Communism For Some, $815 Million For Others: How Mao's Granddaughter "Greatly Leapt Forward" To Untold Riches

Tyler Durden's picture

For a country, whose founder Chairman Mao once upon a time envisioned great wealth equality for all and a communist utopia, things sure have had a very capitalist ending. Perhaps nowhere is this more visible than in Mao's lineage itself, where we find that the granddaughter of Mao, Kong Dongmei, managed to rise above the great unwashed mass of egalitarianism, and ended up just slightly more equal as a result of the Great Leap Forward, with a personal fortune amounting to $815 million according to New Fortune, a Chinese financial magazine. But it is not so much the realization that the occupation of politics is one grand lie (second perhaps only to economics) and where preaching equality for all is merely a means to achieve great wealth for yourself, but that the 40 year old descendant of the Chairman, with her wealth of nearly $1 billion, is merely the 242nd richest person in China, which means there are over 200 billionaires in the country, the bulk of whom we can only imagine are descendants of the original "communist" founders of the country.

From AP:

Kong is the grand-daughter of Mao and his third wife He Zizhen. In 2001 she founded a book store in Beijing selling publications about Mao and promoting "Red Culture" after studying at the University of Pennsylvania in the US.

 

In 2011, Kong married Chen, who controls an insurance company, an auction house and a courier firm, after they had maintained an extramarital relationship for 15 years, according to the magazine, which cited other Chinese media reports.

 

The couple have two daughters and a son, said New Fortune -- likely to be a violation of China's one-child policy.

The locals, attuned to flagrant examples of hypocrisy, were not exactly delighted with the revelation:

Kong's inclusion on the rich list triggered hot debate on China's Twitter-like weibos, with some accusing her of betraying her grandfather's status as the "great teacher of proletariat revolution".

 

"The offspring of Chairman Mao, who led us to eradicate private ownership, married a capitalist and violated the family planning policy to give birth to three illegal children," wrote Luo Chongmin, a government advisor in southwest China.

 

China has implemented the one-child policy for many urban residents for over 30 years, although there have been recent suggestions that the rules may be loosened.

 

"Did Kong Dongmei... pay any fines after being a mistress for more than 10 years and giving birth to three kids?" asked another user with the online handle Virtual Liangshao.

Yes, and a bundler for the president in another non-crony capitalist country is in prison for commingling client funds before blowing up his firm as a result of his greedy bets. Oh wait...

But at least Kong was not caught trying to hide her wealth offshore like some of her uber-wealthy peers in a country in which parking one's cash has become the biggest priority. And lots of cash to park there is. According to China Daily, "Privately held wealth on the Chinese mainland hit 80 trillion yuan ($13 trillion) in 2012, with more than 700,000 individuals now holding 10 million yuan or more in investable assets, more than double the number at the end of 2008, according to a new report." In US terms, this means the number of millionaires has doubled under 350,000 during the course of the great financial crisis, once again showing that not even China is willing to let a crisis go to waste.

The findings, from China Merchants Bank and US-based management consulting firm, Bain & Co, showed that the richest on the mainland are stepping up their investment in foreign assets as they try to preserve their fortunes in the face of uncertain economic prospects.

 

Many of those surveyed said they are becoming increasingly concerned by potential changes in Chinese regulatory policies, financial market volatility and other business risks.

 

About 60 percent of respondents indicated they were now focused on preserving their wealth, against using it to make more.
Chen Kunde, wealth management business director at China Merchants Bank, said the shift in priority was being driven by uncertainties over economic growth.

 

"As the rich gradually age and their knowledge changes, they are tending to focus more on preserving the wealth instead of fighting to create more, in a business environment where it is becoming more difficult to make extra money."

Where do the wealthy want to stash the cash?

On top of cash holdings in traditional bank accounts, individuals said they had a strong interest in forming family trusts, and in creating a diversified portfolio of international interests to preserve their wealth and spread the risk, said the report, with more than half having overseas investments.

 

Jennifer Zeng, a Bain partner in Beijing and a co-author of the report, said: "We don't see a great difference between high-net-worth individuals in China and other countries when it comes to their goals, although the situation here is changing and the shift toward the preservation of wealth might accelerate as the speed at which the wealth was created was faster than in most parts of the world."

 

The report said that Chinese banks had strengthened their position in the domestic wealth management market, while foreign banks had a much lower share of the market due to business restrictions.

 

It said the need for overseas asset allocation among the rich is rising, and China's banks should be encouraged to develop overseas business models and accelerate overseas expansion, to better cater to that rising demand.

Our advice: stay away from banks susceptible to bail-ins. So anywhere in Europe.

As for the great wealth disparity forming between both China, and the rest of the world's, uber rich, and everyone else, a similar divergence developed in 18th century France with less than desirable consequences for the wealthiest. This time will likely not be very different.

The only delaying factor is the presence of the great welfare state myth, which has so far kept the great unwashed in their place, not so much through violent oppression, but through the illusion of how much they stand to lose if they overthrow the system that provides for them, and hands them crumbs in times of need. The same system that is now and always has been, an insolvent ponzi scheme which by definition lasts only as long as the new entrants put in more than existing members take out.

That equilibrium, however, is rapidly changing all around the globe, as more and more realize, voluntarily or otherwise, that the system is broke, and with the great debt creation apparatus now hinging purely on the world's central banks - a process which just like in Cyprus dooms the restoration of confidence as it is impossible to be confident about a system sustained solely by a few global "bad banks" which are terrified to remove the training wheels - that the days of the ponzi are numbered.

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Frastric's picture

Three golden ways to make money: inside info, luck, and inheritance.

kliguy38's picture

"Our advice: stay away from banks susceptible to bail-ins. So anywhere in Europe."

 

Ya THINK??

NotApplicable's picture

Kong Dongmei?

NO

Kong Dongyou!

Scro's picture

Kong Dong Mi; great porn name.

Precious's picture

Billionaire ... but its still China.

true brain's picture

Yeah? but can they breathe the air and drink the water? I'm still ahead. Stupid Chins.

uno's picture

wasn't Mao put in power when the US purposely stop arming chin kai shek?

malikai's picture

If only the world was that easy.

SafelyGraze's picture

".. after studying at the University of Pennsylvania"

yeah! penn!

go quakers!

let's go see them graduate!

http://www.upenn.edu/commencement/

Due to heightened security at Penn’s Commencement ceremony, the gates to Franklin Field will open at 7:00 a.m., and it is recommended that attendees plan on arriving as early as possible. Every guest will be required to go through airport-style magnetometers, and certain items will be prohibited from Franklin Field, including but not limited to oversized bags, bottles, tripods and umbrellas.

umbrellas?

oh. right.

the swat snipers on the rooftops would have a harder time identifying you under your umbrella.

 

The ceremony will feature .. our Commencement speaker, Vice President Joseph R. Biden, Jr. Tickets are not required for admission.

 

Ratscam's picture

no such security measures at our Wharton graduation in 1998. we even threw paper planes down to the bozos who where so eager to get their certificate handed over in person while wearing a ceremony dress they rented for 80 bucks. Amazing how the US citizens have lost their liberties.

Go Tribe's picture

Bet she's a stacker, though.

azzhatter's picture

I like that she is in Tapei. Chairman would be pissed

Cheesy Bastard's picture

Leave her alone.  She might be really good at trading cattle futures.

max2205's picture

Thank god she didn't get grandpa's looks

Cheesy Bastard's picture

Well, they all kinda look the same to me, but your right.  I doubt she could pull off the hairdo in that same dignified way that only Mao could.

http://upload.wikimedia.org/wikipedia/commons/9/94/Mao.jpg

SafelyGraze's picture

"three golden ways to make money: pillaging/plundering; gambling/leveraging/speculating; extorting"

wow. cynical.

left out "hard work"

that's how most of us earned our first billion

good old fashioned hard work

$10/hr * 60hr/week * 50 week/yr

$30k/yr

you keep that up for 33 years and you've earned yourself a million dollars

oh shit. that was supposed to be a billion.

no problem.

work for 33,000 years.

or work 50,000 weeks in a year.

or 60,000 hours in a work week.

or .. or .. drumroll .. $10,000 per hour

Downtoolong's picture

My strategy is to sell pencils on the street corner for $1 billion each. I know it's a long shot, but, think about it. All  I need us just one customer.

Kirk2NCC1701's picture

You're so innocent. The second best -- many argue that it's the best way -- is to marry into it. Then divorce out of it. Beats an MBA any day. Some even argue that it's the ultimate form of prostitution (marry in and out).

zhandax's picture

I started a risk management company in the early 90's with a guy who used to tell me "You can marry more money in 15 minutes than you can make in 15 years."

CheapBastard's picture

I read the Best & Brightest there want only one goal...to work for the Gubbermint.

 

Hey, if local officials (who officially make $800/month) can buy 20-30 condos in Beijing and Shanghai @ $1 million apiece (and how knows how many in Irvine and SF) , there must be somehting to these civil service jobs.

Welder's picture

The same thing happened in Romania. After 1989, former communist aparatchiks have occupied the entire political spectrum, from extreme right to left. The majority of the population not only accepted them, but also strongly opposed the few who were demanding that no apparatchiks should be allowed in civil service jobs. I guess nothing happens without the victims' tacit agreement. 

Element's picture

Suckers!

Nah ... just the royalties on Mao's Little Red Book for CHICOMS

akak's picture

Make me laugh.

Just another example of Chinese Communaughty blobbing-up eternal nature.

NOW who is "farming the poor and extorting the weak", eh AnAnonymous?

Alas, alas, three times alas, just have to bear with the hypocritizenism.

Element's picture

It's like a feckin comic soap opera, Days of Our Angst.

Longest running soapy on zh!

Even if you miss a few episodes, no matter, you still know what the next one is going to be about. lol

TheFourthStooge-ing's picture

Now, some guy who know what sheep think, want and need. Better and better.

So, bit of return of factuality: this AnAnonymous shepherd wants to get a big flocking herd so he can live well off it. He does not want to lose one because it is money, he wants as much as possible because it is money.

Guy thinks to serve rat meat as lamb, so as not to diminish in numericity bigness his flocking the herd. Even mix in the little bit leftover kitten crispy from lunch buffet at JKC Chinese citizenism fastfood franchise.

It has nothing to do with sheep wants and needs and you do not need to mind read them. Just talk to the human shepherd (something much easier). Do not forget to blame 'americanism'.

nmewn's picture

"this AnAnonymous shepherd wants to get a big flocking herd so he can live well off it."

Such is the way of all tribes, clawing their way across the backs of the insignificant matterings of the sheeple, advising them that the bloody marks left are for their own good, to achieve a lifetime of comfort for only themselves.

I've never read a tombstone that said "I lived my life for the people and died in poverty for it."

And probably never will ;-)

Element's picture

 

 

I'm pretty sure in classical Maoism KFC crispy cat would be denounced, and branded food of counter-revolutionary bourgeoisie.

And rightly so ... rightly so ...

I like cats, but I can't eat a whole one.

akak's picture

Speaking of Maoist JKC franchises, hey, they are at least getting more honest in their advertising:

http://www.holytaco.com/we-knew-it/

 

Just make sure that you do not follow up your delicious me(ow)al in the traditional manner of post-wokking-the-dog:

http://www.holytaco.com/well-since-you-said-please/

http://www.holytaco.com/shame-this-sign-needed-to-be-made/

Element's picture

yup that cracked it lol

TheFourthStooge-ing's picture

.

just the royalties on Mao's Little Red Book for CHICOMS

The fallacy in Mao See Dung Book of Small Redness is that people can do all the things.

Erroneous. It would only be relevant if all the students are known to work at night. And somehow this is supposed to mean.

Reminds me to something. Chineses are known to demonstrate for everything and anything. Demonstration is a national sport to them. Dog leg grows too expensive? They demonstrate. The weather has been smog, they demonstrate.

Element's picture

toilet paper short - demonstrate!

smelly finger - demonstrate!

fat guy swim down yangtze river - demonstrate ... no ... wait ... never mind

McMolotov's picture

Chairman Mao once upon a time envisioned great wealth equality for all and a communist utopia...

Ha! Like that ever happens. Some animals are always more equal than others.

In the midnight hour, she cried, "Mao! Mao! Mao!"

Kirk2NCC1701's picture

But did she seal the deal for a White Wedding? Or did Sweet Sixteen just have her Idol time?

YHC-FTSE's picture

Talking of Animal Farm, thousands of pigs floating on Chinese rivers sounds like an omen of things to come. 

The peasants upto lower management types will tolerate a lot, but they can get real ugly very quickly when they sniff out corruption,  which is now at record highs. Last time I looked at the news on the Chicom politburo,  they looked scared at the level of corruption everywhere in government.  

A wage slave at Foxconn is not going to look kindly at a PLA colonel driving past in a brand new Bentley with military number plates. Expect a mob attack on one of them soon.

PaperBear's picture

How many Chinese died under Mao ?

Was it a few tens of millions ?

That's a few tens of dollars per dead Chinese.

Jason T's picture

commie's didn't know wtf they were doing.  quite sad.

http://en.wikipedia.org/wiki/Great_Chinese_Famine

 

Booya's picture

Tsk Tsk Tsk, the citizens of China actually believe it is about them as much as Americans believe things are done for We the People.

Urban Redneck's picture

On the subject of "We the People" since both the USA and CSA constitutions begin with that line... If you look past the fundamental difference over slavery that we feed the young sheeple, and to problems addressed with the federal government, you could simply rinse and repeat the laundry list of grievances that came to head 150 years ago (or just realize exactly how far we haven't come)

One nation under an Almighty God, Single Term Limits, Immigration control, Congressional subpeona of Cabinet Secretaries, impeachment of corrupt State officers, the right to fire civil servants, no government "investment" in shovel-ready BS, only actual infrastructure, a prohibition against defaulting on the national debt which required a 2/3 vote to incurr in the first place, after budget origination with the cabinet departments, a post office that by statute had to operate profitably, the States could issues their own money (i.e. no central bank monopoly), a ban on recess appointments of rejected nominees, a line item veto, only the States can move to ammend the Constitution, not the Congress critters, and it takes only 2/3 of the States to ammed, and my personal favorite -- "Every law, or resolution having the force of law, shall relate to but ONE subject, and that shall be expressed in the title"

Full redline-

http://www.filibustercartoons.com/CSA.htm

reader2010's picture

Absolute power corrupts like there is no tomorrow. 

Major Major Major's picture

“Surely, comrades, you don't want [Mao] back?”

New_Meat's picture

that is true, and is the price that the Chin must pay

Major Major Major's picture

Certainly the [Chinese] do not want [Mao] back; if not allowing great wealth disparity to form was liable to bring him back, then creating the uber rich must not stop.

Aurora Ex Machina's picture

Then again, it's probably difficult not to become a billionaire when the US gives you $3 trillion in treasuries. Look at all the ghost cities & infrastructure: they're burning the cash as fast as they can and there's still piles of it lying around.

 

"Family Trusts". Hmm, sounds familiar...

George Soros, the billionaire best known for breaking the Bank of England, is returning money to outside investors in his $25.5 billion firm, ending a career as hedge-fund manager that spanned more than four decades. Soros, who turns 81 next month, will hand back the money, less than $1 billion, by the end of the year, according to two people briefed on the matter. His firm will focus on managing assets solely for Soros and his family, according to a letter to investors. [source 2011]

 

Kings and Queens were created not by God but by men. Weird when it happens again.

 

p.s. China mining countries in Afghan, throwing $100 billion at it. NYT propaganda matrix TV highlights the terrible destruction of ancient Buddhas [by the way, this story is ancient, but NYT is rehashing it]. Comment: I wonder if JPM analysts going out there a couple years back is in any way related? Not that they have anything to do with Chinese money at all...

New_Meat's picture

"... this story is ancient, but NYT is rehashing it]."

Probably just the Senior Editors and Editorial Directors just realizing that this action is a "cultural" "desecration".  We can be sure that they will investigate in the fullness of time.

- Ned

{next up: the EmmBeez wish to un-Pyramid the Pyramids and the Great Sphynks--Think of all of the stories that will be generated, might even get Art Bell out of his retirement}

Aurora Ex Machina's picture

Sadly not. Destruction of this ancient Buddist site was noted a long time ago:

 

A Chinese company digging an unexploited copper mine in Afghanistan has unearthed ancient statues of Buddha in a sprawling 2,600-year-old Buddhist monastery.

Archaeologists are rushing to salvage what they can from a major 7th century B.C. religious site along the famed Silk Road connecting Asia and the Middle East.

The ruins, including the monastery and domed shrines known as 'stupas,' will likely be largely destroyed once work at the mine begins.[Daily Mail 2010 - if they have the story, it's an old one]

 

So, yeah: unless the NYT has the slowest AP wire connection known to the world, this is getting used as ammo.

 

{remember when they nuked the memoryhole.org back in 2009? how they yearn for the days when microfilm was stored in crappy libraries and was oh-so-flammable. A Culture with A Memory you don't control is just so unfair!}

 

They're well aware of this: there's a few groups (some more accessible than others) that track the revisions to stories in papers like the NYT (in fact, to all online content). Stuff on Iraq etc often have up to twenty edits over time to alter the perception of people searching for old articles. i.e. Look for a story from 2002, you'll be seeing the 2013 acceptable version. It's crazy brilliant when you log them and track them, you get to see people writing the narrative fiction they want to be seen.

 

It's also a technique mentioned in a popular book somewhere. I think it was published in 1947 or 1949, but my sources keep changing, it's hard to get an accurate date. I've heard that history is now doubleplus good.