Market frenzy
Thousands of Hongkongers rallied to demand constitutional change ahead of last week's policy address by the chief executive. But the protesters were outnumbered by fellow Hongkongers who rushed to banks and security firms or logged on to computers to make quick profits from the roller-coaster stock market.
Any differences between the way Hongkongers and mainlanders advance their political demands pale in comparison to the traits they share.
Recent events suggest that Hongkongers and mainlanders have a lot in common when it comes to the pursuit of wealth in the stock market. They reinforce each other's mindsets, creating together the myth of unlimited gains in perpetually rising stock markets.
It's quite a spectacle: everyone in town seems to think they are a financial genius. They chat about favourite shares, recent economic indicators from the US market and new policies from the mainland - along with their own stories of market ventures as the Hang Seng Index soared by over 40 per cent since August 20.
One beautician, for example, reportedly pocketed HK$40,000 from the stock market in a few days - about twice her monthly salary. A bank executive recently bought a luxury apartment in Southern District with the huge sum she scooped up. One businessman walked out of a Louis Vuitton outlet in Central with half a dozen of its latest handbags, to share his earnings with friends and family.
Such stunning stories echo the stock market frenzy on the mainland. One in 14 mainlanders is now reportedly a stock investor. Ten per cent of first-year students and 80 per cent of those in their final year at Shenzhen University have become shareholders, according to a recent survey. Checking the latest market trends online has become a daily routine for mainland civil servants. The Jiangxi provincial government had to discipline three cadres caught trading online during office hours.
The remarkable resemblance between Hongkongers and mainlanders comes from their mutual psychological reinforcement. After the mainland's recent National Day holidays, both the Shanghai and Shenzhen composite indexes jumped dramatically.
One mainland analyst said the rally was not the least bit surprising: the mainland's benchmarks had been expected to match the heavy gains in Hong Kong. That market surge during the first week of October, when mainland bourses were in recess, was not related to market fundamentals. It was fuelled by the news that the authorities would let mainlanders trade Hong Kong shares directly.
Confidence-boosting measures seemed to come in cycles as markets in both places skyrocketed.
Hongkongers are well known for being suspicious about the Beijing government. But when it comes to the stock market Hongkongers, like their counterparts on the mainland, show unexpected faith in its authority - even more than they trust Alan Greenspan. The former US Federal Reserve chairman's warning about overheating Chinese stocks fell on deaf ears.
It is widely believed that Beijing would not dare let the stock market crash ahead of the Communist Party's 17th National Congress, which begins today. Nor would it allow even a hint of financial disaster before the 2008 Beijing Olympics. The national government would bail out investors if a market bubble burst - so the argument goes - to avoid losing face in the international community.
Thus the myth of perpetually rising stock markets has been created. With similar outlooks and enthusiasm, Hongkongers and mainlanders are getting rich together. Whether this unity is a curse or a blessing for the regional and national economies - well, you be the judge.
Kitty Poon, an assistant professor at Hong Kong Polytechnic University, is a part-time member of the government's Central Policy Unit
