China Readings for October 25th

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  • 艺术品信托大跃进 投资顾问高杠杆“圈钱”陷阱 – 金融 – 21世纪网- art trust products, speculation. you can’t keep Chinese from speculating, Beijing should just open casinos, become one big Vegas?//相关人士透露“市场需求很大,前不久发售一个几千万的产品,短短一周卖完了。”
  • 你所不知道的安康医院 – 宏观 – 21世纪网- petitioners and mental hospital institutionalization. this on ankang in shanxi, xu wu case. grim//收治徐武等部分上访者的精神病医院就隶属公安系统,该系统下的所有医院统一称为“安康医院”。
  • 浦发兴业卷入民间借贷风暴眼 温州银行躲一劫 – 机构 – 21世纪网 -
  • Alipay Suffers Mass Withdrawals, Service Outage | Marbridge Consulting – China Internet News – Chinese third-party payment processor Alipay has announced on its official microblog account that its platform was the target of large-scale fund withdrawals coordinated by protesting Taobao Mall SME merchants on the evening of October 21. Alipay users later reported being unable to use the platform the following two days. Alipay emphasized that consumers’ funds remained safe and available, and will continue to be insured by the Industrial and Commercial Bank of China and overseen by the People’s Bank of China.
  • China’s Maritime Strategy Being Tested Amid South China Sea Disputes-Caijing – The current situation has reflected a lack of ocean strategy, under which, China has been under a passive state when confronting with surrounding countries in disputed waters
  • 双城雀巢被指克扣奶农 地方政府或有共谋之嫌 – 消费·传媒 – 21世纪网- Nestle mistreating dairy farmers in China?当地多位奶农称,雀巢公司克扣奶农已成公开秘密,而常年克扣的背后则是地方政府的撑腰。
  • 中宣部副部长解读六中全会 回应外界关切_资讯频道_凤凰网 -
  • Analysis: Dragon tail risk: The cost of a China crash – Yahoo! News – Judging from the latest HSBC survey of China’s manufacturing sector, released on Monday, there is no evidence that growth is collapsing in the world’s second biggest economy.
    Indeed, not one of the 30 economists polled by Reuters last week predicted China’s 2012 growth rate would dip below 8 percent.
    But that has not silenced speculation that China is heading for an economic disaster. Some economists have tried to calculate the potential fallout just in case their forecasts prove to be overly optimistic.
  • In Beijing, the Party Elite and the Police All Have a Say on Culture – Global Spin – TIME.com- The leadership will “draft further guidance, goals and major measures” for “socialist cultural development with Chinese characteristics,” as the state-run Xinhua News Service put it. If that sounds a bit opaque, police offered some more direct guidance on cultural development Saturday in the village of Songzhuang, about fifteen miles to the east of central Beijing. There about 100 film directors, critics, journalists and fans gathered in a courtyard under blustery fall skies for the opening of the 6th Beijing Independent Film Festival (BIFF).The week-long event, which includes more than 50 fiction films, documentaries, animated shorts and experimental pieces, celebrates works produced outside the official system. They weren’t submitted to the State Administration of Radio, Film and Television beforehand, and thus can’t be shown in large theaters or distributed through regular channels. Some of the works show the darkest sides of life in China—environmental degradation, illegal land grabs, minority cultures pushed to the edge of oblivion—and were produced independently by necessity, because they could never survive an official review. But not all the films were so sensitive. Some were created by amateurs who didn’t have the formal training and connections to work in the mainstream, or experienced directors who prefer not having to deal with a censor, even if it means being cut out of the mainstream market.The BIFF opening was held outside because the police forced at least two changes of venue, first from a local arts center and then from a hotel. The courtyard of the Li Xianting Film Fund, which is run by an arts critic and independent cinema backer, was lovely, though not an ideal spot
  • Private Lending Frenzy Spreads to Central China’s Henan – China’s central province of Henan was the third to be struck by a private lending frenzy following Wenzhou, home of entrepreneurs, and northern city of Ordos
    China’s central province of Henan was the third to be struck by a private lending frenzy following Wenzhou, home of entrepreneurs, and northern city of Ordos, the China Business News reported.Some 112 insurance institutions are bearing huge risks in the province, with 36 in the capital city of Zhengzhou, according to the report.The exposure of illegal bonding companies such as Shengao and Baoyin has triggered a “domino effect” in the province’s insurance industry, the report said.
  • Can Tencent’s 100 Million RMB Investment Breathe Life into the Fallen Kaixin001? | TechRice- A couple of months ago I was told by a Sina friend that even though Kaixin001 was founded by their former CTO, the ties between the two companies have withered since Kaixin001′s fall. And of course since Sina has Weibo there’s no point in defending a dying SNS.But similar to Renren, Sina’s target is the eventual monetization of Weibo. And most of that will come from ads. If Kaixin001 can get back in the picture, backed by the Chinese internet public enemy #1 and big brother Tencent, Sina should also be nervous. And will Chen BinHao begrudge Sina’s lack of support for Kaixin001?Of course, Tencent’s ‘backing’ doesn’t necessarily lead to results. Just ask Groupon’s struggling Gaopeng JV with Tencent. It’s possible that Tencent simply wants to pull a few of Kaixin001′s loyal white-collar away from competitors like Sina Weibo.
  • The bandwagon of cultural soft power – China Media Project- Given the fog surrounding this proclamation on the role and development of culture and creativity, it’s fair to say that China’s political culture is the real focus here. The point is that China’s political culture has now taken up the idea of culture in a big way.Typically, when the central Party makes a big fuss about this or that new policy buzzword — they are called tifa (提法) in Chinese — everybody in the Party leadership, from the top down to the bottom, jumps on the bandwagon.When Hu Jintao tossed out the term “cultural soft power” in his 2007 political report, he ushered in months of feverish creation — not by writers, artists, filmmakers or comedians — but by lower-level Party leaders scrambling to implement an abstract idea they scarcely understood. Even leaders at the county level across China were holding “mobilization meetings” to “accelerate the raising of cultural soft power.”

    If there are aspects of this Party “Decision” that might have an appreciable impact on the creative industries, they remain to be seen. If changes in the media over the past two decades are any measure, the most interesting things we can expect are the unintended consequences of changes in the cultural sector as creative people try to push the political bounds and “hit line balls” in areas like film.

    But the most immediate impact of the recent plenary session of the 17th Central Committee of the CCP will be a surging tide of political blather about culture and the “rejuvenation of the Chinese people.”

  • Beijing’s growing pains mirror global population boom – Yahoo! News – Fourteen years after Beijing’s planned satellite city of Tongzhou rose from a small town with many scattered fields, it still lacks decent schools, hospitals and entertainment complexes that residents need to make it feel like home.
    Few of the people for whom Tongzhou was built — residents in overcrowded downtown Beijing — live there.
    Instead, thousands of young, middle-class and blue-collar migrants from poorer parts of China have moved in, contending with the lack of amenities and the daily jam of cars on the highway into Beijing, which now has a population nearly that of Australia’s.
    Far from being an easy fix to housing Beijing’s soaring population, Tongzhou and other satellite hubs in the capital have created new headaches for planners.
  • College girl offers 5 nights of sex for iPhone 4s, chat log exposed | ChinaHush -
  • The Eurobanks’ Latest Scheme to Escape the Pain of Recapitalization: Pull More Financial Firms into TBTF Complex- The most important thing that needed to happen in the crisis and didn’t was reducing the tight coupling of the system. The stymied Bank of England effort to separate retail from wholesale/investment banks would have been a step in the right direction.This regulatory capital relief effort gimmick is a massive step in the wrong direction. It enmeshes other financial players into the already-too-tightly connected grid of major financial firms, particularly the big dealer banks at the core of the global debt/over the counter trading markets. It has the effect of enlarging the “too big to fail” complex, so that if any large player gets in trouble, the damage done by its unraveling are greater and even more difficult to analyze in advance. And it creates more points of failure. Recall how the downgrading of comparatively small monolines led to losses at banks as they had to write down the instruments they guaranteed. If key providers of regulatory capital relief were to come into doubt, banks considered to be adequately capitalized would also come up short.The very fact that this device will apparently be tolerated on a large scale is proof that the officialdom is completely unwilling to stand up to continued banking industry looting and will allow schemes almost certain to create the need for even bigger bailouts to be foisted on ordinary citizens. This is neofeudalism wrapped in the mantle of modern financial technology. I can only hope things blow up quickly enough that the authorities who cast a blind eye on these practices are held to account.
  • A PBoC balance sheet primer | Institute for New Economic Thinking – Last time, I looked at the Chinese property market. The last link in that chain of financial interlinkages is the People’s Bank of China, the Chinese central bank. This post gives a quick introduction to the main monetary challenges faced by the PBoC. Next time I’ll connect the property bubble to the central bank.
  • MOFCOM Clarifies Issues regarding Pre-filing Consultation and Merger Control : China Law Insight – On 20 October 2011, the Anti-monopoly Bureau (AMB) of the Ministry of Commerce (MOFCOM) held a meeting with law firms to communicate information regarding  the authority’s pre-filing consultation practices.  The AMB also responded to many frequently asked questions about China’s merger control process, such as the notifiability of joint ventures.
  • 中国拟在身份证中登记指纹信息 有效保护安全_新闻_腾讯网 – Chinese National IDs will be linked to fingerprints
  • Bank of America Too Much of Behemoth to Fail: Simon Johnson – Bloomberg- The Obama administration says the Dodd-Frank financial reform law ends “too big to fail,” meaning that no financial institution will ever again need to be bailed out. The promise is alluring, but it’s already proving to be false.Consider the law’s promise in the context of Bank of America Corp. (BAC) Through the back door, U.S. regulators are facilitating another round of implicit bailouts, putting more taxpayer money on the line in the form of guarantees. Bloomberg News reported on Oct. 18 that regulators have allowed Bank of America to move highly risky derivatives contracts — and the associated downside risk — from Merrill Lynch into the insured retail deposit-taking part of the bank.
  • Tencent Buys 8% Stake in ChinaVision for HK$247.8 Million | iChinaStock- Chinese Internet giant Tencent has agreed to buy 8% stake in ChinaVision Media Group Limited (01060.HK), a Chinese TV and film producer.ChinaVision said in an announcement today that it has reached a strategic partnership with Tencent, in which Tecnent will promote and stream ChinaVision’s films,soap operas and other media contents online. The two companies also agreed to jointly produce video contents, according to the partnership.
  • Eight Questions the WSJ Could Have Asked KPMG China « Silicon Hutong- As a public relations professional myself, I want to congratulate the KPMG PR team on their coup in today’s Wall Street Journal. In an interview with the Journal‘s Duncan Mavin, Benny Liu, the head of the Audit practice at KPMG China is given an singular opportunity to deliver his messages in what was clearly a very friendly discussion.This interview could have been much more challenging for Liu. At a time when Chinese companies that are listed offshore are facing uncomfortable questions about the accuracy of their accounting, you would expect a newspaper that is ostensibly an advocate for investors to come down on a senior China auditor with some very hard questions. Alas, those question were not forthcoming. Not today, anyway.
  • The Bailout That Busted China’s Banks – WSJ.com- WSJ editorial page writer Sternberg overstating the dangers? He must not be reading Heard on the Street’s Tom Orlik//The irony is that China’s stimulus in early 2009 was hailed in some quarters of the West as its greatest success. Instead it has become one of the most severe risks to face the Communist Party in a generation. And as Ms. Chu shows, it will all start in the banks.
  • Managing in Asia: KPMG Audit Chief Benny Liu Faces China Risks – WSJ.com- WSJ: There’s a perception at the moment that fraud and corruption and accounting scandals are rife in China. How do you deal with that?Mr. Liu: We have rigorous risk-management procedures in terms of accepting clients. We evaluate them every year. We also classify our clients into different categories—for blue chips in Hong Kong that we’ve known for 30 years obviously the evaluation process will not be as rigorous as for a privately held business owned by a rich guy in China. In terms of the audit process, procedures will be more robust. Also, we come across new findings from not just our clients but we hear in the news about other companies gone wrong and we do a lot of training, put out case studies, make sure our staff are aware of the current environment and how to look for red flags. It’s challenging. That’s why our risk-management department is really huge now.
  • The New Luxury Consumer: White male serving Chinese couple in Toyota Highlander Advertisement – Bytes of China – Tricia Wang [ethnographer & sociologist researching cellphones and computers in China & Mexico] – Oh how this Toyota Highlander advertisment is reflective of the new global order.  I saw this picture in Guangzhou’s domestic terminal. A Chinese couple is getting out of their Japanese brand car into what appears to be a private yacht. A white male greets them, taking their travel items and appears to be eager  in their service.
  • 庹祖海:去年中国网游海外收入近2.3亿美元_中国经济网——国家经济门户 -
  • 毕马威审计主管谈中国风险-华尔街日报 -
  • Beijing boosts non-Party hires-Global Times- More than 100 people have been appointed to temporary posts in Beijing’s municipal government despite not being Communist Party of China members. Some say the appointments show the government is more open to hiring talent regardless of a person’s political status.From university professors to company executives, a total of 106 such talents, who have made outstanding achievements in their fields, will be serving temporarily on top of their full-time jobs, according to People’s Daily.According to the report, Beijing has never had so many people in temporary positions. Under the reform and development guidelines for 2010-20 the central government has also cleared the way for Chongqing and Shanghai to follow suit. Those two cities will be “training bases” for non-Party members appointed to temporary posts.
  • Did Groupon Value Its China JV Gaopeng at $500m in July? | DigiCha- Paying $45.2 for 9% equates to a $502,222,222 valuation. That seems high given the issues Groupon’s ($GRPN) Gaopeng JV has had. Is something else going on here?Chalk up another win for the Samwer brothers.
  • Chinese officials jailed for leaking economic data – Yahoo! News- BEIJING – Two Chinese officials have been jailed for leaking economic data to securities brokerages and four people who work in the financial industry are being investigated, a state prosecutor said Monday.Li Zhongcheng, deputy director general of the national prosecutor’s office that investigates official misconduct, said the two individuals shared classified data about economic growth rates, inflation, retail sales, investment and loan growth — all information with the potential to influence stock prices…The deputy director of National Administration for the Protection of State Secrets, Du Yongsheng, said Sun and Wu profited by trading stocks based on the information they divulged and also received payoffs in the form of fees for delivering lectures at brokerage events.

    Du said the superiors of Wu and Sun might also face investigation and punishment, but didn’t elaborate. He declined to respond when asked which brokerages were involved.

  • The U.S. Case Against China’s Internet Policies – Part I: USTR’s Information Request- Before looking at the substance of the request, one brief comment on the tactic. It’s possible that the U.S. is either attempting to build a legal case against certain Chinese policies or simply gathering information that might be used within the context of bilateral negotiations. Either way, using the mandated WTO information request procedure to do so seems like a very smart tactic to me, something that perhaps should be done more often.I always approve of methods that take the legal “high road.” In this instance, the U.S. wins notwithstanding the Chinese response. Either China discloses relevant information (which is what the U.S. wants) or it refuses (or, more likely, drags its feet), making the PRC look like the bad guy. Excellent positioning by the U.S.
  • Communist Land Sales Hurting China’s Poor – Bloomberg- WHAT PERCENTAGE GOES TO CORRUPTION AND NOT LOCAL FINANCES? AND WILL BLOOMBERG DO SOMETHING ON XIANGHE, NEXT DOOR TO BEIJING?//It’s a reversal of one of the core principles of the Communist Revolution. Mao Zedong won the hearts of the masses by redistributing land from rich landlords to penniless peasants. Now, powerful local officials are snatching it back, sometimes violently, to make way for luxury apartment blocks, malls and sports complexes in a debt-fueled building binge.
    City governments rely on land sales for much of their revenue because they have few sources of income such as property taxes. They’re increasingly seeking to cash in on real estate prices that have risen 140 percent since 1998 by appropriating land and flipping it to developers for huge profits.
  • 搜索首页 – 新浪微博-随时随地分享身边的新鲜事儿 – Sina Weibo Search Engine
  • 支付宝遭中小卖家集体“提现” [谢睿]__鲜橙互动 南都网 南方都市报 新闻互动网站 南都数字报 – SMEs trying 2 start run on Alipay by pulling cash out, out of anger over new Taobao fees? $yhoo
  • Review & Outlook: The Tibetan Suicides – WSJ.com- The Dalai Lama observed a fast last Wednesday to mourn Tibetans who have set fire to themselves to protest the Chinese government’s tight control over Buddhist monasteries. The most recent case of self-immolation came on Monday with 20-year-old nun Tenzin Wangmo. She is the ninth Tibetan since March to commit ritual suicide.The suicide of monks and nuns has the potential to ignite unrest among the wider population. It also draws the attention of the outside world to the dissatisfaction felt among Tibetans at Beijing’s ongoing attempt to control the selection of the next Dalai Lama.
  • AFN: Seeking Solutions to Alaska Natives’ Staggering Suicide Rate | Alaska Dispatch – In general, American Indians and Natives kill themselves close to twice as often as other Americans. But the rates are often much higher in certain regions, such as in Western Alaska, where it’s been seven times as high as the national average, and among certain age groups, including Alaska Native teens and young adults.
  • 史玉柱被约谈“自宫”封博-搜狐IT –   近日,有消息传出,史玉柱因8月份在微博上炮轰中国人寿增持民生银行而被北京证监局“约谈”。证监局认为史玉柱在微博上披露中国人寿与民生银行的虚假消息,造成民生银行股价严重异常波动。据报道,监管层开始密切关注新媒体的影响,在以后政策制定中亦会给予考虑。
    对此,史玉柱在其微博上表示将“自宫封博”,但其表示以前针对粉丝的慈善承诺仍会兑现。
  • Deng Xiaoping: The Man Who Made Modern China | On Point with Tom Ashbrook – We’re talking with eminent East Asia scholar Ezra Vogel about the man behind China’s astounding rise — Paramount Leader Deng Xiaoping.
  • Buffett’s Chinese Car Investment Fails to Bring Los Angeles Promised Jobs – Bloomberg- Los Angeles touted landing the North American headquarters of Chinese carmaker BYD Co. as a win that would generate jobs for the second-biggest U.S. city and make it a center for the growing market for electric autos.BYD America opens today about a year behind schedule with fewer workers than first targeted. The company, partly owned by Warren Buffett’s Berkshire Hathaway Inc. (BRK/A), has delayed plans to sell electric cars to retail buyers, citing limited availability of public chargers. Instead, it’s focusing on solar panels, batteries, LED lighting and rechargeable buses.
  • Zambia: striking the Dragon – FT.com- Zambia, the landlocked country in southern Africa that is the continent’s biggest copper producer, has been in the headlines a lot since new President Michael Sata won elections last month. Among other things, the country has suspended new mining licenses, temporarily halted metal exports, and is conducting an audit of the mining sector.All this is being watched closely thousands of miles away in Beijing. China, the world’s largest consumer of copper, has been steadily expanding business ties with Zambia and Chinese miners regularly describe the Zambia-Congo copper belt as a key area where they would like to invest.China has invested more than $2bn in Zambia, and 300 Chinese companies are present in the county, according to Xinhua News Agency.
  • Friedmanism at the Fed | The Nation- hat distinction belongs to Stephen Friedman, the former chairman of the board of the New York Federal Reserve Bank and a member of the board of directors of Goldman Sachs. Through those two posts, Friedman may have had access to privileged information about the extent of Goldman’s exposure to AIG and the opportunity to profit from the Fed’s bailout of the beleaguered insurance giant. While he was serving on both boards, Friedman purchased 52,600 shares of Goldman stock, more than doubling the number of shares he owned. These purchases have since risen millions of dollars in value–and raised allegations of insider trading.Friedman’s purchases were exposed by the Wall Street Journal in early May 2009, and within days he resigned as chair of the New York Fed. His resignation letter claimed that although he had acted “in compliance with the rules,” the suggestion of impropriety had become a “distraction” from the important work of the Federal Reserve. In a press release, New York Fed executive vice president and general counsel Thomas Baxter also said that Friedman’s acquisition of Goldman shares “did not violate any Federal Reserve statute, rule or policy.”
  • China microblogs: confusion, not crackdown – FT.com- Experts dismiss the idea that the Beijing Daily heralds new regulation.“I think more important would be for the mainstream media to raise the requirements it has towards itself,” said Liu Genqin, a media expert at Sun Yat-sen University in Guangzhou. “Beijing Daily is not [the Communist party mouthpiece] People’s Daily, and even People’s Daily’s line seems to be changing every few days now.”What is more important to watch is how the microblogs themselves change. $Sina Weibo, which used to list the posts that had received the most attention in a ranking, now only offers lists of “suggested” posts. This gives the internal censors the website is required to employ on behalf of the government much more leeway in burying posts that could prove unsettling or politically risky. Last month, Charles Chao, chief executive of Sina, said the company would tighten the microblog service’s internal content controls.

    Liu believes that is already having an impact on the medium’s vitality. “I have a feeling that the popularity has slackened a bit, that users are less lively, the topics more mediocre. One reason could be the attitude of the propaganda authorities, another the management by Sina, yet another the choices of netizens themselves.”

  • All sides should agree: down with the Big Banks | Campaign 2012- who is more crony socialist? //Liberal protesters “occupying” Wall Street hate the big banks, which they see as the engine of
    capitalism. But conservatives ought to hate the big banks because they are the enemies of capitalism.Three events last week cemented how the bailed-out subsidy sucklers of Wall Street continue to profit, not from the free exchange and risk-taking that embodies the market, but from cronyism and offloading their risk onto the taxpayer.
  • Alipay Suffers Mass Withdrawals, Service Outage | Marbridge Consulting – China Internet News – Chinese third-party payment processor Alipay has announced on its official microblog account that its platform was the target of large-scale fund withdrawals coordinated by protesting Taobao Mall SME merchants on the evening of October 21. Alipay users later reported being unable to use the platform the following two days. Alipay emphasized that consumers’ funds remained safe and available, and will continue to be insured by the Industrial and Commercial Bank of China and overseen by the People’s Bank of China.
  • China’s Maritime Strategy Being Tested Amid South China Sea Disputes-Caijing – The current situation has reflected a lack of ocean strategy, under which, China has been under a passive state when confronting with surrounding countries in disputed waters
  • 双城雀巢被指克扣奶农 地方政府或有共谋之嫌 – 消费·传媒 – 21世纪网- Nestle mistreating dairy farmers in China?当地多位奶农称,雀巢公司克扣奶农已成公开秘密,而常年克扣的背后则是地方政府的撑腰。
  • 中宣部副部长解读六中全会 回应外界关切_资讯频道_凤凰网 -

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