Friday, September 28, 2012

Man Enough For My Lesbian Daughter?

Cecil Sze-Tsung Chao is no ordinary Hong Kong billionaire property tycoon. He is more like what you would get if you crossed Donald Trump, Hugh Hefner and a Chinese munchkin. Now 76 years old, he has famously remained a bachelor his entire life, more so that he could bed “10,000 women,” by his own estimate, during those years. The union of his loins with one of those multitudes yielded a lovely young girl, Gigi, now 33 years old (top right, with elf-dog), As beautiful and smart as she is (she holds an architecture degree from the University of Manchester, in the UK), she has one clear flaw in her father’s eyes. She (like he) seems to prefer the company of women. Gigi is a declared lesbian. Last week, she announced in Beijing that she had married her seven-year girlfriend, Sean Eav (pictured with Gigi), in a civil union in France.
This situation proved intolerable to Cecil Chao. He has responded assertively, in perhaps the only way that he knows how – by throwing money at his problem. Lots of it - HK$500 million, or almost US$65 million, in fact. The money is set up as a reward for any man from anywhere who can win Gigi’s hand in marriage and set her “straight". This may be the first time that Mr. Chao is using his money to seek the services of a man, but who knows.
Not surprisingly, the announcement has been met with a huge response. Candidates have flooded Gigi’s Facebook and Twitter accounts with over 1,500 requests. Suitors have ranged from the presumably straight-and-narrow earnest types to those simply taking a flyer. There is a Frenchman who has declared himself “soft as a woman.” An internet user proposes bringing along “a gorgeous Brazilian model” to accompany him. There is a gay American, who obviously is not very good at understanding the job requirements.
Gigi has responded with much eyeball rolling and a plea for a return to privacy and sanity. With a dad like that, I presume that she knows it’s just wishful thinking.

Saturday, September 22, 2012

And the World’s Most Expensive Retail Street Award goes to...

Fifth Avenue, New York? Bond Street, London? The Ginza, Tokyo? Wrong. Russell Street, Hong Kong. At US$2,800 a square foot per year in Q2 2012, this Causeway Bay address has the highest retail rents in the world. Ouch. Fifth Avenue comes in second, at US$2,500 per sq foot. Furthermore, despite the sluggish global economic conditions, the lease rates rose over 13% quarter-on-quarter from Q1 2012. Clearly, retail therapy is still an oft-prescribed remedy for the wealth blues on the Mainland. With these rents, it’s safe to assume that shop owners are not selling trinkets and everyday household items. Want a humble slice of bread? Let them eat Belgian chocolate cake with truffle cream. Want some threads? Burberry’s welcomes you to its 7,000 sq ft store. Want to catch a flick? Oh sorry, the theater is now a Tiffany’s. Fancy gazing at a three-carat VVS1 E-colored pear-shaped rock instead?
The story of astronomical rents is consistent in prime shopping locations across Hong Kong. Average rents have risen between 25 to 50% over the past year, to over US$920 per sq ft. The next highest country is Argentina, at almost half that average. Shoppers for ordinary goods are being driven more and more into side streets, upper floors or dodgier neighborhoods. Selection is down and prices are up. There is much head shaking among consumers.
Discontentment with the influence of Chinese politics and money has swelled with the rents over the past two years. It’s unclear if and when either will dissipate. In a recent protest against government policies, a man was seen waving a British Union Jack flag, in a nostalgic moment recalling Hong Kong’s colonial past. Presumably, the flag didn’t have a Burberry label.

ASIA-PACIFIC: Land of the Most Plenty

Well done, Asia-Pacific! In 2011, the region passed North America to lay claim for the first time as the place with the most high net-worth individuals, according to a just-released report by Capgemini and RBC Wealth Management. Asia had already eclipsed Europe in 2010. “High net worth” is defined as having “investable assets of US$1 million, excluding primary residence, collectibles and goods that can be consumed.”
But before Asians raise their self-celebratory glasses of baijiu/soju/sake/shiraz too high, they should consider that the report’s definition of Asia-Pacific includes Japan and Australia. Given how Japan sometimes behaves towards its neighbors (otherwise known as the Erstwhile Colonies), it is debatable whether Japan sees itself as part of the rest of Asia, and vice-versa. Sometimes it seems that Japan is its own planet, one that orbits an independent rising sun. Certainly, many marketeers see Japan as being a distinct place for business. In regards to the Aussies, it is also debatable whether they see themselves as part of Asia, other than as a matter of economic convenience. Of course, if the Chinese continue to buy up the mineral and fossil fuel resources Down Under at the pace that they’ve shown over the past few years, then never mind what the above-ground Aussies might think – the earth under their feet could very well be part of Asia. Excluding Japan and Australia (which together with China accounted for 75% of the number of wealthy), there’s little doubt that Asia still lags behind North America, and possibly even Europe.
But definitions aside, there are some noteworthy trends to chew on, like morsels of gingko nuts:
- There were 3.4 million of these lucky individuals across the region.
- However, while the number of millionaires rose, their overall investable wealth declined, by 1.1%, to US$10.7 trillion. As shown in the above chart, most of the declines occurred in India and Hong Kong.
- Thailand, Australia and Indonesia experienced the most percentage growth. Australians and Indonesians benefited from their natural resources bonanza. Thais were better off (despite devastating floods in November) due to the economic rebound that accompanied a more stable political environment; the country experienced far fewer scenes of red and yellow shirts bashing each other into an orange mess, as in earlier years.
- Indonesia was the only market where the MSCI equity index (a measure of stock price performance) was up.
It is difficult to predict how 2012 may turn out. Asia may retain its lead, but it’s tough to tell. China is down, but Hong Kong is back up, as are other Asian markets. And, the US has continued to crawl out of its sub-prime hole, so North America may reclaim its crown. In any event, 2011 was a watershed year for Asia’s wealthy. And it certainly will not be the only time when the region’s numbers will outstrip those from elsewhere.

Monday, September 10, 2012

Did You Hear the One About the Chinese Driver Who...

Okay, we all know the stereotypes and jokes about bad Asian drivers. But the following two related stories are real. And if they weren’t about such tragic issues, they might be re-worked into one-liners about young, spoiled Chinese drivers and their expensive toys.

Story 1: Political Scandal in China Over Playboy's Ferrari Crash

In the early hours of March 18 – just three days after the Communist Party sacked Bo Xilai as party chief of Chongqing – a Ferrari 458 Italia speeding through the streets of Beijing smashed into a wall, rebounded and crushed a railing on the opposite side of the road. One naked body and two half-naked bodies were thrown from the wreckage. The male driver, one of the half-naked bodies, died on the spot. The other two bodies, both young women, were seriously injured. After almost six months of news cover-up, it is now emerging in the media that the driver was the twenty-something year old son of Ling Jihua, a close aid of Chinese President Hu Jintao. Around the world, high speed sex parties in Ferrari’s are, sadly, nothing new. But in this extended season of discontent among the Chinese masses towards an ongoing litany of moral and legal transgressions by the country’s elite, this incident, and the government’s attempt to hush it up, is particularly lurid.

Story 2: Ferrari Ownership in Hong Kong Restricted for Drivers Under-28 Years Old

According to an article today in the South China Morning Post, insurance companies in Hong Kong will not offer coverage policies for Ferraris to anyone under 28 years old. Apparently, the car dealers and insurance companies have become alarmed at the rising number of accidents across Asia involving young drivers with more money, testosterone and arrogance than brains. In May of this year, a 31-year old Chinese man in Singapore killed himself and two others when he slammed his Ferrari into a taxi. More recently in Thailand, a grandson of the Red Bull drink creator ran his Ferrari over a policeman. Late last year in Japan, in perhaps the biggest traffic incident involving luxury speedsters of its kind, eight Ferraris and a Lamborghini Diablo were among 14 cars that crashed into each other, creating a terribly expensive pile of scrap metal and shredded carbon fiber. Lastly, there is the well-known story of Cantopop star Nicholas Tse, who in 2002 crashed his Ferrari, then placed the blame on his chauffeur, and ended up getting off lightly anyway.
Going forward in Hong Kong, if Junior wants a tony new set of wheels, someone else (presumably Dad) will have to register and insure the car. So Dad will be putting his name where only his money used to be. Perhaps then, if Junior screws up and wrecks the car, he’ll need to walk or take a minibus home to face his spanking.

The consequences of an ill-advised high speed menage-a-trois.


Q: What do you call a rich young Chinese guy behind the wheel of a late-model Ferrari?

A: No laughing matter.

A K-Pop Mega-Hit About Seoul’s 1%

In case you either a) have been living under a rock, b) were shipped off to Mars aboard the Curiosity, or c) as a matter of principle or necessity, associate yourself with nothing cooler than a tepid glass of English beer, you may have missed the recent phenomenon of “Gangnam Style”. If so, this blog posting will enliven your existence. “Gangnam Style” does not refer to a fashion magazine for triad members. Rather, it is the name of a K-Pop music video and hip-hop tune that has become the summer’s most talked-about pop music event – not just in Korea, but globally. It is the first music video from Asia that has received over 100 million hits. It has been profiled in a CNN news segment. It has been played to a raucous crowd at Dodger Stadium. Jay Leno of The Tonight Show in the US used it to spoof Mitt Romney’s ongoing inability to connect with a cool, young voting populace.

“Gangnam” which prosaically means “South of the River”, refers to Seoul’s nouveau riche neighborhood. It’s a district overrun by a combination of cosmetic surgery clinics (there’s practically one in every building), underground hostess bars (ditto), luxury boutique shops, overpriced espresso joints, and hip-looking restaurants with blasé food. It’s a neighborhood where a 300-class BMW is considered to be a Hyundai, and a Hyundai is considered to be... er... what the rest of Korea can afford to drive. There’s plenty of eye-candy for both genders. But there’s also the sense that intellectual thought and culture run as deep as a melted popsicle on a hot sidewalk.

“Gangnam Style” harpoons the district’s vacuity with the precision of a Japanese whaler, while providing loads of melodic hooks and laughs that make this tune an instant classic. But enough jabbering from me. If you haven’t already, catch the video below, then find out more about it in the well-written article that appeared in The Atlantic (!) magazine last month.