Hong Kong's "Not So Golden" Week

Hong Kong needs to prepare for more stormy days ahead

Four days into "Golden Week", when mainlanders used to flood into Hong Kong and go on shopping sprees, clog up the MTR and restaurants, the local tourism and catering sectors are mourning the loss of HK$2.26 billion (US$292 million).

That's the number tourism sector lawmaker Yiu Si-wing estimated, saying a visitor would spend around HK$4,000 during their stay.

Only 918 visitors arrived from October 1-4, compared to 566,000 last year during the anti-government protests.

Mid-Autumn Festival kicked off Golden Week

"For hard-hit, tourism-related sectors such as hotels, retailers and restaurants, they all rely on local consumption to make up part of their losses, by 10 to 20 percent," he said.

Hotels did well this past long weekend, with many locals doing staycations, and hotels offering discounted packages. As a result occupancy levels were 80 to 90 percent, which at the beginning of the pandemic was in single digits, but in the last few months has hovered around 20 percent.

The number of mainlanders coming to Hong Kong plummeted 92 percent between January and August this year to just 2.7 million, compared with more than 34.5 million for the same period last year.

And Simon Wong Ka-wo, president of the Hong Kong Federation of Restaurants and Related Trades, estimated the catering sector took in about HK$1.1 billion over the past four days, which was a drop of more than 25 percent from last year's takings of HK$1.5 billion.

Retailers still relying on local consumers

"The reduction in earnings over the past few days was mainly due to the social-distancing rules that limit eateries from serving customers at more than half capacity. Under these constraints, I think business turnover for the catering sector was satisfactory," he said.

This is Hong Kong's new reality and all industries need to embrace this new normal. Even if the coronavirus pandemic recedes significantly worldwide and people can travel again, Hong Kong is not going to see tourist numbers like before anymore given its recent political developments.

The new national security law has prompted many foreign governments to warn its citizens not to travel to Hong Kong -- even for an airport transfer -- for fears of possibly being detained. 

Last year's protests have severely tarnished the city's reputation as a shopping mecca, and the pandemic has exposed questions of needing so many luxury brand shops.

Hong Kong cannot depend on the mainland market anymore. It needs to rethink what kind of city it can be now that it is considered a dangerous places for visitors to come to. What kind of campaign can the Hong KongTourism Board launch when tourists are terrified they might be nabbed by China's secret police!

Not a relaxing sight to see riot police around

In addition, the local economy can't sustain the city either when many residents are packing up and emigrating elsewhere. 

The odds are stacked against Hong Kong. Anyone have any brilliant ideas?

Life No Longer a Bowl of Cherries in China

Last year when Chilean cherries were on sale in China, it was "cherry freedom"

Last March I wrote about "cherry freedom", where people boasted on social media how they could afford expensive foods to show off their wealth. It started with imported cherries, and then a vegetable called xiangchun that cost 80 yuan to 100 yuan for 500 grams, which equated to a lobster, 10 abalone, or 39 crayfish.

But it looks like those "cherry freedom" days are over following the coronavirus pandemic that has made a huge dent in the Chinese economy, let alone the entire world.

Previously there was a big demand for Chilean cherries and Peruvian avocados by the Chinese middle class. But now sellers at the Jiangan wholesale fruit and vegetable market in Guangzhou are feeling the effects of battered consumer confidence due to declining job prospects and incomes.

These were the first batch of Peruvian avocados sold in China

"Demand has plummeted since the outbreak started. Retailers are very cautious about placing orders... most of us have been losing money, whether selling imported fruit or domestic fruit," said Li Xiaoqiang, a fruit importer at Jiangan market.

"We keep reducing the prices. Take Chilean grapes. The wholesale price used to be 180 yuan (US$25.37) for 8kg, and it is now just 100 yuan or even 80 yuan. Our importers' losses could be up to 800,000 yuan for a container."

Egyptian oranges used to be 100 yuan for 15kg around the same time last year, but now are only 70 yuan.

"Imported cherries are even harder to sell," Li added.

While the market's operators claim 80 percent of China's imported fruits first stop at Jiangan, these days vendors are passing the time playing games on their phones.

80 percent of China's imported fruits go to Jiangan Market

One merchant surnamed Wang said last year the market used to sell 60 to 80 containers of imported oranges a day, but now only sell 15 containers with the price slashed to 50 percent.

"Imported oranges are mainly for hotels, restaurants, clubs and karaoke lounges -- if oranges don't sell well, it means China's service industry is still in deep trouble," Wang said.

Over the past decade China's fruit imports had been steadily rising from US$1.63 billion in 2009 to US$10.3 billion last year, according to the Ministry of Agriculture and Rural Affairs.

Patricia Lin is a white-collar worker in Shanghai and had her pay cut last month, while friends were laid off due to the pandemic. "To be honest, the only thing in my head these days is how to cut spending and save enough money to pay my home mortgage.

"Fruits are good and necessary for health, but I think I won't be able to afford imported cherries or Japanese grapes for a long while. Instead I will turn to local fruits like apples and pears," she said.

How will Li steer China's economy out of the pandemic?

Imagine how many millions of other people have the same thinking as Lin and then you have a serious cascade effect on not only the fruit business, but every other sector as well, particularly luxury, fashion, and restaurants.

Beijing may have hoped people getting back to work would help get things back to normal, but it won't be like before. Wonder if this will be reflected in Premier Li Keqiang's work report later this week when the "two sessions" start on May 22, and what the country's economic road map to economic recovery will be.

Tone Deaf Landlord

Louis Vuitton behind this protest sign will be closing its shop in Times Square

Of all the luxury brands, looks like Louis Vuitton is cutting its losses first.

After seven months of protests in Hong Kong, the French name brand is closing one of its eight stores in the city.

Times Square's owner Wharf Reic refuses to lower rents

The world's top luxury name is pulling out of Times Square in Causeway Bay, after landlord Wharf Reic refused to lower the rent on its second-floor space. Louis Vuitton currently pays around HK$5 million (US$642,000) a month in rent.

According to the Hong Kong Tourism Board's latest figures, only 2.65 million people visited in November 2019, a decline of 56 percent from the same period last year.

Other brands like Moncler, Gucci and Salvatore Ferragamo have seen sales plunge as much as 45 percent in Hong Kong during the third quarter. LVMH reported a 25 percent decline for its Hong Kong sales in the same period.

The mainland customers who use to deluge luxury stores in Hong Kong daily are now staying at home to shop, with prices becoming more competitive in China. Previously luxury sales in Hong Kong were driven mainly by international travelers, with visitors from the mainland accounting up to 70 percent of luxury goods sales.

Hong Kong Land has offered concessions to tenants

While it's understandable Louis Vuitton wants to minimize its losses, landlord Wharf Reic is hardly being sympathetic to the situation. Meanwhile Swire Properties that owns Pacific Place in Admiralty, and Hong Kong Land, with The Landmark in Central have offered a series of measures to tenants, including rent concessions.

Is this wishful thinking on Wharf Reic's part in expecting the protests to end soon? Or is the developer completely tone deaf to what has been happening for the past seven months?

Everyone has been financially affected by the protests in the city, one way or another. Job in the hospitality industry are being cut, shops closing down as well as restaurants. Perhaps telecom and internet companies are benefiting from all the communications and online use, but most of us and the city as a whole have been affected for over half a year.

Swire Properties has also helped ease rent pressure for tenants

And the unrest is expected to continue in 2020, with Chief Executive Carrie Lam yet to find out way out of this political crisis. The economy is not expected to return to pre-protest levels within this year, maybe 2021 if some kind of political resolution is found soon.

So for Wharf Reic to refuse to lower rents is hardly helpful in keeping Hong Kong's economy going, and in the developer's best interests, wouldn't it be better to have a giant prime retail space occupied than left empty? Hard to understand Wharf Reic's strategy when everyone is else is working together to find a way to stay afloat...

Hermes Brand Value Reaches New Highs

A Christie's Hong Kong auction from 2015 of a Hermes Birkin bag

The luxury economy in Hong Kong is thriving more than ever. Forget Louis Vuitton and Gucci -- Hermes is where it's at.

Christie's Hong Kong just held its sale of Hermes handbags and it netted a whopping HK$45.59 million. Apparently clients from 20 countries were fiercely bidding for Kelly and Birkin bags.

This Birkin bag went for four times its estimate

Hermes bags are highly coveted because they are handmade and take months to make, let alone months or years on the waiting list for your order to be processed.

The French company is best known for using quality materials and skilled craftsmen (and women) to make its objects, but it's the Kelly and Birkin bags that everyone wants. They are the ultimate status symbol.

Even better when the bag is made from crocodile skin.

The world record for a Hermes So Black series handbag was set last night with a rare, limited edition matte black Niloticus crocodile Birkin bag from 2010. The final price was four times the low estimate at HK$1.625 million (US$208,000).

The So Black series was created by Jean Paul Gaultier when he was Hermes creative director from 2003-2010.

Have a spare H$2 million to buy this Birkin bag?

But one bag that was sold for even more was another Birkin bag made from Himalaya Niloticus crocodile matte white (though it is brown on the edges) complete with a buckle that is 18k white gold and diamond encrusted. It dates back to 2011 and its price? HK$2 million (US$252,892).

Many people don't see the point in such extreme luxury, but to see buyers willing to bid fiercely for these items show there are people with lots of money to burn, and the gap between the rich and poor is widening even more.

But don't worry if you didn't get your Hermes bag this time -- Christie's is holding two more sales next month in London and New York.

Although Hermes won't get a cent from this sale, its brand value has been elevated to even greater heights.

Women Surpass Men in Buying Suits

This show resonates with Chinese women who encounter gender bias daily

Women in China are snapping up more suits than men these days, thanks to a popular streaming TV series called All Is Well (都挺好 dou1 ting3 hao3).

It's about a typical traditional Chinese middle-class family that values sons over daughters. The protagonist, Su Mingyu 苏明玉 (played by Yao Chen) stands up to the gender bias in her own family by dressing in suits in every episode to show off her fierce independence.



The character Su Mingyu has struck a chord with Chinese women, who are following her sartorial sense on social media, sparking a national shopping trend for fashionable suits.

Since the show started in March, she has worn things like a Burberry suit, Max Mara coat, Erdos cashmere sweater and Stuart Weitzman boots. Su Mingyu definitely has expensive taste, but seems like she can afford it.

Su Mingyu wears stylish clothes that reflect success

She projects the ideal look of success that most Chinese women aspire to -- luxury suit-wearing, financially independent, and mentally strong despite going through gender discrimination all her life.

This coincides with the 2019 China Fashion Data Report issued by Alibaba, where the word "suits" was the most searched keyword on Taobao last year for women; the sales volume of women's suits surpassed that of men for the first time on January 27, 2019.

The search for "大哥廓西" literally meaning "big bro, shoulder-padded suit" in Chinese, grew 317 percent year-on-year, with sales up 39 percent.

And with All Is Well inspiring women to consider dressing in suits, perhaps the power suit will translate to even more sales than men's suits this year.

Women are keen to emulate Su Mingyu's fashion sense

Perhaps this is a sartorial way for women to achieve gender equality in China?

Dolce & Gabbana Ruin a Model's Career

Model Zuo Ye attempting to eat pizza with chopsticks in a D&G commercial

Back in November, Dolce & Gabbana released a strange commercial where a Chinese model wearing a red dress from the Italian fashion house, is seen struggling to eat pizza, cannoli and spaghetti with a pair of chopsticks.

The Italian fashion design duo were accused of racism and cultural insensitivity for the commercials, which were timed just before they were about to put on their fashion show in Shanghai. It also didn't help that co-founder Stefano Gabbana got into a row on a private Instagram message when he apparently described China as a "country of s***". The screen capped conversation was published it online, compounding the already bad situation.

Stefano Gabbana and Domenico Dolce giving an apology

As a result the fashion show was cancelled at the last minute when Chinese models and stars pulled out, and the two designers were shown in a video giving a sober apology for the PR crisis they had created.

Meanwhile the poor model involved in the commercial was attacked online by fellow Chinese, who accused her of "making money by insulting your own country" and "vilifying the image of the Chinese".

Two months after the incident, Zuo Ye finally spoke out, explaining she had not given enough thought to the content of the video and felt "very guilty and ashamed" about it.

"Personally I would never show any disrespect to my motherland. I love my country and feel proud to be able to represent China on the catwalk," wrote Zuo on her Weibo account. "I will draw a lesson from this and show the Chinese in a better light. Again, I apologize to my fellow countryman."

Zuo says she didn't have much say over the content of the ad

But how is this her fault? The recent graduate of South China Agricultural University wouldn't have known ahead of time what she was expected to do in the commercial and how it would impact her career, that she says is now almost completely ruined.

Zuo is a young model hoping to break out with this commercial, but she was unwittingly swept up in the racist ad. She said she was only told she was going to shoot a "fun video" involving Italian cuisine and the email briefing didn't give much more information.

During the three-hour shoot in a Chinese restaurant in Milan, everyone on set spoke Italian except the director, who instructed Zuo in English to show surprise, bewilderment and appreciation of the food, even though she felt awkward.

She said she questioned the use of chopsticks in the video, but was just told to follow instructions.

"I couldn't do it in the first try [picking up the cannoli with the chopsticks] and I asked, 'Are you kidding me? With chopsticks?' The director said, 'Yes! I know it's hard. Just try to do that'."

After two months' silence, Zuo apologized

"I felt awkward when using chopsticks for food that was larger than the normal size. I seldom laugh in my daily life but the shooting required a lot of extravagant acting and I felt very uncomfortable too," Zuo wrote.

She said as an ordinary model she was not allowed to give feedback on the commercial's content nor was she able to watch the final product.

However, many people online still weren't happy with her apology. "I still think your explanation was useless and your video disgusting. You can only blame yourself for having no distinguishing capability. No point whitewashing your wrongdoing," one internet user wrote.

Other sympathized with her, saying, "Blame a model? Why not blame the chopsticks while we're at it."

Zuo obviously wants to put this terrible incident behind her so she can move on in her career, but being dogged by those who cannot empathize with her situation doesn't help at all. At least she was brave enough to explain her side of the story, though it will take time for the fiasco to go away.

Picture of the Day: Louis Vuitton's Lucky Charm?

Giant red cat for Louis Vuitton -- will he bring good luck?

Tonight I went to Galaxy Macau for a dinner and as I rushed to the restaurant I saw this big red maneki-neko, or in Japanese "beckoning cat" and had to stop for a second and check him out.

Turns out he was part of a Louis Vuitton display with the "LV" initials on his chest. Apparently these maneki-neko are meant to bring good luck to the owner.

Perhaps Louis Vuitton needs a lot of luck after luxury sales fell down again thanks to the Chinese government cracking down on daigou, or people who shop overseas for customers who live in China, many of them used to buy fashion brands like LV...

Dolce & Gabbana Strike Out

Chinese model in D&G dress struggles to eat pizza and pasta with chopsticks

The Italian fashion brand Dolce & Gabbana was supposed to hold its star-studded fashion show tonight in Shanghai, but it was cancelled following racist remarks by one of its co-founders, Stefano Gabbana.

He apparently had an online conversation with an Instagram user named "diet prada", where Gabbana described China as "a country of s***."

Stefano Gabbana's thoughts on China...

The texted conversation on Gabbana's Instagram account was in response to complaints about the fashion label's latest campaign "DG Loves China", where a Chinese model in a red D&G dress is seen struggling with chopsticks, trying to eat Italian foods like pizza, spaghetti and a cannoli, or cylindrical pastry filled with cream.

In the cannoli video, a male voice can be heard asking the model, "Is it too big for you?"

Others complain about how cliched the ad looked, with Chinese lanterns and couplets that were deemed "outdated and stereotypical".

As for Gabbana's outburst on social media, he claimed his account was hacked, and his legal office is working on the security breach.

Meanwhile reaction was swift in China -- when word got round about the spat, a number of celebrities who were invited to the show, including movie star Chen Kun and actress Dilireba, who was named D&G's brand ambassador in February said she would not attend, while fellow actress Zhang Ziyi said the brand was "inviting humiliation".

Indeed.

Domenico Dolce (left) and Stefano Gabbana (right)

Even a number of models who were booked for the show refused to turn up before the event was cancelled. Modeling agency Dongfang Binli said all of its 24 models had pulled out of the show and put a "Not Me" tag on their online profile photos in protest.

Supermodel Jin Dachuan said he would not take part in any show or any event staged by the brand in the future.

The brand has incensed Hongkongers in the past. In January 2012, at a Dolce & Gabbana's store in Harbour City on Canton Road, a security guard reportedly told locals that only mainlanders and foreigners were allowed to take pictures in the store. He apparently threatened to smash a local resident's camera if they continued to take photographs.

Remember these protests at Harbour City in 2012?

A series of protests at the store ensured until Dolce & Gabbana eventually apologized days later, though it wasn't enough to assuage people's anger.

The Italian design duo seems to love to court controversy, and some believe the latest ad campaign and subsequent online spat were deliberately done to stir up reaction -- but at the risk of being shunned?

It's a huge gamble, and perhaps this time the Chinese will protest the brand with their wallets and shop elsewhere.

Surely this is not a risk worth taking?

Having just visited Italy, it's obvious the government is taking tourism very seriously by having security personnel at major landmarks, while fashion brands are very keen on serving Chinese customers.

But it seems that Dolce & Gabbana really don't care about the consequences of fanning the flames of Chinese nationalist anger. 

Maybe the massive drop in sales will persuade them to keep their mouths shut?

Picture of the Day: Tax Refund

The line went all the way down to the end and to the left. Daunting, right?

Italy encourages tourists to shop shop shop -- the more the better. That's because if you reside outside the European Union, you are eligible for a tax refund when making purchases of 155 euros (US$175.36) or more in Italy.

The shop should help you fill out a tax refund form with the receipt attached so that you can claim the VAT refund of 22 percent. It's a huge difference which is why it's worth getting the refund.

However, the refund can only be processed at the airport, which is why it's advisable to go there with plenty of time before checking in. The morning I went, my flight was much later, and so I had time to get the refund.

The line for the VAT refund (in a big yellow sign) was very long to say the least, though it did move, slowly. It was full of mostly Japanese people who were holding wads of receipts.

Another rule about getting the refund is that you may have to show the officer your purchase so you can't pack it into your suitcase.

My biggest panic was waiting in line and not being in the right line. When I bought a pair of shoes, the sales assistant told me I would need a stamp on the form and then get the refund. So when my line slowly inched closer to the counters, I couldn't see where you were supposed to get a stamp and started to worry.

The people in front of me were Japanese tourists. They were young people who had bought many name brand luxury items. Thankfully they had an Italian guide, a well-dressed middle-aged man who spoke good Japanese and helped them with translation or questions.

I quickly asked him if I needed a stamp and he said no, and that I was in the right line.

Finally it was my turn at the counter and after showing them the receipt, the tax form (filled out by the store), my passport and credit card, the whole process took less than five minutes. She was even busy chatting with her colleague next to her that she didn't even ask to look at the shoes I bought.

She gave me a receipt showing the amount credited to my credit card and that everything was done. I was able to pack my shoes in my suitcase before checking it in, so there was one less thing to carry.

And in my next credit card statement, the refund was credited. It made my expensive purchase easier to justify. Ha!

Picture of the Day: Red Wallet

How superstitious are you when it comes to your wallet's colour?

During my time window shopping at the Galaxy Macau, there wasn't much to do except wander into the luxury brand shops.

One of my last stops was at Louis Vuitton, a shop I never venture into in Hong Kong because it's so intimidating and the shop assistants are usually snooty.

I asked to see some wallets and they were duly taken out of the cases and carefully explained. Then the salesgirl asked if I was superstitious and I asked why...???

She pointed to the wallet in red and explained Chinese superstition is that one should not have a red wallet because red represents fire and it will burn away all your wealth, or another explanation that red is also the colour of bankruptcy!

So what was that red wallet doing in Louis Vuitton in Macau of all places?

Flashing the Cash in Macau

Beautiful blue skies this afternoon with a view of Galaxy Macau

Usually when I'm in Macau for work, I'm rushing to where I want to get to, and then rushing back to the ferry terminal to get back to Hong Kong as soon as possible.

This time I had an hour to kill before dinner and wandered around Galaxy's shopping mall area. It's very glitzy, much like Elements in West Kowloon, with practically every top luxury brand you can think of having a store there.

Everywhere you look there are luxury brands in the mall

However, unlike Harbour City and IFC mall in Hong Kong, they are not crawling with lots of mainland shoppers. Some stores were completely empty and desperate for anyone to at least walk in, others might have one or two people.

There are two types of mainland consumers these days -- the sophisticated ones who already have the brand name bags and designer clothes who act nonchalant, while the country bumpkins like to flash the cash, but don't have much style.

The latter ones I saw at Burberry, a group of women ranging from 20s to 50s who sat around couches in one room of the store and chatted loudly as they waited for a saleswoman to bring a bag out from the supply room.

One even took her foot that was wearing a dirty nylon sock out of her shoe and rested it on the coffee table. Classy. They spoke in a dialect I couldn't understand but it sounded like they were shouting at each other, but probably having an inane conversation.

Burberry is one of the stores that had some customers

Meanwhile the sales staff wore earpieces and would constantly report on customers' whereabouts -- "the young woman with the black bag is coming up stairs" or "they are still sitting there" in Cantonese.

The gaggle of women got so frustrating for one salesgirl to deal with that she vented her stress by stomping on the store's internal staircase as she walked up the stairs.

Burberry items may be cheaper than Louis Vuitton, but still considered luxury at over HK$10,000 for a handbag.

There's no choice but to try your best to please the rich -- no matter who they are -- because they're the ones paying your salary.

Canada Goose Takes Flight in HK

For mainlanders this is the must-have winter jacket these days

Hermes, Chanel, Gucci and now Canada Goose.

The Canadian down jackets are a must-have for mainland Chinese shoppers, and while they have been flying off the racks in luxury department store Holt Renfrew, the US$900 jackets will soon be available in Hong Kong.

This past Christmas when I was in Vancouver, mainlanders descended on racks of Canada Goose jackets at Holt Renfrew, trying them on and snapping them up. I've heard stories of them calling up their friends in China and asking them what size and colour they want, and buying 10 to 12 at a time.

The Chinese are snapping up the jacket in Canada stores

How do they even pack them all into their suitcases?

The latest news is that a sign in Chinese in a Toronto store states shoppers can only buy two jackets per day, probably due to complaints from local residents unable to get their hands on the prized jackets.

Dani Reiss, president and chief executive of Canada Goose knows he's onto a hot product and is eager to expand to Asia.

"A lot of people from the mainland often go to Hong Kong to buy products. That's one of the reasons why it makes sense for us to have a store in Hong Kong," Reiss said. "Even though it's a warm-weather climate, [where the temperature] almost never goes under zero."

Dani Reiss plans to open stores in Hong Kong and Beijing

The Toronto-based company will have two flagship stores, one in Hong Kong, the other in Beijing, and an e-commerce presence on Alibaba's Tmall, and set up an office in Shanghai.

The Hong Kong store will be in IFC mall and is expected to open in the fall. An interesting fact is Reiss is the third generation to run the company that was started by his Polish immigrant grandfather in 1957.

There should be no problem in selling Canada Goose in Hong Kong -- it's subtle in its look, very functional and it's a status symbol to wear. What more do you want in this day and age when Chinese luxury spending has to be a bit more discreet these days?

Review: The China Hustle

Dan David goes to Washington to ring warning bells, but no one listens

This documentary is required viewing for anyone who invests in China stocks. That practically means everyone. The producers of Enron: The Smartest Guys in the Room have made a film that complements The Big Short with a China angle.

The China Hustle talks about how the United States was barely recovering from the financial crisis of 2008-09 and the big stock traders needed to climb out of the red. What did they do? They looked to China.

Meanwhile Chinese companies were looking to the west for legitimacy -- or more importantly, money. How did they do it? Through reverse mergers. Reverse mergers are when a company finds a shell company that is listed on the stock exchange and buys it out but still retains the shell company's public listing. Boom! Overnight it becomes legit. Over 400 Chinese companies have done this in the US.

And with the keen interest in China, investors flocked to these stocks that promised crazy returns. Many people made lots of money, including one of the main characters, Dan David. He lists off several companies where he made 300, 500, 1,000 percent profit. He'd buy stocks at say US$1 and sell at US$5, and so on.

The film asks what is capitalism? Is it good or bad?

But then he gets curious and wonders if he and his partners are just lucky and decided to do some due diligence. He got some people to check out one of these Chinese companies and found that its real production numbers were no where near what it had claimed on paper in its filings with the Securities and Exchange Commission (SEC).

They surreptitiously set up cameras from outside the factory compound to monitor the traffic and assumed that there would be tons of trucks coming in and out, but in reality there was hardly anything going on.

One of their researchers posed as a man selling tea and wanted to give a sample to each staff member so he asked the guard outside how many staff there were. He said 40.

So David realized that there could be many more companies taking American investors for a ride and dug up more evidence. He start shorting those stocks and brought down those Chinese companies, and in the process won big.

Jim Chanos has been shorting China stocks for years

He wasn't the only one. There were a handful of others who realized the same thing, but did their research in different ways. That includes Carson Block, who named his company Muddy Waters after the Chinese saying, you cannot fish in clear waters.

The documentary also talks to Jim Chanos, who has called out the Chinese economy to be so laden with debt that it will collapse soon, but we have yet to see that happen. This is perhaps because the Chinese government is desperately trying to keep it all together, so much so that they detain the CEOs of companies and force them to get rid of assets to curb the risks, like in the cases of HNA and Wanda.

In the end these traders believe US$30 billion to US$50 billion was taken from American investors and the film names Chinese CEOs who have disappeared with hundreds of millions of dollars.

Where did that money go?

In real estate, particularly overseas like Hong Kong, Vancouver, New York, Sydney and shopping sprees for jewellery, art, cars, handbags, clothes and so on.

Carson Block of Muddy Waters brought down Sino-Forest

The China Hustle also exposes how the auditors, the SEC, the government, no one is really making these Chinese companies accountable; nor can the American authorities force Chinese CEOs to testify or give back the money. The Chinese government can't punish companies that have listed overseas either. There is no Chinese law against defrauding foreign investors.

Hong Kong gets some scenes in there when David addresses a room full of traders at the Asia Society in Admiralty, persuading them to help him short a Chinese stock. In the end it was his biggest win to date.

In the end, there is a big hint that more investigation needs to be done on Alibaba, though it's difficult to get a clear picture without all the paperwork available. One stock market blog says that even though Alibaba is trying to be more transparent, as of November 15 last year, it was the most heavily shorted stock in the world, with an open short position of US$23.1 billion according to financial analytics firm S3 Partners.

So -- it's a lesson that if something is too good to be true, it is. And we the general public need to be very careful about where we put our money. The China dream is just a mirage...

The China Hustle

Written and directed by Jed Rothstein

82 minutes

Fact of the Day: Number of China's Rich X9

The wealth gap in China is getting even bigger with even more wealthy people

A private survey has found the number of rich people in China has risen nearly nine times in a decade.

Those with at least 10 million yuan of investable assets hit 1.6 million in 2016, up from 180,000 in 2006, according to the 2017 China Private Wealth Report by Bain Consulting and China Merchants Bank.

The overall value of the private wealth market rose to 165 trillion yuan last year, growing 21 percent annually from 2014-2016. It's expected to reach 188 trillion yuan this year.

The rich spend a lot of money on luxury and invest abroad

There are about 120,000 "high net worth individuals" who had at least 100 million yuan worth of investable assets, up from fewer than 10,000 people in 2006.

The percentage of rich people with overseas investment rose to 56 percent this year, up from 19 percent in 2011.

The top four destinations for investment were Hong Kong, the United States, Australia and Canada, though Hong Kong's popularity fell 18 percent and the US fell 3 percent from 2015-2017.

Respondents said their top reasons for investing overseas was to diversify risks, capture market opportunities and migrate.

The wealthy are concentrated in major cities and coastal areas, but the survey found 22 provinces have at least 20,000 high net worth individuals.

One thing wealthy Chinese can't buy is class...

One can't help but wonder if this wealth amassed in a short period of time is due to loose credit from banks and they've taken advantage of this to invest in real estate and other appreciative assets.

The other possibility is investing early in property and it has significantly appreciated within a decade.

Either way it's a staggering number of nouveau riche in China who are looking for places to spend their money. They are definitely looking overseas for greater security and better living environment.

Anyone who has the access to some kind of wealth are trying to get it out of the country through investing in insurance products or real estate.

But the one thing they can't buy is sophistication and manners.

One Fat Cat's Ill-Gotten Gains

A Wu Guanzhong painting of Hong Kong was owned by a corrupt police chief

Chinese President Xi Jinping caught another fat "tiger" in his ongoing anti-corruption campaign but only now do we see how fat this cat was.

Former Tianjin police chief Wu Changshun was worth 426 million yuan thanks to his massive collection of artwork, jewellery and watches.

Xi angrily described Wu has "defying all laws human and divine," according to state media. The police chief was dismissed in 2014, and following an investigation, was sentenced to death with a two-year reprieve -- basically life imprisonment.

Wu Changshun was apparently worth 426 million yuan

Wu collected over 1,000 pieces of artwork, including a painting called In Memory of Hong Kong of the city's skyline by famous modern Chinese artist Wu Guanzhong who died in 2010.

Other famous paintings and calligraphy included those by Zhang Daqian. One of his paintings called A Copy of Juran's Landscape was sold at China Guardian's autumn auction for 103.5 million yuan.

Also in the collection were 11 paintings by Fan Zeng, a master of traditional Chinese painting. Wu also amassed hundreds of antiques, including a blue and white 15th century porcelain jar from the Ming dynasty, Buddha statues and ornaments.

Also in the illicit stash of goods was a green jade bracelet worth HK$1.8 million, and at least 45 luxury watches, including five Patek Philippes, as well as Cartier, Rolex, and Vacheron Constantin.

He also had several Patek Philippe watches and other brands

Apparently Wu's collection was so vast that a Tianjin auction house had to hold three separate auctions to sell all the items between November 2015 and December last year, according to a report by Caixin.

Going through this huge list of items not only demonstrates Wu either had a lot of money to burn, or his bribers knew exactly what he wanted in terms of gifts. It seems like brand names were a must, and he had very good taste.

Oh well. That's all in the past now with Wu languishing in jail.

But it also makes you wonder, if there are other fatter cats...

Hong Kong's Unhealthy Shopping Habit

Hong Kong people's preoccupation with shopping hardly keeps them happy

Ah Greenpeace has another survey out -- this time it's about how Hong Kong people are the most obsessed in the world when it comes to shopping.

In the non-profit group's survey of 5,000 people in Hong Kong, the mainland, Taiwan, Italy and Germany, we scored first or second in 10 out of 12 indicators showing a tendency to spend excessively on material goods as well as an unhealthy reliance on shopping.

The questionnaire, which was conducted from the end of last year to early this year showed Hong Kong topped the charts on a number of indicators, such as admitting they owned more clothes than they needed, and consumers who had tried to conceal their shopping sprees.

Fifty-three percent of 1,000 Hong Kong people owned clothes that were still tagged, compared to 51 percent of those on the mainland, 46 percent in Italy, 41 percent in Germany, and 40 percent in Taiwan.

Numerous ads and signs entice people to shop daily

"It's nothing new that Hong Kong people are addicted to shopping, but we didn't think that Hong Kong would rank as one of the tops in the world," says Greenpeace campaigner Bonnie Tang Man-lam.

Mainland Chinese scored similar points to Hong Kong in most indicators.

While the survey didn't go into why Hong Kong scored so high, but Tang explained it was because of the city's values and lifestyle centered on consumerism.

"Most people said their feelings of satisfaction from shopping only lasted a day, and they would then shop again just to fill that empty void. The more they shop, the lonelier they got," she says.

Are Hong Kong people really that sad? Though I do know some people who really do depend on shopping to make them happy, which is a sad, endless cycle that goes nowhere except an empty bank account.

But stores like 759 are downsizing with shelves going empty

However, most people can't help but be sucked into buying things with the number of advertisements they are bombarded with daily, along with seeing what their friends are purchasing and showing off on social media.

That said, shops from luxury brands to small boutiques are downsizing or closing because it isn't economically viable anymore. My favourite greeting card shop Prints is closing down its several locations around town, while some 759 stores are gradually closing down with shelves of snacks and foods are getting barer by the day.

It's a sad state of affairs really -- shopaholics should get a life, while retailers can't make enough to pay the rent. This is Hong Kong, 2017.

Advertorial Wedding

Angelababy wearing a Chaumet diamond tiara

French jeweller Chaumet is defying the bleak retail economy thanks to its sponsorship of the celebrity wedding between actors Angelababy and Huang Xiaoming in October last year.

On social media the bride showed off a six-carat, US$1.6 million wedding ring that was quickly dubbed the "Angelababy Ring" by millions of netizens.

The jewellery house has a long history of being the official jewellery to Emperor Napoleon I, making the crowns and ceremonial jewels for him and his wife Empress Josephine as well as other monarchs since the late 1700s. But it has lost out in terms of brand recognition, because well, you don't need a tiara everyday.

The infamous "Angelababy ring" with a six-carat diamond

Nevertheless, this massive wedding held at the Shanghai Exhibition Centre has hit the jackpot for Chaumet, says chief executive Jean-Marc Mansvelt.

He recalled the overwhelming response from Chinese clients for the Josephine Airgrett Imperiale ring, as well as for two antique diamond tiaras Angelababy wore at her wedding.

Mansvelt is quick to point out many shoppers flock to the Chaumet stores in Singapore, Hong Kong, Taiwan and China, asking for the "Angelababy ring", but "it was not something that was originally designed for her," he says.

But do Chinese consumers care to know who Empress Josephine was?

And why should Mansvelt care anyway? He's seeing "more than double-digit growth" in revenue in greater China from its 20 boutiques on the mainland, five in Hong Kong and four in Taiwan.

There doesn't seem to be any thought about how over-the-top the wedding is, and how the bride and groom profited from the sponsorships and tie-ups with companies, pitching their stuff by wearing or using it.

No-frills couple Shu Qi and Stephen Fung

This contrasts starkly with the recent wedding of Taiwanese actress Shu Qi and Hong Kong-based actor and director Stephen Fung in September. She wore a pink dress from H&M given to her two years ago, and they didn't even have a wedding banquet.

Seems like you either do the full-on, with everything on top kind of wedding, or the other extreme of keeping it as plain as possible...