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31 August 2019



Thank you as always for the insightful thoughts.

One question that has been on my mind, given the turn of events, [of which I don't think anyone suspected to gain the traction it has (i.e. violence in what we are witnessing)], has Hong Kong lost its status as a global financial centre if things continue as they are or get worse?

David Eldon

Fair question James. I think we have to honestly say that centres such as Shanghai or even closer to home, Shenzhen, have ambitions to be global financial centres. That said, Hong Kong’s legal system is perceived as being more stable than other jurisdictions and the level of global talent available in Hong Kong remains high. For those reasons, and while China remains supportive of Hong Kong, my current thinking is that Hong Kong’s position as a global financial centre remains intact.

Helmut Knipp

Hello John from the Great State of Texas,
As a former longterm resident (16 years) of Hong Kong I have been watching these moves and countermoves with great interest an trepidation.
I don't think either side can win and declare victory. The Hong Kong community with ultimately loose as China, for political reasons and to maintain its image, must prevail. Hong Kong people on the other hand will wind up not only losers, but with a bloody nose, at best.
I have an alternate, tongue in cheek, solution. Hong Kong People are waving the American flag more fervently than, certainly democrats, in our own country, and are asking for US intervention and help. The US cannot and will not do that.
However, I have a suggestion. While Hong Kong wants to have a closer relationship with the US, we have "california" that wants to be socialist if not communist. Why don't we just agree to an even trade. You get california and we get Hong Kong. I think everyone would be happy.

David Eldon

Hi Helmut; pleased to see you haven’t lost your sense of humour in this crazy world - but it’s about all we have left now. A sense of humour and one hopes, an idea on perspectives. Of course - and as you know anyway - I have been (and am still) resident in Hong Kong for many more years than you were here but perhaps we have a similar amount of concern for the future of the territory. You are correct that as matters stand there are unlikely to be any winners. No sides now have a clear way out. The protesters are, largely, people who were not born when China resumed sovereignty over Hong Kong and as a result show a disregard for the law surrounding that event. But I understand their desires for the future. Desires that perhaps would be better met by proving to China that Hong Kong has been and will continue to be a useful addition to China rather than a thorn in its side. And to let the protesters understand that in a globally changing and challenging world (not just Hong Kong) they need to focus on ensuring there are jobs available and affordable accommodation too. As for democracy - again, have a look at Britain which is not a great example. And on the subject of California - what can I say? I thought you had a lot of Chinese there already. :-)


You do seem to find it hard, almost impossible to brook any criticism of the authorities, Chinese or Hong Kong, the police, or "business." Of course when there big bags of money at stake then what do the protests of those who have had no opportunity to share in that wealth matter?

Whatever you might think about the UK system of government, it is crass in the extreme to suggest it might not be as good as the totalitarian regime north of the border. Boris Johnson was indeed elected by 0.3% of the population but sooner or later he will have to face the electorate, a fate that isn't going to befall Carrie Lam or Xi Jingping.

As to China being a supporter of, or tolerating protests in the past, I assume you have been re-educated about Tiananmen and Xinjing

David Eldon

I don’t know, nor does it matter to me, how you were brought up, but I come from an era where I was taught to respect the rule of law, and where wilfully and criminally damaging property that does not belong to you and which therefore has to be paid for by the taxpayer was not the right way to make a protest.
I also have worked hard for whatever benefits I have derived, and was not given anything or inherited anything to help me on my way. You seem to suggest that the protesters deserve a share of other people’s money.
My premise on the UK, obviously not written clearly enough, was to say “be careful what you wish for”. If you think a UK democratic process is a model to which you aspire, look at that process carefully. I did not say the China model was better.
Do I condone Tiananmen or Xinjiang actions? I do not. Neither do I condone genocide in Sudan, or the behaviour of Colonial Britain in slaughtering Indians in Amritsar or other places, or the illegal incarceration of people being used as pawns in Iranian gaols. We do not live in a perfect world - and if you look globally instead of just here we are probably closer to a war than at any time in recent history. There needs to be dialogue, and rational perspective brought to a situation that is out of hand.


Once again, it seems to be impossible for you to simply acknowledge rightful criticism of Chinese or Hong Kong authorities without resorting to whataboutery from a different age. As you criticise Hong Kong protesters for smashing up MTR stations you don't criticise HK police for throwing tear gas or firing rubber bullets. Maybe you weren't there but I can tell you that these were not responses anything like commensurate with what was happening in the first instance, and the only effect has been to escalate the tensions. But the police are the police and if you were brought up in a certain way then you respect the rule of THE law, no matter how closely it resembles triad activity. If the police had handed out sweets to protestors in the first instance I doubt we'd be where we are.

I'm not suggesting protesters deserve a share of other peoples money. I am saying for the most part they have not been able to share in policies that wrongly enrich a certain type of rent seeking, monopolistic tycoon, no matter what rubbish they spout about how they have created trickle down effects. There is no meritocracy in Hong Kong, you know that. There isn't much in UK or US either for that matter, but HK has a much greater disparity between rich and poor.

As for "being careful what you wish for" tell me seriously you prefer a totalitarian communist regime to a democratic model? You might deny that's what you explicitly say, but you are more than implying it by continually rubbishing eg UK democracy (without of course saying anything about the regime to the north) Once again you simply seem incapable of anything other than apology for the CCP.


For some balance, perhaps check out other points of view




Helmut Knipp

Hello David, once again from the Great State of Texas,
While the subject is probably one neither you nor I really enjoy commenting on present circumstances force us to take a stand. Because, as we know, "the hottest places in Hell are reserved for this who at times of great crisis preserve their neutrality".
That said, I generally agree with your position and say to those who disagree, take a hard look at why you disagree. Is it an inherent fear or dislike of China? Or is it a lack of knowledge or understanding of China. China will ultimately prevail and we can only hope and pray that the powers that be in Beijing will be gentle and exercise restraint even if that may be difficult.
As an aside, I loved living in HKG and my wife and I even were married there. All of our memories of 16 years are good ones and we/I hate to see stem destroyed.
My offer to trade HKG for California still stands!
In closing, let us pray for the speedy, full recovery of the protester that was shot yesterday.........not an auspicious event on the 70th Anniversary.

David Eldon

The bizarre thing Helmut is that the protesters are, amongst other things, calling for freedom of speech and yet if you express an alternative view to theirs they do not want to accept it. I guess it happens everywhere. I too am sorry for the boy who was shot, and who I am told is, thankfully, in a stable condition - but if you are about to be smacked around the head with a metal bar and warn the assailant - more than once - that you will fire if he continues, what are the police to do instead - offer him a sweet? Neither side is going to step down here (not that the Government have stepped up!), and it is hard to see how this will end. However it is, there will be tears.

Helmut Knipp

Indeed, there will be, but the eventual outcome will be in favor of China, like it or not. They have the long view, they have they staying power and they are willing to take the risk...........Face its what it is all about.
Cheers, from another hot day in Texas........the pool will feel great, especially with a cold beer or margarita in my hand.

David Eldon

Hope the pool was good ,,, it's the best place to cool down, and sadly Hong Kong looks nothing like cooling down. Heaven knows where the cool heads are - they are certainly not represented by the wilful vandals, and of course my question as a taxpayer in Hong Kong is who is ultimately going to pay for the damage? Not the people who are not working ... that's for sure, although they may pay for it in the future.
As for the Margaritas .. I'm on!!


Hi David,
Things have certainly escalated. And certainly things have become terrible with such violence.

Economically, some suggest, like Jim Rogers (investor) that the HKD to be no longer, particularly that it has been pegged to the USD for 37 or so years.
The movement of capital is or has already moved. Retail particularly high end (im thinking of Prada, and the like) have closed some stores. Have you revised views since last correspondence on 3rd Sept?

David Eldon

Indeed, James, matters have escalated and the mindless violence is not going to be the way to find a solution. The protesters do not seem to have a leadership that is willing to discuss matters rationally, and the administration (cannot really call it Government) does not seem to have any ideas either.
However, to your questions; the HKD peg has been brought into question on a good number of occasions. It was introduced at a time of instability in Hong Kong and removing it in a time of instability would be bizarre in the extreme. The peg, probably most famously was a feature of speculative moves by George Soros many years ago. He lost.
My views on Hong Kong as a financial centre have not shifted dramatically since my comments on 3 September - and if you have not seen it, there is an article in today's South China Morning Post that bears reading on the subject. Not sure if this link works or not: https://www.scmp.com/business/companies/article/3032199/unconvertible-yuan-drag-shenzhens-race-supplant-hong-kongs
They key in that article, for me anyway, is the notion that Hong Kong and Shenzhen should work more in cooperation than competition. I remain depressed by the situation (globally as well as Hong Kong), but optimistic about the future. To do otherwise would be to give up!!


Hello David, Hello Helmut. Pardon me for intruding on your echo chamber, or love in, or whatever. Indulge me for a moment whilst I comment on some of the more "interesting" points you make.

1) As requested, I'm taking a hard look at why I disagree with your position....... Is it an inherent fear or lack of "understanding" of China? Errr... no, although I acknowledge I fear the CCP and don't understand a totalitarian authority that derives its power from force and abuse. And I'm not bothered about the prosperity that regime has brought to the people of China, because that same prosperity could easily have been brought about by a properly democratic authority.

2) China will ultimately prevail and all we can do is hope and pray they'll be gentle...... Oooh - not sure how or where to start there. Sounds feudal and as long as we tug our forelocks and plead, hopefully they won't chop our heads off.

3) Interesting that the boy who was shot was supposedly warned twice. I didn't hear that on any of the videos (was it the senior superintendent who exonerated the police officer within 45 minutes of the event who said it?) As for sweets, it's a bit late for that. You need to start handing those out before (or instead of) firing rounds of tear gas or kicking the hell out of people on the MTR.

4) Your point that the protestors who call for freedom of speech won't accept the alternative (meaning yours?) point of view is one of the most illogical things I've heard. Freedom of speech involves disagreement. Thats what freedom of speech is about Of course if you voice the "alternative point of view" on the mainland you risk being "re-educated," not just disagreed with.

5) Who will pay for the wilful damage caused by vandals? Almost certainly the same people who have paid far, far more to enrich a small group of "elite" rent seekers in Hong Kong who have been enabled by the mainland and HK authorities.

6) Its such a shame that high end outlets like Prada are closing down. What will this cost us economically? I fear for the millions in Hong Kong who won't be able to get their Prada outfits, or LVMH bags, or whatever.

7) I'd love to join you for Margaritas around the pool. Sounds lovely. Maybe we can also invite a couple of million legitimate protestors from Hong Kong. I'm sure they'll see the light after a few cocktails.

8) I do appreciate being able to voice my opinions on your blog. It would be very easy for you to just bar them. Thats one thing at least. Check out whether you can do that on any controversial Chinese blogs hosted on the mainland (oh.... there aren't any....)

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