Understanding China, One Blog at a Time

An American in China

Archive for February 20th, 2011

Mao Sighting in China

Posted by w_thames_the_d on February 20, 2011


I saw this guy on the subway and swore he looked like Mao. In this photo it’s not as obvious but the guy was a dead ringer for Chairman Mao.

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Poverty in China- Chinese Photo

Posted by w_thames_the_d on February 20, 2011


This guy is a poor man in China. Not one of the extremely poor as he has migrated and works in Beijing, but poor nonetheless. You see these guys all over the subways toting those big bags with their clothes and whatnot inside. The Chinese hate them and are humiliated by their presence, I find them fun to talk to.

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Red Hats in China- Communist Friends

Posted by w_thames_the_d on February 20, 2011


Excerpt from “The Party”- (Richard Mcgregor)

In late 2008, Wang summed up the rules he had learnt for doing business as an entrepreneur in China. From the moment he established his private business, he said, he had been careful to take on a government shareholder, to give his company a ‘red hat’. ‘You take too much, the state is unhappy, and you take too little, you get upset with yourself,’ he said. When this first state shareholder was replaced a few years later, he made sure his new partner was state-owned as well. The first rule, he said, was that you will not develop quickly without a ‘red hat’, or a state partner. And second, you had better be careful about making it big without one. He had no need to articulate the third rule, which he had learnt in the wake of 1989: to stay out of politics altogether.

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Religion in China

Posted by w_thames_the_d on February 20, 2011


From-“The Party-new (Richard Mcgregor)
excerpt:
“In China, the Party tightly controls religion, mandating only five official faiths and demanding that all services be registered with the local branch of the religious affairs bureau. Non-government organizations and private charities have struggled to gain a foothold in China for similar reasons, because the government is reluctant to register them and provide them with a firm legal foundation on which they can operate. The Party’s management of religion, NGOs and the Avon lady is founded on the same principle, to prevent them developing into rival centres of power. As innocent and clean-cut as the industry seems in the west, direct sales in China rolled into one incendiary package in the business arena the ingredients that so worried the Party about religion and NGOs. Evangelical-style rallies attracted tens of thousands of people, who, as part of their recruiting drives, would rise to their feet to deliver inspirational speeches about what direct sales had done for them. Herbert Ho, who then worked for Amway, recalled hearing one man at a rally complain that he had been with the Party for thirty years and ‘got nothing. I have been with Amway for three years and I have already got enough money to buy a house and send my children to college. Amway is my new home.’ Ho added: ‘This was very uncomfortable for the officials to hear. There was also a whiff of religion for them. The Chinese government does not respond well to this.’ One foreign firm had recklessly held a sales gathering on 4 June, the hyper-sensitive anniversary of the 1989 massacre.”

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My Crooked Chinese Friend and Why I Will not Buy Chinese Stocks

Posted by w_thames_the_d on February 20, 2011


I have a Chinese friend who is an entrepreneur. The guy is rich and is a pretty likeable sort. He started a few companies and then sold them, (he and his wife’s parents are both ‘officials’ as well). When a friend and I started a company, he said he could get us some funding. I said that we were just starting out and had few sales, he told me not to worry, and smiled.
I never went for the funding from this guy, we did something else, but I then asked his number two about my friends companies.

As we explored the financials of one of his current three businesses, I was surprised to find out that although the thing had been bleeding cash for the past three years, it was still able to get funding in China. I asked how they could continue to get cash if they had a low level of sales. The guy laughed and explained that my friend was one of the owners of the company. And all owners also had other businesses, so to make this company seem healthier, one of the other co-owners would have one of the managers of one of his other companies sign an ‘allegedly’ bogus sales contract with the failing firm.

I was taken aback. I said that in essence was a big scam and his company should have gone broke. He said that due to the way Chinese companies are run, it’s always like this.
You may discount this as a small example of China and disregard the post and tTo me it does not matter, as I have decent idea of what is happening here. The owner of that company is now peddling a web ‘security’ package in Australia and/or the UK. Knowing what I do about China, I’d never buy stock here nor in what my friend owns. But I do know that if I need to get cash for any of my future endeavors, he is a good resource.

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Chinese Market

Posted by w_thames_the_d on February 20, 2011


Market in Beijing

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Chinese Government Gives a Vote of Confidence to Her Mlik- “It is Generally Safe” WTF!!!

Posted by w_thames_the_d on February 20, 2011


File this under “WTF are the communists thinking?”
Here is an excerpt from the chinadialy where the leaders of the Chinese bureau of safety and foods and such says that milk in China is  “Generally safe”!
NO shit, the guy says its “generally safe”. WTF is generally safe? Does this mean it has less poisonous toxins than before, or it is fit for human consumption? Call me spoiled but I am used to the government issuing statement like “this is fit for consumption”, but that is in the west, I guess here in China, this is all the better they can do. ….

excerpt:

“BEIJING – China’s Ministry of Agriculture (MOA) said ThLursday the quality and safety of fresh milk on the Chinese market was “generally safe” and that no leather hydrolyzed protein or other prohibited materials had been detected in its tests in recent years.”

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Huawei and its Communist Links

Posted by w_thames_the_d on February 20, 2011


From “The Party” (Richard Mcgregor)

Huawei, the telecommunications equipment manufacturer and perhaps China’s most globally successful company, is careful to say it is a collective rather than a private company, a definitional distinction that has been essential to the company’s receipt of state support at crucial points in its development. In 1996, Zhu Rongji, then vice-premier, visited Huawei with the heads of four large state banks in tow. On hearing the company needed funds to compete with foreign firms in the domestic telco equipment market, Zhu ordered the banks on the spot to support the company. ‘Buyer’s credit [for local customers] should be provided!’ Zhu declared. Huawei’s status as a genuine collective is doubtful. The company has never published a full breakdown of its ownership structure. Most shares are believed to be owned by Ren Zhengfei, a former People’s Liberation Army logistics officer who founded the company in 1988, and his managers. The same murky structure characterizes Ping’an, the Shenzhen-based insurance company. Ping’an, one of China’s largest financial institutions, is classified as a private company, but the true ownership of large chunks of its shares remains unclear.
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Comment on Investing in China

Posted by w_thames_the_d on February 20, 2011


Here is an excellent, imho , opinion on investing in China. The author of the comment is the authoress of one of my favorite blogs found here. I agree withe her sentiments and am amazed at how ignorant people are of how things work in China. One of my good friends just sunk tens of thousands into a Chinese stock and he understands that 20% of all Chinsees stocks listed in the USA are being investigated for some form of fraud. But, greed, being what it is, often blinds us. to be forewarned is a beautiful in China
excerpt from comments.
“My brother-in-law asked us the other day, “So if I wanted to invest in some stocks in China, what would you recommend?” Mr. Hot Stuff and I looked at each other and said in unison, “Don’t. Just Don’t.” Mr. Hot Stuff went on to say that everything is so corrupt in China that if you reallyreallyreally want to invest there, find out which companies the rich party officials are invested in and then invest in those same companies. Otherwise, just kiss your money goodbye.”

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Chinese Market

Posted by w_thames_the_d on February 20, 2011


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