Thirty Eight Thoughts

Entries from May 2008

#5 MTR trippin’

May 27, 2008 · Leave a Comment

I’ve been traveling on Hong Kong’s Mass Transit Railway (MTR) since 1985.  Most days nothing much happens, but once in a while there are “incidents” while most days involve dealing with various idiosyncrasies. 

Some of most common include: Fainting (mainly young women who can’t stand the crush in the morning because they skipped breakfast); Fighting (usually men in their 30s, who can’t stand being so close to each other in the crush, usually fights are continued on the platform, with mostly finger wagging and shouting, no blows, no kung fu); Making-up (always seated young women, who are amazingly dexterous as they apply lip or eye-liner on a speeding train or use he eyelash curling machine much to the squirming of onlookers); Finger nail clipping (usually old folks, or mid-aged women, avoiding the flying nails is an art); Newspaper reading (done by everyone, as morning papers are tabloid size and free, most people try to read their papers in crushingly impossible situations, even if it means resting the paper on someone, even on other people’s heads); Reading and walking (mostly young office people, because their stingy bosses wont let them read the newspaper at work, the practice causes the mass slowing of the stream of crush hour people trying to exit the station); Pole leaning (mostly practised by workmen and mid-aged women, who for some read become very tired when entering the train and can’t seem to be able to stand up. Pole leaning usually leads to mass stumblings because passengers have nothing to hold on to); Not moving to the middle of the carriage (most people, due to the unconfirmed belief that the train doors will close before you have time to get out of the train); Please hold the hand rail (is the warning given by the driver, after the train shrieks to a juddering halt. Because of the pole leaners, most people, by then, are five feet from where they were originally standing); Preparing to leave the train, well before it has reached the station (this annoying habit, practiced by all ages, produces significant levels of anxiety as already crushed people try to move to accomodate the panicking exiting passenger). One event that I have been unable to witness, but which my wife says she saw once on the KCR, is underarm deodorant spraying! Apparently, the KCR traveller is more tolerant than MTR patrons. 

 

And finally, my personal favourite. I was standing in the train chewing gum when I suddenly coughed, causing the gum to exit before its time. The gum landed on the suit jacket of the guy sitting in front of me. After an apology, I tried picking the gum off his jacket, but it started rolling down. Fortunately, I managed to catch up with it, and, as the train had arrived at my station, I was able to leave the scene quickly, with the offending gum between my fingers (after all where else could I put the damned thing?).  

 

 

The video is something that I’ve always wanted to do – tape an exit from the MTR. I was going to tape the people, to give a flavour of the typical user, but I thought it would be intrusive in a carriage where people could not exit, and therefore had no choice when being filmed. So I filmed their feet instead. The tape is sped up to reflect the fact that most people are very anxious to exit the MTR as quickly as they can. The music, I think, reflects this urge. Go!

Although most major cities have some form of non-contact cash payment card system, Hong Kong’s Octopus system has been at the forefront of the cashless revolution. The cards were introduced for the MTR, and were adapted for the KCR and buses. Eventually, the cards’ use was extended to convenience stores and other retailers (McDonald’s etc). Topping up of the cash on the cards can be done automatically, via an agreement with the credit card companies. The draw back of the card is that women tend to keep their cards in their bags, and place the bag over the reader as they enter the turnstile. Unfortunately, this does not always work, because the distance is too great. This means that these lazy women have to shuffle their handbags around until contact is made. This delays the smooth flow of traffic through the turnstiles. My advice here is to avoid queuing behind women with big handbags when trying to get through the turnstiles. Of course this assumes that you can even get to the turnstile, because Hong Kong people are not particularly good at queuing. Generally, they queue like they drive, recklessly, and with no regard for anyone around them. Patience is the only advice I can give regarding queuing.

 

However, I can offer a couple of useful tips for specific journeys on the MTR, which can save the time spent wrestling with the crowds at the turnstiles. First, if there are no trains to Kowloon at the platforms in Central, the train will always arrive at platform one (the platform to the left). Even if everyone is queuing to the right, turn left when you come down the escalator. Second, if you are traveling to the end of the Tuen Wan line (the longest line in the system) from Admiralty, take the train to Central, and get a seat when everyone exits at Central. The train will then return to Admiralty and onwards to Tuen Wan, with no need to change trains. The extra minutes wait are worth it. Lastly, when traveling in the rush hour to Central from Kowloon Tong and beyond, change trains at Prince Edward (by descending the stairs), rather than at Mongkok, which is always overcrowded, and means waiting at least for two trains to arrive before being able to enter.

 

 

 

Categories: MTR
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#4 Esperanza

May 25, 2008 · Leave a Comment

This is a photograph of the grave of Mrs. Esperanza Gomeze, the wife of Mr. Quirino Gomeze. She was born in 1876. The grave is in St. Michael’s Catholic Cemetery, Happy Valley, Hong Kong.

 

 

Why is this picture of any interest? Because it is as far back as my known family tree extends (on my mother’s side). Esperanza, a Macanese, was my great grand mother. And with the recent death of the last of her children, I may never discover what were the names of Esperanza’s parents and where they lived.

Categories: Family
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#3 Betty Botter

May 25, 2008 · Leave a Comment

Chinese manufacturers are constantly looking for ways to cutify every plastic widget they make. They are no where near as good as the Japanese at this. The picture below is a good example of a staid Chinese manufacturer trying to produce cuteness – badly. The original is obviously “Peter Rabbit by Beatrix Potter”. The new arrangement of the words to “Petty Rabbit by Betty Botter” looks enough like the original words to be associated with them, but obviously they are very different (thus escaping the copyrights’ wrath). I have to say, I am quite impressed with the anagramatical skills of the manufacturer – although I doubt sales of the food warmer were significantly affected by the effort.  

Categories: Attitude
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#2 Please remind your servant….

May 25, 2008 · Leave a Comment

I recently received a notice, which I’ve posted below, from the estate management company of my building. I was surprised to see the use of the word “servant” in the English version of the notice. The Chinese version uses the wording for “maid” – which is sort of acceptable. But, it’s not as good as the more commonly used domestic helper.

 

Questions: 1) how could the translator change the meaning of the Chinese so significantly? 2) Is servant the right word to use? Technically, servant correctly describes a domestic helper, but it has connotation more akin to a slave. According to reactions I have received to the notice, it also seems to be viewed as archaic and demeaning 3) I suspect that the English version was produced using some form of translating aid (because of the ugliness of the structure, grammar etc of the notice), which begs the question, how could the translating aid bring about such a severe change in the meaning of the word? 4)  If it was translated by someone, one has to ask: Do Hong Kong people consider their domestic helpers as servants? Or is it just the translator?

 

Note: the notice asked owners to make sure their “servants” mop up any excess water after the “servant” cleans the owners’ car(s). Anyone that has ever been to Hong Kong will know that Hong Kong cars are the cleanest in the world, because every car owner has a “servant” that has to clean the vehicle every day (usually very late at night).

 

I have to say, that some of Hong Kong’s legions of domestic helpers are treated like servants, despite the fact that these women are responsible for feeding, clothing and caring for the owners and, most importantly, the owners’ children and motor vehicles (in that order of priority). True, they do not need to come here and work under such torrid conditions, but desperate (mostly ignorant) people will tolerate desperate conditions, and of course, for every bad employer, there are plenty more good ones.  

Categories: Attitude
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#1 Investment Weekly – Property higher using two cows

May 24, 2008 · Leave a Comment

I have been posed an interesting question: how can Hong Kong residential property-prices continue to rise (+36% in three years), even though local equities are in a bear market? I answered this valid question with some “you have two cows” jokes.

You have two cows. You sell one to buy a flat at Sino Land’s Palazzo pre-sale. Having lost half your cashflow and assets, you realize that the flat is the size of a very small cow pat, and it’s nothing like the bull shown in the advertisement[1]. In the end you live with the stench (of the one cow, the sewage works and the Shing Mun open drain), because the cow/sewer/drain produce enough flammable gas, which you sell, to recover any losses. (Hong Kong property prices (even those sold on false promises) will continue rising because of gas-induced price/wage inflation, low funding costs and because cattle are slower than cheetahs (or is that cheaters?)).

  [1] What possessed the designer to put two pictures of Newlands Rugby Stadium in South Africa in the ad?

 Hong Kong residential property index, HS Index and Hibor (rebased – 100) 

 

You have two cows. They are identical in all aspects (being clones). One is priced in Renminbi and the other in Hong Kong dollars. The cow priced in RMB is increasing in value, while the other is declining. You figure that the value of the parts is greater than the value of the whole. With equities in a bear market, you double up on RMB by slaughtering the HK$ cow and selling its parts to RMB owners. (China’s two undervalued currencies (by about 40% according the latest Big Mac Index) and straight-line, managed appreciation will continue to attract investment dollars into hard assets like property).

I have decided to double up on Dore (0628.HK), which I still believe will continue to benefit from Mainland high-rollers piling into Wynn’s casino in Macau. I recommended the stock at HK$0.78, which was the closing price on Friday May 2nd, ahead of its suspension and share placement the following Wednesday (May 7th). I have doubled-up using the closing price of Friday again (which is the standard practice of this newsletter). The new average price happens to be below the downside of HK$0.65, which was the placement price.

Part of my optimism about the stock (i.e. apart from the 2x PER, 20% dividend yield, recession-proof VIP Macau gaming revenues) stems from the shareholder roster of the company. For a HK$1 billion company, it has some interesting institutional shareholders.

The most interesting recent addition is Mr. Mark E. Kingdon, founder of the US$3 billion hedge fund, Kingdon Capital. Mr. Kingdon has been around the financial markets for a long time (30 years) and doesn’t buy 5% of a company unless he’s confident about it. He doesn’t flip, either. We know that 224 million shares were issued to Chen Yi Ming two weeks ago. The shareholder roster shows that Mr. Kingdon joined Chen at the same time. Therefore, his portion of the 322 million shares was bought in the open market. I believe he bought his shares from some of the smaller minority shareholders such as Farallon, Indus and PMA around April 14-17th. He topped his holding over 5% when Deutsche sold on May 6th. Based on stock market records, Kindon probably bought at prices ranging from 52 cents to 71 cents, at an average of about 60 cents. I’m happy to follow him in. 

I’ve been following the corporate family stories at SHK Properties and TVB with great interest. SHK Properties is currently sponsoring a program on local TV station, TVB, called CEO Connection. Bearing in mind the complete lack of communication between Chairman and CEO Walter Kwok and his two brothers, I would say that is quite ironic. I was amused to read that the children of TVB’s owner Run Run Shaw don’t want to inherit the centenarian’s business (because they don’t want to end up fighting between themselves?), thus opening the way for a potential sale of a stake in the broadcaster. My advice to anyone thinking about buying a piece – don’t. The quality of programming is terrible, the library of old movies/serials is not worth a jot, and TVB’s days have been numbered for years (Shaw’s children know it). In order to ensure control stays local (for propaganda purposes), someone (with a favour to give) will be reluctantly roped in to buy it. Pity them, but lucky us because we added TVB’s shares in June 2001. Back then I considered it “cheap”. I was right: it was cheap, but for a reason – it’s rubbish. Its 8% compound annual growth rate of return since 2001 is proof, because that is only half the performance of the whole portfolio, and less than the HS Index’s 10% CAGR. We will be glad to hear offers over HK$70 a share, so that, with dividends included, I can exit the position at the average return for the portfolio. 

I will be looking for greater returns than TVB from Hong Kong residential property and, eventually, the US$ (the two most undervalued assets around at the moment). Dore will be cherry on the cake, as I reconfirm the HK$1.30 target (+88%).

Categories: Investment
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