Thursday, October 31, 2019

Killing Hong Kong

While we certainly sympathize with the Hong Kong protesters, we are obliged to note the facts on the ground. Whatever the goal of those who are demonstrating for freedom, as of now, their most glaring achievement has been to wreck the local economy. 

Under the circumstances Beijing does not need to intervene very forcefully. The protesters are effectively hurting themselves, their livelihoods and the future of Hong Kong.

Zero Hedge has the story:

Hong Kong has finally entered a recession after more than half a year of violent anti-government protests, the city's Financial Secretary wrote in a blog post over the weekend, reported Reuters.

"The blow to our economy is comprehensive," Paul Chan wrote, adding that upcoming economic data later this week will trigger a technical recession.

"The government will be announcing its advance estimates for the third quarter on Thursday. After seeing negative growth in the second quarter, the situation continued in the third quarter, meaning our economy has entered technical recession," Chan wrote.

"It seems it will be extremely difficult for us to reach full-year economic growth of 0 to 1%. I would not rule out the possibility that the full-year economic growth will be negative."

How did it happen?

Protesters have frequently shut down popular shopping districts, something that we outlined last week, warning that the retail industry in Hong Kong is on the brink of collapse.

Tourism plunged 37% Y/Y in 3Q19, and the trend for 4Q19 is likely not to improve. The number of tourists for the first two weeks of October was down 50% on a Y/Y basis. 

Rooms at the most high-end hotels, like Marco Polo Hongkong in Tsim Sha Tsui, are going for $72 per night, a 75% discount versus last year. 

Anyone who wants to travel to Hong Kong this week, departing from New York City airports, can easily get roundtrip plane tickets for 50% off because air travel to Hong Kong remains depressed. 

Local businesses are cutting back on their workforce as approximately 77% of all hotel workers have just been asked to go on leave without pay. 

As I said, we all sympathize with the protesters. But, as of now, theirs seems to be a lost cause.


David Foster said...

I suspect a lot of Hong Kong residents are going to be moving elsewhere, especially the most talented ones.

May be some investment opportunities resulting from this.

ASM826 said...

There have been many lost causes. Does victory have to be assured before you stand against a tyrant? If every bit of freedom your society has is threatened, are you supposed to surrender so you don't hurt sales in the major shopping districts?

Sam L. said...

Off-topic, Stuart, but just ran across this at Instapundit:
THURSTON, WE HAVE A PROBLEM: “Kids from poorer neighborhoods keep coming to trick-or-treat in mine. Do I have to give them candy?”

Found via Bridget Phetasy who tweets, “lol this is the best description of limo liberals I’ve ever read. ‘Hate has no home here. But neither do the poors.’”

Goes to here:

Prudence gave the writer a pretty good answer.

Anonymous said...

Personally cannot decide if this is meaningless noise or bisexual drama? Is the best we have to offer whoever holds office? It could be the case, considering the nature of human social behavior is not too far from that of most animals. It is easier to be judgemental of others than to realize the downer that is humanity, ourselves included.

Anonymous said...

If you are only an animal then you can do no wrong.