|Lion Rock Events
The HKMA - "Is it Hot Air or a Bubble?"
The setting of the lowest mortgage rate in at least 20 years by banks in Hong Kong spurred a reaction from the Hong Kong Monetary Authority (HKMA) to set a guidance floor, prompting a number of questions which the LRI forum "Is it Hot Air or a Bubble - 神話？泡沫" addressed. Speakers included Arthur Yuen (Deputy Chief Executive, HKMA), Shih Wing-ching (Chairman, Centaline), Andrew Shuen (Research Director, The Lion Rock Institute), Kwok Kwok-chuen (HKU Honorary Senior Research Fellow) and Simon Lee (Co-founder, The Lion Rock Institute) as moderator. The outcome of the forum, that HKMAs intervention wasn't justified and it should not intervene in the market, attracted high media coverage at ~20 articles & reports. Video of the whole event can be found here and one of the media's coverage here.
The Lion Rock's Roar
A short review of recent media appearances
Bill Stacey comments in Next Magazine on the lack of a hawking presence and that reviving hawking in Hong Kong would be a pro-competition law worth having. Hong Kong would be served well with a more vibrant hawker scene, with more competition to please our palates and give Hong Kong a stronger heritage.
Aries Wong, in the HKEJ, continues discussion on the minimum wage and draws attention to research by David Neumark and William Wascher’s review of evidence from new minimum wage research.
Ken Wong comments this month in the HKEJ on the minimum wage, telling a story of its effects. He also recalls previous housing policy: of all the "Home Starter Loan Scheme" applicants, (30,000 successful between 1998 to 2002), about half of the applicants defaulted, identifying the moral hazard that exists.
Dan Ryan comments on the minimum wage rate in the SCMP: “trying to work out this Goldilocks not too high, not too low figure” enforces the fact that “all minimum wage laws do is either force people out of work if the arbitrary figure they propose is above the market rate, or end up being pointless if the figure is below the market rate.”
Nicole Alpert appeared at the Legislative Council’s Panel on Commerce and Industry to present Lion Rock’s views on the development of the exhibition industry in Hong Kong, focusing on The Trade Development Council (TDC) and the HKCEC. The TDCs subvention is paid for by the community, and has a bargain of a lease on the HKCEC (the value of which is enormous). There is evidence that TDC crowds out private business, while at the same time using community funds. Hong Kong is better with competition, and TDC should be able to compete without the subvention, thus it should face an audit and its subvention removed.
Andrew Shuen focuses on a myriad of trade and financial topics this month as a regular on i-Cable’s Money Cafe, among them the airline’s recent pains, the subprime crisis, Mainland’s real estate market, Singapore’s economic growth and the likelihood for Hong Kong to develop a Renminbi offshore center. In AM730 he focuses on Greece and Europe’s financial troubles.
Simon Lee’s Apple Daily column discusses many topics, including education, speculation, housing policy and the recent initiative to ban idling. Simon recently appeared at the Legislative Council’s Panel on Housing to present Lion Rock’s views on the re-launching of the Home Ownership Scheme (HOS) and revitalization of the HOS Secondary Market. The ability to buy a home should be measured by the individual income of the home buyers and the government should not formulate any policy on a home ownership rate target. Lion Rock later welcomed the Chief Executive’s decision not to resume HOS, and suggested that the Government use rental vouchers for the much-needed public housing optimization, which would provide real choice, flexible funding, and avoid long waiting times.
Peter Wong’s column in the HKEJ discusses the deep-seated contradictions in home ownership between young people and current home owners in Hong Kong, and also why TDC can escape an audit. His appearance on RTHKs City Forum attracted high media coverage, with ~15 reports & articles covering his points and passionate discussion with audience members. Peter warned, "the Government should not encourage the next generation to bear the risk of something they cannot afford...LRI is opposed to the rehabilitation of HOS. The risks are severe - if first home buyers get into financial trouble, negative equity or even bankruptcy. The government should not encourage people to buy homes." Read The Standard’s coverage here.The Lion Rock Institute is HK's leading independent think tank dedicated to the value of freedom and upholding the interests of HK's future.
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