The Hong Kong Protest: What It's All About

Tyler Durden's picture

Considering that as recently as 3 weeks ago the leader of the Occupy Central movement in Hong Kong decided to throw in the towel, after admitting that his civil disobedience movement’s pursuit of democracy had “failed” as a result of waning public support, many are shocked by how aggressively Hong Kong's students took up the baton: almost as if the mystery sponsor behind the ISIS blitz-ascent from obscurity had decided to "destabilize" yet another region. Tongue-in-cheek kidding aside, for everyone confused about the context of this weekend's at time very violent student protests, here is Evergreen GaveKal with its wrap up of the "Hong Kong Democracy Protests."

By Tom Holland, of Evergreen GaveKal

The inhabitants of Hong Kong were treated over the weekend to the unusual spectacle of police battling political protesters in the city’s streets. Baton charges and volleys of tear gas might be common enough tactics in New York or London, but not in Asia’s leading international financial center. The rapid escalation of the protests over the weekend and the police’s strong-arm response shocked locals, and triggered a -2% fall in the city’s benchmark Hang Seng stock index on Monday morning as investors worried about the impact of continued unrest on Hong Kong’s markets, its economy and its future as Beijing’s laboratory of choice for China’s financial liberalization.

Only a few weeks ago it seemed that Hong Kong’s pro-democracy movement was a spent force. After Beijing ruled out open elections for the chief executive of the territory’s government, the leader of Occupy Central admitted that his civil disobedience movement’s pursuit of democracy had “failed”. However, Hong Kong’s students and high school pupils failed to take heed. Last Friday a group of around 200 stormed security fences blocking off the ‘Civic Square’ outside the government’s headquarters to stage a sit-down protest against official obduracy. The heavy-handed police response prompted thousands more protesters to descend on the site over the weekend and on Monday morning the city woke up to find a civil disobedience campaign dismissed as irrelevant just weeks before had paralyzed the area surrounding Hong Kong’s government headquarters. With the mood highly febrile ahead of a public holiday on Wednesday to mark the Communist Party’s assumption of power in China, the fear is that the crowds of protesters could swell further over the course of the week, prompting an even more uncompromising response from the city’s Beijing-backed government.

The worst case scenario—that the Beijing government will deploy the People’s Liberation Army to restore order at the barrel of a gun—is extremely improbable. It would be a public relations disaster for China’s leaders. However, it is equally hard to envisage any lasting rapprochement between Hong Kong’s pro-democracy movement and the city’s government. Indeed, although the protesters’ overt cause may be their campaign for free and open elections, many are motivated by underlying grievances both towards the mainland, which they fear is swamping Hong Kong’s unique identity and culture, and towards the city’s own administration, which they believe to favor the interests of property and business tycoons over the aspirations of  local people.

As a result, even if this week’s protests end peacefully, the discontent will rumble on. And if slowing Chinese growth and rising US interest rates inflict economic hardship on the city, the dissatisfaction is only likely to mount. In recent years the combination of mainland money flows and rock-bottom mortgage rates—Hong Kong’s currency is pegged to the US dollar, so local borrowing costs follow US rates—have propelled the city’s property prices to record highs, up 300% from their 2003 low. While any slump would make property more affordable, it would also hammer the balance sheets of the city’s middle class property-owners, many of whom are inclined to sympathize with the weekend’s demonstrators.

Against that backdrop, an extended campaign of civil disobedience is likely to weigh further on Hong Kong’s stock market, already down -8.3% since early September. A new equity trading link between the Hong Kong and Shanghai market, which is due to go live towards the end of October, may not help much. With the valuations on Hong Kong listed-stocks bang in line with their mainland peers, there are currently few arbitrage opportunities to be exploited. And with Beijing’s ‘mini-stimulus’ to support the mainland economy running out of steam and the People’s Bank of China resisting pressure for a full-scale monetary easing, the chances that a continued rally in mainland stock prices will support the Hong Kong market look slim.

Finally, some critics have suggested that the weekend’s pro-democracy demonstrations could prompt Beijing to choose Shanghai’s Free Trade Zone over Hong Kong as the favored venue for its financial liberalization program. Possibly, but one year after it was opened with great fanfare, progress at drawing up rules to govern capital flows in and out of Shanghai’s new zone is glacially slow and almost entirely opaque. The mainland city still looks decades away from mounting a credible challenge to Hong Kong.

Even so, hopes that Hong Kong investors will benefit from a new spate of mainland liberalization measures look exaggerated. With China’s growth rate now slowing towards 7%, exposing the vulnerabilities of China’s financial system, complete interest rate liberalization and a full opening of the capital account are receding further into the future. That may preserve Hong Kong’s pole position. But along with the gathering momentum of pro-democracy protests, it will also limit future opportunities for growth.

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Took Red Pill's picture

coming soon to a city near you

Pinto Currency's picture



De Gaulle had a similar experience in 1968:

“...At the same time, he strongly opposed the global economic dictate of US currency, insisting on establishing the golden standard as the base of international economic relations.

De Gaulle's efforts were deliberately undermined by the architects of dollar-based globalization. The student movement in Paris started, without any significant domestic social reasons, literally a month after the meeting of Bilderberg Club where Baron Edmond de Rothschild and leading CIA strategist, rabid anticommunist James Jesus Angleton launched a far-reaching scenario of destabilization of Europe, instrumentalizing an ambitious George Pompidou for a political change in France that should be fairly recognized as a sophisticated coup d'etat. ...”


TruthInSunshine's picture

Spain's "Constitutional Court" suspends Catalan voting.

Because when it gets serious, you have to stop the vote.

Latina Lover's picture

Of course they stopped the Vote. But this will not end the Catalan march to independence.

As for HK,  I smell another color revolution brewing..... things must be really bad in the USSA for the CIA to attack China in addition to Russia, Syria etc.

svayambhu108's picture

<-- because US is a democracy this doesn't happen in US

<-- because US is worse than China this doesn't happen in US

Latina Lover's picture

The USSA is no more of a Democracy than China, India, Russia, Germany etc etc.

All governments are essentially the same, a very small group of insiders dominating everyone else.

Pinto Currency's picture



"...As in the case of the new communication technologies, the potential effectiveness of angry youth in post modern coups has long been under study. As far back as 1967, Dr. Fred Emery, then director of the Tavistock Institute, and an expert on the "hypnotic effects" of television, specified that the then new phenomenon of "swarming adolescents" found at rock concerts could be effectively used to bring down the nation-state by the end of the 1990s. This was particularly the case, as Dr. Emery reported in "The next Thirty years: concepts, methods and anticipations,'' in the group's "Human Relations," because the phenomena was associated with "rebellious hysteria." The British Military created the Tavistock Institute as its psychological warfare arm following World War I; it has been the forerunner of such strategic planning ever since. Dr. Emery's concept saw immediate application in NATO's use of "swarming adolescents" in toppling French President Charles De Gaulle in 1967 [sic]. ..."

UnpatrioticHoarder's picture

Yes, Hong Kong is still Britain's patch, these protests are likely an MI6 special

The Doofus's picture

That's crazy.  This has nothing to do with England.  Hong Kong has been free for a long long time.  The citizens don't want to live under a one-child fascist state.  Who can blame them?

Oracle 911's picture

@ Latina Lover

The same guys from Washington want rule everywhere. They took the EU, Switzerland although BRICS  countries are getting rid of these tentacles.


About the protesting Hong-Kongians, they are useful idiots although they have  noble intentions, they are used in a similar manner as Ukrainians in Orange revolution.

Joenobody12's picture

Do not insult us Hong Konger with your US attack China bull shit. That isthe party line of the PRC, blaming on a phantom enemy whereas they are the real problem behind teh crisis. 

Apostate2's picture

Yes Joe. Beijing line. These running dog posters throw in US/West/ and so on (now the specious argument it is an indirect attack on the Russians because they are China's new best friend) to discredit the protesters. They just can't get it through their blindingly narcissistic western centric dystopian and self-loathing view that it is not about them. What tools. 

old naughty's picture

i do not believe anyone here is insulting Hongkongers...comments are information that sometimes present an alternative view.

To believe in no foreign involvement is perhaps naive...the entire 20 C has dozens of his-story to help us with waking up to the fact that the entire globe is just a chessboard.

If cannot afford to lose the "pole", yet, what'd it take to allow a bit of leeway to Hong Kong, hummm?

Follow the money...

old naughty's picture

just an observation:

"sorry for inconvenience..." is bigger than "Fight for democracy..."


kevinduhand's picture

Hong Kong stock exchange is operating normally. People are going back to school and work as usual. Buses have adjusted route. Incidents of robbery and sexual harrassments are occuring in the occupy area. People are starting to get irritated by occupiers.

Protest is about to get "Occupy Wall Streetized"


Western Style Election(give you two choice, both our puppet, now vote) will be implemented eventually.

Hong Kong people have lost.

Now back to the big picture of ChiRussia vs America


kevinduhand's picture


Live from Hong Kong in the morning




X.inf.capt's picture

or just count it in your favor!!!

Armed Resistance's picture

"Those who make peaceful revolution impossible make violent revolution inevitable".  JFK 1961

TheReplacement's picture

Well played sir.  Sad but true.

Anusocracy's picture


There isn't a right to vote and there isn't a right to form a government.

TeethVillage88s's picture

Pinto Currency has this threat going about whether CIA is going after China, starting a color revolution, and how the gold standard put forth by the BRICS will be crushed

Pinto might be right...

A) Ecuador sent their gold to the USA, would love a tape recording of what got them to do that
B) Jugo Chavez got cancer & Died even if he did get the gold back
C) We are Technically at war with NATO against Russia
D) US Assassinations of JFK, MLK & Bobby Kennedy could have been the Bankers, the CIA, the MIC as Bobby spoke out for civil rights, JFK spoke about ending the FED, and Bobby was running for President
E) Presidential Candidate Eugene McCarthy spoke against the Vietnam War, met with Che to discuss repairing relationship with Cuba... then "Strangely" after Bobby was Assassinated in 1968 he became "Right Wing" and then Dropped out of Politics 2 years later.

" Indeed, he almost seemed to take a turn to the political Right during his final two years in the Senate, as witnessed by his opposition to President Richard Nixon's Family Assistance Plan, a form of "reverse income tax" to help the poor get off of welfare and a program similar to a plan he had proposed several years earlier—though many liberal senators and representatives also opposed the plan."

GeezerGeek's picture

Regarding D: think LBJ, whose corrupt chickens were about to come home to roost. (Not mutually exclusive with CIA involvement.) And BTW, remember that George HW Bush repeatedly insisted that he was in Tyler, Texas on that infamous day. RFK, in case you forgot or never knew, as JFK's Attorney General, and didn't announce his candidacy until after LBJ decided not to seek reelection.

For those who like to go down rabbit holes:


Pinto Currency's picture



Just look at Iraq, Libya, Syria, now Iran and BRICS.

Gold and oil don't mix well for the Anglo American banks.

And there are also too many embarrassing questions re. supposed Treasury gold to answer.

Tinky's picture

"Pinto Currency has this threat going about whether CIA is going after China, starting a color revolution, and how the gold standard put forth by the BRICS will be crushed"

Not a snowball's chance. China ain't Iran in the '50s.

TheRedScourge's picture

The Chinese government wants to install a nominations board to filter out any of the candidates they do not like before the people get a chance to vote. To paraphrase the official explanation of this, this plan is in accordance with "basic law". Whatever the hell that means.

SAT 800's picture

LOL. Yes, well, it means whatever they want it to mean. you need to re-calibrate a little when you start considering China; it's a dictatorship; plain and simple. no frills. no extras. just the usual; you disappear; no body knows anything; they change their history; they change the rules, they change the "laws"; they do whatever the fuck they want. The Hong Kongers will just need a little breaking in; but they will be broken to the bit. and that's all there is to the story, really.

Dakota Kid's picture

Sat " it's a dictatorship; plain and simple. no frills. no extras. just the usual; you disappear; no body knows anything; they change their history; they change the rules, they change the "laws"; they do whatever the fuck they want.

 It sounds like you're talking about the USSA.

Kirk2NCC1701's picture

So they decide who gets to play, who gets to stay, who has some sway. And thus is different from the USSA "how"?

In other countries people KNOW that there's a "Whole Lotta rigging going on". The naive Sheeple in the USSA however, still believe or delude themselves that the system still kinda works and can be fixed.

It would be hilarious, if it weren't so tragic.

SAT 800's picture

Very interesting; and very plausible.

matrix2012's picture

Someone just mentioned to me that the Asian Financial Crisis in 1997 just be rolled on not long after the handover of HK to China.

That crisis was indeed meant to shake up the Chinese takeover of HK.

JailBank's picture

Not until the SNAP cards stop working. That day is going to be nuts.

X.inf.capt's picture
oh, now you know why they bought all those MRAP's and SMG's!!!

`and to deal with those PESKY preppers and gold bugs

BlindMonkey's picture

I am looking for the joy and fun to start in Atlanta. The blacks are a very large percent of the population and they will definitely enjoy showing us white folks what multicultural tolerance is all about.

DirkDiggler11's picture

Yea, but just crash the GA EBT / SNAP payment system for a month and watch the panic start ...

Uber Vandal's picture

Memphis might be sligtly further along than Atlanta judging by the comment from this article:

Mourning told us a summons is not enough and claimed this is a problem on a bigger scale, “Memphis is going to burn if they don’t control these children.”

SAT 800's picture

Hard to control 34 yr. olds with an 11 yr. old mind.

BlindMonkey's picture

All this zombie talk ain't actually about the undead.

KnuckleDragger-X's picture

I'm kind of betting on Chicago on an underdog line since the south side has been a free fire zone for years and it's starting to spread.

SAT 800's picture

I'm down with multicultural equality; they all go down the same to forehead or occipital bun shots.

Never One Roach's picture

I have had a gun poked into my ribs three times in a row last year by diverse peeples, any one of whom could have been Barry's son [if he had had one] so I'm with SAT on this. Two times in braod friggin daylight... once in front of Bed Bath & Beyond at 10am! The first time it happened I called the cops ... who did nothing. They said it's a miracle they didn't shoot me, "just for fun."

"If you want to keep your diversity, keep it," but leave me out!

OhNo's picture

Shit and i thought i was safe wearing my rolex around time square.

SAT 800's picture

mentally sub-normal tribal primitives.

booboo's picture


"Fighting for DemoCrazy"

Listen up you dumb fucks, Democracy IS the fucking problem and when you finally get that through your thick fucking skulls we can move forward, until then keep voting your God given rights away to the state.


TheRedScourge's picture

They may be too stupid to realize this, but they're not too stupid to realize that the Chinese government getting to stack the nominations board so as to allow them to pre-select the candidates is worth rioting over.

Buck Johnson's picture

I guess the destabilization of China is starting before more de-dollarization happens in trade.


youngman's picture

If this was Ferguson or Detroit...they would be looting all the time....this is a very nice neighborhood in Hong Kong.....nothing like that with these kids....shows intelligence......