Last night was New Year’s Eve according to the Lunar Calendar, marking the beginning of the Year of the Rat. Some people also call it the Year of the Mouse, and especially Walt Disney is using that with lots of Mickey Mouse related New Year’s events and ads for Hong Kong Disney Land.

We stayed in Shanghai this year, because a 6-week old baby is a bit too young to take to a South-East Asian beach resort, or to fly to Beijing to meet Grace’s family. However, her parents are here now to take care of Scott, so it was still a family event. Like every Chinese family we had a big dinner, and after that the family gathered in front of the TV to watch the New Year show. This program, that is rumored to be the most watched (non-sports) TV program on earth, features stand-up comedians, dancing, singing and acrobatics. To me each year’s program is similar, although the themes are a bit different (of course this year the Beijing Olympics were part of it).

It’s not my favorite program (and that’s an understatement), so I was happy that Gary and Yang Lei decided to drop by. Yang Lei and Grace played with the baby, while Gary and I sat in my study smoking nice cigars and drinking a New Zealand red wine. We talked about the past year, and our plans for the coming year(s). Always nice to reflect on what has happened to Tudou, and where it is heading. Around 10 PM the fireworks outside got so loud that I had to close my window (I opened it for the cigar smoke) and around 11 PM even with the window closed it was difficult to talk.

Gary and Yang Lei left around 11:30, so they would be home in time for the new year. And in time to pack for their mini-vacation somewhere in South Asia. After that I got my camera and made some shots of the firework that was set off outside. The sounds and lights amaze me every year again, especially because the fireworks are a lot heavier than the ones that are allowed in Europe. I put a short clip on YouTube (shot from our 37th floor balcony) so you can get an impression of what was going on outside. Happy Year of the Rat to all my readers!

This afternoon I went to the Dutch consulate to apply for a passport for Scott. Finding out exactly which information we would need to apply for the passport was a bit difficult. When I called the consulate last week at 10:30 AM I got an answer machine saying that the consular section would only be open between 9:00 and 11:30. Huh? I was calling in that time frame.

The information available online did not answer all my questions, but the next day I reached their receptionist who gave me a list required documents. Quite some information, but we had all of it readily available, except for the required baby passport pictures.

So the next hurdle was to get these passport pictures made. There are quite some restrictions for Dutch passport photos, which is fine for adults, but a hassle for little babies. The consulate gave us the name and address of a Kodak outlet that would know how to do this. But when we called there to check they said they had no experience with babies. Because there is no way you can ensure that the baby will be awake when a picture will be taken, and you cannot wake a baby up without causing inconsolable crying, we decided to take some pictures ourselves and bring it to the Kodak shop to make them into the right format to fulfill the requirements. So finally we had our pictures and this afternoon we went to the consulate.

In order to apply for a passport for your kid, both parents and the baby have to come to the consulate together. This caused some logistic issues in between nursing times, but because it’s almost Chinese NY I had a very flexible schedule today. Things went very smoothly there, we were the only visitors at the consulate, and they helped us quickly and efficiently. In two weeks Scott will have his own passport!

The only thing is that he does not have a Chinese visa and residence permit yet, so that will be the next problem to solve. Not sure how that works yet, but knowing Chinese bureaucracy that might take a bit more time. I am also not sure if I still need to officially register Scott in the Netherlands – I tried to do that at the consulate right after he was born, but was told that this was not necessary (or even possible). Any suggestions are welcome, otherwise I will spend some time online during Chinese New Year to figure it out.

Today Scott is one month old, and in China you then celebrate Man Yue. There is a tradition that the baby’s hair gets shaved off at Man Yue (or after 100 days, or after 1 year).

At first we were not sure if we should also follow the tradition, but eventually we decided to do it. We were curious what our son would look like without hair, and apparently it is good for the baby’s hair when you shave his head completely. A special baby barber came to our apartment, and got rid of all our baby’s hair in a matter of minutes. He will use Scott’s hair to make special Chinese painting brushes out of it. A good souvenir.

Judge for yourself whether it looks good or not. I had to get used to it at first, but now I like it. I feel Scott looks much more like a young baby now.

It does not happen very often in Shanghai, but every couple of years you can see some snow here. Today was one of those few occasions. Yesterday it snowed for several hours, but the snow did not stay on the ground because it was still too warm. But last night after midnight it cooled off enough for the snow to start covering the ground. Around 3 AM this morning I was driving in a taxi, and many roads downtown were completely white. The taxi driver had probably never seen snow before, because he drove as if the roads were perfectly clean. Luckily we had no accident, because when I got out I almost fell down because the road was so slippery. A few hours later when it was light we took some pictures, but by that time the roads were clean again. A few pictures of a white Shanghai (all taken from my apartment) can be seen here.

After our nanny left us earlier this week, my wife luckily managed to find a new one. I am quite relieved, because it saves us a lot of precious time. The new one started today already, and she is a pleasant person in her mid-forties. Very modest (unlike the first nanny) and also very experienced, I had a good feeling about her right away. She does not speak any English, which is good, so she won’t teach Scott English with a Chinese accent.

The nanny won’t stay overnight like the first nanny, because she is Shanghainese and has her own place to stay. But she will work here 6 days a week from 9 AM to 9 PM, so it will make our life a lot easier. Happy that this worked out before Chinese New Year!

Update: I cheered too early. Two hours after writing this post the phone rang (waking us up), and our nanny told us she would not come back. Not unusual in China, domestic staff comes and goes, especially in the beginning of the employment. The reasons: She was too tired today because Scott is so heavy (??) and she lives in Hongkou which is quite a long trip by public transportation. Anyway, we are back to square one. I am afraid I will have to help a bit more in the household over the next days, the chances of finding another nanny in the week before Chinese New Year are almost zero.

Update 2: Two days later the second nanny called again. She missed Scott and would still like to work with him for a few more days. She will now help us out until Chinese New Year, then my wife’s older sister will take care of Scott for 2 weeks and after that it should be easier to find a new nanny.

I often get annoyed at the very one-sided way that China is portrayed in the media. It probably sell more papers when you call the government here a dictatorship, and do as if China is a country where people live in fear and are restricted in everything they do. Or it is because the journalist has never been here, or he/she lives here but still does not understand (or does not want to understand) China. Because of that most people who have never been to China have a completely wrong idea about the situation here.

Therefore I was happy to see a blogpost today on Danwei, referrring to an interview with Dr. Susan Brownell. She is an American anthropologist with more China experience than most foreigners in China: she came to China in 1985 already. A quote from the article describes exactly the way I see the real political situation in China:

The stereotype Americans have is that China is a dictatorship – that Chinese leaders don’t have a lot of popular support and are therefore using the Olympic Games to legitimize themselves. None of that is true. It’s not a dictatorship – it’s a pretty well-run, open society. In some ways, the Chinese are more open than we are in the West. China’s government has a lot of popular support. I think that Chinese people believe in government more than we do in the U.S. The government’s primary goal here is not to legitimize itself. I think it is trying to shape the next generation of Chinese people to be international – which will benefit China economically and politically.

The whole interview can be read on the blog of a Seattle Times reporter. I read the article, it’s well worth the time if you want to understand a little bit more about the Beijing Olympics, and what it really means to China. Just like Danwei says, I hope all foreign journalists that plan to cover the Olympics will read it as well, to get a better understanding of China.

For the past weeks we have had a nanny to take care of Scott. Quite convenient, as we could sleep a little bit more (no changing of diapers in the middle of the night) and she also did some of the special cooking for my wife (Chinese tradition is that women need to eat healthy and more nutritious food when they nurse the baby). The nanny was a Chinese lady in her late forties, and she was quite traditional in her views of how to care of the baby and the mother. If it had been up to her, my wife would have not been allowed to drink juice or normal water, and she could have taken a shower only once per week. She did not even allow my wife to use a laptop! Luckily my wife has more Western views, and already took a shower the day after the delivery. Of course she also went online not long after Scott was born. Some minor ‘fights’ erupted because of this, but in the end the nanny always gave in. Reluctantly, I have to say, but from experience I know that fighting with my wife and winning is not easy 🙂

Then nanny walked around in her pajamas since the day she arrived in our apartment, and even went out in her pajamas to buy food. Now I am used to seeing Shanghainese running around the city in pajamas, but if someone lives in your house and does not wear anything but a sleeping suit, it gets on your nerves. Both my wife and I decided not to say too much about it, because it turned out the nanny did not have any other clothes. She carried all her belongings in a plastic bag, and moved from family to family. She did not even have her own apartment, but lived at the premises of the nanny company in between jobs. A strange way of living for me, but she seems to enjoy taking care of kids so much, that she did not care.

Scott was her 52nd baby already, and she seemed just as happy with him as with all the others. Or actually a bit too happy, because after a couple of days she started to call him ‘my son’. Also, it seemed that she became more unwilling to let me hold my own baby, as if she was jealous. Honestly, at that point my wife and I both started wondering if employing a nanny was really such a good idea. Eventually, however, we were convinced that she just really loved kids, and she took very good care of our son. Life as new parents was a lot easier with such a nanny around.

Yesterday morning the nanny suddenly announced that she had had a fight with her boss (the owner of the nanny company) and that she was resigning. She would therefore leave us as well, and by lunchtime she was gone. It is a bit of an adjustment, I have to say, but we are coping well. We are now thinking about whether we should get a new nanny or not. The timing is not optimal, because in two weeks the Chinese New Year will start, and most people want to spend the first 15 days of the New Year with their families in their hometowns. We’ll see. My wife’s parents will help us out a bit the coming time, but if it is too difficult we might resort to paying a bit more for a new nanny. For sure it will be a less traditional one!

Now that the stock markets worldwide are seeing a big correction, the Chinese stocks start following them. Finally. Over the past year I have watched in amazement what was happening in the market. Although not everybody agrees, I felt Chinese stocks were completely overvalued (mainly based on multiples). The main reason the prices kept going up, was because more and more people entered the market, blinded by the possibility of getting rich. People were putting their life savings in, without being aware of the fact that what goes up can also go down. As an economist with a major in corporate finance, I felt a bid sad watching the ignorant crowds on People’s Square on weekends, listening to investment experts with laptops showing off their profitable investment strategies. None of them ever heard of efficient markets, let alone the world bubble.

Shanghainese have the reputation of being very thrifty, but when it comes to the stock market they seemed to jump in without thinking twice. Once my driver started to invest in the market, I knew the bubble had to burst soon. I heard stories about retirees putting all their money in the market, and just last week I came across an article about Chinese students investing their university fees, instead of paying their tuition. How many more signs are needed to show that the market is overheated? But people kept investing.

I hope for the small Chinese investors that the markets will stabilize, although fundamentally there is still a big downward potential. Imagine what would happen if all these people would lose most of their savings, that could be a threat to China’s stability. For that reason I believed that the government might step in if prices would fall too quickly, in order to stabilize the economy. But now that the markets are following the markets outside China, I am not so sure anymore.

The main reason that China’s stock market went up so much over the past 2.5 years (about +450% right now, +600% early November at the top) is that Chinese can only invest in companies listed in China. Once the index started to climb in mid-2005 it was basically a self-fulfilling prophecy: people made money, bragged about it and others started to follow. There was no other place to invest in stock anyway, even Hong Kong shares are not available to mainland Chinese investors. Therefore valuations of companies in Hong Kong are very different from valuations of the same companies listed on a China exchange. And that’s also the risk: once investors start to pull out their money, others will follow. And then the ride can go downhill fast, because fundamentally the Shanghai stock exchange is still far overvalued.

I hope for the Chinese investors that there will be a bottom in the market soon, either based on perceived fundamentals or on people starting to buy back shares at lower prices. At that point the market could even start rising again, because most investors do not understand why markets move as they do. If people start to make profits, others might follow again. Maybe the Chinese government should start slowly open up investment opportunities outside China, to avoid a second China-only bubble.