It makes sense to start this category with warning. Marshall McLuhan was most famous for his insight – The medium is the message: it isn’t just the content of a media which matters, but the medium itself which most meaningfully changes the ways humans operate.
But McLuhan wasn’t an advocate of it, he saw dangers beneath the surface as this quote from his participation in the 1976 Canadian Forum shows.
“The violence that all electric media inflict in their users is that they are instantly invaded and deprived of their physical bodies and are merged in a network of extensions of their own nervous systems. As if this were not sufficient violence or invasion of individual rights, the elimination of the physical bodies of the electric media users also deprives them of the means of relating the program experience of their private, individual selves, even as instant involvement suppresses private identity. The loss of individual and personal meaning via the electronic media ensures a corresponding and reciprocal violence from those so deprived of their identities; for violence, whether spiritual or physical, is a quest for identity and the meaningful. The less identity, the more violence.”
McLuhan was concerned with the mass media, in particular the effect of television on society. Yet the content is atemporal. I am sure the warning would have fitted in with rock and roll singles during the 1950s or social media platforms today.
I am concerned not only changes in platforms and consumer behaviour but the interaction of those platforms with societal structures.
The Bureau of Investigative Journalism have an interesting article on Indian hackers who work in the ‘hack-for-hire’ industry: Inside The Global Hack-For-Hire Industry. Indian hackers are typically used because their clients are unlikely to be prosecuted under their home country laws like the UK Computer Misuse Act. Indian hackers have gone after British journalists, businesses, NGOs and even politicians. Jay Solomon, a former journalist with the Wall Street Journal accused a US legal firm of using Indian hackers to steal emails between him and one of his sources. This was bundled up in a dossier used by the law firm to get Solomon fired from his job as a journalist.
Business technology origins of blackhat hacking services
India is known for its enterprise technology work. Most bank computing systems and telecoms billing systems in the UK are managed by Indian technologists out of India. The Indian hacker for hire business sprang out of a company called Appin that looked to sell clients services to help secure those services. Other companies engaged in cybersecurity for corporate clients also provide Indian hackers and tools for offensive computer work. Ethical hacking at the firm was the main business, but a lucrative sideline was blackout Indian hackers working for the highest bidder.
Favourable environment
Presumably the same factors that favour software programming and technology services in India also favour these blackhat Indian hackers:
Plentiful volume of talented software engineers
Relatively low cost compared to their counterparts elsewhere
Global connections via a diaspora for firms providing Indian hackers for hire
Lax or loosely enforced regulations
‘Clusters’ of talent similar to the US Silicon Valley, notably Gurugram
It’s interesting that much of the demand for Indian hackers has come from the Gulf states. Indian hackers have also worked on behalf of foreign governments including Cambodia, Egypt, Pakistan and Turkey – all of this government work was carried out with the approval and sometimes behest of the Indian government. Indian hackers working for Pakistan, with Indian government approval! For western corporate intelligence employees, who are clients of these firms, they’ve done foolish things like endorse the Indian hackers and their firms on LinkedIn.
China Gender Law: Country Tells Women to ‘Respect Family Values’ – Bloomberg – An amendment to the Women’s Rights and Interests Protection Law passed by the nation’s top legislative body on Sunday introduced a list of moral standards for women to observe. …“China is attempting to use laws to regulate and discipline women,” said Xiaowen Liang, a New York-based feminist and lawyer. “Why do you only need women to observe family values? What kind of family values are we talking about? These are very vague ideas.” – inching towards A Handmaiden’s Tale with Chinese socialist characteristics
Biden froze out China’s ambassador. He may regret that. – POLITICO – A Washington, D.C.-based diplomat familiar with Qin’s relations with the administration said Beijing’s apparent unresponsiveness to Qin fueled skepticism about his influence back home. “There were one or two issues where the U.S. wanted his help on some things, but he just wasn’t able to do it — he didn’t seem to be totally in the loop,” the diplomat said, declining to name the issues… “Somebody got this wrong in our system — either [Qin] was more influential than we appreciated and we should have known that or he somehow snuck onto the Central Committee without us understanding that was possible,” said the former administration official. “But either way, if we’d known what we know now, we probably would have operated a bit differently and put in a little bit more energy in trying to build some trust with him.” – To be fair to the Biden Administration, I think lots of people in the PRC system were also surprised with Qin’s selection for the Central Committee and likely promotion to be Foreign Minister. And even they thought it might happen, would being nicer to him change any of the fundamental policies? And how could they have managed the optics of giving Qin more access to US officials than Amb. Burns gets to PRC officials?
Coronavirus: Hong Kong allows restaurants and bars to stay open all night, but step ‘too little, too late’, industry leaders warn | South China Morning Post – Residents have grown used to eating dinner earlier and cooking at home during the pandemic, industry leaders say. If this habit sticks it has negative implications for food services and entertainment, but positive opportunities for FMCG, food delivery and media sectors. When I lived in Hong Kong, one thing that I noticed was the ‘insomniac’ nature of the city with late night restaurants and take-outs together with late night mall shopping all of which added to the city’s ‘Blade Runner’ vibe
China stops publishing data metrics of vast domestic apps market amid declining internet service revenue, faltering economy | South China Morning Post – The Chinese government has stopped reporting data metrics of domestic apps for the last three months without explanation, which makes it difficult for outside analysts to assess the health of this industry in the world’s largest internet and smartphone market. The Ministry of Industry and Information Technology (MIIT), one of the government agencies responsible for regulating apps, started omitting this market segment’s data metrics from its monthly reports from July, according to the latest information on its website
Everything you need to know about Spam — Quartz Weekly Obsession — Quartz – “Spam became iconic in Asia because it was a taste of America without being in America. It’s like drinking Coke. While you can’t afford to travel to America, you can eat and drink America or enjoy a little piece of America in your life.” — Ayalla Ruvio, consumer behavior researcher and professor in the department of marketing at Michigan State University
Germany
Business As Usual: German Companies Ignore Major Risks in China – DER SPIEGEL – The doctrine of “transformation through trade,” to which Germany adhered for decades, was exposed as an illusion by Russia’s invasion of Ukraine, a truth that even Germany’s president accepts. “We must become less vulnerable and reduce one-sided dependencies,” Frank-Walter Steinmeier told public broadcaster ARD, “and that applies to China in particular.”Germany has seen trade with the People’s Republic quadruple since 2005, but during that same period, China has developed into a full-blown dictatorship. The West’s hopes for further market-economy reforms have been dashed. President Xi Jinping, who had his power cemented last week at the 20th Party Congress, is fully committed to a state-controlled economy. “Henceforth: Marx gets precedence over the markets,” says Jörg Wuttke, president of the European Union Chamber of Commerce in China – worthwhile reading in conjunction with: We don’t want to decouple from China, but can’t be overreliant – POLITICO – this op-ed by Chancellor Olaf Scholz is embarrassing
Subprime attention crisis is a short book, or a long essay depending on the way you want to look at it. It was written by Tim Hwang.
About Tim Hwang
Hwang is a lawyer working for email newsletter platform Substack. Prior to this he worked in a US think tank attached to Georgetown University: Center for Security and Emerging Technology and in public policy at Google focused on machine learning. So he brings a deep set of knowledge to writing Subprime attention crisis. One also has to bear in mind that his current employee Substack is based on the online media model moving from online advertising driven to subscription driven.
Timing is everything
I read this book over a couple of days at the beginning of this month. By this time, Meta and Alphabet has published quarterly results that were below what investors expected with falling sales. Add into the mix that the problems that Twitter and Snap have had (which are are bigger issues than just down to the dynamics of the online advertising market), all of which makes this book feel timely.
On the other hand, one could also argue that much of the crisis had already landed. Ad tech businesses like Rubicon Project have either gone under or merged with their peers creating a massive amount of consolidation. The latest wave of consolidation happened in 2020 – 2021.
Meta-specific issues
Even with Meta and Alphabet there are business specific issues. Meta has struggled to compete effectively with TikTok. The poisonous nature of debates on Facebook, together with an aging audience on the platform hasn’t helped. In fact it’s a wonder that the context collapse that the platform has suffered from for at least the past six years hadn’t dragged it down yet. WhatsApp has helped enrich Facebook data and provided a channel for business services. At the time Facebook bought the business partly because Zuckerberg needed a brain trust for the future. The brain trust is gone and Zuckerberg’s dive into the Metaverse looks very similar to Apple’s peak John Sculley moment with the Knowledge Navigator concept. You can see glimpses of the Knowledge Navigator in the smartphone, the iPad, the now abandoned WikiReader product or the use of contextual information and national language processing like Siri. Apple didn’t waste the kind of money that Meta has spent chasing an illusory vision of the future.
Alphabet-specific issues
I was surprised that Alphabet growth had lasted this long based on the following considerations:
With mobile, Google also pivoted a different type of search from product search to where is my nearest coffee shop with free wifi and has managed to sell search ads against them. This meant that Amazon and eBay managed to capture a lot of product searches, with consumers only hitting up Google afterwards and Amazon’s advertising has been eating Google’s lunch. Secondly a lot of the high street and neighbourhood shops have been eaten alive by food delivery services and this was then exasperated by the COVID which has changed at least some people’s consumer behaviour
Historically, Google has been too focused on looking for multi-billion dollar opportunities which haven’t panned out and closed down smaller services that were making money and bringing in attention. In essence, over the years they have thought Google Reader, the Google Search Appliance, Google Health, Boston Dynamics and several other projects were the big payday. They weren’t, but they were respectable business opportunities, just too small for Google to want to pursue. In its wake Google had destroyed entire sectors, or turned them into cottage industries such as enterprise search and knowledge management, RSS newsreaders autonomous robots
“something like almost 40% of young people when they’re looking for a place for lunch, they don’t go to Google Maps or Search, they go to TikTok or Instagram.”
YouTube seems to struggle getting brand building advertising dollars in the face of TikTok, Instagram and this explains why you saw a decline in sales over 2 percent. Instead you see a lot of D2C product ads a la day trading and drop shipping courses advertised. Part of this might be down to the product. YouTube has been screwing over creators and creators have made it clear that they’re not happy. You don’t need to go to YouTube if you get the directors cut of your favourite creators content on Patreon or Curiosity Stream. Censorship of political analysis content around China or Ukraine seems to be particularly bad.
Back to Subprime attention crisis
Hwang in Subprime attention crisis points out many of the things that agency employees and owners have known for years:
Online advertising effectiveness has declined compared to its performance 25 years ago
Audiences don’t see a lot of the ads that are displayed. Different reports will give you different numbers on this
Online advertising is destroying the very media industry that its content is shown on
Online advertising fraud is a big problem
Online advertising business practices are an even bigger problem with up to 70 percent of of online programmatic advertising spend going to advertising technology intermediaries such as The Rubicon Project (now Magnite) and Xaxis
This has allowed businesses like Procter & Gamble and adidas to reduce advertising spend at no loss in effectiveness. In the case of P&G Subprime attention crisis highlights how they cut $200 million in online advertising spend, moved that spend on to offline media like radio and print AND managed to increase their reach by 10 percent.
More on adidas via its inhouse head of media Simon Peel
Hwang marshals his facts well. Which is what you would expect from a lawyer. He uses analogous examples from the US financial services sector including the 2008 financial crisis. The book itself is 141 pages in length and there is a substantial section detailing his sources. Subprime attention crisis is based exclusively on desk research.
State capitalism has been created in various forms in China since opening up. Some of the new forms have aspects that impacts the relative attractiveness of doing business in or with Chinese companies.
Opening up
Historically since opening up China has been a mixed market model. There were small private businesses including many farmers. There was the state owned enterprises, a direct descendent of Mao’s work units and businesses that the government wanted to keep a strategic hold on.
Taken at an exhibition that was part of the Shenzhen Biennial, when I was there back in 2010
Grey zone and hybrid companies
Grey zone companies
A classic example of a grey zone company would be Huawei. In their 2019 paper Who Owns Huawei, Balding & Clarke make a convincing argument that Huawei is a state controlled company, if not state owned in the conventional sense. This view is supported by:
The state hacking of Nortel which Huawei disproportionately benefited from in their subsequent telecoms carrier contracts and 5G technology
State bank vendor financing on behalf of Huawei at negative interest rates that telecoms providers like BT and Vodafone were given
Zichen Wang translated a Chinese academic paper that pointed out an alternative view. Yes the ownership structure was a shit show, was pretty much the one point of agreement between the two papers.
But that much of this was down to domestic practice influenced by classic state capitalism and modern business law that China brought in and still doesn’t square up with what was happening on the ground in terms of business laws.
You can make up your own mind if this is an element of state capitalism.
Hybrid companies
An example of this would be the Stellantis | Guangzhou Auto Company joint venture that made Jeep branded SUVs for China. These joint ventures were basically the way the Chinese government coerced technology transfer from western firms to local firms. The Stellantis JV has gone into bankruptcy and GAC seems to have its own range of capable SUVs based on Stellantis expertise gained over the years.
Huawei’s joint venture with 3Com allowed the telecoms giant to build a large enterprise networking business to compete with the likes of Cisco Systems. At the time that China first rolled out its Golden Shieldinternet censorship platform, it relied on Cisco technology, and China would want to remedy this under its state capitalism system. Huawei now supports internet censorship around the world. This form of state capitalism has been common in a number of developing countries over the years, but China was particularly successful in using it in a coercive manner to enhance state capitalism rather than just driving economic growth.
Rise of the hybrid firm – Gavekal Research – Today, 48% of onshore listed companies, representing 67% of market capitalization, have a mixed bag of major shareholders from the private and state sectors. While many of those companies are still clearly controlled by either state or private shareholders, a large and significant group of firms occupies an intermediate position that is harder to characterize. – on China’s state capitalism system
How China’s communist officials became venture capitalists – Times of India – The US and other Western governments have long been wary of the economic power of China’s “state capitalism,” fueled by giant state-owned companies and an industrial policy driven by subsidies and government mandates. But policymakers need to pay more attention to what’s really propelling China’s growth: private firms with minority government-linked investments. “The distinction between state-owned and private has been important for policymakers outside China and for analyzing the Chinese economy,” says Meg Rithmire, a professor at Harvard Business School who specializes in comparative political development in Asia and China. “That boundary is eroding.” – see also Chinese banks vendor financing deals which is the real reason behind Huawei’s growth (alongside stealing IP and other proprietary elements: Nortel cough, cough)
Influenced firms
Influenced firms are a particularly pernicious part of the Chinese state capitalism system. The Chinese economy has always relied on relationships and even patronage of government power brokers similar to Malaysia, Thailand and Korea. But the state has looked to move personal bonds to state bonds. Much of this comes from National Intelligence Law 2017; that puts demands on Chinese citizens, Chinese companies and anyone connected to China.
Like the more widely reported Cybersecurity Law (which went into effect on June 1) and a raft of other recent statutes, the Intelligence Law places ill-defined and open-ended new security obligations and risks not only on U.S. and other foreign citizens doing business or studying in China, but in particular on their Chinese partners and co-workers.
Of special concern are signs that the Intelligence Law’s drafters are trying to shift the balance of these legal obligations from intelligence “defense” to “offense”—that is, by creating affirmative legal responsibilities for Chinese and, in some cases, foreign citizens, companies, or organizations operating in China to provide access, cooperation, or support for Beijing’s intelligence-gathering activities.
The new law is the latest in an interrelated package of national security, cyberspace, and law enforcement legislation drafted under Xi Jinping. These laws and regulations are aimed at strengthening the legal basis for China’s security activities and requiring Chinese and foreign citizens, enterprises, and organizations to cooperate with them. They include the laws on Counterespionage (2014), National Security (2015), Counterterrorism (2015), Cybersecurity (2016), and Foreign NGO Management (2016), as well as the Ninth Amendment to the PRC Criminal Law (2015), the Management Methods for Lawyers and Law Firms (both 2016), and the pending draft Encryption Law and draft Standardization Law.
For Young Chinese, Even State Sector Jobs Are No Longer a Safe Bet – the public sector hasn’t lived up to its reputation of being a safe haven. Nearly three years into the pandemic, many of China’s local governments are facing eye-watering fiscal deficits and implementing austerity measures. And those cuts are hitting civil servants hard. Wang had originally expected to earn at least 250,000 yuan ($34,600) per year at his new job. In reality, he estimates he’s being paid just 160,000 yuan. His basic salary has been cut by 30%; his social insurance payments haven’t risen as promised; part of his annual bonus has never been paid. Instead, Wang finds himself forced to work regular unpaid overtime shifts, helping to implement the town’s virus-control policies, and trying to cut back spending at home. His plans to trade in his boring SUV have been put on hold indefinitely.
Chinese ‘police stations’ in Canada under investigation | Hong Kong Free Press – there is a definite turning point around the illegal Chinese police operations against its diaspora. I expect United Front activities to be the next point of focus and you could see triad organisations treated less like organised crime and more like the paramiilitary or terrorist arm of the United Front
How the U.K. Became One of the Poorest Countries in Western Europe – The Atlantic – “Between 2003 and 2018, the number of automatic-roller car washes (that is, robots washing your car) declined by 50 percent, while the number of hand car washes (that is, men with buckets) increased by 50 percent,” the economist commentator Duncan Weldon told me in an interview for my podcast, Plain English. “It’s more like the people are taking the robots’ jobs.” That might sound like a quirky example, because the British economy is obviously more complex than blokes rubbing cars with soap. But it’s an illustrative case. According to the International Federation of Robotics, the U.K. manufacturing industry has less technological automation than just about any other similarly rich country. With barely 100 installed robots per 10,000 manufacturing workers in 2020, its average robot density was below that of Slovenia and Slovakia. One analysis of the U.K.’s infamous “productivity puzzle” concluded that outside of London and finance, almost every British sector has lower productivity than its Western European peers. Read alongside – What British politics looks like to the rest of the world – The Face TL;DR a joke that makes their country look good by comparison.
Japan cannot survive without Russian oil, warns trading house chief | Financial Times – Some analysts have expressed concern about Itochu’s heavy exposure to China through its 10 per cent stake in Citic, but Okafuji stressed that its risks were lower since its investment was in a government-owned company. “Currently, what they are doing in China is to move private assets from private companies to government-owned companies to reduce the gap between the rich and poor,” he said. “Our objective is to contribute to providing a prosperous lifestyle to the Chinese people, so I think the Chinese government welcomes that.” – I expect that the Chinese government and CITIC will tear the face off Itochu
Concerns mount over German Chancellor Scholz’s upcoming trip to China | Axios – it looks like there is a battle royale brewing between the German public and their large corporates. Add to this: Ports in a storm: Chinese investments in Europe spark fear of malign influence | South China Morning Post and Watching China in Europe with Noah Barkin – 55 percent of Germans believe he (Scholz) is out of his depth), deepens divisions in his government, and undermines its quest for a common European policy toward Beijing, a goal that was spelled out in black and white in the three-party coalition agreement. More worryingly, it shows that Scholz and his advisers still have a steep learning curve on China. Germany’s sway with Beijing depends on a united front in Berlin, in Europe, and across the G7. Scholz has managed to torpedo them all in the span of a few weeks. To be clear, the problem is not that Scholz is meeting with Xi. The party congress showed that Xi may be the only member of China’s leadership who is worth talking to these days. And it is normal for Scholz, who has been chancellor for nearly a year but unable to meet with Xi in person because of China’s restrictive COVID-19 rules, to want to sit down for a face-to-face with the country’s newly anointed leader for life. But the when, where, and how of this first meeting are important. And Scholz has whiffed on all three. The situation is reminiscent of his predecessor Angela Merkel’s decision, two years ago, to hurry through the EU-China Comprehensive Agreement on Investment (CAI) weeks before Joe Biden entered the White House. Like Merkel, Scholz is gifting Xi a geopolitical victory without much in return. And he is voluntarily sacrificing whatever leverage his government might have had with China. He may not realize that but members of his own government—some of whom have been working diligently for months on a new, tougher China strategy—are furious. “As long as the German chancellor doesn’t buy into his own government’s China strategy, then it is worthless,” one German official fumed. “The Chinese can see the divide in Berlin and Europe, and believe me, they will find a way to exploit it. It is absolutely fatal. And what is so stunning is that Scholz has done all of this of his own free will.”
Hong Kong
America’s Biggest Financial Firms Are Still Collaborating with the Sanctioned Hong Kong Government – After an increasing number of critics began to pile on, including the co-chairs of the Congressional Executive Commission on China Representative Jim McGovern and Senator Jeff Merkeley, a coalition of 20 U.S.-based Hong Kong activist groups, and the Wall Street Journal editorial board, Citibank’s Jane Fraser claimed that she had tested positive for Covid-19 and will pull out of the summit. The rest of these executives have only a couple of days to come down with similar illnesses or unexpected family commitments, but I’m not holding my breath and Hong Kong Summit Surrounded by Drama Before It Even Begins – Bloomberg – Top executives pull out after getting Covid; storm approaches. Event aimed at showing city is back in business after pandemic
9 in 10 marketers spend time in making global marketing locally relevant: report | Advertising | Campaign Asia – Marketers say local requirements are kept in mind by headquarters when making decisions, however, the majority (82%) feel they spend too much time educating HQ on Singaporean nuances and needs. 47% of marketing decision-makers in Singapore say that senior leadership in regional or global offices are misaligned with local marketing teams, there is a lack of local understanding of effective channels, and in some cases, there’s an assumption that a global approach will work across countries. Over a third (36%) of marketers believe in localising content for maximum ROI, however, the local tone, diversity and humour in campaigns is often not well understood by global offices teams.
– The departures mean Apple is losing at least three vice presidents — the highest manager level below Chief Executive Officer Tim Cook’s executive team — in recent weeks. Evans Hankey, Apple’s vice president in charge of industrial design, is also leaving the company, Bloomberg News reported earlier this month. Chief Privacy Officer Jane Horvath has departed Apple in recent weeks as well, taking a position at a law firm
Trio conduct 6G reconfigurable intelligent surfaces trials … – Reconfigurable intelligent surfaces can be programmed to modulate the phase of electromagnetic waves and reflect signals into blind spots, enhancing coverage and improving user experience. The low cost, low energy consumption and easy deployment, of RIS have attracted broad interest in 6G research and made it a popular candidate technology. The technical trial mainly evaluated the deployment effects and performance of sub6 GHz RIS and mmWave RIS in different indoor and outdoor scenarios. The tests modelled deployment conditions with and without RIS, different incidence and reflection angles, different deployment distances, etc. Recorded performance index parameters included RSRP, throughput and others. The trial participants worked together to carry out several RIS test projects yielding hard data that makes a strong argument in favor of continued RIS technology development.
The amount of stories about the Chinese illegal foreign police stations that have broke over the past couple of days is really interesting. The clampdown on illegal foreign police stations seems as if it was either coordinated, or there was an inciting incident that persuaded other governments that they had to act. Secondly, what becomes apparent from the coverage is that governments were aware about them for a while, but chose to do nothing. The mainstream media lack of coverage made China critics look like paranoid cranks when they discussed Chinese illegal foreign police stations in their countries. There is a contrast between the British military Operation Motorman to stop what they perceived as the illegal provisional IRA policing of ‘Free Derry’ and the current handling of illegal foreign police stations set up by the Chinese.
I think that one of the reasons why illegal foreign police stations hasn’t been covered well by mainstream media is that they didn’t want to give credence to coverage by media that are right of centre like Fox News.
China
US think tank CSIS shares expert thought on the 20th Party Congress.
China’s limitless presidency means limited diplomacy | Financial Times – … Chinese diplomats find it disconcertingly easy to revert to behaviour that could be seen as bullying. This confirms the suspicion that European governments have of the Communist party: that it is becoming more brazen. A certain school of Chinese nationalism says that the west is set on containing China’s rise at all costs — and that, as a result, Beijing may as well conduct external relations for internal consumption. Yet European alliances are still in China’s grasp, and many of its own objectives, from technological upgrading to climate action, can only be achieved with a wide range of allies and Video before Hu Jintao’s exit from congress puts files in focus – Nikkei Asia
German exporters rethink €100bn ‘love affair’ with China | Financial Times – Competition — fair and otherwise — remains a problem. “Our members know that every technology they bring into China, in a relatively short time, will be part of the Chinese market,” said Ulrich Ackermann, head of foreign trade at the VDMA. “We say, be aware you can be kicked out in a short time.” Ackermann spoke of a German manufacturer of construction machinery, whose state-owned Chinese rival sent machines to customers, free for use for the first year. “How can we compete with that?” – This has been the standard playbook for decades. Huawei won telecoms because of state bank vendor financing at negative interest rates, not superior technology and certainly not superior reliability. What took the Germans so long to catch on? I suspect it was the outsized political impact that a few large companies have on German policies versus the middle sized companies that actually drive exports, German employment and prosperity.
Hong Kong Policy Address: How much of John Lee’s maiden speech was old wine in new bottles? – Hong Kong Free Press HKFP – Hong Kong has experienced a mass outflow of residents since the start of the Covid-19 pandemic and the implementation of the national security law. The previous administration disputed the scale of the exodus, with Lam attributing it to the suspension of quarantine-free travel with mainland China, saying that the number of One-Way Permit holders coming into Hong Kong had significantly decreased. Lee, who has been pressured to stop the exodus of talent from the city, acknowledged the trend for the first time on Wednesday, admitting that the local workforce had shrunk by 140,000 people over the last two years. Lee had previously rejected the use of the term “emigration wave” to describe the city’s recent and dramatic population decline. While Lam said that she did not want the government to be asking citizens to stay, Lee presented a series of proposals on Wednesday, ranging from new visa schemes to stamp duty cuts, designed explicitly to attract talent. – even the talent attraction proposals won’t make much difference, looking for people only from the world’s top 100 universities and earning at least $318,000 per year. That isn’t going to plug education, healthcare and social care staff gaps. It won’t fill much of the many financial services opportunities either, nor multinational regional hubs
Ideas
Adam Curtis on the collapse of the Soviet Union and modern Russia. His commentary on Brexit is spot on.
Smiles in Profiles: Improving Fairness and Efficiency Using Estimates of User Preferences in Online Marketplaces
Forbidden Questions – Marginal REVOLUTION – asks some interesting questions around science, innovation and politics. On the Flipside you have communism’s examples of bad science as an exemplar of what can go wrong when politics frames scientific exploration and ideas
I was fired from NYU after students complained that the class was too hard. Who’s next? – The Boston Globe – What is overwhelmingly important is the chilling effect of such intervention by administrators on teaching overall and especially on untenured professors. Can a young assistant professor, almost all of whom are not protected by tenure, teach demanding material? Dare they give real grades? Their entire careers are at the peril of complaining students and deans who seem willing to turn students into nothing more than tuition-paying clients.
China’s wealthy activate escape plans as Xi Jinping extends rule | Financial Times and as an interesting counterpoint: Asian art and luxury buying boom | Financial Times – At one level, it is a worldwide trend. From fine art to fine wine, luxury-sector companies have bounced back from the depths of the pandemic as their super-rich customers have, so far, been largely immune to global inflation and economic turmoil. After its worst decline on record in 2020, the global personal luxury goods market grew last year to reach €288bn in value, up 7 per cent on 2019, according to consultancy Bain. It says 2022 began with a further healthy rise. In Hong Kong, though, the picture has been quite distinctive, with some of the super-rich spending locally while others have moved abroad, joining an exodus of more than 153,000 residents since the beginning of 2021. The territory has recorded a 14 per cent drop in the number of millionaires in 2022 compared with last year (that is, people with at least $1mn in liquid assets, according to residency advisory firm Henley & Partners). With about 125,100 millionaires out of a population of 7.3mn, the city fell by four places to 12th globally for the number of high-net-worth individuals – building imperial palaces while China becomes redder…
Second-hand Rolexes: watch out for stupid prices and superfakes | Financial Times – the FT blames millennials who started collecting watches when they couldn’t go on holiday during COVID. I think that the causes are multi-variant. Luxury brands have looked at and learned from streetwear ‘drop’ business models exemplified by the likes of Supreme and Nike’s SNKR app. Secondly, the market might moderate a bit when Rolex realises that there isn’t so much of a demand in China post the 20th party congress. I haven’t paid crazy money like what you’ve described for a pre-owned Rolex, but everyone of my watches original warrant cards have a (mainland) Chinese family name on them. Buying via the verified service on eBay at least reduces the risk of buying an overpriced real, rather than super fake Rolex. I think we should be thankful for small mercies that it didn’t go into meme stocks or OneCoin analogues.
Chinese censors alter ending of Minions: The Rise of Gru film | China | The Guardian – DuSir, a film review publisher with 14.4 million followers on Weibo, noted that the Chinese version ran one minute longer than the international one, and questioned why the extra time was needed. “It’s only us who need special guidance and care for fear that a cartoon will ‘corrupt’ us,” DuSir wrote. Huaxia Film Distribution and China Film Co, the film’s distributors in China, did not respond to a request for comment
Hit film Return to Dust has vanished from China’s cinemas. Why? | Financial Times – “In the beginning,” she says, “Return to Dust attracted almost no attention. An art-house film about poverty among rural peasants? Honestly, neither the government nor mainstream Chinese audiences would normally care.” But then came several fateful quirks of timing. Over the summer, an online short, Second Uncle, became a Chinese viral hit, telling the story of a kindly rural carpenter. On social media, the little-known Return to Dust was mooted as a companion piece. From such small acorns sprang word-of-mouth success. Week by week, the movie built an audience – it might be the government, it could also be forces in the domestic media scene as big budget Chinese films don’t need competition stealing their ability to pay back investments
From East Berlin to Beijing, surveillance goes in circles | Financial Times – Last month, the Stasi HQ hosted a Berlin Biennale seminar on the “Digital Divide”, where panellists discussed the ways in which old, disproved theories are recycled in modern surveillance. Shazeda Ahmed, a post-doctorate at Princeton University, described the rise of emotion recognition technology in China. Parents have pressured schools there to give up emotion recognition in classrooms, but some police forces are investing in the technology, hoping that a person’s movements and gestures can signal their propensity to commit a crime. Such methods fall under the umbrella of “predictive policing”, but they are dangerously unproven. Academics doubt whether gestures can be analysed as discrete events that carry the same meaning from person to person. Speaking at the Biennale, digital rights lawyer Ramak Molavi gave a historical perspective, comparing emotion-recognition trends today to phrenology and physiognomy, the ideas that a person’s skull shape and facial features indicate their character. Molavi described how the ideas had been discredited, but enjoyed a renaissance during the Nazi regime – this isn’t the first time that science and ideology have led each other up the garden path
Taipei urbanism – by Noah Smith – Noahpinion – I had a disorienting sense of being back in Japan — so much so that I kept expecting people to drive on the left side of the street. So much of the infrastructure in Taiwan looks and feels Japanese — the pavement, the building materials, the signs at the airport. People cite this as a residue of the colonial period, but given that the colonial period ended 77 years ago, it’s probably more due to Taiwanese architects, urban planners, and engineers continuing to look to Japan for inspiration. After a few minutes, however, the sense of Japan-ness faded, crowded out by two key features of the Taipei landscape: lush greenery and shabby building facades
Interesting trends interview that covers a lot of the issues influencing the interviewer calls the world of visuals. The world of visuals is considered to be influenced by everything from a desire for authenticity and video content to the metaverse. While the metaverse is immature (despite what you may here elsewhere), the effect on culture of the world of visuals will be more apparent.
I saw the impact of the web on graphic design way before I got to experience the web at college. The idea of the technology inspired (mostly wrong) cultural tropes. The move towards ‘b-roll’ video makes a lot of sense. The world of visual interview gives an insight to where Getty Images thinks that the world of visuals is going.
John Le Carré
I came across some amazing interviews with author John Le Carré. John is sadly no longer with us, but the video footage still feels very pertinent. Beyond the Karla Trilogy ofTinker, Tailor, Soldier Spy, The Honourable School Boy and Smiley’s People – I would also recommend Agent Running In The Field – which shows how well Le Carré still kept his finger on the pulse and was written as a riposte to Brexit. Brexit also persuaded Le Carré to change his nationality to Irish in the end, he died an Irishman.
Gucci x Palace
Following on from their collaborations with The North Face, Gucci has now collaborated with UK skate and streetwear brand Palace. Like Kim Jones over at Christian Dior, Gucci seem to be really on the zeitgeist.
Soviet oil
Asianometry has put together another great documentary. This time he focuses on how the Russian empire became an oil power. If you like John’s introduction to the subject area, I can recommend Daniel Yergin’s The Prize, as a Christmas read. This was required reading back when I worked in the oil and gas industry at the start of my career. Yergin covered the oil industry globally from 1850 to 1990 in this book and complements this introductory video to the subject.
