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Strategies & Market Trends : HONG KONG -- Ignore unavailable to you. Want to Upgrade?

To: Tom who wrote (1613)	5/15/1998 2:29:00 PM
From: Tom	Respond to of 2951

More on recent rumor of speculative attack on HK Currency. It's been reported that a China-controlled group listed in Hong Kong was responsible for a massive outflow of funds in the local currency on April 29. This sparked fears of a re-newed speculative attack on the HK dollar. Ironically, the move challenged the HK$/US$ link which Beijing supports. Highlights, never-the-less, the growing clout of China-controlled interests in the HK economy. Traders say the red-chip company converted HK$7 billion (US$897 million), which it had been holding in high-yield currency deposits, into U.S. dollars in order to repay a loan. The HIBOR soared from 4.5% to over 6%, prompting the HKMA to issue a statement asserting that the outflow was related to "a genuine commercial order by a corporate."

To: Tom who wrote (1613)	5/15/1998 2:37:00 PM
From: ----------	Read Replies (1) \| Respond to of 2951

100% agree, Tom. The current leadership is making phenominal strides. Despite all the prestige & perks, I would not have Mr. Zhu's job for anything. Look how rare it is for our 436 Congressmen to agree on something. Mr. Zhu has a billion people to convince "this is the right thing to do." Talk about a tough job! There is an interesting article in this week's FORTUNE magazine. Seems the current CEO of Coca-Cola worked out a deal while in China. The article says there are a lot of older Chinese who are employed by the Government in cities. Their tasks are not a full-time job. So, the Coke CEO said:" Ok... how about you folks selling Coca-Cola? You earn a commission on each bottle you sell, your local party chapter gets money to help with local problems." It seems to be catching on, and Coke is establishing the brand name recognition they want. Regards, Doug

To: Tom who wrote (1613)	5/16/1998 3:13:00 AM
From: Stitch	Read Replies (1) \| Respond to of 2951

Tom, << To All: China is doing a splendid job.>> I would laud your post. I agree that Zhu is the man of the hour. Zhu is worth studying closely given his uncharacteristic penchant for telling it like it is and his impatience with bureaucratize and circumspect confucianisms. These traits, of course, somewhat endear him to those of us in the West. Zhu's description reads like that of an X-style CEO who has just turned around a major corporation and is known for hard punching, decisive action. Interesting that Zhu hails from the same hometown as Mao. It may be about the only thing they have in common however. It seems to me that never before has China had a leadership so ready to shed the introspection that has been a hallmark of Chinese world affairs since history began. It seems a "no brainer" to me that Zhu expects China's resolve to accept an economic leadership role (mostly through holding the line on their currency) will escort them to a seat in the World Trade Organization. Zhu is no stranger to the benefits of open markets and borderless investing. His role in the development of Pudong in Shanghai when he was the city's mayor was key and yielded huge benefits to the city's people. Their average income was almost three times the national average at last count. As a standing member of the central committee his role in salvaging the joint venture between American Motors and China (Beijiing Jeep) earned the respect of capitalist all over the world. I have often wondered if Deng had visions of a reawakened and globally responsible China long ago. Tiananmen Square and the predecessor demonstrations in 1987 may have slowed things considerably. Hu Yaobang lost his party job in 1987 and Zhao Ziyang lost his in 1989 after Tianamen. Deng, I believe, had his hand forced by political realities of those times. We can only hope a similar development doesn't interfere with Zhu's goals. But those forces still most certainly exist in China and to not be wary of that is foolhardy in my opinion. Further, for all his apparent capabilities, the challenges faced by Zhu are huge. Successfully tackling the $250 billion in bad bank debt and the continued dismantling of antiquated state enterprises, while holding the line on devaluation in the face of the slowing of market share growth will be a hat trick if ever there was one. But the prize is equally huge. If successful Zhu will usher China into position as the region's leading economic influence supplanting Japan. Except for the most virulent ideologist this may whet the appetite of the old guard enough to keep them at bay as well as the ever less patient student factions. But the inevitable rise of unemployment may threaten the peace and once again preempt the intentions of a reform minded leader. Zhu will need lots of elbow room A man of his style usually does. I hope he gets it. Best, Stitch It will be interesting to watch Hong Kong's elections, the first "free" elections held on Chinese soil since 1949 (which is the same year Zhu joined the party). It will also be interesting to watch the visit Clinton will make to China in June. I for one would like to see changes in