The Sinocism newsletter is compiled by Bill Bishop, and republished here with permission. Be Informed About China. The Sinocism China Newsletter. Free.
The "older house sister" is getting massive coverage in Chinese media in a scandal that touches on many problems in contemporary China, including corruption and the household registration system (hukou). The Telegraph summarizes the case in Rural Chinese banker built up £100 million property portfolio:
Gong Aiai, 49, who is known in the Chinese blogosphere as "Older House Sister", is said to have parlayed her position as deputy head of a small bank in northwestern China's Shaanxi province into at least three extra identities, one of them identifying her as a Beijing native that allowed her to buy up sought-after property holdings in the capital.
At least one of her properties is apparently in Beijing's Sanlitun SOHO (北京涉“房姐”案民警被停职-新闻频道-和讯网), rented to a KTV.
The case is again on page one of People's Daily (人民日报-公安部调查陕西“房姐”多个户口 北京：注销户口，停职当事民警 神木：停职公安局副局长等4人), and a taskforce is looking into hukou fraud (China Daily):
On Thursday, Beijing police canceled Gong's false hukou and seized all of her assets in Beijing, including properties and cars. Officers have also been sent to Shanxi and Shaanxi provinces to take part in a joint investigation.
"We will suspend and detain any police officer involved in (helping) Gong (to register false hukou)," the Beijing Public Security Bureau said in a statement on Thursday.
Xinhua writes that Hukou forgery scandals highlight police corruption:
A Xinhua reporter found by investigation that a fake hukou can be bought for between 30,000 yuan and 50,000 at a grass-roots police station in a county of northeast China's Jilin Province.
"What do I need to prepare to get an extra hukou?" the reporter asked, pretending to be interested in buying one.
"Only a photo is needed, a different one from the one on your current ID card," a policeman replied, adding it took about one month to finish all procedures.
In fact, it was found that the new hukou is not even "fake," as all the documents and procedures are exactly the same as those used to get a legitimate one.
There must be some very nervous police and officials as it is highly unlikely Gong is the only one to have bought an extra hukou and any serious investigation could reveal a lot of corruption. Given the level of official media coverage heads will need to roll.
Beijing has launched a campaign (People's Daily) against waste and official gluttony. It began with "four dishes and a soup" and has progressed to "operation empty plate". "Operation empty plate" apparently was started by netizens earlier this month, Sina Weibo has promoted it and today it is on page one of People's Daily--人民日报-吃光盘中餐 今日不剩饭 “光盘行动”得到热烈响应. The People's Daily says that "operation empty plate" has been forwarded "50 million" times around the Internet (记者追踪“今天，你吃光盘中食物了吗” “光盘行动”被转发5000万次).
Whether it is really a grassroots movement or something coordinated by the Ministry of Propaganda with assistance from Sina, it is desperately needed here as the amount of food waste is quite shocking (South China Morning Post):
Agricultural scientist Yuan Longping has called on Beijing to stop people wasting tens of thousands of tonnes of food each year by issuing fines.
Yuan, a member of the Chinese Academy of Engineering who is known as "the father of hybrid rice", said he had seen too many sumptuous banquets that ended up with many leftovers.
The People's Daily cartoonists are quite talented and today they have a good one (Screenshot) depicting officials pigging out under a table in response to the campaign to stop waste and gluttony. Today's paper also has a commentary about special privileges and waste--人民日报-吃空饷背后的身份特权.
Xinhua's secretive government receptions defy China's central authority is quite entertaining, especially when you try to imagine what a "cohort of pussyfooters" might look like:
After the Communist Party of China (CPC) Central Committee promulgated a package of rules requiring government officials to change their work style and ditch extravagance for frugality in late December, more than 20 provinces have issued detailed regulations to build cleaner governments.
Behind the bandwagon, however, hides a cohort of pussyfooters who rack their brains to keep their corrupt working practices and lifestyles while maintaining good repute, as Xinhua reporters have confirmed.
An employee with the South Asia Wyndham Hotel in Kunming, capital of southwestern China's Yunnan Province, told this news agency on condition of anonymity that all its large banquet halls had been booked by big companies and a few government departments for the Spring Festival period...
They added that the colloquial saying "to eat quietly, to take gently and to play secretly" had entered common use in local officialdom.
In one cunning countermeasure against the central authority's "frugality order," according to an executive of a state-owned enterprise, luxury banquets have been moved out of starred hotels and into the canteens of government departments.
"It used to be an unspoken rule to invite officials to starred hotels, while now starred-hotel cooks are invited to canteens," said the executive.
Top chefs usually bring their high-end tableware to well-decorated canteens, which are as good as in starred hotels, they added.
Restaurants and hotels stand to lose a lot of money between this and the corruption crackdown if they are actually implemented with rigor over any sustained period, as First Financial notes in 公务宴订单骤降 酒店餐饮业频现退单降餐标.
Since East Asia was not already tense enough, North Korea has now threatened to build up “nuclear deterrence” (NK News):
Reacting to the news today, North Korea expert Leonid Petrov said,
It is regrettable that after the sixty years of confrontation both the UNSC and the DPRK are still locked in the security dilemma and prefer to exchange invectives and threaten the region with prospects of resuming the Korean War. Despite the “generally balanced” tone of the recent UNSC resolution on North Korea, warnings to take “significant action” will only lead to promises “to boost and strengthen defensive military power”.
More sanctions will only lead to less dialogue because sticks work only when carrots are also on offer. In the situation where military action is inconceivable and diplomacy does not work, the usage of soft power might be more useful.
Following Obama’s 2008 arrival at the White House North Korea conducted a rocket launch similar to the latest one and when similar UN sanctions were applied, quickly followed it with a nuclear test. At a time when Obama had promised an “open hand” to North Korea, Pyongyang’s one-two blow undermined the prospects for any short-term engagement between Washington and Pyongyang.
China as usual has urged calm after the DPRK nuclear test announcement (Xinhua):
"It is in the common interests of all parties concerned to maintain peace and stability on the Korean Peninsula and achieve the denuclearization of the peninsula," spokesman Hong Lei said at a regular news briefing. "(We) hope all concerned parties will keep calm and act in a cautious and prudent way, as well as refrain from taking any action that could lead to the progressive escalation of tensions," the spokesman said.
At some point the US has to take nuclear threats from the DPRK seriously, as China surely understands, right?
For those interested in reading more about the DPRK, NK News is a terrific source of information on North Korea and also has a daily newsletter.
Today's Links:
*THE ESSENTIAL EIGHT*
Party Official: Bo Xilai Could Face Severe Punishment - WSJ.com -* i've been saying since the chongqing exposes in chinese media last month that the odds Bo gets a ride in the lethal injection van are higher than many assume//* "We have always had severe punishment for corrupt officials," Mr. Li [Jingtian] said during the interview at the World Economic Forum in Davos on Wednesday, in response to a question about the fate of Mr. Bo. Such interviews are rare for senior party officials. He cited the examples of Liu Qingshan and Zhang Zishan, two leaders in the party's early days who were executed in the 1950s following accusations of embezzlement and other crimes in one of the party's first anticorruption campaigns.
Apple's China dilemma: market share or cachet? | Reuters- *a high-end phone 2 years ago is a low-end one today. market seeing massive feature and price compression (China manufactures most of world's smartphones after all), it will be increasing hard for Apple to differentiate, especially since it does not have the content/iTunes ecosystem lockin it has in other markets, but never will in China given consumer behaviors. And given shift in market, and rise of Samsung, it has far less leverage with China Mobile than it once might have. Basically all my Beijing friends with smartphones are not interested in the iPhone 5, even though many have the 4s. it has been a stunningly rapidly shift in my little world...but that is how fashion works, and a phone in china is fundamentally a fashion accessory, and the iPhone 5 is a relative fashion flop //* Apple's best plan of attack remains securing a deal with the country's top mobile carrier by far, China Mobile Ltd. It also needs to push the development of more localized apps and extend installment financing to bring its pricey smartphones within the reach of an urban populace with an average annual income of just $3,500. But it should resist the temptation to just put out a cheaper iPhone, some analysts say. Introducing a long-rumored lower-cost version of the gadget could backfire by diluting Apple's premium brand - one of its most valuable assets. "If you think of Apple, it's like a bright star in the galaxy, shining so brightly and everyone is looking at it. But it might have dimmed a bit as other stars such as Samsung have popped up," said TZ Wong, an analyst at research firm IDC.
Lenovo Says RIM Bid Among Options to Boost Mobile Unit - Bloomberg - *any possible deal unlikely to be approved, though that will not stop hyperventilating by bankers and RIM bulls//* Acquiring RIM would require approval from Canadian and U.S. regulators because of the size of the transaction and the fact that the company operates secure mobile networks for government agencies. Canadian Industry Minister Christian Paradis said this week that he would prefer RIM to grow “organically.”
Sen. Kerry’s Approach to China as Secretary of State | Center for American Progress - Nina Hachigian | January 24, 2013--Some issues in the U.S.-China relationship need immediate attention. Foremost among them is the dispute between Japan and China over the Senkaku/Diaoyu Islands, which is becoming increasingly tense and dangerous. Sen. Kerry and his team would be wise to devote considerable energy to determining how the United States can help diffuse the situation. Beyond the immediate issues, a broader aspect of U.S. policy toward China needs attention: The United States and China have no shared vision for what their future bilateral relationship could or should look like. They have not articulated a clear understanding of how they could continue to co-exist in peace a decade or two down the road, and they need to develop a shared, tangible idea for the future of the relationship.
Auditors named in Caterpillar-ERA debacle - FT.com - *too bad the partners who own the relationship with the firms that go bad are never named. investors would benefit from an accounting malpractice database//* Two of the world’s top accounting firms helped conduct due diligence last year for Caterpillar’s $886m acquisition of ERA, the Chinese mining equipment maker that was later alleged to have accounting irregularities. Deloitte and Ernst & Young conducted due diligence for the transaction, according to two sources close to the deal. Deloitte audited the working capital for ERA, while Ernst & Young conducted overall due diligence, one of these people said.
Cleaning Up China's Secret Police Sleuthing - Caixin - Wiretapping, email hacking, cell phone tracking and secret videotaping are just a few of the cloak-and-dagger techniques long employed by police in the course of criminal investigations in China. But now, for the first time, police officers applying for permission to employ these so-called "technological investigation measures" will be subject to "rigorous" reviews, without saying by whom. The stricter rules were written into an amendment to the Criminal Procedures Code that took effect January 1. Details were spelled out in complementary regulation documents recently released by the Ministry of Public Security, the Supreme People's Procuratorate and the People's Supreme Court...And authorities have been known to overstep the bounds. Last October, for example the director of public security in the city of Taiyuan, Li Yali, tapped his agency's power of secrecy to spare his son judicial discipline after he was arrested for drunk driving
Japan-China Crisis Is A Huge Geopolitical Problem - Business Insider -Henry Blodget interview w Ian Bremmer-- Blodget: So what happens if we get exactly that. A Japanese plane shoots tracers at a Chinese plane. The Chinese plane responds and shoots down the Japanese plane. What happens? Bremmer: Well, first of all, you’re gonna see a cut-off of diplomatic ties between the two countries. The ambassadors of course, will immediately be withdrawn. Not complete secession, but that’s the first thing that happens. You’ll see anti-Chinese and anti-Japanese across the board. You’ll see some violence. There will probably be Japanese ex-pats living in China that will be roughed up and killed. Japanese exposure in China which has already taken a beating would be considered unsustainable. Japanese companies would be leaving China in droves.
《平安乐清》 English Subtitles - YouTube An investigation concerning the Qian Yunhui incident in Yueqing. 对乐清钱云会事件的调查。by Ai Weiwei
*SEE ALSO: Extraordinary Images Of The Hottest Country In The World For Untapped Natural Resources*
Please follow Money Game on Twitter and Facebook.
Join the conversation about this story » Reported by Business Insider 15 hours ago.
The "older house sister" is getting massive coverage in Chinese media in a scandal that touches on many problems in contemporary China, including corruption and the household registration system (hukou). The Telegraph summarizes the case in Rural Chinese banker built up £100 million property portfolio:
Gong Aiai, 49, who is known in the Chinese blogosphere as "Older House Sister", is said to have parlayed her position as deputy head of a small bank in northwestern China's Shaanxi province into at least three extra identities, one of them identifying her as a Beijing native that allowed her to buy up sought-after property holdings in the capital.
At least one of her properties is apparently in Beijing's Sanlitun SOHO (北京涉“房姐”案民警被停职-新闻频道-和讯网), rented to a KTV.
The case is again on page one of People's Daily (人民日报-公安部调查陕西“房姐”多个户口 北京：注销户口，停职当事民警 神木：停职公安局副局长等4人), and a taskforce is looking into hukou fraud (China Daily):
On Thursday, Beijing police canceled Gong's false hukou and seized all of her assets in Beijing, including properties and cars. Officers have also been sent to Shanxi and Shaanxi provinces to take part in a joint investigation.
"We will suspend and detain any police officer involved in (helping) Gong (to register false hukou)," the Beijing Public Security Bureau said in a statement on Thursday.
Xinhua writes that Hukou forgery scandals highlight police corruption:
A Xinhua reporter found by investigation that a fake hukou can be bought for between 30,000 yuan and 50,000 at a grass-roots police station in a county of northeast China's Jilin Province.
"What do I need to prepare to get an extra hukou?" the reporter asked, pretending to be interested in buying one.
"Only a photo is needed, a different one from the one on your current ID card," a policeman replied, adding it took about one month to finish all procedures.
In fact, it was found that the new hukou is not even "fake," as all the documents and procedures are exactly the same as those used to get a legitimate one.
There must be some very nervous police and officials as it is highly unlikely Gong is the only one to have bought an extra hukou and any serious investigation could reveal a lot of corruption. Given the level of official media coverage heads will need to roll.
Beijing has launched a campaign (People's Daily) against waste and official gluttony. It began with "four dishes and a soup" and has progressed to "operation empty plate". "Operation empty plate" apparently was started by netizens earlier this month, Sina Weibo has promoted it and today it is on page one of People's Daily--人民日报-吃光盘中餐 今日不剩饭 “光盘行动”得到热烈响应. The People's Daily says that "operation empty plate" has been forwarded "50 million" times around the Internet (记者追踪“今天，你吃光盘中食物了吗” “光盘行动”被转发5000万次).
Whether it is really a grassroots movement or something coordinated by the Ministry of Propaganda with assistance from Sina, it is desperately needed here as the amount of food waste is quite shocking (South China Morning Post):
Agricultural scientist Yuan Longping has called on Beijing to stop people wasting tens of thousands of tonnes of food each year by issuing fines.
Yuan, a member of the Chinese Academy of Engineering who is known as "the father of hybrid rice", said he had seen too many sumptuous banquets that ended up with many leftovers.
The People's Daily cartoonists are quite talented and today they have a good one (Screenshot) depicting officials pigging out under a table in response to the campaign to stop waste and gluttony. Today's paper also has a commentary about special privileges and waste--人民日报-吃空饷背后的身份特权.
Xinhua's secretive government receptions defy China's central authority is quite entertaining, especially when you try to imagine what a "cohort of pussyfooters" might look like:
After the Communist Party of China (CPC) Central Committee promulgated a package of rules requiring government officials to change their work style and ditch extravagance for frugality in late December, more than 20 provinces have issued detailed regulations to build cleaner governments.
Behind the bandwagon, however, hides a cohort of pussyfooters who rack their brains to keep their corrupt working practices and lifestyles while maintaining good repute, as Xinhua reporters have confirmed.
An employee with the South Asia Wyndham Hotel in Kunming, capital of southwestern China's Yunnan Province, told this news agency on condition of anonymity that all its large banquet halls had been booked by big companies and a few government departments for the Spring Festival period...
They added that the colloquial saying "to eat quietly, to take gently and to play secretly" had entered common use in local officialdom.
In one cunning countermeasure against the central authority's "frugality order," according to an executive of a state-owned enterprise, luxury banquets have been moved out of starred hotels and into the canteens of government departments.
"It used to be an unspoken rule to invite officials to starred hotels, while now starred-hotel cooks are invited to canteens," said the executive.
Top chefs usually bring their high-end tableware to well-decorated canteens, which are as good as in starred hotels, they added.
Restaurants and hotels stand to lose a lot of money between this and the corruption crackdown if they are actually implemented with rigor over any sustained period, as First Financial notes in 公务宴订单骤降 酒店餐饮业频现退单降餐标.
Since East Asia was not already tense enough, North Korea has now threatened to build up “nuclear deterrence” (NK News):
Reacting to the news today, North Korea expert Leonid Petrov said,
It is regrettable that after the sixty years of confrontation both the UNSC and the DPRK are still locked in the security dilemma and prefer to exchange invectives and threaten the region with prospects of resuming the Korean War. Despite the “generally balanced” tone of the recent UNSC resolution on North Korea, warnings to take “significant action” will only lead to promises “to boost and strengthen defensive military power”.
More sanctions will only lead to less dialogue because sticks work only when carrots are also on offer. In the situation where military action is inconceivable and diplomacy does not work, the usage of soft power might be more useful.
Following Obama’s 2008 arrival at the White House North Korea conducted a rocket launch similar to the latest one and when similar UN sanctions were applied, quickly followed it with a nuclear test. At a time when Obama had promised an “open hand” to North Korea, Pyongyang’s one-two blow undermined the prospects for any short-term engagement between Washington and Pyongyang.
China as usual has urged calm after the DPRK nuclear test announcement (Xinhua):
"It is in the common interests of all parties concerned to maintain peace and stability on the Korean Peninsula and achieve the denuclearization of the peninsula," spokesman Hong Lei said at a regular news briefing. "(We) hope all concerned parties will keep calm and act in a cautious and prudent way, as well as refrain from taking any action that could lead to the progressive escalation of tensions," the spokesman said.
At some point the US has to take nuclear threats from the DPRK seriously, as China surely understands, right?
For those interested in reading more about the DPRK, NK News is a terrific source of information on North Korea and also has a daily newsletter.
Today's Links:
*THE ESSENTIAL EIGHT*
Party Official: Bo Xilai Could Face Severe Punishment - WSJ.com -* i've been saying since the chongqing exposes in chinese media last month that the odds Bo gets a ride in the lethal injection van are higher than many assume//* "We have always had severe punishment for corrupt officials," Mr. Li [Jingtian] said during the interview at the World Economic Forum in Davos on Wednesday, in response to a question about the fate of Mr. Bo. Such interviews are rare for senior party officials. He cited the examples of Liu Qingshan and Zhang Zishan, two leaders in the party's early days who were executed in the 1950s following accusations of embezzlement and other crimes in one of the party's first anticorruption campaigns.
Apple's China dilemma: market share or cachet? | Reuters- *a high-end phone 2 years ago is a low-end one today. market seeing massive feature and price compression (China manufactures most of world's smartphones after all), it will be increasing hard for Apple to differentiate, especially since it does not have the content/iTunes ecosystem lockin it has in other markets, but never will in China given consumer behaviors. And given shift in market, and rise of Samsung, it has far less leverage with China Mobile than it once might have. Basically all my Beijing friends with smartphones are not interested in the iPhone 5, even though many have the 4s. it has been a stunningly rapidly shift in my little world...but that is how fashion works, and a phone in china is fundamentally a fashion accessory, and the iPhone 5 is a relative fashion flop //* Apple's best plan of attack remains securing a deal with the country's top mobile carrier by far, China Mobile Ltd. It also needs to push the development of more localized apps and extend installment financing to bring its pricey smartphones within the reach of an urban populace with an average annual income of just $3,500. But it should resist the temptation to just put out a cheaper iPhone, some analysts say. Introducing a long-rumored lower-cost version of the gadget could backfire by diluting Apple's premium brand - one of its most valuable assets. "If you think of Apple, it's like a bright star in the galaxy, shining so brightly and everyone is looking at it. But it might have dimmed a bit as other stars such as Samsung have popped up," said TZ Wong, an analyst at research firm IDC.
Lenovo Says RIM Bid Among Options to Boost Mobile Unit - Bloomberg - *any possible deal unlikely to be approved, though that will not stop hyperventilating by bankers and RIM bulls//* Acquiring RIM would require approval from Canadian and U.S. regulators because of the size of the transaction and the fact that the company operates secure mobile networks for government agencies. Canadian Industry Minister Christian Paradis said this week that he would prefer RIM to grow “organically.”
Sen. Kerry’s Approach to China as Secretary of State | Center for American Progress - Nina Hachigian | January 24, 2013--Some issues in the U.S.-China relationship need immediate attention. Foremost among them is the dispute between Japan and China over the Senkaku/Diaoyu Islands, which is becoming increasingly tense and dangerous. Sen. Kerry and his team would be wise to devote considerable energy to determining how the United States can help diffuse the situation. Beyond the immediate issues, a broader aspect of U.S. policy toward China needs attention: The United States and China have no shared vision for what their future bilateral relationship could or should look like. They have not articulated a clear understanding of how they could continue to co-exist in peace a decade or two down the road, and they need to develop a shared, tangible idea for the future of the relationship.
Auditors named in Caterpillar-ERA debacle - FT.com - *too bad the partners who own the relationship with the firms that go bad are never named. investors would benefit from an accounting malpractice database//* Two of the world’s top accounting firms helped conduct due diligence last year for Caterpillar’s $886m acquisition of ERA, the Chinese mining equipment maker that was later alleged to have accounting irregularities. Deloitte and Ernst & Young conducted due diligence for the transaction, according to two sources close to the deal. Deloitte audited the working capital for ERA, while Ernst & Young conducted overall due diligence, one of these people said.
Cleaning Up China's Secret Police Sleuthing - Caixin - Wiretapping, email hacking, cell phone tracking and secret videotaping are just a few of the cloak-and-dagger techniques long employed by police in the course of criminal investigations in China. But now, for the first time, police officers applying for permission to employ these so-called "technological investigation measures" will be subject to "rigorous" reviews, without saying by whom. The stricter rules were written into an amendment to the Criminal Procedures Code that took effect January 1. Details were spelled out in complementary regulation documents recently released by the Ministry of Public Security, the Supreme People's Procuratorate and the People's Supreme Court...And authorities have been known to overstep the bounds. Last October, for example the director of public security in the city of Taiyuan, Li Yali, tapped his agency's power of secrecy to spare his son judicial discipline after he was arrested for drunk driving
Japan-China Crisis Is A Huge Geopolitical Problem - Business Insider -Henry Blodget interview w Ian Bremmer-- Blodget: So what happens if we get exactly that. A Japanese plane shoots tracers at a Chinese plane. The Chinese plane responds and shoots down the Japanese plane. What happens? Bremmer: Well, first of all, you’re gonna see a cut-off of diplomatic ties between the two countries. The ambassadors of course, will immediately be withdrawn. Not complete secession, but that’s the first thing that happens. You’ll see anti-Chinese and anti-Japanese across the board. You’ll see some violence. There will probably be Japanese ex-pats living in China that will be roughed up and killed. Japanese exposure in China which has already taken a beating would be considered unsustainable. Japanese companies would be leaving China in droves.
《平安乐清》 English Subtitles - YouTube An investigation concerning the Qian Yunhui incident in Yueqing. 对乐清钱云会事件的调查。by Ai Weiwei
*SEE ALSO: Extraordinary Images Of The Hottest Country In The World For Untapped Natural Resources*
Please follow Money Game on Twitter and Facebook.
Join the conversation about this story » Reported by Business Insider 15 hours ago.