|P.T. Black is a partner in Jigsaw International, a Shanghai boutique lifestle-research agency that looks at the direction of change in China.|
The development of Macau's casinos is a no-brainer for people who spend a lot of time in China. The fundamental appeal is hard to ignore -- Chinese people love to gamble. It's everywhere, from the dice games at pubs to the lucky draws that end every festive dinner or sponsored event. Gambling is a big part of Chinese life. Macau is counting on that. Flights are full, and even Cirque du Soleil is moving in.
Many clever analysts look at Macau and see instead the Shanghai Stock Exchange. They attribute China's overheated stock market to the same impulse that packs the poker tables: belief in fortune and ego and a ferocious hunger to get a lot for a little. It seems to be the only way to explain the recent valuation of PetroChina at over a trillion dollars, twice that of ExxonMobil.
However, the supposed naiveté of the Chinese investor is no longer a given. White-collar workers are studying finance and financial markets intensely; magazines such as Chinese-language Harvard Business Review edge out fashion titles on newsstands. Banks and financial advisers are rushing in to offer investment advice. Last weekend Shanghai hosted a financial-planning exhibition, complete with bank managers handing out information pamphlets to intent young couples.
The rapidly increasing sophistication of young investors across China is a massive opportunity for global finance operators. But even more, it serves as a reminder that Chinese people are learning incredibly quickly. Investment portfolios have already grown from real estate to stocks and now to mutual funds and even art and wine. Anyone who expects Chinese behavior to be rooted in ignorance will be surprised. And that is something for a gondolier to sing about.