Re-imagining Too Big To Fail (TBTF), Part II

Extracted from an article in the Nikkei Asian Review:

M2 Money Supply

China  US$22.4 trillion
USA    US$13.2 trillion
Japan  US$8.4 trillion

China's M2 Money Supply is larger than the combined figure of USA and Japan. This is a canary in the coal mine.


St Stephen’s students held after secret cameras found on campus

St Stephen's College is a well-known school located in Stanley, Hong Kong Island. Alumni consist of who's who of Hong Kong society including Yip Man, the grandmaster who brought Wing Chun to Hong Kong. The seven students, age 15-16 years old, are alleged to have placed cameras in changing rooms as well as classrooms. The former included both male and female. The cameras were said to have been placed as long as three months ago. The school is supposed to be an elite education institution teaching in a 'Christian environment.' Presume its Christian teachings were not inculcated properly into these boys.

My issue with it is that the incidents involves up to seven (so far) students. This is more serious than your average Peeping Tom or teens-on-hormone-gone-wild behaviour. The students are old enough to know what they were doing and the consequences if caught. Some of the students may have siblings in the same school or even friends whose sister or brother study in the same school. Imagine your friends sharing these photos. And the whole thing went on undiscovered for three months which tells to some extent the security awareness of the school all made the more grating when it has boarding facilities.

By the way, this guy is on the School Council, Reverend Douglas Koon, who were in the press a few years back. In 2015, he likened Hong Kong to a "cat" and the Beijing Central Government to its "master" when he was making a reference that if the people of Hong Kong want to have more freedom then they should behave themselves, in others words, obey the master's wishes. In 2014 - the year that saw the Umbrella Movement occurred - he came out in defense of the archbishop of the Hong Kong Anglican Church a.k.a. Sheng Kung Hui when the latter said (this before the Umbrella Movement) that the pro-democracy protesters should learn to keep quiet as Jesus remained silent in the face of crucification. He added icing to the cake by further adding that, after some student protesters arrested in a prelude to the Movement complained that while under prolong arrest they had no food and had to queue for the toilet, 'why didn't they bring along their Filipino maids to the march?'

With that kind of Christian teachings, why should anyone be surprised the types of student-followers that come after.

Addendum dated 6 April 2017: That the school is undergoing an identity crisis can be gleaned from the difference in its Latin and Chinese motto. In addition, a normal Christian school especially one which is more than a hundred years old would not under normal circumstances have Chinese characters in and as part of its emblem. Well, this school has and nowhere in its history milestone does it state when the Chinese motto became part of the emblem. No wonder the school and its students have an identity crisis.


Recently, Hong Kong has been ranked in the list of Healthiest, Happiest and Most Expensive countries/cities to live in respectively:

Bloomberg Global Health Index - (outside of Top 50)!
World's Happiness Report 2017 - ranked #71
Economist Intelligence Unit, Most Expensive- ranked #2

On the same note, the city of Singapore is ranked #25 (but #1 in Asia) and #1 as the world's happiest and most expensive city respectively. Happy and expensive in correlation? Would be strange to think so.


What lousy English

A headline taken from a local circular in Hong Kong: 'Cathay Pacific reports second loss since 2008 as rivals’ cheaper fares erode margins.'

On 15 March 2017, Hong Kong's flagship airline, Cathay Pacific, reported a loss of HK$500+ million in its 2016 financial year. The last time the airline made an annual loss was back in the financial crisis year of 2008.

So, what it meant to say was: 'Cathay reports first loss since 2008...'


Re-imagining Too Big To Fail (TBTF)


Ranking of a few of the world's largest countries' bank assets at end-2016:

USA $16 trillion
Eurozone $31 trillion
Japan $7 trillion

and China's $33 trillion! (Lo and behold, this figure is said to be underestimated, as with everything that pertains to China) By the end of 2017, the assets are expected to increase to a whopping 37 trillion. China just announced that its targeted GDP growth for 2017 is 6.5%. For sure it will achieve this number but at what cost?

In the same context, 3 of the largest banks in the world are now China-owned.

Somehow, the above superlatives sound a bit hollow because it is just all these money sloshing around and nothing else. There are no key drivers such as productivity, innovation, etc. The result is the chunk of money transfers from one bubble to another. it is no stretch of imagination that the China government was trying to enrich the economy and the wealth of its population by handing out tons of money. However, the money was leaking out of the country and did not benefit the country nor its people. A lot of it was wasted. Now that China is trying to stop the leakage via capital controls, this money will be trapped within the country thus aggravating more bubbles within the country. China has created a money monster which it can't control.

At some point, something has to give. Nobody knows the impact within China but I think the rest of the world will certainly be on the receiving end of it. It is easy to prepare for the worst knowing how worse is going to be but this is one worse that is going to be big and outside of imagination.


Imitation is the sincerest form of flattery

Many years back, the winner of the Oscar's Best Picture award, The Departed, was based on the Hong Kong flick, Infernal Affairs, however, the former's director when accepting the award paid a compliment to the latter (although he wrongly mentioned that it was a Japanese production).

The winner for Best Picture in 2016, Moonlight, has been said to be based on a number of Hong Kong movies. You can decide yourself here:

Excerpt from 'The side-by-side comparisons that show how a Hong Kong director influenced “Moonlight':

Wong (Kar Wai)’s influence on Jenkins is clearly seen in a video made by YouTube user Alessio Marinacci, which juxtaposes scenes from Moonlight against Wong’s Days of Being Wild (1990), Happy Together (1997), and In the Mood for Love (2000). Moonlight cinematographer James Laxton also told the Film Stage blog that there was a Dropbox folder full of images, including screengrabs from Wong’s movies, in preparation for the production of Moonlight.

Cold shoulder? More like bully the bully.

This is a list of world leaders U.S. President Donald Trump has spoke by phone with since inauguration:

President of Mexico, Enrique Pena Nieto

Canadian Prime Minister, Justin Trudeau
President of Indonesia, Joko Widodo
Israeli Prime Minister, Benjamin Netanyahu
President of Egypt, Abdel-Fattah El-Sissi
Indian Prime Minister, Narendra Modi
British Prime Minister, Theresa May
Prime Minister of Japan, Shinzo Abe
German Chancellor, Angela Merkel
President of Russia, Vladimir Putin
President of France, Francois Hollande
Prime minister of Australia, Malcolm Turnbull
King of Saudi Arabia, Salman bin Abd al-Aziz Al Saud
Crown Prince of the UAE, Mohammed bin Zayed
Acting President of South Korea, Hwang Kyo-Ahn
King Abdullah II of Jordan
President of Ukraine, Petro Poroshenko
Prime Minister of New Zealand, Bill English


Conspicuously missing is China President Xi Jinping. The last time the two communicated was before inauguration via a telegram and a phone call made to Trump. Befitting China's label as an upcoming world superpower, one would expect President Xi to be close to if not at the top of the list. In Chinese parlance, President Trump appears to not place Xi in his eyes for now.

It's anyone guess where this is leading to. And wherever it is leading to, it looks like the U.S. is telling China in no unclear terms that it will be on the former's terms. China has been trying to act on its own terms for many years -- bordering on bullying -- that should please many to see the country now getting its comeuppance. Sounds like I will call you when I feel like it.


U.S. warns North Korea of 'overwhelming' response to any use of nuclear weapons.

Most, especially in Asia, would have missed the above news. If the U.S. were to nuke North Korea, which country will suffer the biggest impact (not talking about South Korea)? China, of course. In an indirect way, the U.S. is warning China to watch its conduct in the South China Sea or keep its reins tight over North Korea. Either way, China out of its own choice or not will have to suffer the fallout of a nuclear strike.
Politics at what cost (WWII)

On 16 November 1941, two battalions arrived from Canada as reinforcements for the defense of Hong Kong (the city surrendered to the Japanese forces on Christmas Day 1941.) I remembered reading elsewhere that most of the soldiers were in their early adulthood or 20's. 

However, the writing was on the wall for the end of Hong Kong in early 1941. The British Empire gave up on defending the city as early as 7 January 1941. In response to a telegram asking for reinforcement of Hong Kong, Winston Churchill said: “If Japan goes to war there is not the slightest chance of holding Hong Kong or relieving it. It is most unwise to increase the loss we shall suffer there. Instead of increasing the garrison it ought to be reduced. Japan will think twice before declaring war on the British Empire, and whether there are two or six battalions at Hong Kong will make no difference. I wish we had fewer troops there, but to move any would be noticeable and dangerous.”

Guess the 'we' do not include Canadians. While the poor soldiers were defending Hong Kong, the Empire was occupied with how to re-take Hong Kong after the surrender of the Japanese Imperial Army.

Historically, the period between 8-25 December 1941 has been known as the Battle of Hong Kong or Defense of Hong Kong, however, it was never that because it had been already been decided as the 'Fall of Hong Kong' before it even began.   

References:
Spider? More like parasite

Always wondered why and how the city of Singapore became a financial centre. Perhaps its genesis lies with the city of London. Now part of the question can be answered. Courtesy of Wolf Street's World's Worst Tax Haven to Expand Its Operations:
Unbeknownst to even many Brits, the “City of London Corporation” has functioned for centuries as an offshore island inside Britain, even inside London, a tax haven in its own right,
... Not only is the City of London paradise on earth for rights-seeking corporations; it is also the rotten, beating heart of a vast, secretive financial web cast across the globe. As Shaxson points out, each of the Web’s sections – the individual havens in the Caribbean and elsewhere (all of them Crown dependencies) – trap passing money and business from nearby jurisdictions and feed them up to the City, just as a spider catches a fly.
Corporations in the city of London, which are mostly financial types, are able to vote as an entity in council elections. Each entity is able to garner a certain number of votes. The bigger the corporation the more votes. Sort of like the functional constituency sector in Hong Kong.

Think of how Singapore became a financial centre. The city consistently blows its trumpets by saying that its success was built on people because of its lack of natural resources. All these years, it is a known fact that individuals and businesses from the nearby region park most of their funds in financial institutions in the city.

After alcohol, tobacco and fat, Sugar is the new evil

In the pre-Internet days, we wouldn't even have the slightest chance to know about how the sugar industry colluded with universities to hide the negative effects of sugar in the 1960s. We can add this to the long list of hidden truths that are slowly being re-discovered. Not only was the fact that sugar contributes to heart disease. etc. but the additive was added to tobacco in order to increase addiction i.e. the extra kick. From How Sugar Helped Hooked American on Cigarettes:

“Were it not for sugar,”... a former U.S. Department of Agriculture tobacco official quoted..., “the American blended cigarette and with it the tobacco industry of the United States would not have achieved such tremendous development as it did in the first half of this century.” The combination... was a “stroke of genius.”

Still think genius only in the positive? A movement has started to label sugar as a toxin which was written about in a book called Pure, White and Deadly by John Yudkin published as far back as 1972. If you think that drinking fruit juice is any better, you might want to think again. Robert Lustig is the person who started the above-mentioned movement.

Did anyone mention the 'Sugar King of Asia'?