare and are deadbeats than those who are working and supporting them.

I think it is arguable and safe to say that it would be a misleading lie that the majority of the Americans who are not working are deadbeats on welfare. Only a fool could think that. Is it possible that there are only 4.2 million Americans—who could be deadbeats—between 18 and 65 who do not have a paying job—that’s only 1.328% of the total population? I bet most of those 4.2 million are probably disabled and can’t work or are a stay at home parent.

Did you know ABC reported that Americans work more than anyone in the industrialized world—more than the English, the French, the Germans or Norwegians and even, recently, more than the Japanese?

In addition, according to the OECD, in the United States 67% [that is almost 70%] of people aged 15 to 64 [the working class years] have a paid job. … And having a good education is an important requisite for finding a job. In the United States, 89% of adults aged 25-64 have earned the equivalent of a high-school degree, higher than the OECD average of 75%—and yet some billionaires, including Bill Gates [worth almost $80 billion], the Koch brothers and the Walton family, would have you believe that the public education system in the United States is failing and must be reformed.

20 Something Finance even says “The U.S. is the Most Overworked Developed Nation in the World.” And Business Insider says the average person spends 90,000 hours at work over their lifetime—based on a 5 day 8 hour workweek with a two week vacation annually, that equals 45 years. I worked 45 years, starting at 15 and I retired at 60.  My retirement check comes from CalSTRS, and I paid 8% of my gross income into CalSTRS for the 30 years I was a classroom teacher.

But a Houston based billionaire, according to the Democratic Underground, is attacking public pensions with a goal to kill the guaranteed-benefit plans that are run by teacher retirement systems in every state. This billionaire’s name is John Arnold, who is worth $2.9 billion dollars. Arnold runs a Houston-based hedge fund, and before that he worked for Enron, and it is said that he earned $750 million for Enron the year it went out of business. Huh, how do you earn $750 million for a company that goes out of business the same year?

Contrary to the popular thinking of fools, Social Security is not a form of welfare because workers and employers pay into that program for their entire working life, and in 2013, there were 38 million retired workers—nine out of ten individuals age 65 or older—who collected an average monthly benefit of $1,294. There were 4.9 million dependents; 8.8 million disabled workers, who were paid an average of $1,145 a month, and 6.2 million survivors—survivors are young children and a surviving spouse who cares for the children.

What about food stamps—a real welfare program?

From Media Matters.org we learn that nearly half (47% or 23 million), who get food stamps, were under the age of 18, and another 8 percent (3.9 million) were 60 or older; 41% (more than 20 million) lived in a household with earnings from a job. These workers are known as the “working poor”, and the average household on food stamps received a monthly benefit of $287.

And, these so-called deadbeats—that a few billionaires and a lot of fools think outnumber working Americans—are allegedly robbing us blind while they sit around drinking beer, eating popcorn and watching TV or having sex 18-hours a day to make more babies so they can collect more food stamps. If you believe that, then you might want to look in a mirror to see a fool.

If these billionaires succeed, what will replace progressive era plans like CalSTRS, Social Security, Medicare, unemployment and food stamps?

If we look back at history, we might discover the answer to that question. In 1900, before Presidents Theodore Roosevelt, Taft, Wilson, FDR, Kennedy and LBJ, ushered in the progressive era, 40-percent of Americans lived in poverty with only a 5% unemployment rate, and up until 1938, in some states, children could be sold as young as five to factories, coal mines and whorehouses. Imagine your five-year old child working as a prostitute, because boys and girls were sold into prostitution back then when the U.S. was ruled by capitalist Robber Barons.

Is this the America a few billionaires, with help from some fools, are fighting to get back?

By the way, did you watch the video that comes with this post? It really is an educational eye opener.

_______________________

Lloyd Lofthouse is a former U.S. Marine and Vietnam Veteran,
who taught in the public schools for thirty years (1975 – 2005).

His third book is Crazy is Normal, a classroom exposé, a memoir. “Lofthouse presents us with grungy classrooms, kids who don’t want to be in school, and the consequences of growing up in a hardscrabble world. While some parents support his efforts, many sabotage them—and isolated administrators make the work of Lofthouse and his peers even more difficult.” – Bruce Reeves

lloydlofthouse_crazyisnormal_web2_5

Lofthouse’s first novel was the award winning historical fiction My Splendid Concubine [3rd edition]. His second novel was the award winning thriller Running with the Enemy. His short story A Night at the “Well of Purity” was named a finalist of the 2007 Chicago Literary Awards. His wife is Anchee Min, the international, best-selling, award winning author of Red Azalea, a New York Times Notable Book of the Year (1992).

To follow this Blog via E-mail see upper left-hand column and click on “FOLLOW!”


Follow

Get every new post delivered to your Inbox.

Join 13,117 other followers