Notes from the Other Side of the World. We are in our third year of living in Shanghai in the People's Republic of China. This blog is a journal of traveling 12 hours in the future.
Greetings and welcome back to the Yellow River Chronicles as we wind down the New Year. The YRC staff has lit out for the territory, as Huck Finn said:
'I reckon I got to light out for the territory ahead of the rest, because Aunt Sally, she's going to adopt me and civilize me, and I can't stand it. I've been there before.'
We will be back next week with a full report on Bali, Indonesia, with the traditional mix of snarky commentary and ego-centric journalism that many regard with wild surmise. In the meantime, we wish you a wonderful New Year's Celebration.
Greetings, hello and welcome back to the FINAL Yellow River
Chronicles of 2012. However, to keep
things in perspective and avoid panic in the financial markets, you should be
informed that this is not the final YRC of the Lunar Year of the Dragon (which
ends in February) but it may be the final YRC of the Mayan calendar. Complicated, this temporal thing, yes?
The Great Helmsman KNOWS who has been naughty and even naughtier
Before we proceed further, we at the YRC would like to wish
all our friends and readers a happy Celebration of the Winter Solstice and
Subsequent Return of the Sun. The YRC
has readers of many nations, many religions and many holidays, and we wish you
all a wonderful time, and thanks for tuning in.
Speaking of tuning in, last week many of you were stunned
(or perhaps secretly pleased) when the YRC went “black”, as in, was totally not there. The more conspiracy-minded of you suspected a raid by the Chinese
authorities on the YRC offices high above the lovely Jing’An temple or some
other malfeasance. Would that it were
true, it was simply stupidity on the part of the YRC technical staff, who have
ALL been summarily SACKED for the mistake.
This was all similar to the opening credits of “Monty Python and the
Holy Grail” where:
“We apologize again for the fault in the subtitles. Those
responsible for sacking the people who have just been sacked have been sacked”
Now That All that Fawning and Groveling About is Over...
This is the pasta, people, not the city
We were actually waiting for part Two of the “Build It and No
One Will Come” series here at the YRC.
As you may recall, last week we were chatting about the lovely city of
Ordo (no, not the pasta, that is Orzo) and it’s amazing sense of design and
space and generally emptiness (once again, not the pasta).
We are
also standing at a conceptual intersection in the Yellow River Chronicles. You may also recall we did a small series on
amusement parks and then we sort of pasted in some random filler and then we
did some more filler and then an article on empty cities. (Thanks to Neil Thatcher for the edits!)
Well, it seems that in addition to strange
and disputed theme parks and large empty cities, the People’s Republic also
has….<dum….dummm>, empty theme
parks! Yes, truth! It turns
out that there are now many, many empty cities, shopping centers, apartment
buildings, theaters, restaurants and airports.
Here is an excerpt from a highly authoritative BBC articles that you can
read here: BBC Article
China's ghost towns and phantom malls
Weeds cover a deserted theme park north of Beijing
See, conceptual overlap...an empty....Chinese...theme park! Thanks, Trey!
By
Robin Banerji & Patrick Jackson
BBC News
As growth slows,
China's huge investment in infrastructure is looking ever harder to sustain,
leaving a string of ambitious projects - towns, shopping malls and even a theme
park - empty and forlorn.
"We have spoken a
lot about these ghost towns in Ireland and Spain recently [but China] is
Ireland and Spain on steroids," says Kevin Doran, a senior investment fund
manager at Brown Shipley in the UK.
Investment in
infrastructure accounts for much of China's GDP - the country is said to have
built the equivalent of Rome every two months in the past decade. And with such
a large pool of labour, it is harder to put the brakes on when growth slows and
supply outstrips demand.
"You have got
seven to eight million people entering the workforce in China every single
year, so you have to give them something to do in order to retain the
legitimacy of the government," says Doran.
"Maybe 10 or 15
years ago they were doing things that made sense - roads, rail, power stations
etc - but they have now got to the point where it's investment for investment's
sake
Wonderland Amusement
Park, Nankou Town, Changping
The Disneyesque castle
and medieval ramparts of this theme park north of Beijing, conceived nearly 20
years ago, lie abandoned. Local farmers grow crops among the empty buildings.
In the mid-1990s,
developers had promised to build the largest amusement park in Asia, but the
project got mothballed over a land rights dispute.
The site does in fact
attract visitors, according to locals quoted by Chinese media, but hardly the
sort the developers had in mind - they are drawing students, photographers and
artists from Beijing, apparently, in search of a "ruin culture".
Thames Town, Shanghai
Photographers who
visit this imitation English town generally come not to capture decay but
newlyweds, posing in front of mock-Tudor buildings and red phone boxes.
The Shanghai suburb
boasts a market square, a castle, a neo-gothic church, cobbled streets, a pub,
a chip shop, Georgian-style houses and statues of well-known English figures,
such as Winston Churchill, James Bond and Harry Potter.
As a backdrop, Thames
Town is a hit with the wedding industry, but that is about it.
"The city is a
virtual ghost town, with empty shops and unused roads," according to an
article in Business Insider.
Yet perhaps not all is
lost. Apartments have reportedly been sold, to buyers who want them as
investments and second homes.
The proof of the
developers' pudding may lie in news that the construction of another mock
English town is being planned near Beijing.
"Four miles of
polluted rivers running through 1,000 acres of blighted semi-rural land will be
restored and landscaped into scenic standards becoming of the English
countryside," a Chinese official told the Daily Telegraph.
So, the question that remains (in addition to “WTF Chairman MAO!),
is where is all this leading?
Photo courtesy of BMW
And here is the final, prophetic tale (with some
interesting ideas on finance) from Shiji, in eastern China.
The rise and fall of a
Chinese crab town turned "BMW town" and then back to crab town (sort of like a
small Iceland, really) is chronicled in the Daily
Telegraph (article follows).
To summarize, a small
town in China with an average annual income of around $1,500 a year suddenly
became fabulously wealthy…for a year or so.
At the center was “King Claw” (yes, that was his real nickname) who
orchestrated a massive $50 million Ponzi scheme with the assistance of local
party officials.
And in the end…
…there was little
demand in the end for the huge apartment blocks, which today stand empty and
half–finished. And when the borrowers started defaulting on King Claw's loans,
the pyramid collapsed. Around 1,700 villagers have complained to the police,
some having lost their entire life savings. Two villagers were killed in a
mysterious car crash after trying to reclaim their money from one of the loan
sharks.
The YRC Economic Staff Opines...
This ain't Dali, but it ROCKS!!
With all this emptiness in mind, It appears to the economic staff of the YRC that the People's Republic has created a potent mix of unregulated financial markets, real estate speculation and a naïve investor base combined with local government corruption that is fueling one hell of a party, somewhere, people!
Here is the article, which is worth reading in its entirety:
BMW
town crashes in pyramid fraud
For a short while, life
in Shiji, a small crab–farming village in eastern China, seemed too good to be
true.
For as long as anyone
can remember, Shiji has been poor. The village is little more than a dusty grid
of brick shacks and its residents live on an average of just 10,000 yuan
(£1,000) a year.
But this spring, a
miraculous transformation occurred. The locals suddenly noticed that they were
rich.
"We have become a
BMW town!" wrote one shocked villager on a local internet forum. "In
our county, there are now 800 BMWs and 600 Mercedes, 500 Audis, 50 Porsches, 30
Jaguars, one Ferrari, one Lamborghini and one Maserati," he added.
A forest of cranes had
also sprung up around the village, constructing large apartment blocks which
advertised themselves with pictures of English butlers and sumptuous,
chandelier–lit dining rooms.
Miracles abound in
modern China, where countless families have become fabulously wealthy in a
single generation. But the dramatic change in Shiji's fortunes raised eyebrows.
Chinese journalists
soon arrived to count the number of BMWs on the roads (10 in 13 minutes,
according to CCTV, the state broadcaster).
Then they started
asking questions about where the money had come from.
Earlier this month,
Shiji's boom ended as abruptly as it began.
The local Dragon Court
BMW dealership has been shuttered; its owner is under house arrest. And as The
Daily Telegraph arrived to investigate, jittery local officials were quick to
detain us.
"It is not worth
looking into too deeply," cautioned one of them, loading us into the back
of a black sedan.
What happened in Shiji
is a fraud that plays out every day in some corner of China's murky economy, as
local Communist Party officials and greedy entrepreneurs collude in vast
pyramid schemes.
"It all began
when a man named Shi Guobao returned to Shiji after working in Beijing,"
said Zhu Yi, the head official in the village.
"He became a
property developer, but he wanted to make a bigger fortune so he decided to
also become a loan shark." Together with 17 of his friends, Shi began
tapping the villagers for their savings, promising to pay them 10 per cent
interest each month.
The gang quickly
raised 350million yuan, (£35.5million) which they then lent out at rates of 30
per cent or more each month to borrowers including local property developers.
Shi became known as "King Claw", the man at the head of the pyramid.
For a while, the
scheme worked well. Other property developers borrowed from Shi in order to
begin construction and the local government, which earned income from every
acre sold to the developers, also prospered.
During the boom, the
villagers reported fireworks being lit in celebration almost every night.
The owner of the BMW
dealership, Zhang Shanyuan, flooded the streets of Shiji with cars when his
friends came to celebrate the birth of his son.
But there was little
demand in the end for the huge apartment blocks, which today stand empty and
half–finished. And when the borrowers started defaulting on King Claw's loans,
the pyramid collapsed. Around 1,700 villagers have complained to the police,
some having lost their entire life savings. Two villagers were killed in a
mysterious car crash after trying to reclaim their money from one of the loan
sharks.
Today, the only
luxurious cars left are parked outside the local county government offices and
Shi and his 17 friends are either in prison or under house arrest.
"I am not sure if
any government officials were involved. As far as I know, no local government
officials have any luxury cars. The cars outside the government offices must
belong to other people. And there were only 152 BMWs registered in the
county," said Mr Zhu, who escorted us 200 miles away to Nanjing before
releasing us so that we could not pry any further.
Greetings, Comrades and welcome to this week's Yellow River Chronicles. This week we are RELEASING THE NERD from the YRC staff basement where he ticks and ties and plays furtively with his stapler. He's almost here now, scurrying up the stairs while carrying his laptop, a ten-key calculator and some pencils (.5 mm, we betcha).
By the way...it's cold in the basement...
We have Released the Nerd because we are going to discuss <cough> economics. As you all know, the economy of the People's Republic remains a subject of fascination and speculation for many as it continues to hurtle along at a compound rate of 10,043%* a year. As proof, please see the attached, highly technical chart for the more analytic of you. And, it looks REALLY cool.
(*this is an...exaggeration)
China GDP and real GPD growth rate from year 1978 - 2009
Chart copyright STARMASS, whoever they may be. They sound like they work for somebody on the set of Dancing with the Large or something like that, don't they??
The most current projection by the YRC staff is that the Chinese economy will be larger than all the combined economies of the Universe by the end of the year. That is how fast it is growing, people. It's going to be huge! A veritable unstoppable juggernaut of economic growth!
What if You Built it and They Did Not Come?
But then, consider this really cool video from the City of Ordos, built in Inner Mongolia (the part of Mongolia that is part of China, not Mongolia, an independent state).
Watch: Gorgeous video of a Chinese ghost town turned into a skatepark
The video and notes below are from Shanghaiist.
Ordos is a city in Inner Mongolia, originally built for 1 million people it houses only a few thousand. Huge modern city with practically no foot traffic? It was just a matter of time before someone turned it into a skatepark.
We look forward to the sequel set in the impending ghost town of Lanzhou, for which developers are levelling 700 mountains.
Directed, filmed & edited by: Charles Lanceplaine
Additional filming: Patrik Wallner & Tommy Zhao
Music: You Me by Hamacide + Chacha
Sound mix: Gaetan Lourmiere
Logo: jmartdesign.com
Skaters: Jay Meador, Gustav Nymans, Tommy Zhao, Alexander Hwang, James Capps, Elliott Zelinskas & Brian Dolle [Via:Business Insider]
"Kids are like, 'Let’s move there. It’s a skate paradise!'' director Charles Lanceplaine says about the reaction to his newest skate film, Ordos. "But there's nothing to do there. There are no restaurants or anything. There’s one night club. We tried to go but no one was there."
BBC has this to report:
In Inner Mongolia a new city stands largely empty. This city, Ordos, suggests that the great Chinese building boom, which did so much to fuel the country's astonishing economic growth, is over. Is a bubble about to burst?
A huge statue of the mighty warrior Genghis Khan presides over Genghis Khan Plaza in Ordos New Town. The square is vast, fading into the snowy mist on a recent Sunday morning.
Genghis Khan Plaza is flanked by huge and imposing buildings.
Two giant horses from the steppes rise on their hind legs in the centre of the Plaza, statues which dwarf the great Khan himself.
Only one element is missing from this vast ensemble - people.
There are only two or three of us in this immense townscape. Because this is Ordos, a place that has been called the largest ghost town in China.
Most of the new town buildings are empty or unfinished. The rampant apartment blocks are full of unsold flats.
According to Wikipedia, Ordos is not suffering economically.
Ordos is one of the richest regions of China. With a nominal per-capita GDP of US$14,500 in 2008, it is ranked ahead of the capital city of China, Beijing. It is extremely rich in natural resources, having one sixth of the coal reserve in China. The pillars of its economy are textile (wool), coal mining, petrochemicals, electricity generation and production of building materials.
So there you have it! The vacancy conundrum, straight from the People's Republic and points economically challenging as we lead into next week's Yellow River Chronicles. A rapidly expanding economy, an empty town, and a red Swingline stapler. Check it all out at next week's Yellow River Chronicles!
Hello and welcome back once again to the quiet offices of the YRC, high above the clamor and clatter of daily activity in the streets here On the Other Side of the World. Our subject this week is credibility, near and dear to the good old YRC, a veritable bastion of journalistic moral androgyny. Bastion, people!
This may be a short issue because our links to the outside world are rapidly closing as three GIANTS of journalistic integrity lock headlines in a battle over their veracity. Yes, the window to the internet is once again closing as we received news that ONE of our VPN providers was temporarily shut down. But we hope to finish this week's column before lights out...again.
Background on the Triad of Credibility:
The first credibility salvo was by The New York Times, which published a story concerning the personal wealth of China's Prime Minister. You can read the entire article (click here for the NY Times Story) but the gist of it was that the historically poor family of Wen Jiaboa had amassed a fortune of $2.7 billion during his tenure as prime minister. This from the Times:
Many relatives of Wen Jiabao, including his son, daughter, younger brother and brother-in-law, have become extraordinarily wealthy during his leadership, an investigation by The New York Times shows. A review of corporate and regulatory records indicates that the prime minister’s relatives — some of whom, including his wife, have a knack for aggressive deal making — have controlled assets worth at least $2.7 billion.
In many cases, the names of the relatives have been hidden behind layers of partnerships and investment vehicles involving friends, work colleagues and business partners. Untangling their financial holdings provides an unusually detailed look at how politically connected people have profited from being at the intersection of government and business as state influence and private wealth converge in China’s fast-growing economy.
Hmmm. $2.7 Billion? Are you sure??
There was, of course, considerable reaction to the story here in the PR of C, and access to the New York Times was promptly deleted . No more times for you, sir. And you, sir. The official, PR of C version of The New York Times (well, sort of) promptly went on the attack. This from the UK Telegraph (click here to read the entire story).
China's People's Daily launches attack on The New York Times
The mouthpiece newspaper of China's Communist Party has launched a blistering attack on The New York Times, accusing it of "faking" and "distorting" news and being a government "propaganda tool".
People's Daily turned its canons on the 161-year-old newspaper on Monday, after The New York Times published the results of an investigation into Mr Wen's family's financesPhoto: Alexander F Yuan/AP
The 1,500 word People's Daily editorial appeared to be a direct response to The New York Times's explosive exposé last week about the $2.7 billion (£1.67 billion) "hidden fortune" of the family of Chinese prime minister Wen Jiabao.
But in a humiliating about-turn, within hours of the People's Daily publishing its lengthy assault on the American newspaper's journalistic integrity it emerged that much of the Chinese newspaper's critique had in fact been plagiarised from other sources.
The Beijing-based People's Daily turned its canons on the 161-year-old newspaper on Monday, three days after The New York Times published the highly embarrassing results of its one-year investigation into Mr Wen's family's finances.
"For a long time, the New York Times has [had] one line printed on its masthead, 'All the news that's fit to print'," noted the People's Daily opinion piece, under the headline: 'New York Times: scandals stack-up, prestige declines'.
"This century-old newspaper claims its news is authentic and reliable, yet there have been quite a few [cases of] plagiarism and fake news in recent years," added the combative piece published on the website of a newspaper which is controlled, funded and censored by the Chinese government.
It turns out the New York Times has a history of faking news," the People's Daily went on, pointing to the damaging scandal surrounding reporter Jayson Blair, who resigned in 2003 after being accused of "frequent acts of journalistic fraud".
So NOW Who Do We Believe?
So, the NYT is a propaganda tool that fakes the news. Hmmm. You can now understand that two giants of journalism are fighting it out, toe to toe for the Grand Credibility Champion title here. But before the YRC climbed into the ring to sort those two out, a third contender appeared on the scene.
It was reported recently, in aforementioned People Daily, that Kim Jong-Un, the young leader of North Korea, had been named The Sexist Man in the World." Why, he even beat out South Korean rock legend PSY of Gangnam style fame. China Daily on-line produced a 55-page article and things were going just FINE until it was revealed that the source of their information was....the THIRD in our TRIAD of Credibility, The Onion:
The online version of the Chinese Communist Party's official newspaper appears to have fallen for a spoof by the US satirical website, The Onion.
The People's Daily ran a 55-page photo spread of North Korean leader Kim Jong-un after he was declared The Onion's Sexiest Man Alive for 2012.
He is shown riding horses, holding children and greeting his troops.
The spread is accompanied by tongue-in-cheek quotes from The Onion about the "Pyongyang-born heart-throb".
"With his devastatingly handsome, round face, his boyish charm, and his strong, sturdy frame, this Pyongyang-born heart-throb is every woman's dream come true," the People's Daily quoted The Onion as saying.
"Blessed with an air of power that masks an unmistakable cute, cuddly side, Kim made this newspaper's editorial board swoon with his impeccable fashion sense, chic short hairstyle and, of course, that famous smile."
The Onion, which ran its Sexiest Man Alive piece earlier in the month, had anupdate to its articleon Tuesday.
"For more coverage," it wrote," please visit our friends at the People's Daily in China, a proud Communist subsidiary of The Onion, Inc. Exemplary reportage, comrades."
Paper trail
By around midday on Wednesday, the People's Daily spread appeared to have been removed, with the link to the English version returning an error message.
Yuwen Wu of BBC Chinese says after The Onion published the spoof on 14 November, the story was picked up by the Hong-Kong based ifeng.com. It published a Chinese version on 21 November - but with readers' comments and a clear explanation about the satirical nature of the Onion site.
A Chinese website, Yangzi Wanbao (Yangtse Evening Daily), published a shorter version of the story on the same day, citing ifeng.com as the source, but without the crucial explanation about The Onion.
Guangming Daily then carried the story on 26 November, quoting the Yangtse Evening Daily. The People's Daily in turn published the story on 27 November, citing Guangming Daily as its source.
And the YRC Vote is For...
Hard choice folks, but we are now going to read the Onion for all our news. As long as it is not blocked, of course...
