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METAPHORS OF EXCHANGE AND THE SHANGHAI STOCK MARKET

DISSERTATION

Presented in Partial Fulfillment of the Requirements for

the Degree of Doctor of Philosophy in the

Graduate School o f The Ohio State University

By

Susan Diane Menke, M A

*****

The Ohio State University 2000

Dissertation committee: Approved by:

Dr. Chung-Min Chen, Advisor

Dr. Richard Moore /Advisor Dr. Amy Zaharlick Department of Anthropology UMI Number 9971606

Copyright 2000 by Menke, Susan Diane

Ail rights reserved.

UMI

UMI Microform9971606 Copyright 2000 by Bell & Howell Information and Leaming Company. All rights reserved. This microform edition is protected against unauthorized copying under Title 17, United States Code.

Bell & Howell Information and Leaming Company 300 North Zeeb Road P.O. Box 1346 Ann Arbor, Ml 48106-1346 Copyright by Susan Diane Menke 2000 ABSTRACT

This thesis looks at the metaphorical usage expressed in the informal discourse o f investors in the Shanghai Stock Market. By investigating this creative language usage, it is shown that there are elements of traditional Chinese worldview which are reflected in the values and priorities implicit in economic activity in this context. It is also shown that meaning creation is dynamic, in the exhibition of newly created discourse forms.

The analysis is based on the assumption that an examination of the underlying meaning of economic rhetoric will disclose elements of “root metaphors” which provide a

“window” on cultural meaning. Primary categorizations in this analysis include metaphorical references to the cooking process, to natural and supernatural entities, and to the strategies of war and games. An interactive approach is then utilized to provide a dialectical translation into more basic, or secondary conceptualizations which reveal the morality of economic exchange. This includes the embeddedness of Chinese money morality, as well as the importance o f kinship structures and whole/part reasoning. While a few examples indicate socio-cultural transformation in the “borrowing” or creation of verbal references to Stock Market activity, the persistence of most of these verbally expressed conceptual forms makes a strong case for historical and cultural continuity in the development of Chinese modernity. Dedicated to my mother

Mary McCoy Menke Neff

111 ACKNOWLEDGMENTS

I wish to express my appreciation to my advisor. Dr. Chung-Min Chen for his support and insights during this process, and for his patience in correcting my mis­ perceptions about Chinese culture, as well as mis-translations of the Chinese language.

1 thank the members of my committee. Dr. Richard Moore, who as my initial advisor in the Ph.D. program gave me a great deal of assistance and encouragement, and

Dr. Amy Zaharlick who has always been a joy to work with.

Thanks also to my friends Wu Jing and Wang Wei, who not only gave me fiiendly advice, but have also been indispensable in helping me translate these sometimes difficult concepts. And my advisor in Shanghai, Professor Gan Xingdi, who gave me invaluable information for my research, as well as the staff at the Shanghai Academy of Social

Sciences.

I also wish to thank Dr. John Current and Dr. Mohamed El Naggar for their encouragement and support.

This research was supported by a Foreign Language Areas Studies Fellowship, sponsored by the U.S. Department of Education and the East Asian Studies Center at the

Ohio State University.

IV VITA

October 4, 1957 ...... Bom, Columbus, Ohio

1989 ...... M.A. Business, The Ohio State University

1996 ...... M A Anthropology, The Ohio State University

1999-2000 ...... Graduate Research Associate, Department of Management Sciences, The Ohio State University.

FIELDS OF STUDY

Major Field: Anthropology TABLE OF CONTENTS Page Abstract...... ii

Dedication ...... iii

Acknowledgements ...... iv

Vita...... V

List of Tables ...... viii

List of Figures ...... ix

Chapters:

1. Introduction and literature review ...... 1

1.1 Metaphor theory ...... 5 1.2 Philosophical basis of metaphor theory ...... 12 1.3 Metaphor, meaning and selfhood ...... 18 1.4 Methodology and summary ...... 25

2. The Stock Market in Shanghai ...... 30

2.1 History of the Shanghai Securities Market ...... 31 2.2 The new Shanghai Stock Market ...... 34 2.3 Current context ...... 46 2.4 The investors: xiaohu, zhonghu and dahu ...... 53

3. Gupiaohua; The informal discourse o f Shanghai stock investors ...... 72

3 .1 Investing is cooking ...... 75 3.2 Investing is natural or supernatural ...... 85 3.3 Investing is war ...... 92 3 .4 Investing is a game ...... 97 3 .5 Miscellaneous metaphors ...... 101 3.6 Conclusion ...... 110

VI 4. Metaphor and worldview ...... 116

4.1 Metaphors and Chinese worldview ...... 117 4.1.1 Cooking and kinship ...... 118 4.1.2 Investing as part of the natural order ...... 126 4.1.3 War and games ...... 130 4.1.4 Conclusion ...... 132

4.2 Metaphors of money and the Market ...... 134 4.3 Risk and outcome ...... 138 4.4 Fate and face ...... 146

5. Conclusion ...... 154

Bibliography ...... 164

Appendix A - List of Mandarin Chinese examples ...... 183

vu LIST OF TABLES

Table

2.1 SSE Composite Index (SSEI) ...... 41

2.2 Turnover ratio based on stock value ...... 42

2.3 Turnover ratio based on number of shares ...... 43

vm LIST OF FIGURES

Figure

2.1 SSE composite index annual closing price ...... 41

2.2 Candlestick chart ...... 56

IX CHAPTER 1

INTRODUCTION AND LITERATURE REVIEW

A central issue in the history of Anthropological research has always been that of relativism, or how best to truly comprehend the meanings and motivations of behavior in what has sometimes been called “exotic” or “primitive” contexts. In recent years anthropological and cultural studies have been extended to more complex societies, and have focused on how the observations of “local culture” can add depth and realism to the more aggregate and abstract studies of fields such as economics and political science.

However, like Clifford Geertz’s metaphor of “two tunnel builders working on opposite side of the mountain”, these different perspectives in looking at complex societies have often been at loggerheads, rather than trying to “construct a single tunnel...where they are eventually to meet in the middle” (Geertz, 1963:5). The purpose of this study is to utilize an anthropological, or more relativistic approach in the study of economic exchange. In other words, to look at how the shared understandings and practices of culture reveal values and priorities in Market behavior.

The focus of this study were participants in the Stock Market in Shanghai, China, interviewed during fieldwork research in 1998. There is little precedent in Anthropology for study of the investment world; this was a realm most often left to economics and

finance. For the purposes of this study, this was both a blessing and a hinderance. The

dearth o f previous work on which to build allowed flexibility in the choice of theoretical approaches, but little reassurance in deciding how well any given approach might apply

The question was: how best to truly gain a sympathetic understanding of how observed social behavior reflected meaning for the people in this context?

Several months into my fieldwork, after I had become familiar with the setting and had made a fairly large number of contacts, I decided to distribute a questionnaire The questions were loosely based on a previous survey conducted by economic psychologists

Fumham and Bond (1986), comparing explanations for financial success in Hong Kong and Britain (see Lewis, Webley and Fumham, 1995:149). My survey asked for number rankings of various personal attributes, such as luck, hard work, and education level, in terms of their level of importance in acquisition of wealth and success in the stock market.

There was a complication, however, when 1 decided to include “competitive personality” as one of these attributes. After showing the survey to several Chinese academics and students affiliated with my host university (Shanghai Academy of Social Sciences), it was difficult to gain a consensus as to how best to express the concept in Chinese. And after distributing the final questionnaire to several potential respondents, the entry was either left blank or required further elaboration (and even then, most often, left blank). It was valuable experience in the challenges of using quantitative methods in cultural studies.

Alfi'ed Bloom (1981) had a similar experience in using survey techniques during research in Hong Kong. He had written several questions utilizing counterfactual statements; asking how respondents might react in several possible, but highly unlikely

scenarios. His responses were few, and quite often provoked the complaint that the

situation could not possibly happen, therefore an answer was not appropriate Finding this

interesting, he asked a Chinese fnend’s wife a question involving a hypothetical kangaroo

She asked whether he was talking about a single kangaroo or all kangaroos Replying that it was only a hypothetical question, that the question was not about a real kangaroo, she

replied “Either you are talking about a single kangaroo or about all kangaroos. What else is there?” (Bloom, 1981:36). What, to an English speaker would seem like a rather straightforward question, is misunderstood or simply rejected by Chinese speakers for lack of, what Bloom calls, an “already prepared schema” for interpreting counterfactual information. He then continues in his analysis to describe the importance of understanding these conceptual (and categorical) bases of translation:

. . .an English speaker cannot rely on a taste of experience, or a brief verbal description, or a simple combination o f labeled schemas from his repertory . . . to understand what the Chinese speaker means by li mao’ - with its moral and natural law implications - by contrast to what he means by its rough English equivalent ‘etiquette’ - with its social and conventional implications - or to understand the highly subtle distinctions carried by the more than ten Chinese terms which divide up the semantic range of the English noun reason’ What is required in each case is not simply translation, but a complex cognitive accomplishment - an accomplishment that may be aided by appeal to categories the speaker already has and by appeal to exemplar situations that he has experienced...(Bloom, 1981:85-6)

Surveys and interviews can be additionally problematic in cultures that Edward

Hall (1976) has characterized as “high context”. As described by Hall, high context cultures tend to derive a large degree o f information from the physical context, with much less information in the actual, explicit communication. The “truth” is arrived at circuitously, most often through telling the interviewer what the interviewee thinks they want to hear, rather than whatever is actually the case. True intentions and goals tend to be masked, in order to present oneself (and perhaps one’s country) in the best light Many social scientists would probably agree that China, as well as Japan, could be characterized in this way (Bond, 1991:49). An additional problem (in my experience) in the Chinese context is that there remains little faith in the confidentiality of information, a hurdle that can only be overcome, in most cases, through an extended length of time nurturing trust in relationships.

Overcoming all of these obstacles proved to be a significant challenge in studying people’s motivations, perceptions and goals in investing in this fledgling Stock Market.

Unable to trust any sort of quantitative techniques as tools in this type of research, 1 decided to use what 1 knew fi-om my own life experience. During my several years in the

“subculture” of stock investing in the U.S. (as a Stockbroker and later as an Investment

Analyst), 1 had found quite interesting the “internal language ”, or jargon that had developed around all types of stock market activities and characteristics. What 1 noticed soon after arriving in Shanghai was that it was just as pervasive, but also how strikingly different that vernacular was in this context. Rather than the sports metaphors which were prominent in U.S. stock investing, Chinese investors had developed a very different set of idioms.' 1 decided to look further into what this might reflect about the conceptualizations of Chinese stock market participants, using the “roadmap” provided by metaphor theory.

Since it has always been the strength o f anthropology to focus on the social nature of translation and communication, as well as the multi-layered nature o f meaning, metaphor appeared to be an excellent vehicle for achieving the goals of this research

1.1 METAPHOR THEORY

Language, symbolism and worldview have always been dominant issues in

Anthropological studies. Beginning in the tradition of Culture and Personality studies,

particularly with Ruth Benedict’s Patterns o f Culture in 1934, Anthropologists looked for

“macro” level elements or themes that could be said to characterize cultural worldviews.

In this work, Benedict argues that culture as a whole determines the behavior of human

beings, who are characterized as “creatures of society” who “accepts without more ado

the equivalence of human nature and his own cultural standards” (Benedict, 1934, 1-6).

In a similar, rather deterministic fashion, others such as Cora DuBois have examined

“dominant values” (Dubois, 1944) and Clyde Kluckhohn (1951) contributed the analysis of “value orientations”. “ In this tradition of identifying a primary “ethos” or “theme” with which to characterize cultural systems, human interaction was highly generalized.

Detailed, more “micro” pictures of cultural conceptualization were often lacking, and the static nature of these analyses often discounted human agency and creativity.

As Sherry Ortner (1973:1338) notes, more recent studies have responded to criticisms of reification and essentialism in this tradition by breaking “meaning systems” down into finer and finer units. Thus, more recent work by David Schneider (1968),

Victor Turner (1967), and other Symbolic Anthropologists have looked at the more refined aspects of these larger orientations. Influenced by cognitive psychology and the structuralism of Lévi-Strauss, the American Symbolic Anthropologists of the late 1960's and 1970's attempted to “decode” systems o f meaning through examination of key rituals

and symbols. The writings o f Turner, Schneider and also Clifford Geertz (1963, 1973) did

depart somewhat from the scientistic influence o f the Structuralists and Psychologists,

however, focusing more on the particularistic aspects of individual cultures in the Boasian

tradition rather than on the determination of universalistic human qualities prevalent in these other two schools of thought In these symbolic studies, ritual and symbolism are

analyzed as to how they act to reinforce and perpetuate various aspects of culture. Culture

is seen as “systems o f meaning” for which “thick description” provides unique details rather than broad comparisons.

Geertz’s (1973) essay “Thick Description; Toward an Interpretive Theory of

Culture” was a particularly influential argument for this interpretive orientation of anthropology. This orientation away from “broader interpretations and more abstract analyses” (Geertz, 1973:21), toward a more detailed inspection o f the local, or “natural laboratory”, suggests Anthropology as hermeneutics, i.e. reading and interpreting a local culture just as one would a text. He sees this as the strength of Anthropology; that through examination o f local “symbolic dimensions o f social action ”, it is possible to include “the answers that others have given... in the consultable record o f what man has said” (Geertz, 1973:30)

The Symbolic Anthropologist’s break with the universalism, scientism and thematization that could be said to characterize some earlier research, led to a more literary orientation in Anthropology in the 1980's. Here it was recognized that the primary function (and value) of Anthropological research lay in the translation o f the foreign. However, unlike the translator of language, the anthropologist “must render the foreign familiar and preserve its very foreignness at one and the same time”(Crapanzano,

1986:52). Cultural translation caimot simply chronicle the notes of a spectator, but must look at the underlying meaning, try to perceive it as it is perceived by the participants, and then present it in a way that is conceptually and discursively available to “outsiders" In other words, the Anthropologist must make explicit what is implicit, particularly those values and meanings that may not be accessible to scientific objectivity. Based in part in continued criticism o f reification and essentialism in Symbolic Anthropology, more recent studies have emphasized even more detailed units o f analysis in the quest for emic understanding, one of which is the analysis o f shared meaning implicit in metaphorical language.

This recent focus in Anthropology on metaphor theory incorporates elements of discourse analysis borrowed fi~om literary theory, as well as the traditions of the “cognitive revolution" of psychology. The emphasis now is on both pragmatics (use and context) and semantics (meaning) in such a way that symbolic analysis is contextualized rather than abstracted, and diachronically situated, rather than atemporal. (Ohnuki-Tiemey, 1990a:

22-4). The assumption is that man is essentially rhetorical, and that social life is created through the sharing o f beliefs, values and intentions, rather than simply through shared symbols. It is through this process of sharing, that numerous native “interpretative procedures" develop, which can be observed, chronicled and analyzed (Brunner, 1990:

95). There is a great deal of debate over the scope and inclusiveness of what constitutes

metaphor. Metaphor is implicitly symbolic, as is all natural language. But as Sherry Ortner

(1973:1339) points out, anything by definition can be a symbol, i.e. a vehicle for cultural

meaning. Most researchers agree that the creation of metaphorical symbols depends on a

transgression of boundaries between constructed classes of these symbols, most of which

tend to be culturally specific/ Therefore, discovery and interpretation of metaphors tends

to begin with the discovery o f where these boundaries have been constructed. It is in this

that the strength of metaphor theory lies, in that it recognizes how these “native”

conceptual boundaries may ofien be difihcult to discover. As Stephen Gudeman points

out: “The empiricist attempts to build "^as if models, the metaphor model builds ‘as being’

models. . . When a Bemba farmer considers cultivating a new plot of land, he predicates

upon it the schema of the ancestors. In these circumstances, he sees the land as being’ the

ancestors’(Gudeman, 1986: 41). Max Black, whose “interaction view ” defines metaphor

as a “system of associated commonplaces ” concurs with Gudeman, saying that “a

metaphor that works in one society may seem preposterous in another. Men who take wolves to be reincarnations of dead humans will give the statement ‘Man is a wolf an

interpretation different from the one I have been assuming”(BIack, 1962: 40).

The Philosophy o f Rhetoric (1971 [1936]), I.A. Richard’s seminal work, was one of the first to present a view of metaphor opposed to the traditional positivist approach.

Traditionally, metaphor was principally consigned to the realm of “literary flourish” in poetic language, basically seen as based on a correspondence between denotative and connotative meaning, or in other words, an objective correspondence between the described concept and its referent. Traditionally, the ^Ggurative" is thus, simply, the recognition and expression of a priori correspondences between categories, reducible to some literal analogous expression. In Richard’s, and later Max Black’s (1962)

“interactionist” conceptual model, metaphor involves not only the recognition of a pre­ existing relationships, but also involves the creation o f new meanings and relationships.

Metaphorical and literal distinctions become blurred as it is recognized that metaphor cannot be reduced to its literal equivalent without a loss o f informational content. In this view, the relation of ideas between seemingly unrelated “domains” have a much greater cognitive content than the simple sum of the parts, and metaphor imbues both categories or domains with a new and irreducible sense or essence. This perspective, then, tends to place more emphasis on creativity and agency in the production of meaning (Turner,

1991:125).

Max Black (1993), gives an interesting example of the “game theory” or objectivist analysis of the metaphor “Marriage is a zero-sum game” Here the interpretation of what he calls an “implication-complex ” breaks down as follows:

a) A game is a contest;

b) between two opponents;

c) in which one player can win only at the expense of the other.

This “heavy-handed ” interpretation tends to accomplish the goal of reducing the initial concept to something close to literal propositions. However, it relies heavily on implicit understandings about what meaning “contest ”, “opponents ”, and “winning” impart, and ignores the cultural understanding that this summary would most likely have negative connotations, rather than describing what would commonly be considered as a “match

made in heaven” (Black, 1993:28-9X Thus, Black’s (1962, 1993) interactional view of

metaphor recognizes that “substitution and comparison metaphors can be replaced by

literal translations by sacrificing some o f the charm, vivacity or wit o f the original, but

with no loss o f cognitive content But interaction metaphors are not expendable...” and, as

in the previous example, this loss o f cognitive content should be recognized and described

(Black, 1962; 45-6).

In another seminal work, influenced primarily by the cognitive tradition, George

LakoflFand Mark Johnson’s (1980) experiential approach focuses primarily on the basis of

metaphor in physical experience. Largely ignoring the work of Richards and Black, they nevertheless elaborate on their argument that metaphor is not simply linguistic comparison, but rather forms the basis of human thought and understanding. Primarily through examining metaphors characteristic of English (one might say American) speaking cultures, they highlight many aspects of cultural understanding reflected in statements not commonly recognized as metaphorical. One particularly productive example in English is what they call ontological or container metaphors. States of being are characterized as spatially contained (for example “in love ” or “in trouble”) which reflects the propensity of the Cartesian view in western cultures to view the world as broken into segments and ontologically separable categories. Other examples, such as “time is money” metaphors, as well as Western linear conceptions o f time, reflect what Lakoflf and Johnson call an

“experiential gestalt”; a cluster of understandings that not only organize, but define physical reality for the participants (Lakoff & Johnson, 1980:70).* In this way they

10 illustrate that metaphor underlies most of natural language; that our cultural values are

reflected in those metaphorical structures, and therefore, “values are not independent but

must form a coherent system with the metaphorical concepts we live by” (Lakoflf&

Johnson, 1980:22)®

This and later examinations (discussed further in the next section) of how metaphor is pervasive and implicit in human thought processes and shared understanding, have led to a wealth of attempts at defining the term One of the simpler definitions would be that of Lakoff and Johnson (1980: S): “The essence of metaphor is understanding and experiencing one kind of thing in terms of another”. Or as Kenneth Burke states, it “brings out the thisness of that and the thatness of this” (Burke, 1955:503). Most definitions would be compatible with the characterization cited earlier; that metaphor involves the projection of a source domain onto a target domain, and metaphor is produced through this transgression of boundaries between contrasting domains. The influence of

Anthropological relativism tends to focus on where the boundaries of these domains lie, and culturally specific assumptions as to what are suitable “mappings”.

For the purposes of this study, the “broad” definition o f metaphor is utilized, subsuming the categories of allegory (an extended metaphor, such as a fable or narrative); analogy (an explicit and systematic metaphor); metonymy (an attribute or location is substituted for the referent); simile (a metaphor using explicit “like” or “as” constructions); and synecdoche (a metaphor where a part is substituted for the whole).

Metaphor could also be characterized as trope, in which “word are given meaning other than their literal meaning” (Klamer and Leonard, 1994; 45-8). However, as discussed

11 earlier, it can be problematic to make distinctions between metaphorical and “literal”.

The analysis of metaphor in Anthropology in the last decade has focused on how it reflects, as well as underlies, the pragmatic aspects of social interaction. Incorporating symbolic, literary and cognitive perspectives, examples, such as Ohnuki-Tiemey’s (1987) examination of the monkey metaphor in Japanese culture, attempt to utilize the strengths of Anthropological approaches to provide a more “thick”, less over-determined alternative to the more culturally restricted analyses in other fields. What is agreed on by most recent analysts is the synergistic quality of metaphorical expressions; that they convey more of the “essence” of what is described through evoking an emotional or aesthetic response in the listener, in a way that produces a “creative engagement”, “tension” or “affective inclusiveness” for the participants. All of this is dependent on a shared body of “local knowledge”(Geertz, 1973) or an “ecology of collective representations”(Eric Wolf, 1982).

It is the necessity of this inclusiveness which allows metaphor to provide a “window” on culture or worldview, defined here as “a body of symbols and meanings in play in a given society at a given time” (Ortner, 1990; 59). Therefore, the strength of the anthropological approach to metaphor theory, “lies first in its insistence upon the role of culture in the formation of metaphoric models with which various peoples reason” (Fernandez, 1991 ;9).

12 PHILOSOPHICAL BASIS OF METAPHOR THEORY

A primary focus in metaphorical analysis in recent years, has been a re-engagement of the debate concerning the validity of the objective and subjective perspectives. Those who have adopted the “strong form” view, such as LA. Richards (1971 [1936]) and

1 2 others, see subjectivity and creativity as the basis of all perceptions, and, therefore, see reality as a “projected world” in which all thought is irreducibly metaphorical. Max Black

(1962, 1993) takes a less deterministic stance, focusing on the fact that there are some classes of metaphors which are irreducible to literal propositions. In his view, some metaphors actually structure our perceived world, others do not. More recent studies, such as those by Pierre Bourdieu (1977) and Mark Johnson (1987) concur with this

“middle range” view, as Johnson (1987: 210-1) states: “...there is indeed a middle ground between these two extremes”, that “signs do not just map onto objective reality all by themselves - they can relate to ‘the world’ just because people understand both the symbols and their world and can relate one to the other”.

The strength of these syntheses is an enhanced recognition of relativism. What

LakofF and Johnson (1980: 193) call “imaginative rationality” highlights the allowable, or

“rational” cultural transformations in our own culture as well as others. Truth and rationality are re-examined in terms of differing, rather than universal conceptual schemes and discourse structures. For instance, in the introduction to the edited volume N a tu ra l

Images in Economic Thought (1994), Philip Mirowski discusses the pervasiveness of metaphor and culturally based value judgements used in interpretation in the economic sciences. Similar to Donald McCloskey’s The Rhetoric o f Economics he discusses the more deterministic aspects of cultural orientation in scientific reasoning. Reflected in what Lenk (1993:4) calls the “epistemological imperialism o f‘Cartesian dualism ”, the rhetoric of neoclassical economic discourse dictates the assumption that the social is identical, or highly similar, to the natural and the mechanical. This is reflected and

13 perpetuated in the descriptions of social reality implicit in common metaphors such as

‘price mechanism' or ‘equilibrium ' In this perspective, then:

Using Natural metaphors in theories of Society fosters reassuring and graphically concrete images of order, situating humanity squarely at home in “its” universe, while the parallel projection of social concepts onto Nature render what might otherwise be an unintelligible alien world comprehensible and accessible to human desires and purposes. The identity resides in the process, and not in any especially stable character of Nature o r Society. (Mirowski, 1994:14)

In a similar vein, Lakoff and Johnson (1980) look at the cultural basis of metaphors in common usage that describe value systems based in physical experience. In this context.

Good is Up, More is Up, therefore Control and Rationality are both described spatially as

Up. In their view; “In our culture, people view themselves as being in control over animals, plants and their physical environment, and it is their unique ability to reason that places human beings above other animals and gives them control” (Lakoflf and Johnson,

1980:17). These cultural value systems are then reflected in the rhetoric of Economic science, in the pervasive use of mechanical and biological metaphors in “appropriate " discourse.

This follows in the tradition of the rational Empiricists and Materialists, such as

Kant, Locke and later, Karl Marx. In this objectivist view of truth, reahty and meaning were external to human understanding, such that the truth and falsehood in a statement could be determined by its congruence with the reality in the external world. This, in turn, allowed for the possibility o f finding universal truths or understandings. This ontology was predicated on a view of the world as composed of categories of distinctly demarcated categories of being, with delimited properties and definable relationships. It is this

14 assumption of this accessability of the human mind to observation of universal, external conditions and categories, which allows for empirical verification of the truth or falsity of statements in scientific reasoning. In other words, the categories of the universal mind d o fit the categories of the world

These recent metaphor studies have taken a harder look at this traditional epistemology, focusing more on the long ignored Aristotelian “poetic”. Rather than ontologically separating the metaphorical fi'om the literal, as is necessary in a Cartesian tradition in which all meaning is ultimately reducible to literal translation, this view examines the pervasiveness of metaphor in all of human understanding. For instance, the value of Economic models as “useful approximations” is extended to examine the inherent limitations of what could be called “dead” metaphors; a sort of “common code” which is most often neither questioned or even consciously perceived. Just as Barker (1978) describes it, when a person enters the post oflSce, they “act post office”, the student is trained from the beginning in the art of producing suitable discourse. What is considered eloquent and persuasive is most often appropriate to “root metaphors” (Pepper, 1942), or, what Nietzsche called “knowledge metaphors” (see Hinman, 1982. 199). Pepper’s W orld

Hypothesis, for instance, sees these “root metaphors” or concepts as fundamental in all, including scientific, discourse. Thus, in the culture o f the social sciences, “Local models are often built around ‘primal’, focal’ or ‘axiomatic’ metaphors. A primal metaphor is a construction so basic to a people it defines reality for them... (it is) an organizing force”

(Gudeman, 1986: 40). These “local models” of economic discourse, most often built around organic or mechanistic conceptualizations o f social life, not only reflect underlying

15 conceptualizations and assumptions, but also “frame” new analyses of economic and social

behavior (Klamer and Leonard, 1994:42). Through examination of these critical

assumptions, analysis can step outside the traditional constraints of neoclassical

economics, producing observations such as that given by O’Barr and Conley, that “one

(possible) reason for the slow pace of economic reform in the former Soviet Union is that

Soviet economists and policymakers have no tradition of speaking and writing about economic planning in units o f less than five years”( 0 ’BaiT and Conley, 1992:147). In this more subjective, less “scientific” view, meaning is not necessarily universal, but more relativistic and constrained by context and mutual or individual understanding. Truth and rationality are re-examined in terms of differing, rather than universal conceptual schemes and cultural meanings. It has also brought to light the importance of examining existing assumptions about societies and human behavior, in favor of sets of assumptions which have been consciously adopted and discussed. This in turn “makes the familiar, ... seem strange, and so to gain that mental distance that allows intellectual reflection” (Carrier,

1997:46)

These critical examinations o f Cartesian empiricism have also been utilized to look at how the metaphor of the “Market model” over time has extended into the values of

Western culture. As James Carrier (1997: 27) states: “the sort of person contained in the

Market model is the true or valid person, the standard against which other notions o f the self are measured”. Western capitalisms are not simply “a techno-economic design, but a complex cultural system with a very special history in the modem West” (Appadurai,

1986:49). This tradition of seeing the atomistic individualism as a “good” permeates not

16 only the public, but also the private sphere in American life, such as in David Schneider’s

(1968) observations that many American see the world of work (the “rational” realm) as

“not only distinct, but antithetical to the relations and values of the family and household” or what could be called the “emotional realm” (c.f. Carrier, 1997:18). Dependence on others is seen as irrational, antithetical to the Model, and therefore immoral And, again using the examples o f Lakofif and Johnson (1980), it has become almost a lingua franca in

American life This is reflected in metaphorical characterizations such as TIME IS

MONEY, o f which they cite numerous examples (Lakoflf and Johnson, 1980:7-9).

This is also implicit in the quite common view of free market economics , in the

Weberian and Parsonian traditions, as necessarily corrosive o f the collectivity characteristic o f Asian cultures. Assumptions as to what is necessary and sufficient for development of modem capitalist economies tends to rely on assumptions of convergence with the values implicit in Western economic reasoning. These assumptions are necessary so that the ultimate “good” of Polanyi’s “Great Transformation” in global modernization can take place, producing the “disembeddedness” of the western Market model

(Polanyi, 1968 [1944]). The characterization of the economic successes of the “dragons”, such as Japan, Taiwan and Korea in the last decade as the Asian “miracles” is one obvious example of this ethnocentric bias (Cumings, 1993:30). As Dore (1973) points out, it is the lack of convergence, in many respects, with the western Market model in recent decades that has led observers to view these Asian economies as special cases (Smart, 1997: 171).

In these cases the underlying assumptions of economics - those of the rational, self- interested and atomistic individual - are reflected in the western analyses of economic

17 development as necessary and valued personal qualities, without which free market economics cannot develop in the “optimal” sense

Herein lies the value of an approach that discounts universally valid truths in favor of an examination of how the translation and perception of meaning can be naively ethnocentric. It requires “a willingness to settle for tentative or partial truth, (favoring) a dialectical historical relativism” (Rowe, 1990: 311). It is the view o f metaphor theorists that the more subjective, creative aspects o f language is an important “window” on the development of economic priorities and perspectives, and that rhetoric provides a challenge to the picture of human agency oflfered by rational choice theory. Importantly, it offers a critique o f inherited notions o f rationality... not in the name of the ‘irrational’, but in the name of a thicker’ concept o f rationality itself’ (Quinn, 1996: 1127). As Bourdieu states “one must move beyond the usual opposition between economism and culturalism, in order to develop an economy of symbolic exchanges (Bourdieu, 1991: 37). The goal is not to develop universal laws or truths, but to see the comparison as a cumulative process in which partial truth must be accepted. In this way, more emic understandings provide a supplementary, but equally important understanding of how shared values and meaning impact economic decisions on the micro level, and economic policy in the larger context.

1.3 METAPHOR, MEANING AND SELFHOOD

Any investigation of metaphor is primarily an analysis of meaning There are two arenas through which this might be accessible, the intentionality o f the individual, and what John Gumperz (1982) calls “conversational inference”, the “situated or context

18 bound process of interpretation by means of which participants in an exchange assess each other’s communicative intentions” (c.f. Young, 1994:17). While the individual, intensional aspect of meaning lies in the self, it is the public, shared process of dynamic meaning creation that transgresses the self^other juxtaposition, providing not only insight into conceptualizations of the self and others, but also the shared, negotiated process of the creation of selfhood in society. It is for this reason that is necessary to look far beyond the mechanistic translation of language units, into the underlying basis o f shared meaning.

The question remains then, as to how and to what degree meaning is shared.

Ohnuki-Tiemey uses the concept of “polysemes” described as a “pool of meaning” on which “the participants draw at times the same meaning and at other times different meanings” (Ohnuki-Tiemey, 1987:10). While most observers agree that the process of shared meaning lies primarily in cultural patterning, there is an entire spectrum of viewpoints as to the degree to which it is shared. At one end of the continuum is, what

Sherry Ortner calls the “soft or external position”, seeing cultural structures and “symbolic resources” as primarily external to actors, who act as agents at all times in the process of interpretation. At the other end of the spectrum lies the “hard or internal position”, characterized by Bourdieu s (1977) early habitus, which sees the interpretation o f meaning as filtered through cultural “hard-wiring”, allowing little for individual agency in behavior.

(Ortner, 1990:84).

Most researchers, however, tend to take the middle road, in which individual agency in the interpretation of reality is acknowledged, but also allowing for the existence of cognitive limitations in perception which are “filled in” with cultural “programming”.

19 Even though, as Lakoff and Johnson (1980) have observed, that “meaning is always meaning to someone” in a speech community, shared meaning always depends on a synthesis of both external and internal realities. For them, the use o f metaphor is one way of “partially communicating unshared experiences”, but also depends on shared experiences such that conceptual mappings can be apprehended and understood (Lakoff and Johnson, 1980; 225).

This “middle range” view is also supported by the work of cognitive psychologists, such as Tversky and Kahneman (1981). Primarily focused on testing the assumptions o f rational choice theory, their studies illustrate the limitations o f human cognitive capabilities based in behavioral decision theory, highlighting the impact o f these limitations on perception, choice and decision-making This has led to greater emphasis on what Ferrow

(1984) calls “social and cultural rationality”; the recognition that “common sense” plays a major role in everyday interaction and that there are basic “ rules of thumb” which are often used without any conscious reflection. Most often these “rules of thumb” are based in shared cultural values and assumptions (Ferrow, 1984: 3 17). And as Short (1984: 719) points out, the existence of these limitations may be an important factor in social bonding.

The implication for the cultural analysis of meaning is that there are often elements of both behaviorist type stimulus-response behaviors - due in large part to cultural “hard-wiring” - as well as ideational and emergent factors. Sherry Ortner summarizes it this way:

The suggestion here is that one way in which structures structure events is that actors find them personally meaningful in a given context, internalize them or in some other way make a link between them and the self, and enact them such that the cultural schema becomes a vehicle of personal agency No permanent linkage is made, no one is programmed, as it were, yet in the particular context in which the

20 connection is operating, the structure has for the actor a certain naturalness...and hence coerciveness (Ortner, 1990; 90).

What is quite interesting however, is that this debate would not exist without the underlying assumption of Cartesian mind/body and self other distinctions, concepts which are highly unproductive in, what Henderson (1984) calls Chinese “correlative thought”.

Marcel Mauss was one of the first to look at Western notions o f the individual, as contrasted with that in the Chinese context. As he observes:

Birth-order, rank and interplay of the social classes settle the names and life style of the individual...his individuality is his ming, his name...(which) represents a collective noun, something springing fi'om elsewhere: one’s corresponding ancestor bore it, just as it will fall to the descendant of its present bearer. . .’’(Mauss, 1985:14)

As Tu Wei Ming points out, in “Confiician ” societies self development is not an individual task, and the “privatized self’, or “self that is a closed system ” is not the “true self’ (Tu,

1985b. 57). This “fuzziness” of the boundaries of the self conform well with most conceptualizations in the Chinese cosmos. For instance, the western conception of boundedness, as illustrated by Lakoflf and Johnson (1980) in their discussion of the pervasiveness of the container metaphor in the English, tends to become much more fuzzy in most analyses o f Chinese logic. According to Lakoflf and Johnson, categories in

Western thought, including that of the self, are described ontologically as containers in which objects and states o f being are either in or out. This would include visual fields (“in sight), and various activities (“immersed in his studies ”) (Lakoflf and Johnson, 1980:30-2).

John Rouzer’s (1997) Ph.D. dissertation takes an interesting look at the productiveness of this type of metaphor in Mandarin Chinese. In his analysis o f the use o f zhong

21 (middle/center) and // (in or inside), he found that many times // could be used in

translation of these types of metaphors, but that zhong most often sounded more “natural”

to the native speaker. The use of // or ‘in” was most often confined to objects or groups

of objects with a “strong physical basis”, such as a group of trees (Rouzer, 1997; 143). The

more common use o f zh o n g indicates a conceptualization that is equally as possible in two

dimensional or even one dimensional space, rather than the three dimensional quality

required of a container (Rouzer, 1997: 65). It also suggests a lack of boundedness or discreteness. In English one would be “in the middle”, but rarely is this type of designation

used in Mandarin Chinese.

This conforms well with Chad Hansen’s (1983) discussion of the “whole/part” logic in Chinese historical texts, characterizing Chinese semantics as “a view that the world is a collection o f overlapping and interpenetrating stuffs or substances” (Hanson,

1983: 30). In contrast with the Platonic view of the mind as an entity which “knows” or

“apprehends” abstract meanings and objects, in Chinese texts the mind is seen only as discriminating between units o f larger collections, implicit in the “rectification of names” of Confucianism. Names, or m ing implies a hierarchical notion of a fluid cosmic order, therefore the existence of “ideas” in the Platonic sense was less important than the implications o f behavioral manifestations of thoughts and motivations on this cosmic order. In other words, meaning isn’t conveyed or produced as in the Platonic sense, it is only discovered through “knowledge about names - and how to use them ” (Hansen,

1983:58). This has led to characterizations o f the Chinese language as discourse oriented and pragmatic, focusing more on the purposes it will serve, rather than any concern for the

22 relationship between language and the “external” world (see also Tsaol979).

Manfred Porkert’s (1988) description o f Chinese worldview implicit in the practice of traditional Chinese medicine helps to clarify these points:

Phenomena that would be described in Western terms as ‘things’ or objects, would instead be regarded as the consummation of a whole series of actions, or effect, in the past - actions that have accumulated, so to speak, in the past and are only to be sought for in the past. All material things, including the bodies of human beings, are the outcomes and the visible expressions of quite specific actions that have accumulated in the past ’’(Porkert, 1988:68).

This “oneness” with the past would coincide well with Nakamura’s (1997: 205) observation that metaphors in Chinese tend to reflect historical usage much more so than

Westerner’s. While American metaphors tend to reflect current experience, Chinese metaphors tend to reflect continuity and in the use o f phrases and images from classical mythology and literature (as discussed further in Chapter Three and Four of this study).

And it is a conceptualization or perspective that should be carefully observed and acknowledged in any analysis involving etymology o f the Chinese language. One such example is Linda Young’s (1994) discussion of the commonly used y//7H'e/...5î/oy/...construction, most often translated into English as the “because...so

(therefore, thereby)...” sentence structure. This conventional translation masks the

“contingent conditions that must be taken into account ”, in that this implies a “peculiarly

Chinese sense of causality in which a full range of conditions must be elaborated and considered as causes for a particular event ” (Young, 1994: 40). This notion of causality implies an interconnectedness between things which must be taken into consideration when determining possible cause/effect relationships. The observed process is not

23 perceived as linear with a direct relationship leading to a valued endpoint. Rather, it is a dialectical process of examining the entire matrix o f linkages. This “whole/part” cultural schema has implications for Chinese notions of selfhood, in which “self is constructed more broadly as a corporate self - a self that is always contextualized by and so interdependent with others” (Young, 1994:41). This has implications for other Chinese conceptualizations as well, such as the notion of “privacy”. Until recently a non-existent word in Mandarin, it still retains somewhat pejorative implications. Unlike the broad range of contexts subsumed in the English language schema of privacy, the use o f the word in

Chinese relates specifically to assumptions that the reference is to sexual activity. This highlights the moral basis o f assumptions of “self’. Rather than placing value on the development of autonomy and distinction, the Chinese self is considered most highly developed in relationship to other selves; in terms of “bonds instead of boundaries”.

(Young, 1994:41)

Francis L.K. Hsu (1983) discusses notions of autonomy, self expression and privacy in terms of what might be called the “root metaphor” of Chinese culture - that of kinship. In his view, all o f these characteristics developed as correlates of the “Chinese type of kinship system”, including ‘lesser emphasis on individual autonomy and self- expression and greater expectations from and receptivity to authority”. The exclusivity of sexuality to the private realm derives from the “asexuality” necessary for maintenance of this system, as opposed to the pervasiveness of sexual references in the Western sphere

(Hsu, 1983:339). This “interpersonal nexus’ of kinship he sees as “the key” to these schemas of continuity, inclusiveness, authority and asexuality will be discussed further.

24 1.4 METHODOLOGY AND SUMMARY OF CHAPTERS

The purpose of this study is, therefore, to look at the “submerged portion of the iceberg” in Chinese economic behavior, through the “window” of metaphor. Although metaphorical speech cannot be equated with the entire scope of what constitutes culture, it is assumed that it most often follows pre-existing culturally shared models, especially when gathered in the “natural” context of informal language. Metaphors reflect transformations of existing cultural schema that allow for a shared perception of similarity between the two domains. As Gregory Bateson notes, they “cut across different contexts, thus enabling the combining o f both imaginative and literal observations and cognitions”(Bateson, 1972; 12) What is accomplished by this convergence, or transgression of boundaries is an indicator of meaning to the participants. For instance, the embedding of iconic transformations in higher level structures, such as cultural “root” paradigms, is what allows for resolution o f the ambiguity implicit in all natural language, and allows for meaning to be shared. This interactive approach highlights relative, rather than universal mappings, allows for the dynamic nature of discourse, and recognizes the resonance and synergy of metaphorical expressions above and beyond that conveyed in mechanistic translations of language. It is this affective power that indicates the existence of inclusiveness, of sharedness in both created and preconceived cultural realities. Thus, this approach incorporates both the behaviorist and ideational, allowing for the intention of people to create new meanings from old forms. In this way, culture is not viewed as a

“thing”, but as a mediated and dynamic creation of human interaction, based in common experience And rather than focusing on the universality of physical/spatial orientation in

25 the metaphorical studies of Lakoff and Johnson (1980), the focus is more on shared

understanding in more abstract domains that are more likely to exhibit cultural variation. It

is hoped that this approach will give culture a more primary locus in the analysis And

also, that the use o f informal speech in this study allows for the analysis o f more implicitly

shared symbols and institutions, rather than the more explicit representations of what

Foucault (1980) calls “dominant discourses”, or the more formal, public representations

and hegemonic ideational systems.

The focus has also been directed away from the view of cultural meaning as part of

a system of exploitation. Conceptualizations so firmly rooted in the Western materialist

tradition are somewhat suspect in this case, as previously discussed. The attempt, in this

type of approach, is to move more towards what the German philosophers called

Lebenswelt, or the “world as it appears in ordinary experience prior to conscious critical

reflection” (LaFarque, 1994: 13). In other words, to perceive and relate different

experiences than one is familiar with, to understand what does and does not matter to the

participants.

One advantage of the this study was that it allowed some demarcation of the

boundaries of a relevant “speech community” and, to a lesser extent, “culture” that is

problematic in most Anthropological studies All of the participants were investors in the

“A” share Market in Shanghai, a market only available to Chinese citizens^ All o f the

participants also physically resided the Shanghai area, and thus could be characterized as

Shanghainese with a certain measure of assurance. The Chinese interviewees themselves, however, seemed to have a strong sense o f “Chineseness”; the phrase hen zhonggou (very

2 6 Chinese) was used quite often to describe aspects of society that they felt were unique to their culture. Interviewees were quite accessible in the more than 100 neighborhood

“trading rooms" throughout Shanghai, and a broad sample of these locations were visited in order to gain some perspective as to local variation and what could be said to characterize these investors Metaphorical examples were collected over a seven month period, and it was determined that this was sufficient as the number o f new examples exhibited greatly diminishing returns toward the end of my stay. Efforts were also made to interview proportions of both males and females from various age groups and socio­ economic backgrounds that reflected the proportions of people observed in these “trading rooms". With my background in the investment industry and fluency in Mandarin Chinese, it was fairly easy to converse on the subject of the Market, although these conversations were most productive after trading hours when the distraction of Market activity was not an issue. The greatest challenge at times was to get people to talk about themselves and the Stock Market, since most participants simply wanted to ask questions about my life in the United States. And data could only be gathered indirectly (recorded in notes and on a handheld tape recorder) since direct solicitation for metaphors about the Market only led to confusion. This required a lengthy process of “weeding out" a great deal of repetitive and non-related conversational data before the final analysis could be written, but allows for presentation of these metaphorical examples in their “natural" context.

27 To summarize briefly then, the purpose o f this ethnographic study is:

I ) to chronicle the historical and current context in this particular domain of Chinese society, i.e. among participants in the Shanghai Stock Exchange (Chapter Two of this

study).

2) to utilize an interactive approach to present informal, “everyday” language and metaphor usage examples as a “window” on Chinese worldview within this domain of economic activity (Chapter Three).

3) to highlight possible correlations between these metaphors and Chinese worldview, language usage, and economic behavior (Chapter Four).

2 8 CHAPTER ONE ENDNOTES

1. See also O’Barr and Conley’s (1992) anthropological study of American institutional investors, in which they state: “The vast majority of metaphors used to describe the investment business relate to sports and games” (O’Barr and Conley, 1992: 149).

2. Metaphorical expressions were chronicled early on, although not explicitly analyzed, in Boaz’s (1914) The Handbook o f American Indian Languages.

3. An interesting example of “empirical classes” is noted by Shweder (1984:43) in his citation of an ancient Chinese encyclopedia: Animals are divided into: 1) belonging to the emperor, 2) embalmed, 3) tame, 4) sucking pigs, 5) sirens, 6) fabulous, 7) stray dogs, 8) included in the present classification, 9) fi-enzied, 10) innumerable, 11) drawn with a very fine camel hair brush, 12) et cetera, 13) having Just broken the water pitcher, 14) that from a long way off look like flies.

4. Another common example is “Juliet is the Sun” from Shakespeare. See (Elgin and Scheffler,1987).

5. Examples include “You’re wasting my time ”, “I don’t have time to give you”, “How do you spend your time?” (Lakoff and Johnson, 1980: 7-8).

6. The influence of objective empiricism is apparent in their “experiential approach ” however, in the focus on the potential universality of metaphorical mappings of basic, physical experiences onto more abstract concepts.

7. The capitalization of the word “Market ” reflects the tendency towards reification or personification of this concept, as discussed in Chapter Four.

29 CHAPTER 2

THE STOCK MARKET IN SHANGHAI

Scattered throughout Shanghai, in storefronts behind uneven sidewalks and lines of

parked bicycles, are hundreds of stock “trading rooms” {zhengquansuo). Averaging somewhere between 500 and 1000 square feet, almost all are constantly filled with patrons and onlookers, most often sitting in rows staring intently at walls lined with signboards on which instantaneous updates of stock prices appear. The mood fluctuates between tense and cheerful, depending on the performance o f the Stock Market on a given day. Older women knit while younger participants gather around computer screens, continually monitoring moment to moment stock trends on charting software.

There is no doubt that the “stock fever” noted by Ellen Hertz in her 1994 and 1998 studies is still operative. Estimates o f the number of people participating in the market in the metropolitan area range from one out of two, to as many as three out of four. Most often, those whom I interviewed during my fieldwork who did not participate had a member of the family that did, or expressed the wish that they had the financial means to do so. Books on technical analysis and other stock selection techniques line the counters of neighborhood street-side booksellers. More upscale bookstores carry numerous

30 selections of volumes published in the United States and Japan. Along with more academic finance textbooks, there are selections by American stock market “heros” such as George

Soros, and particularly Warren BuSett. ‘

The fact that I was fi'om the United States and had experience in the investment field seemed to qualify me as an expert on the Shanghai stock market; I was constantly asked to give specific stock recommendations, and would quite often lose the interest o f my interviewee when none was forthcoming. This single-minded focus reflects what one observer called “a giant dragon let loose on the land”, a wellspring of interest in participating in whatever can be reaped in the development of Chinese “capitalism”.

The following sections look at the general context of the Shanghai stock market, both historically, and currently as it was during my fieldwork in 1998. As was discussed in

Chapter one, context is important in order to situate any study of metaphor. It helps to identify what can be designated as historically “Chinese”, as well as those elements that have perhaps been chosen to be “borrowed” from other traditions. And it should help to give some insight as to what values and perceptions led to these choices.

2.1 HISTORY OF THE SHANGHAI SECURITIES MARKET

The city of Shanghai originally developed primarily because of its location. From its origins as a small fishing village on the coastal plain of the Yangtze River, it grew to serve as a trading center for shipping lines moving goods in and out of China’s central regions. It was this propitious location that first attracted foreign seafarers, who designated it as a highly attractive port for foreign trade. Chinese officials initially resisted

31 the intrusion of these foreigners, but with the conclusion of the Opium War and the signing of the treaty o f Nanjing in 1942, Shanghai was officially designated as a treaty port. It was then opened to foreign trade after the ratification of the treaty in November,

1843.

Thereafter, international settlements began quickly forming for each nationality, dominated by those of the French and the conjoint British/American Concessions.

Separate administrative councils eventually lead to the establishment of a conjoint

Shanghai Municipal Council, which assumed general administrative duties for the city. The city council was initially dominated by British and American members, with the French maintaining separate administration in their own area, and membership forbidden to

Chinese residents. This would change in 1928, however, when Chinese members were allowed election to the council by the Chinese residents o f the city, but limited to 5 of the

14 council memberships. (Lethbridge, 1983:14).

The protection o f the city by a well-staffed municipal police force led many rural

Chinese to seek refuge in the city during and after the Taiping Rebellion o f the 1860's, and immigration continued as Shanghai began developing its reputation as a commercial center. It was seen as a place of opportunity for many poor Chinese, who, through memberships in “secret societies”or other affiliations, had the chance to apply entrepreneurial skills and aspire for social mobility. The reputation o f this “Paris of the

East” in the 1920's and 1930's as a center of glamour, decadence and free-wheeling capitalism is still well known. Contrasting with the more traditional atmosphere of Beijing,

Shanghai became the center o f “modernism” and innovation. This is evidenced by the fact

32 that it was the birthplace o f the Chinese Communist party in 1921, and provided a gathering place for sympathizers, both Chinese and foreign. It was also during this period that Shanghai became a center for the Arts, such as the fledgling movie and music industries (Lethbridge, 1983: x).

An informal, over the counter version of the Shanghai Stock Exchange came into existence in the late 1800's, along with active and thriving bond and commodities markets.

It was, at one point, noted as the largest securities market in the Far East (Xu, 1993: 244).

Along with the rest o f pre-revolution Shanghai, these exchanges reflected the qualities of both Sino and Western influences and were built with direct input fi'om foreign colonialists, an influence that appears notably in the formal discourse o f the stock market publications of the time.^

In an interview with a woman whose grandfather was Chairman of one of the earlier exchanges, she related memories of the stock market from her childhood in

Shanghai during the 1920's and 30's. Trading then was denominated in several currencies, primarily in Mexican dollars (called “mex”), as well as British pounds, U.S. gold and

Chinese taels. The largest stock brokerage firms were owned by colonialists, with names such as Benjamin and Potts; or Swan, Culbertson and Fritz, and were located in the most prestigious locations on the riverfront, also called the Bund. Local trading rooms were filled with both Chinese and foreign investors, watching as updated stock quotes were posted on chalkboards. Social life and business life also revolved heavily around the local horse racetrack (now the People’s Park), and the jockeys had a reputation for being heavy traders in the stock markets. This speculative, free-wheeling atmosphere had a number of

33 negative consequences. In one instance, around 1910 a new bond issue was floated and the issuer shortly thereafter absconded with the proceeds. The resulting crisis of confidence led to a major market crash fi'om which the markets would not recover for several years.

This all changed, however, with the attack on Shanghai and surrounding areas by the Japanese in 1937. Chinese fiom the countryside began pouring into the city for protection, and Western businesses began to leave. The population of Japanese immigrants at this point had grown to comprise the second largest component o f Shanghai s metropolitan population (after the Chinese), and they were successful in expelling Chinese forces from the city, taking over local businesses and municipal operations. Foreign and

Chinese businessmen eventually returned to Shanghai after the Japanese surrender in 1945, but were quickly ousted again with the Communist revolution of 1949.

2 2 THE NEW SHANGHAI STOCK MARKET

In the post-revolution era, securities markets first appeared with the issuance of

Chinese government treasury bonds {guo gu quan) in the 1980's. Carrying terms of 5 and

10 years, they were distributed primarily through mandatory assigned quotas to state and collective enterprises and local governments. This provided a source of funds for the government whose revenues had become dispersed and depleted since the initiation of economic reforms of 1979. However, these bonds carried the stigma of pre-reform governmental planning. With the relatively low interest rates and the lack o f any established secondary market for resale, the bonds were met with a less than enthusiastic

34 response.

The resistence by the public to these mandatory bond purchases, along with the continuing and increasing need for governmental funding, led to the establishment of an organized secondary market for these bonds This in turn led to consideration of creating a market for equity securities. By the late 1980's some state enterprises began experimenting with the issuance of public or external securities, initially with bonds and later common stock. Most of these shares continued to be distributed internally among their own workers, but experiments with transfers of these shares in the budding secondary market

(among external buyers and sellers) after 1986 led to a wider distribution o f shareholders

These initial “over the counter” markets, however, were rife with problems. The limited

“insider” access to the initial shares led to rising incidences of “off the book” deals for those who wished to make secondary or external purchases, leaving a cloud of expectations of usury and greed in the market as the initial buyers and sellers attempted to mou qu, or make exorbitant profits. Countermeasures by the government to control share prices only drove the market further underground.

By the mid I980's a small amount of equity securities had been issued and were being exchanged at several “trading counters” in Shanghai. Modeled on the specialist system similar to that of the New York Stock Exchange, this stock trading was subject to the same vagaries of the larger, but also fledgling debt market. At this time, however, trading in equities remained very much a minor component of these markets, accounting for only one percent of the total trading volume for securities (Ma, 1997).

35 Bringing the Shanghai and Shenzhen stock exchanges into full operation in late

1990 and 1991 marked the beginning of formal securities trading with any real degree of structure and regulation. By the end of 1993, over 10,000 enterprises had issued stock, but only a small proportion o f these were initially approved for secondary or external trading on the two formal exchanges Established by The Beijing Securities Exchange

Executive Council, which was primarily a team of returned “overseas” Chinese financial experts, trading was initially automated for the much larger bond market through a nationwide computer trading system called STAQ, an acronym for Securities Trading

Automated Quotation System (Xu, 1993: 245). Aware of China’s high rate of savings

(approaching 16% of gross annual per capita income it is one of the highest in the world), and recognizing the untapped potential in using these “hidden” or “idle” assets, government administrators accelerated the process of issuing publicly traded equity shares as a source of capital for state owned enterprises. Directives were issued that all trading must take place only on the formal exchanges, and by the end of 1991 there were 39 entities listing equities on the Shanghai Stock Exchange (hereafter referred to as the SSE).

The standardization of these markets was aided by the introduction of a computerized automated quotation system similar to that established for the bond market, which allowed for linkages between geographically dispersed participants.

After the debates of the 1980's as to whether the market reforms were a temporary or permanent experiment, and how best to maintain “socialist” characteristics in the economic marketplace (and especially after the political upheaval of 1989) , Deng Xiao

Ping’s southern tour in 1992 was significant in establishing faith in the government’s

36 commitment to economic reforms. The continuity of the shareholder system during this period was further supported by the establishment of several administrative regulatory committees to oversee securities market development The primary responsibility of these committees were to study and enact regulations and policies for the fledgling stock markets. These regulatory recommendations were still being debated during my fieldwork in 1998, however. The issues that had been tabled included such important regulatory functions as issuance of new shares, stock market manipulation, corporate disclosure of information, the banning of trading in securities by securities brokerages, and banning banks from providing capital to securities companies for this purpose (China Daily,

11/7/98).

Renewed optimism and faith in the government’s commitment to the stock exchanges led to the “feeding frenzy” or the “stock fever” noted by Ellen Hertz (1994) during her fieldwork 1992. Much of the black market activity had been eliminated with new government regulations and the initiation of the automated computerized trading in

1991 and 1992, leading to a surge of activity on the established exchanges. A serious discrepancy in supply and demand developed as investors wishing to buy into the new market were hampered by a dearth of new issues; only 22 entities conducted initial public offerings during 1992, bringing the total number of listed companies to only 30 with a correspondingly insufiBcient number of shares issued (floated). In order to stem the rapid appreciation of market values caused by these new and enthusiastic buyers chasing too few shares, daily price limits were imposed at 5 percent, then 1 percent, then 0.5 percent, in which trading of shares was halted at daily price increases or decreases at the designated

37 levels. Despite these price limit restrictions, the market index rose from 128 in early 1991 to 1400 in May o f 1992 when the price limits were lifted. This subsequent elimination of price controls had the additional impact of making the new issue market much more attractive. Investors, aware of the potential for unfettered, immediate and substantial profits in initial public offerings lined up for ‘long hours, sometimes days, in line outside brokerage offices to place their orders” (Hertz, 1994: 60). These new issues, almost always oversubscribed, were subject to a lottery system, which had the following consequences described by Zhu Huayou:

On June 21, 1992, when four companies in Xiamen issued stock underwriting forms, 600,00-700,000 people queued up all the night for panic purchasing. On August 10, 1992, when underwriting forms for shares to be issued by seven companies were distributed in Shenzhen, over one million people queued up for dozens of hours in rain. When they got word that many of the forms were being held back, they went on strike. Some people went to the countryside to buy other people’s ID cards (because ID cards were needed to buy the forms) and hired rural laborers to stand in the queue to buy forms on their behalf. Some security business insiders, abusing their power, withheld large numbers of underwriting forms and then either sold them at higher prices or waited until the lottery was held and sold the winning forms at astounding prices; still others bought shares first and then sold them at a huge profit (Zhu, 1996: 73-4)

In 1993, the People’s Bank of China developed procedures to pre-qualify investors, hoping to eliminate some of the chaos that the warrant lottery system had produced. Investors now had to show that they were carrying a minimum balance in a savings account at the bank in order to qualify for purchase o f equity warrants With these new procedures and with the volume of new issues, over time these warrant “frenzies” slowly dissipated.

38 What followed were continued attempts by government policy makers to counter the destabilizing effects o f Market volatibty Cycles o f government intervention ensued, in which, for instance, securities dealers were requested to sell large quantities of shares to bring the Market to more “reasonable” levels, and the issuance o f new shares was periodically halted In order to tap foreign capital sources, a “B” share market was also established in both Shenzhen and Shanghai in which shares were available only to non-

Chinese citizens. Fear o f losing control o f the market to foreigners and a subsequent outflow of capital, however, prompted the government to allow only a small percentage of new issues (25% in 1992) to be designated for this purpose (Xu, 1993: 244). The

Shanghai and Shenzhen exchanges are both responsible for clearing trades in both A (for domestic purchase o f shares, denominated in Renminbi) and B (for foreign purchase, denominated in foreign currencies) shares, as well as the much larger volume o f Treasury

Bonds (issued by the Ministry o f Finance), Government Revenue Bonds (issued by the

Central Planning Commission), Financial Bonds (issued by the People’s Bank of China) and corporate bonds issued by individual companies (Xu, 1993: 247). Securities listings are distinct to each location as neither exchange lists shares included on the other. In addition to these two exchanges which have already been established, several other major cities, such as Guangzhou, Xiamen, Shenyang and Wuhan have expressed their interest in opening exchanges, but as o f this writing this had not occurred.

A gradual decline in share prices followed through the middle o f 1993, probably exacerbated by the selling pressure of those wishing to take profits from their initial purchases of new issues soon after these shares first become available. Increasing liquidity

39 (number of shares available for purchase) on both exchanges did not lead to any significant

decrease in volatility in the markets between 1994 and 1997. Volatility could still be

considered extremely high to this day, even for a developing market. The effects of an

increasing number of shares outstanding for purchase (which should, theoretically,

decrease volatility) has been offset by other factors, such as inconsistencies in government

policy. In 1994, for instance, the government simply shut down the commodities futures

markets because of “excess” volatility (Huan, 1995:61), which undoubtedly had a

psychological impact on traders in other types o f securities. The same year regulators also

severely restricted the number of new stock issues, blaming a glut of issues earlier in the year for a Stock Market slump. On the other hand, announcements such as that in 1997 o f the intention to transform 1000 state enterprises into fully autonomous corporations, and to encourage smaller entities to merge and form larger corporations probably enhanced investor confidence. That volatility is a continuing concern is indicated by the fact that

measures were also introduced in 1997 to prohibit banks fi"om engaging in, or lending money for the purpose of speculating in the stock markets (The Economist Intelligence

Unit, 1998; 39). These types of government actions undoubtedly have an impact on investors in the equity markets.

40 This high degree of volatility is exhibited in the following tables;

SSE COMPOSITE INDEX (SSEI)

Year Open High Low Close (Mow) (Kai Pan) {Zui G ao) {Zui Di) {Shott Pan) 1991 128.84 292.75 104.96 292.75 1992 293.75 1429.01 292.76 780.39 1993 829.16 1536.82 778.33 833.80 1994 837.30 1052.94 325.89 647.87 1995 637.72 926.41 524.43 555.29 1996 550.26 1258.69 512.83 917.02 1997 914.06 1510.18 870.18 1194.10 1998 1200.95 1422.95 1043.02 1146.70 Table 2.1 Note; Source is SSE statistics. The SSE composite index (SSEI) is a weighted average market capitalization index with a base date o f December 19, 1990 and a base value of 100

S S E CMnfMl* A nnuü Claifeig Plica 1400

1200

1000

80 0

600

400

2 0 0

1990 1891 1992 1993 1894 1886 1896 1897 1998

Fig 2.1

41 TURNOVER RATIO BASED ON STOCK VALUE (100 million RMB)

Year Market Capitalization Total Average Daily Daily (Year End) Turnover Annual Average Average Turnover Turnover Turnover Ratio Ratio 1991 29.43 45.72 155.4% 0.18 0.61% 1992 558.40 323.84 58% 1.27 0.23% 1993 2206.20 2608.89 118.3% 10.07 0.46% 1994 2600.13 25482.40 980% 101.12 3.89% 1995 2525.66 55153.84 2183.7% 219.74 8.70% 1996 5477.81 27661.45 505% 111.99 2.04% 1997 9218.07 29843.54 323.7% 122.81 1.33% 1998 10625.91 12386.11 116.6% 50.35 0.41% Table 2.2

Note: Source for 1991-1997 is SSE statistics Source for 1998 is the China Securities Regulatory Commission

42 TURNOVER RATIO BASED ON NUMBER OF SHARES

(100 million shares) Year Companies Total Annual Annual Daily Avg Daily Listing A Shares Number of Turnover Number of Turnover Shares Floated Shares Ratio Shares Ratio Traded Traded 1991 8 N/A N/AN/A 0.0002 N/A 1992 30 N/A 18.83 N/A 0.07 N/A 1993 101 27.15 146.95 541% 0.60 2.21% 1994 169 76.81 656.76 855% 3.02 3.93% 1995 184 129.86 513.99 396% 2.04 1.57% 1996 287 256.43 1102.33 430% 4.46 1.74% 1997 372 372.57 1215.68 326% 5.00 1.34% 1998 N/A 379.73 1127.95 297% 4.59 1.21% Table 2.3

Note; 1991-1997 Source for Annual figures is Shanghai Securities Yearbook, source for Daily figures and number of listed companies is the SSE Source for all figures for 1998 is the China Securities Regulatory Commission.

43 The Turnover Ratio based on Value (defined as Total Value of Shares Traded divided by the Total Market Value or Market Capitalization) indicates how much and how often money is changing hands. Likewise, the Turnover Ratio calculated in terms of equity shares (Total Shares Traded/Total Shares Floated or available for purchase) both indicate that the existing shares are being traded at an extraordinary rate, sometimes as much as eight times per share in a single year. This contrasts with the Turnover ratios in the United

States which rarely exceed 100%.^ The performance of the Shanghai Securities Exchange

Index (SSEI) also reflects historical market sentiment, as was discussed quite frequently in my interviews in Shanghai. Most investors told me that for the first several years after formal trading was initiated, it was very easy for everyone to make money. Most felt that the government would do whatever was necessary to make the fledgling stock market perform well, to gain "face" (ycm mianzi) for it’s economic reform policies. At the time, with the much lower levels of market capitalization, this feat was much more easily accomplished. As more stocks were foimeled through the bureaucratic approval process however, the size and value of the market increased and many small investors had a rude awakening. Many people left the market in 1994 and 1995 as prices slumped, and many investors did not recover. The government initiated several strategies in mid 1994 to counteract the slump, including a temporary freeze on new issues, but the market did not really regain its upward strength until middle and late 1996. The market also exhibited a great deal of volatility with rumors and then a formal announcement of Deng Xiao Ping’s death in February, 1997. It is interesting to note that the market index spiked sharply upward shortly thereafter, closely approaching a new all time high in the next several

44 months. However, the reinstatement o f 10% price limits on daily movements for stocks in

December of 1996 may have also been a factor, as price limits are sometimes thought to increase market volatility rather than their intended effect.

This historic volatility has also most likely been exacerbated by the prevalence of individual investors and lack o f large institutional investors. In more mature markets, larger institutional investors tend to have a stabilizing effect on volatility by making longer term investments. Several Mutual Funds have been established by Chinese companies, but, hampered by the inconvertibility o f the Renminbi/Yuan, these have been primarily active in the B share market This and the lack of Insurance or Pension funds for investment has tended to limit the number of intermediaries that would be available to offset the effect of those who want to “stirfiy” (chao gi/), or engage in short-term trading.

It is interesting to note that this “short term" mentality is also evidenced by those employees holding internal shares iguojiagu). As Jun Ma (1997) notes:

Employees are reluctant to make long-term investments in the enterprise because, in the absence o f adequate legal protection of private property rights and possible hostility directed against them in a future political campaign, they worry about possible appropriation of their assets. Many employees are eager to make short­ term profits fi'om black market trading of their shares. As a response, the state recently regulated that employees’ shares are not allowed to trade in the market within one year after purchase (Ma, 1997)

It is quite likely that this “short term” mentality is produced by some o f the same factors in public investors as well. The lack of legal protection for property rights, little recourse for shareholders who wish to hold companies accountable for incorrect or even fi*audulent financial disclosure, and the possibility of changes in government policies regarding the stock market all most likely have been factors in xiaohu (small investor) mentality.

45 2.3 CURRENT CONTEXT

The stock market in Shanghai is no longer an experiment. The government has repeatedly reiterated its support for the shareholder system as the backbone of economic reforms and has made substantial capital investments to reinforce this point. One of these investments, the new modem headquarters of the SSE is a prime example. As of the end of 1997, the SSE had moved its operations to a new modem building in the Pudong

Special Development zone o f Shanghai/ The development of facilities in Pudong, including a new intemational airport, are directed toward the establishment of this district as the “dragon head” o f China’s new economic future. And the shiny new facilities for the administration of the securities industry perhaps epitomize this commitment.

Because of the lack of administrative oversight and other structural constraints, the

Chinese equities market is still quite one-dimensional. As of 1998 there were no derivative securities, stock futures, options or short selling allowed. Improvements in oversight are occurring, however, such as that of the transfer of administrative authority over the market from the People’s Bank of China to the newly formed China Securities Regulatory

Commission in July 1998 (China Daily, 7/21/98). Oversight activity is now also conducted by the newly formed Securities Association of China, a self-policing organization of securities brokers. According to SSE reports, there were 467 members (primarily brokers) of the Shanghai Exchange by the end of 1997,43 of which were local and 424 non-local. The majority o f the companies listed on the two exchanges are local, ostensibly because local officials benefit financially fi'om listing these, rather than the larger national companies. The data tends to confirm this observation, in that there are more than 100

46 Shanghai companies listed on the SSE, while no other region or city (including Beijing) lists more than approximately 20. The requirements for listing on the exchange may also be a factor. Companies must first meet the requirements for issuing A shares, and, if desired, must meet stricter requirements for issuing B shares to the foreign market. These

A share requirements are that a company show a specified, usually three year period of profitability, and have a specified amount of capital and net assets on their balance sheets.

Listing of companies is also predicated on government policy as to what is strategically important for the economy. Companies are therefore chosen by sector, industry, or geographical location in such as way as to provide capital flows to the various regions of the country, or to support industries which are felt to be important for national economic development. The types of companies listed on both exchanges are also somewhat influenced by geographical location; while Shanghai lists primarily domestic companies,

Shenzhen, perhaps because of its close proximity and influence from Hong Kong, lists many joint ventures that are at least partly foreign owned

Because the Chinese Renminbi/Yuan is not currently convertible, B share issues require an additional assurance by the company that they have the capability to acquire enough foreign exchange to pay dividends. If a company can sell a sufficient amount o f B shares, they can qualify to be considered foreign joint ventures, a designation which allows certain advantages in terms of exemption fi'om governmental intervention. These requirements allow for only a small portion of state owned enterprises to be listed, currently estimated at only 5-10%. As of the end o f 1997, only 39 of the 383 companies listed on the SSE were issuing both A and B shares, with 12 companies dual listed in

47 Shanghai and Hong Kong, and a very few listing ADR’s (American Depository Receipts)

on the New York Stock Exchange. As previously mentioned, the few mutual funds which

do exist are primarily foreign invested in B shares, contributing to the almost total absence of correlation between movement in the A and B share markets

Both foreign and Chinese investors can also buy equities in domestic companies listed in Hong Kong, called H or “red chip” shares. These companies are held to stricter intemational standards of accounting, and pay dividends in foreign currency. Since the return of Hong Kong to the Chinese in 1997, the Hong Kong equity markets have remained largely independent o f the two domestically instituted markets, although many are suspicious that Hong Kong will also become subject to the same vagaries and oversight inadequacies as the other two Chinese markets.

Even though the B share market is currently open to both foreign and domestic investors, it is the A share market that by far commands the largest share of trading activity. As of late 1997 the B share market accounted for only 2% of total market capitalization between the two markets. The number of listed companies in the A share market had also increased to 383, and the rate of new share issuance is illustrated by the fact that by mid 1998, this number had increased to 456, an annualized average increase of roughly 40%. According to SSE statistics, by the end of 1997 there were more than 17 million registered investors, the vast majority o f which are individuals. Institutional investors such as insurance companies or mutual funds account for less than one half of one percent of total investors. The significant size of the A share market (over 900 billion yuan as of late 1997) is illustrated by the fact that its market capitalization is the equivalent

48 of approximately 23% of China’s Gross Domestic Product, based on World Bank (1997) statistics.

The vast majority of listed companies are classified as industrial, most likely reflecting the continued presence of state owned and collective enterprises The government has continually stated its intention to convert most of China’s more than

300,000 state companies into shareholder owned corporations, but quojiagii (government and internal shares) and farengtt (legal entity shares held by banks and other government related agencies) still constitute more than SO percent of the ownership structure of most listed companies. Very few listed companies have seen this percentage fall below that level. The intent of the privatization process is to develop large, privately held industry specific conglomerates similar to those of Japan and Korea, but it appears that it will be years, or even decades before this can be accomplished.

In recent years, new issues of stock have been received with decreasing degrees of enthusiasm, with only those issues in “hot” industries such as technology receiving any widespread attention. Competitive bidding by potential underwriters is still non-existent;

IPO’s (initial public offerings) are structured by a sole seller on behalf of the issuer. A new issue price is worked out between the two parties based on what they determine to be the appropriate nominal value for the stock based on projected earnings and a reasonable price to earnings ratio. The shares are then placed in the “public issuance network ”, within the structure of the existing computerized trading network Investors bid on the number of shares desired; oversubscribed issues revert to a lottery system, and it falls on the shoulders of the underwriter to take up the slack when the issuance is under subscribed (in

49 other words, there are more shares than buyers).

The government also finds it necessary to give some existing shares a “special treatment” (ST) designation, in order to alert investors as to the “uncertain prospects of these firms” (China Daily, 9/12/98). This dubious distinction is given to companies that have exhibited limited prospects for positive earnings reports. Any company with verified losses for more than three years in a row is subject to suspension of trading. As o f October

1998, there were 26 designated “special treatment” companies listed on the Shanghai exchange, most of which were actively traded.

Most companies are now holding annual shareholding meetings which are well attended, and in which company policy is often quite boisterously and vigorously debated.

Some companies have also begun issuance of interim earnings reports at three or six month intervals. Most of these reports, however, offer Uttle in terms of comprehensive descriptions of company strategy or prospects. Usually the public information which is available consists of abbreviated earnings reports for the preceding time period, published in investment related newspapers and periodicals. Companies are now primarily adhering to intemational accounting standards, and using widely recognized intemational accounting firms to produce audited statements. Disclosure has improved, but many investors remember incidents such as that which occurred in 1993, in which the Qing Dao

Brewing Company used a large amount of capital raised in a new issue to make loans to other unidentified Chinese companies, rather than using the funds for expansion as promised in the prospectus (also called the offering information circular). This type of activity was still occurring in 1998. In November, the South China Morning Post reported

50 that Chengdu Hong Guang Industrial Company had illegally reported profits when it had actually incurred losses prior to an initial public stock offering In this case, it was reported that the money was used for stock market speculation, paying off the losses of the company and deposited in offshore accounts (South China Morning Post, 11/12/98)

Consolidation in the securities industry is also evident, as a number of investment brokerage firms have merged in the past few years. All o f the initial brokerage firms, which came into existence in the middle 1980's, have either merged or gone out of business. More often than not, however, this is because o f illegal practices rather than an inability to compete. During 1998, two of the larger firms, Guotai Securities and J&A

(Junan) Securities announced a merger to become the largest securities firm in China. This was not a purely business decision, however. Word on the street long before the official announcement had it that these two companies, controlled by the military, had been engaging in illegal speculative activity for years. ^ Local officials, powerless to make any arrests, had required the intervention of Vice Premier Zhu Rongji (prior governor of the

Peoples Bank of China) to force the reorganization of the companies and punishment of the parties involved.^

Until this point, Shenyin Wanguo Securities (also the merger of two companies under similar circumstances) had been the largest brokerage in China, with registered capital of 1.36 billion yuan and more than 100 trading locations (zhengqticmsito) throughout Shanghai. The function o f these investment firms is not only to facilitate the clearance of trades, but also to provide research to investors. The typical structure of these company research departments is tripartite, and includes those analysts which deal

51 directly with small investors, those which work with companies which trade in securities,

and those which work directly with listed companies. Of these three divisions, the analysts

working with small investors are by far the minority, primarily providing taped phone

recordings and articles in local investment newspapers. Almost all of the securities firms now also provide fairly comprehensive information about the Shanghai securities markets on Internet web sites. ^

There are still no short term or long term capital gains taxes in existence, although investors do pay a “stamp tax” of 0.4 percent (lowered fi'om 0.5 percent in 1998). Round lots (minimum number o f shares which can be purchased) are 100 shares or multiples thereof. An average price for most securities of between 10 and 20 yuan (approximately

$1-2) per share makes securities purchases fairly accessible for many Shanghainese, and trading rooms are known as a places for the “waiting for work” (cktiye) to spend their time.* Availability o f fimds is also facilitated by the existence in China, of one of the world’s highest per capita savings rates (Xia, Hailin and Grub, 1992; 125), and a fairly substantial increase in average household income o f 6.7% annually since 1978 (Huan,

1995: 61 ).^ Margin regulations also exist for those who wish to borrow against the value of their securities to fund new purchases. Rumor has it however, that for those with connections in securities firms, these regulations are often ignored and accounts are simply illegally overdrawn (touzhi) in order to buy stock.

The prevalence of short term trading behavior in the Shanghai market is well known. Current dividend income from stocks averages below 1% of 1998 market values, providing little incentive to hold stocks on that basis. Volatility indicators show that the

52 market continues to be extremely volatile. These figures are high even when compared to other emerging markets, except perhaps Taiwan. This volatility is in part due to the same factors which Sam Chang observes in the Taiwan Market, including lack of liquidity (too many buyers wanting to buy too few shares), the predominance of individual investors, and lack of a capital gains tax (Chang, 1993: 104). The government in China is doing its best to discourage this “excessive speculation”. Price limits of 5% have again been instituted, to provide a “cooling down” period for buyers and sellers. Newspapers and periodicals call for more “rational” behavior and self-discipline. There is a story which has been widely disseminated in the media of an old woman in the United States who received

Coca-Cola stock when she was a young girl, held on to it, and is now rich. But, as 1 heard more than once fi’om Chinese participants, '^^Meiguoren shi touzizheren, Zhongguoren shi toujiren” (Americans are investors, Chinese are speculators).

2 4 THE INVESTORS: XIAOHU, ZHONGHU AND DAHU

Local stock rooms {zhengquansno) are very much neighborhood gathering places.

Almost all who meet there are acquainted with each other, and know the details of each others lives, as well as how each other are doing in the Market. Conversation during

Market hours revolves almost exclusively around technical indicators on computer screens, what individual stocks are doing that day, or the impact of national and intemational events on the Market. At the time of my research, most investors were concerned with the flooding in central China, the Asian financial crisis, and whether or not the government would devalue the Renminbi. American president Bill Clinton’s visit in

53 June of 1998 also received a great deal of attention, as some thought that the government

might intervene in the Market at that time and provide a profit making opportunity for

investors.

Other than this one period in time, there seemed to be little focus on government

policy as a factor in Market performance.*" Indeed, over the years since Ellen Hertz’s

previous research in 1992, trust in government policy (zhengfn zhengce) seems to have

been somewhat restored ** When asked, most investors stated that their primary method of

market analysis was either following their intuition iganjue) or technical analysis (jistni fenxi). For those wishing to supplement their ganjue there is some information available

for fundamental analysis (jiben fenxi), including speculation about companies earning

potential in magazines, newspapers, and telephone recordings. However, the accuracy of

disclosure by companies, as previously noted, probably tilts this type of analysis more

towards guessing {caixiang) than in many other, more mature stock markets. Most feel

that the market is still hen mimi, or very secret.

The most widely used “method” of stock selection was technical analysis (Jishu fenxi). For those without access to computers in the local trading rooms, numerous books,

magazines and newspapers are available which provide technical indicators of individual

stocks, and of the market as a whole. Technical analysis completely ignores factors

important in fundamental analysis, such as the financial strength of the company or the

prospects of the industry. Instead, it focuses entirely on the supply and demand for a

stock, looking for trends and reversals of these trend patterns in various types of charts.

As such, it incorporates elements of market sentiment and mass psychology most often

54 ignored in fundamental types o f analysis, in that “technicians view the expectations of

cycles as being part of human nature, and they realize that expectations determine the

supply and demand for securities” (Bauer and Dahlquist, 1999: 10).

Technical analysis is widely discounted by American academics, who, influenced

by Efficient Market Theory (that the price of a stock will reflect it’s underlying intrinsic

value in the long run), and Random Walk Theory (future price movements caimot be

predicted by past actions), quite often place this type of analysis in the realm of the

“unscientific” or even equate it with pseudo-sciences, such as astrology However, this

type of analysis is widely popular with stock market practitioners in the U.S. and other

markets. Bauer and Dahlquist (1999:9) report that, in a Bank of England survey of

Foreign Exchange Dealers in 1988, “at least 90% of respondents placed some weight on technical analysis when making forecasts, and technical analysis was particularly popular

when short investment horizons were considered”. Most major brokerage firms in the U.S. have a Chief Technical Analyst, who have developed their own styles and their own following of investors. And there are numerous independent newsletters published specifically for Market technicians.

Chinese investors are using techniques developed in the United States as well as technical charting techniques which originated in Japan and not widely known in the U.S.

These techniques, called “Candlestick Charting” were developed several centuries ago in

Japan to attempt to predict price movements in the rice market (Nison, 1991; 13). These types of charts are drawn in a similar fashion to bar charts, using daily open, high, low and close prices for a given stock, and are named for the fact that the results resemble

55 candlesticks:

Caodiesttck Chart 50 — 4 5 — 40 35 — » 30 — «Ë 26 - 20 - IS I 10 i

1 i______L_ 2 3 4 5 Time Period

Figure 2.2

Source: Nison (1991: 23)

The body of the bars reflect the difference between the daily open and close prices. The lines extending fi'om the bodies reflect price extremes in daily trading, and therefore, the daily highs and lows. If the body is black, it indicates that the closing price was lower than the opening price, if not, the reverse is the case. What the Japanese call an insen (yin line), or black candlestick, is called ayinxian (also yin line) by the Chinese. Conversely, white

(empty) candlesticks are called a yosen by the Japanese, andyangxian (yang line) by the

Chinese.

The primary focus is the daily opening and closing prices, as this is most often when the largest amount of trading activity occurs.'^ Inter and intra-day patterns are studied to attempt to predict trend reversals (an indication to buy or sell), particularly when these patterns are reinforced by indicators such as a “morning star” (bullish) or “evening star”

(bearish) compositions (Nison, 1991:56). Other Japanese terms for these types of patterns

56 include the “three mountains, the three rivers, the three Buddha tops, inverted three

Buddha, dumpling tops, fiy pan bottoms, and tower tops and bottoms” (Nison, 1991 ;

105). In addition to these and numerous other technical and numerical indicators, computer reports include company earnings and descriptions, recent news (gonggao xhvci) and special reports (tebie baodad) issued by the Shanghai Stock Exchange and other sources.

What follows is an abbreviated list of technical indicators and indexes available on software in Shanghai, and widely used for analysis of the entire market {dapan fettxi) as well as individual stocks

Shang zheng 30 zhishu chart of market index performance for 30 days

Zhangdie amount that stock or market rose/fell in a given day

Chengjiao zonge total volume of shares traded

Chengjiao shoushu number of round lots traded (100 shares)

Xianshou current volume

Zhangjiasshu advancers, number of stocks increasing in price

Ping pcm jiashu number of stocks whose price remained unchanged

Xiadie Jiashu deciiners, stocks that decreased in price

Wai pan outstanding bids to buy (a stock)

Nei pan outstanding bids to sell (a stock)

MACD moving average convergence/divergence, a comparison between

moving averages over two different periods. The moving average

for the longer time period is subtracted from that of the shorter time

57 period, producing a line that oscillates around a mean o f zero

Above zero indicates that the more recent, shorter term moving

average exceeds the longer term, and vice versa (the definition of

moving average follows below).

Fenshi ztwshi tu short term trend graph

Mai mai lidao buy/sell strength, technical indicator of supply and demand

Baojia fettxi offer price analysis, price information on individual stocks

Yidong pingjtm shu (ri pingjuti) moving average, calculated by averaging

stock prices over a recent time period,

successively adding new numbers and

dropping the first numbers in the series as

time progresses. These are provided in

increments of 5, 10, 30 and 60 minutes, 5, 20

and 30 days.

RSI {qiangruo zhibiao) relative strength index, calculated by comparing

price movements of a stock with other stocks in the

same industry (fenleigu or bankuaigtt).

KDJ (chao mai chao mai) ratio o f buyers to sellers expressed in the form o f a

line graph, a technical indicator of buy or sell

volume over a period o f time.

Zoushi momentum, or price velocity, indicating that a stock

price is increasing or decreasing at an increasing or

58 decreasing rate (accelerating or decelerating). It is

calculated by comparisons with price levels in

previous periods. If price levels close incrementally

higher at an increasing rate in each successive

comparison period, the momentum is said to be

accelerating in an upward trend.

Moving Averages are used most commonly, and most often in conjunction with other indicators (including Candlestick Charting). For instance, a price movement from below to above the moving average would indicate a “breakout” (Jupo) or a buy signal

The slope of the moving average line is also an indicator; if it levels off and declines it may be a bearish indicator. Most of these techniques are highly subjective, however, despite the

“scientific” sounding terminology. All buy and sell signals require a certain amount of interpretation as to what is a sufficiently strong indicator. For instance, interpretations vary as to the length of time or the degree of price movement necessary to provide a clear

“signal”. In this way, technical analysis incorporates components o f mass psychology and what psychologists call “cognitive dissonance”. As Nison notes (1991; 10), trends exist because, for instance, a trader with a long position (holding stock) will tend to “glean all the fundamentally bullish news he can in order to buoy his hope that the market will turn in his direction...People remember prices from one day to the next and act accordingly...peoples’ reactions indeed affect price, but price also affects peoples’ reactions”. In other words, once a purchase or a sale decision is made, people tend to

59 ignore information that does not support their position, and overweight information that does. And many people find it irresistible to “jump on the wagon” and participate in a sustained upward trend.

The short term orientation of these trading techniques as they are used in China is indicated by the time increments used to calculate these averages; some are calculated in minutes, with the largest being 30 days. Investors in Shanghai gather intently in groups around computers, discussing the technical indicators o f various stocks, flipping quickly back and forth between the various screens and graphs. And for those investors that are unable to access technical information on computer, small, portable pager size units ignpiaoji) are available with much o f the same real-time information.

With this large amount of information available electronically, some investors

(particularly ckdm, or larger investors) have begun placing buy and sell orders fi'om home via telephone. Stockbrokers (jingjiren) are now available to answer questions, provide daily research information and advice to a limited few. For those without the means or the inclination to use electronic sources, numerous publications are available with comprehensive data. The two most widely read sources are the Shanghai Securities News

(Shanghai Zhengquan Bad) and the Securities Market Weekly (Zhengquan Shichang

Zhoukan)}* The Securities News, available daily except Sunday on most newsstands, is a newspaper format which covers local business news, general economic news, and all of the securities markets, including the commodities and futures markets Securities Market

Weekly is a glossy magazine format, and more specific to the stock market. The information included is primarily that used for technical analysis, such as those indicators

60 listed above. It also includes brief news and commentary about specific companies, as well as corporate financial information such as annual income {shouyi), earnings per share

{meigu shouyi), shares issued (zongbuben), total A shares floated (Jiutong A gtt), total capitalization (zongzichan), the debt ratio (fuqian bilu), and the price to earnings ratio

(shiyinglu). As with most company reporting, comprehensive descriptions of company prospects and detailed financial reporting are limited

The procedure for opening an account and investing in the stock market is fairly simple. First, the investor must make a minimum deposit in a Bank of China branch into an account in the name of the brokerage firm. He/she then returns to a local trading room with the receipt and is issued a plastic card with a magnetic strip after filling out a form with all of the relevant personal information. The card is then presented at the counter whenever a buy or sell order is placed. Orders are entered into a computer connected to the exchange, and the investor pays 4 percent of the total value as a service fee. All of the stocks have six or seven digit code numbers rather than the 3, 4, or 5 letter stock symbols that are used in the United States for writing trading tickets. Settlement is in two days, and the investor may take possession o f the stock certificate, but rarely does.

In addition to the local neighborhood trading rooms, investors, primarily xiaohu or small investors, also gather at numerous investment seminars and meetings.'^ I was able to attend a number of these types o f meetings, one o f which was held on a weekly basis at a restaurant/bar called Sai D uo Ke Ba, a transliteration of “Stock Bar”. The walls of the

Stock Bar are painted with dollar and yuan signs, red arrows pointing upward on a background of painted sky, and with several framed portraits o f Warren Buffett and John

61 D. Rockefeller. Each week, 50-100 xiaohu (also called sanhu, or dispersed investors) would gather to drink tea, share snacks and listen to various speakers on the subject of the

Stock Market. These speakers, always called by the title Laoshi (teacher) were generally divided into two categories; those who were guping laoshi, or those who were considered to be knowledgable about the Market, and those who were caixiang (just guessing). Some spoke in Putonghua or Mandarin Chinese, others preferred Shanghainese, the local dialect. Most popular were those who had “secret” or inside information {zhiqingzhe).

After some presentations, speakers would take questions from the audience addressing individual stocks, but most presentations dealt in generalities about the Market. Of the more than 25 presentations that I was able to tape, most could be divided into three subject categories:

1) Discussions of general economic trends, such as whether or not the government will devalue the Renminbi, or the impact the Asian financial crisis would have on the

Shanghai market. These speakers were most often Professors from local universities or licensed Investment Analysts from brokerage firms (jingji fenxijid). A summary translation of several representative presentations of this type are as follows:

In order to “stirfry” stocks {chao gu), other than technical analysis and

news, one must also pay attention to the macro-economic situation. The

macro-economic situation has two very important factors: 1) The State

Council yesterday announced it will discontinue conducting annual

property inspections {caiwu da jiancha)}^ This would be a benefit to

companies, in that they could decide their own financial policy. 2) China’s

62 leaders recognize that stable stock market development is important, and,

in light of the Asian financial crisis, the exchange rate for the

Renminbi/Yuan will be maintained

• Short term, pay attention to stocks issued by local companies in Shanghai,

since Shanghai is the base for the development of industry and commerce

for the whole country

• The most recent market news fi'om Hong Kong is good. Macro economic

strength, finance policy, as well as the national financial situation will all

have positive effects on the China stock market

2) Analyses of technical trends, both for the market and for sectors of the market

Recommendations are made to buy and sell in various sectors or individual stocks at certain “hot points” (re dian), and stock information telephone recordings (which charge by the minute) or a speaker’s book are often touted These experts were called gushi jishu fenxijia (stock market technical analysis experts). Several representative summaries follow:

To “stirfiy” stocks {chao gu) pay attention to technical analysis. Especially

pay attention to daily trends.

• The 11 month market (line) cannot breakthrough. The two major points are

the first week and 13 days (ago). The high point, was perhaps 21 days

(ago). From the monthly trend line we see the breakthrough is false, the

downward breakthrough is real.

63 • The 10 month momentum indicator shows the market is in a downward

adjustment. Long term looks good, the short terms looks weak.

• High technology are the lead sheep” stocks {lingtonycmg). Don’t be afraid

that the price is high, the key point is the trend is down a bit.

• Presently, the stock market situation is not good, it is a “drowsy dragon”

Last week the trading volume was too low, and as a result, the market

went down. According to common practice, next week will also continue a

little down, I have this feeling.

3) Those who professed to having information on how and when unnamed dahu were planning to manipulate (caozuo) the market. These speakers were by far the most popular. Usually recommendations were made to buy stocks at specific levels or on specific days, or to watch overall market and sector levels if several dahu were involved.

For obvious reasons, several of these speakers requested that I turn off my tape recorder while they were speaking. A summary of one representative presentation of this type is as follows:

• The speaker claimed to have inside information about what the big

investors would do in the near future.

• He had been told that the large investors would depress the market for

three trading days, and to focus on buying in the commercial sector during

those days.

64 However, since most small investors are investing short term, he

recommended selling into the market as it was going down, and then to buy

when prices were low enough.

He further states that to be a good investor, one should do the opposite of

what the newspapers say. Since big investors control the market and

release information to help themselves, small investors should listen closely

to the information and do the opposite.

Trading volume has been increasing dramatically in recent days and

investors should pay attention to that.

The small investor should primarily pay attention to price and trading volume, it is not necessary to know much about the company.

Liquidity in the market overall will become a problem in the future, as allocating shares to domestic investors is becoming more difficult. More shares will have to be allocated to foreign investors

Recommendations for buy and sell levels of individual stocks were given.

The four most important factors in a short term investment strategy are: 1) the overall economic situation, 2) following inside information about big investors, 3) technical analysis, and 4) the amount o f capital the individual investor has to commit.

Medium term investors should hold their positions for at least one month, and a ten percent profit is reasonable.

65 • Investing in stocks is like being in a battle in a war, the small investor has

to be willing to move quickly from unpromising stocks to good ones.

• One company, Nantong Jichang has had adjustments made by the

government concerning its management policies. Now the “patient” has

had an operation and is in good condition. More specific recommendations

are included in a newly published book (authored by the speaker).

One individual who described himself as a ckihtt (not a speaker at the Stock Bar) indicated his personal strategy for making money in the market. Using a relatively large amount of capital, he was able to gain the trust of small investors by urging them to buy particular stocks several times in a row (he didn’t say how this information was disseminated). He would use his own fimds to drive the stock up so that the xiaohu would make money. At an opportune moment, afrer he had gained the trust of his xiaohu cohorts, he would sell into the buying pressure, relieving himself of most of his shares, and the smaller investors of most or all of their previous profits. Other manipulation strategies, such as that described by Chang (1993) as occurring in the Taiwan Stock Market almost surely occur in China as well.

Small float plus this 7% (daily) price limit then enable manipulators to bid up an individual stock to its daily ceiling quickly. At the closing seconds o f the trading session, such players often load the market with large bid orders to reinforce the illusion that many bids for the stock are unfulfilled. Unsophisticated investors, following tips and rumors, then chase after such shares, often unsuccessfully for several days, until they finally are able to buy it when the majors are ready to unload. Similar tactics can drive prices down. (Chang, 1993; 108)

6 6 Despite the impact that the machinations of the ckUm have on the profit potential

for smaller investors, and the apparent illegality o f their activities, most people I

interviewed seemed to have at worst an ambivalent attitude towards the large

manipulators, and at best held them almost in awe Like Geertz’s “Bazaar type traders” in

Indonesia (Geertz, 1963: 34) and Parry’s “Traders of Benares”, their “condemnation generally seems to lack a real sense o f outrage” (Parry, 1989: 77). Dahu are not seen as particularly ruthless or unethical, but rather, “society supports this capacity by moral payments, imputing strong character to those who show self-command (and intelligence) and weak character to those who are easily diverted or overwhelmed. Hence we can understand the paradox that when an immoral deed is accomplished by a well-executed plan...the culprit may be half-admired...’’(Gofl&nan, 1967: 259-60). Unlike Hertz (1994,

1998), who observed the prevalence of discourse concerning the struggle for control between these different types of actors, the State and large investors (who are often associated with State enterprises) in my experience, were seen more as entities to be scrutinized and utilized, rather than as adversaries. In this context, there are ambiguous attitudes about profit-making just as there are ambivalent attitudes toward the reliance of large investors on guanxi (connections) for getting ahead - a well documented and arguably a somewhat socially acceptable practice (see Yang, 1994; Kipness,1997; Gates,

1996; Gold, 1985; Huang, 1989; Oxfeld, 1993; Van, 1996) . Moreover, these are primarily anonymous “faceless” crimes that occur in a context which is not seen as a zero sum game, and this ambivalence towards stock market manipulation reflects the attitude

67 that the market is primarily a test of luck and skill. Those who prevail are not necessarily seen as taking away from those who do not, but are rather seen as “tools” to be watched, utilized, and even emulated.

Thus, the Shanghai Market shares many characteristics with fledgling stock markets around the world, but also exhibits a number of attributes that could be designated as unique. The relatively extreme level of volatility, for example, can be explained to a certain extent by structural and policy factors, but these consistently high levels, similar to those of the more mature Taiwan Stock Market, suggest that there may also be cultural factors at work. The possibility of the influence of these cultural attributes will be discussed further in Chapter Four.

68 CHAPTER TWO ENDNOTES

1 .Warren Buffet, a large U.S. investor, seems to be a local folk legend. When I told Chinese stock market investors that I was a student from the United States, I was quite often asked if I knew him, or even if I might be his wife.

2 . While in Shanghai, I was able to gather a fairly significant portion o f period literature about the stock market in the 1920's and 30's at the local library. Although it would be an extremely interesting study to compare the discourse of the pre and post revolution stock markets, it is beyond the scope of this study.

3. Comparison is difficult here, as the available Emerging Markets Databases appear to be using different sources than I. The International Finance Corporation (IFC), for instance, which is probably the most widely used source for this type of data, reports a much lower figure for trading volume on the combined Shenzhen and Shanghai exchanges, as compared to the SSE data for that exchange only. I decided to use the data obtained directly from the SSE, as I do not know the source or reliability o f the IFC figures. However, despite the much lower IFC numbers, China is still ranked fifth by the IFC of 82 stock markets in the world in volatility as measured by Turnover Ratio in 1995. It is proceeded only by Turkey, Germany, Taiwan, and France. If my figures had been used, the SSE alone would easily have been number one.

4. It is interesting to note the fetishization (or metaphorical quality) of the Market in the existence of this new, extremely large facility. Because trading is automated, there are no fioor specialists as in the New York and other Stock Exchanges, and, at least on the day that I visited, very little activity on the “trading floor” itself. The building seems to have a primarily symbolic function, representing China’s commitment to economic reforms, and only secondarily to provide office facilities for administrative staff.

5. One direct translation of Junan, the name of the latter securities company, would be “military peace”.

6. The CPC Central Committee also issued a directive in 1998 that all armed forces members must divest all of their assets as part of a major ant-corruption campaign. (China News Daily, 7/29/98).

7 .. A list of a few of these Website addresses includes; WWW 99stocks.com.cn, provided by Citic-Jiading Securities WWW ssnews.online.sh.cn, provided by Shanghai Securities News WWW chinastockmarket.com WWW.stockstar.online.sh.cn WWW. china-stock net

69 8. Despite official figures, such as those reported in the Shanghai Star that ‘1>y rewriting the definition of laid-ofifworkers, Shanghai officials have decreased the number oflaid-ofif workers in Shanghai to 129,700 by the end of June"(Shanghai Star, 9/4/98), informal sources told me that unemployment was running as high as 30% in the city in 1998. When I first arrived in Shanghai and told one of the Professors at my host university the subject of my study, he replied, “Do you know anything about unemployed workers? Because that is primarily what you will be studying" I found it to be only a slight exaggeration. And one stock market participant observed that it was good that the stock market existed, in order to give the large number of unemployed “something to do"

9. A banker in Shanghai informed me that the savings rate figures are probably very inaccurate, that there is a great deal of cash hoarded in private households that is obviously not reported in these figures. I also witnessed on several occasions people entering the Bank of China branch offices with large shopping bags of cash to be deposited.

10. This is contrary to Ellen Hertz’s previous observation during her fieldwork in 1992, in which she felt that political analysis {zhengzhi fetvci) was the most widely used and most important form o f market analysis. At that time, she observed that technical analysis was rarely used or discussed. (Hertz, 1994:172).

11. It was stated that the inauguration of Zhu Rongji (originally fi'om Shanghai) as Vice- Premier has been a factor in this process. To attest to this, I heard a song called “Zhu Rongji is My Friend" {Zhu Rongji shi wtxie pengyou) played several times in various locales. And the Clinton impeachment scandal provoked, on numerous occasions, unfavorable comparisons o f the American government with that of the Chinese.

12. Nison (1991: 25) notes the large number of military comparisons in Japanese Stock Market vernacular. For instance, a large amount o f buying and selling activity on the open is called a “morning attack", or, conversely at the close, a “night attack".

13. The most widely used software was called Qian L ong (Money Dragon), a name which will be o f interest later in this discussion.

14. Other published sources with daily stock market information include China Business News {Xinwen bao), China Securities News {Zhongguo Zhengquan bao). Futures Daily {Qihuo Ribao), Coastal Economic Information News {Yanhai Jingji Xinxibao) and two sources which could both be translated as Daily Investment News {Meiri Zhengquan) {Tiantian Zhengquan). Other regional newspapers, such as Sichuan Finance and Investment News {Sichuan Jinrong Zhengquan Bao) also include stock prices and market information.

15. Investors are commonly divided into three groups based on the size of their investment in the stock market. D ahu, or large investors, generally invest more than 1,000,000 yuan

70 in the market, zhonghu more than 50,000 yuan, and xiaohu, or small investors, usually invest in much smaller increments. I did not meet anyone who claimed to fall into the category of zhonghu.

16. These inspections, primarily audits, were no longer to be conducted by government entities, and would now be conducted privately by companies between themselves

71 CHAPTERS

GUPIAOHUA; THE INFORMAL DISCOURSE OF

SHANGHAI STOCK INVESTORS

Gupiaohua (stock talk) is not a phrase used by participants in the Shanghai

Market, but the term was readily understood when I used it with those with whom I

conversed in China. This widely shared “stock talk” conveys a sense of inclusiveness, of

being an “insider” who is knowledgeable about the Market However, the lack of any

formal term for this “everyday” vernacular reflects the basic nature o f culturally derived

metaphorical speech; that these shared associations are more implicit than explicit, and

more interactive and dynamic than static. These “clusters of conventional expressions” are

narratives uttered spontaneously in this particular interactive context (Johnson, 1987:

105). As “everyday language”, it is more likely to express more directly the motives of the speaker and is more heavily laden with meaning, rather than when masked by adherence to the standards of formal discourse. As such it captures more directly the essence and the importance o f the process for the participants.

72 Shanghai “stock talk” is rich in metaphors. Many would argue that this is a function of the nature of the Chinese language itself (see Ho, 1993; Kaplan, 1966;

Friedrich, 1991). As a more “discourse oriented” language than for example, English, it reflects the underlying historical and cultural factors that in turn reflect the cognitive through “such characteristics as the fuzziness of sentence boundaries, thematic prominence, the frequent deletion of major sentence elements and the easiness with which forms are compromised to accommodate meaning” (Ho, 1993: v-vi). In other words, meaning is not created through the “function of its constituents”, but through “the relations that exists between these constituents” (Ho, 1993. v). Meaning takes precedence over form in Chinese, such that:

...an analogy can be made: English which requires rigorous agreement between sentence elements, is the natural science type language, while Chinese, whose rules are few and vague, and more subject to pragmatic manipulations, is the humanities type language. In such a language, options and subtleties abound, which give pause to its speakers in articulation and expression. .. (Ho, 1993: 69)

Most likely it is this relational orientation rather than a focus on the particular which is a synergetic force in the development of richly iconic “wordplay”.

The following chapter is an examination of metaphorical descriptions of stock market activity gathered from a wide variety of sources. These include personal interviews with participants in a wide range of occupations, with varying educational backgrounds and levels of economic resources at their disposal. Other sources include presentations given at Stock Club meetings (as discussed in Chapter Two) and several books informally describing the experiences of individuals in the stock market. Each example is presented first in Mandarin Chinese (Pinyin), then translated word for word into English, and finally

73 glossed into English in a way that is more conceptually accessible to English speakers in

the United States. All of these examples are “shared representations”; that is they should

be readily understood in the original Chinese by almost any Shanghai Stock Market

investor. And almost none are used in sources of more formal discourse, such as

investment newspapers or magazines.

For the purposes of analysis, the examples have been loosely categorized, with the

understanding that categorization is necessary for comprehension, but can highlight, de-

emphasize or hide properties (Lakoff and Johnson, 1980; 163). As Paul Friedrich states

“macrotropes are not, in fact, related to each other in a highly organized or rule-governed

and definable way...they are infinite and characterizable to only a limited degree”

(Friedrich, 1991. 23). The assumption is that actors are “constrained but not determined by the received categories at a given historical period and by the context of their social

interaction”(Ohnuki-Tiemey, 1991: 189). And as Dan Sperber observes, these categorical

“representations are more or less widely and lastingly distributed, and hence more or less cultural” (Sperber, 1985: 74). Therefore, with the understanding the “brevity engenders reification” (Gates, 1996: 7), in this and the following chapter the analysis is continued to

examine the “chains o f associations” that are implied by metaphorical reference (Parkin,

1984: 358). These can be better described as orientations or domains of narrations which describe major themes in a culture (Lakoff and Johnson, 1980: 67), which link and interweave with other related themes or domains. Therefore, the informational content is

not only in the categorization itself, but also in the links between these domains. As discussed in Chapter One, the analysis of metaphor involves an attempt at understanding

74 “metaphorical character”, not through any sort o f fixed algorithm, but through both “fixed

and general, though context sensitive, rules” (Stem, 1988; 435-6) In other words, to

attempt to understand “what a speaker knows when he knows the interpretation of a

metaphor” (Stem, 1988: 438). Thus, through the use o f as many examples as is feasible,

rather vague or fuzzy boundaries are established to examine each “type” of domain, and

the relationships between these domains, for insight as to how metaphorical language

reflects how Chinese stock investors see the stock market and themselves

3 1 INVESTING IS COOKING

The process of cooking food is probably the most prominent metaphorical theme in describing Shanghai stock investment behavior. The word for the market itself is d a p a n , which would be directly translated as “big plate, dish or tray”. Rather than buying into the market, an investor might say he/she “ate in” {ch i Jin ) and then either hold a stock and let it “simmer” {b ei g u ), or sell the stock at a loss to cut his losses by “cutting meat” ig e ro u )} Even the terminal product of the cooking/eating process is represented, when a poor performing stock is referred to as a “garbage stock” {la ji gu).

The following are examples of a number of metaphors involving the Chinese word p a n , or plate:

( 1 ) Dapan zhishu hui dao 1000 dian yixia budakeneng.

Big plate index number retum to 1000 point below not big probable.

“There is little probability that the market index will retum to below 1000".

75 (2) Ta renwei zhe zhi gupiao panzi da, bijiao rongyi mai Jin.

He/she felt this stock plate big, comparatively easy buy in.

"He/she felt this was a big stock offering, so it would be comparatively

easy to buy in.”

(3) Xia zhott dapan yinggai you pan zheng, ye hui diaoiou shangxing.

Next week big plate certainly have plate adjustment, and can turn head upward.

“Next week the market certainly had an adjustment (correction), and can now turn

upward.”’

(4) Jishi zhouyi kaipan xiaxing, xiayibu yinggai you shangzhang hangqing.

Even though this week open plate downward, down a bit certainly have rise

price(s).

“Even though the market opened down this week, after it is down a little there will

certainly be a rise in market prices”.

(5) Jintian shou pan xiayibu, die ting ban.

Today close plate down a bit, fall stop board

“Today the market closed down a little, and fell to the lowest point for the trading

day”.

76 (6) Jin qi gushi you hen cki de shangsheng kongjian. huoli pan hen duo.

Soon (recently) stock market have very large POSS upward space, profit plate

very many.

“Soon (recently) stock market will have (has had) a very large upward rise, there

will be (have been) a lot o f profit takers”.

(7) Caopan tuijian “Liannong” gufen.

Hold (act) plate recommend “United Farm” shares.

“Official analyst(s) recommend United Farm’ shares.

Other metaphors that relate more directly to the cooking process include the following:

(8) Chao gu yao zhongshi Jishu fenxi, tebie zhongshi rijunxian de fenxi.

Stirfiry stock want pay attention to technical analysis, especially pay attention to

day equal POSS analysis.

“Short term stock traders want to pay attention to technical analysis, and especially

pay attention to daily technical indicators.”

(9) Mai Jin gupiao beitao !e zenmaban? Yao you hao de xinli naishouli, Jishi ge rou.

zai drwei shi zai Jin, mibu sunshi.

Buy in stocks cover how? Want have good feeling endurance, promptly cut meat,

at bottom position time again enter, make up for lose.

77 “How do you cover yourself when buying stocks? You want to have good feelings

(instincts) and endurance, promptly take losses, at the bottom again buy in to make

up the lose.”

( 10) Muqicn gupiao shichang paomo de chengfen hen goo, hen duo shi bei renwei

chaozuo qilai de.

At present stock market frothy components very large, very many are thinking

manipulate upward

“At present many stock market components are very volatile, many think it is

being (will be) manipulated upward.”

(II) Chao shou zhuan qian de guattjian shi yao you xiaoxi.

Stirfry hand make money key is want have news.

“The key factor for speculators to make money is having access to information.”

( 12) Zhe yi hui ta de rou meiyou bai ge. Zheng ru ta deyuiiao, gu zhi jixu xiajiang...

This one turn around his meat not have white cut. Just as he expect, stock index

continue downward...

“This time the sacrifice he made was not in vain. Just as he expected, the stock

index continued downward...”

78 A number of metaphors also relate to the presence or absence of heat in the cooking

process. In this case stocks (and the Market) can also be “hot” or “cold” depending on

how they are performing. For example:

(13) Yiqian de leng gu yiding yao gaodu guanzhu, hai you Shenzhen de bendi xiao gti,

cixin gu he hangye jiyou gu.

Previously cold stock certainly want high degree attention, also have Shenzhen s

local small stock, next new stock and industry achievement outstanding stocks.

“You want to pay a great deal of attention to previously underperforming stocks,

also Shenzhen local, new stocks and industry stocks that have already been

performing well.”

(14) “ChangHong ” qian yi jie duan chaodie, die de hen lihai, xiattzai jia wei hen di,

12 shi re dian mai jin.

“Long Rainbow” before stage pass drop, drop very fierce, now price located very

low, 12 is hot spot buy in.

“Long Rainbow was previously in a downward trend and dropped very

substantially, but now the price is low and 12 Yuan is the point to buy in.”

(15) Tu fasheng de you leng bian re de gushi, Wang Xiansheng gandao, jihua yiran shi

zai gupiao shichang shang.

Sudden occur cause cold change hot market, Mr Wang felt, opportunity still is at

79 stock market on

‘The stock market could suddenly change from downward (cold) to upward (hot)

price trends, and Mr Wang realized that there was still opportunity in the stock

m arket/(Lu, 1998: 6)

( 16) Xia yilun hangqing de redian: qian y i jiedttan remen gti de fanchott he iengmen

gu de bu zhang.

Next one round (turn) prices POSS hot spot: before a stage (phase) hot door

stocks taken out and cold door stocks fill swell.

“In the next round of price increases, the hot stocks will be sold and cold stocks

will rise in price.”

( 17) Tu faxing de you leng bian re de gushi, shi Wang Lao Xiansheng gandao, jihtta

yiran shi zai gupiao shichang shang.

Sudden have cold change hot stock market, make Wang old Mister feel,

opportunity still is in Stock Market.

“The sudden change from cold to hot made old Mr Wang feel that there was still

opportunity in the Stock Market.”

There are also metaphors which relate to the cooking process in terms of food production and storage, such as the following:

80 (18) Wode cangweiyou “Beijing Wcmdoug”, 100gufen, “TonghuaDongbao”, 100

g u f en ...

My storehouse place has “Beijing Wandong” 100 shares, “Tonghua Dongbao”,

100 shares.

“My stock portfolio consists of 100 shares of Beijing Wandong, 100 shares of

Tonghua Dongbao /

( 19) Mancangde ren keyi zhao Jihui chuhuo, kongcangde ren keyi fengdi Jinhuo.

Full warehouse people can look for opportunity out goods, empty warehouse

people can chance upon low in goods

“Fully invested people can look for an opportunity to sell, those with

money to invest can chance upon low priced stocks to buy

(20) Xuanze gupiao, yao xuanze gcmggang kaishi iutou, you hen da shangshen

kongjian de gupiao.

Select stock, want select just start sprout head, have very big upward space stock.

“When selecting a stock, you want to select one that has just sprouted, and has a

great deal of upward potential.”

(21) Chabuduo Hang nian ban yihou, shouhuo jijie zhongyu lai le.

Almost two and one half years after, harvest season finally came.

“After two and one half years (of holding the stock), harvest season finally came.”

81 And the process of eating food is reflected in a number of metaphors;

(22) .. shi bu duan xiajiang de wujia, ta wuqing di zai tunshizhe tayi beize de Jixu.

...is not broken falling price, it mercilessly low at gobbled up his whole life savings.

' . .the unbroken price drop mercilessly gobbled up all of his life savings.”

(Lu, 1998: 3)

(23 ) Chi Jin Jueding shi, Ji yao duo dongnao Jin sikao qingchu, you yao guoduan

xin g d o n g .

Eat in decision time, since want many brains consider situation, again want

decisive action

“When deciding to buy a stock, you want to carefully consider the situation and

take decisive action.”

(24) Ni ge rou, ni chi kui.

You cut meat, you eat loss.

“If you sell at a loss, you lose money.”

(25) Gtt pingjia de suan tian ku la

Stock analyst the sour sweet bitter (spicy) hot.

“The sorrows and joys of the life of a Stock analyst.”(Lu, 1998: 2)

82 As Ohnuki-Tiemey (1987, 1990b, 1991) and Tomlinson (1986) suggest, these

metaphorical references to the process of acquiring and cooking food suggests a tension

between active and passive elements. Cooking, as well as investing, both require a balance

between actively acquiring and combining elements, but also requires a certain degree of

passivity as the process unfolds. A decision to hold a stock in “storage” requires a certain amount of passivity as the stock “simmers” (Jbei g u ), but at any point the investor may actively take the initiative to buy or sell. To ch a o g u , or speculate on a very short term basis, reflects the unique qualities of the Chinese style cooking process. Food is cooked very quickly at high temperatures with little passivity or waiting time involved. The prevalence of this type of activity by Stock Market participants perhaps reflects a belief in the efficacy and necessity for personal agency in the process; that if stocks are left for too long untended they will “bum” and become useless.

These metaphors reflect a number of ways that Chinese style cooking is similar to stock investing;

1. Investors and cooks both create something of value.

2. They create something of value from materials that are externally presented.

3. They selectively combine materials to create the product.

4. The materials must be used in the correct proportions.

5. The quality o f the materials influences the end result.

6. The more quickly the materials are transformed, the more control the participant

feels he/she has in the process.

7. The transformation requires a special state (heat).^

83 Therefore, as the participant looks at materials as they are presented on the “large plate”

{da p a n ), various elements o f information are selected for their desirability in producing a

valuable product for consumption. These elements are transformed when heat (upward

price movement) is applied, and the presence or absence of “heat” must be constantly

monitored by the “cook”. Depending on the presence or absence of “heat” and the

“cooking” style of the participant, a choice may be made to allow the stock to “simmer”,

sell the stock at a profit, or to take a loss {ge rou) and discard the stock as “garbage”.

As previously discussed, the overarching metaphor of INVESTING IS COOKING

incorporates a number of concepts fi'om various metaphorical domains. A more accurate

gloss for this assigned category might be INVESTING IS THE ACQUISITION AND

CONSUMPTION OF FOOD. This in turn implies the metaphorical conceptualizations of

STOCKS ARE FOOD, along with the spatial association of HEAT IS UP and COLD IS

DOWN (as in upward and downward movements of the individual stock or of the Stock

Market as a whole). In this case, heat, or lack thereof, is the special state that transforms

the materials into the desired/undesired end product What these metaphors disguise,

however, is that unlike the cooking process, the application of heat in the investing process is not under the direct control o f the participant. In this case, the investor can only monitor externally produced changes in “temperature”, determine what he/she believes these changes will produce, and act accordingly In other words, afier the active process o f combining the selected elements, the investor can only passively observe with the hope that “heat” will occur for a successful transformation of the elements into a product of value. Without this “heat”, a successful outcome is unlikely.

84 3 2 INVESTING IS NATURAL OR SUPERNATURAL

A number of metaphors describing Shanghai stock investing involve entities that can be best characterized as natural or even metaphysical. Several of these, such as descriptions of stocks as “dragons” {lo n g ), draw on existing and prevalent cultural metaphors. Others, such as h e i m a (black horse) have more elusive origins/

The natural and supernatural are combined in this category in an attempt to comply with native categories of thought, particularly, in this case, based in the influence of

Daoism. As several researchers have suggested (see Hanson, 1983, 1985a, LaFarque,

1994), Daoism was and has been an important influence on the “common man” in China over the centuries, while Confucianism has been primarily the focus of the elite literati.

These metaphorical images of stocks as animals, investors as sparrows, or of the Market as an ocean quite likely reflect the Daoist conceptualizations of the interaction o f natural forces and a holistic view of man’s place within (rather than apart from) nature.

Companies with publicly traded shares reflect this thinking as well, as reflected in company names such as “Long Rainbow” {Chang Hong) and “River Su Spring Orchid” {J ia n g Su

C hun L an). And one of the most widely used Stock Market technical charting software packages was Q ian L o n g (“Money Dragon”). These natural images are quite common throughout all types of informal Chinese discourse, a characteristic which will be discussed more completely in Chapter four/

This overarching category subsumes a number of subcategories, the first of which could be designated as STOCKS ARE ANIMALS/ Several examples are as follows:

85 ( 1 ) Bu zhuo hei ma shi yimen xuewen, ye shi yizhong yishu.

Catch black horse is a study, and is a skill.

‘T o identify a stock which will rise in price requires knowledge and skill.”

(Li, 1997: 1)

(2) Shen Shi de "Jin Hai ” jianglai mingnian de hei ma.

Shenzhen Market POSS “Gold Sea” future next year POSS black horse

“The Shenzhen Stock Market’s “Gold Sea” will be next year’s leading performer.”

(3 ) Shei shi daidong xia yilun gushi shangshen de lingtouyang? "Shen Fazhan ”.

Who is drive (spur on) down a turn stock market rise POSS lead sheep?

“Shenzhen Development”.

“What stock will drive the next rise from this market downturn? ‘Shenzhen

Development’.”*

(4) M ei yige banhiai dou you longtou. "Ma Gang ’’ shi gangtie bankuai de iongtou,

"HongOiao Jichang” shi cixin gu de longtou.

Every individual sector all have dragon head. “Horse Steel ” is iron/steel sector

POSS dragon head, “Rainbow Bridge Airport” is new stock POSS dragon head

“Every individual sector has a leading stock. “Horse Steel” is the iron and steel

sector’s best performing stock, “Rainbow Bridge Airport” is the new issue stock’s

leading performer. ”

86 (5) Dcqxm muqian de xingshi bu shi hen hao. Meng long de xiaoxi hen duo.

Stock Market presently POSS situation not is very good. Drowsy dragon POSS

news very numerous.

“ The present situation in the Stock Market is not very good. There has been a lot

of news about the ‘drowsy (dreaming) dragon’.”

While most of these examples refer to a similar concept; i.e. are used in

descriptions of a leading or outperforming stock, there are subtle differences in their

usage. It was explained to me that a “dragon head” and a “black horse” can be used

interchangeably, but that “dragon head” is more offen used for a stock which rises more

unexpectedly than a “black horse”. Lingtouyang, or “lead sheep”, which refers to stocks

which have historically been industry leaders, seems to derive primarily from more formal

sources, and was used most offen by academics and analysts (although it was used from

time to time in casual discourse). It appears to have a meaning very similar to the term

“bellwether stock” used in American Stock Market vernacular. The final example, that of likening the Stock Market to a “dragon”, was used in a number of different contexts in informal conversation. In addition to being “drowsy” {lo n g d a i) when there was little volatility in the Market, the “dragon” was also described as “sleeping” {sh u izh a o ) in a similar context, or as “full o f vitality” (lih a i) when thwarting the desires o f one individual investor.

87 Several other examples derive directly from Daoist philosophy, as mentioned

earlier.

(6) Jishi zhouyi kaipan xiaxing, you yinxian, ye hui diaotou shangxing.

Even though this week open plate go down, have “yin” line, yet can turn around

upward.

“ Even though the Market opened down this week with an ‘yin’ line, it can turn

around and go up.”

(7) Ni kan, shang zhou you wuge yangxian, zhei gufen wo tuijian. Chang shi you hao

tongdao.

You look, last week have five “yang” lines, this stock I recommend. Long time

have good chaimel (path).

“ You see, last week this stock had five days where the stock closed above it’s

opening price, so I recommend it. For a while it has had good technical

indicators.”

Both y in x ia n and y a n g xia n refer to Candlestick charting indicators discussed in Chapter

Two. When a stock closes above it’s daily opening price, a box is drawn to indicate the difference between the two prices and then left empty or white. Conversely, when a stock closes below its opening price, it is shaded or completely filled in. This terminology referring to the Daoist concepts of Yin and Yang most likely reflect their respective

88 associations with dark and light.

The next set of examples could be glossed as THE STOCK MARKET IS AN

OCEAN:

(8) Xianzai, xiaopan gu zhonggao iuiluo, cùzpan git “chao zhang chao luo

Presently, small plate stock medium large pullback, big plate stock “tide rise, tide fair.

“At present, small capitalization stocks are in a medium to large downturn, large

capitalization stocks are rising and falling.”

(9) “Zichan Zhongzu ” gu zai tuichao.

“Capital heavy group” stock at (in) low tide.

“The heavy industry group stocks are at relatively low price levels”

( 10) Zai dapan gu tuichao de tongshi, Jiyou gu kaishi zhangchao.

At large plate stock low tide the same time, excellent performing stocks start high

tide.

“At the same time the large capitalization stocks are at low levels, certain

historically excellent stocks are starting to rise in price.”

(II) Jishi dahu zai caozong gushi, sanhu tiao shui.

Even though large investor(s) at manipulate Stock Market, disperse investors dive

89 water.

"Even though large investors manipulate the Stock Market, dispersed investors

dive into the water.”

(12) fVo jtteding xia hai.

I decide fail ocean.

"I decided to fall into the ocean (in this case enter the Stock Market and buy

stocks).”’

Several other metaphors relating to Stock Market activity make use of natural imagery:

(13) Ru shi de zijin yue lai yue shao, dangshi bei jide mi bu toufeng de zhengqitan

jiaoyi da ting, m jinyijing men ke luo que.

Enter market the funds more and more small, then many secret not divulge

Securities Market large hall, nowadays already door can trap sparrows.

“The funds I had to buy into the market were becoming less and less, and secrets

were not being divulged in the large stock trading hall, nowadays the process just

traps (small) investors.” (Lu, 1998: 2)

(14) Zai zhengquan jiaoyisuo you shou wei yun fu zuo shou wei yu.

In Securities Market right hand produce cloud cover left hand produce rain.

“In the Securities Market, the right hand that produces clouds obscures the left

90 hand that produces rain (the market is being secretly manipulated) "

(15) Dangshi, gushi gang qibu, gupiao zhongleiye liao m o chen xing, jiage ziran ye

mei you shenme da de btxiong.

However Stock Market just started, stock categories also sparse seem morning

star, price naturally also not have very big fluctuation.

“However, the Stock Market had just started, stock categories also seemed as

sparse as the morning stars, so naturally (stock) prices did not fluctuate widely.”

(Lu, 1998: 4)

( 16) Gushi xiang ztio yuncangzhe wuqiong baobei de da shan, shan shang you jingji,

you yeshou, shan shang ye chuxian le xuduo iingren yangmo de yingxiong.

Stock Market picture is rich in limitless treasure big mountain, mountain have

brambles, have wild beasts, mountainon also produced many leaders admire hero.

“The picture o f the Stock Market is that it is a mountain rich in limitless treasure,

which contains brambles and wild beasts, but also has produced many leaders to be

admired as heros.” (Lu, 1998: 29)

These natural images emphasize the necessity for recognizing and dealing with uncontrollable changes in certain conditions, as compared to the previous references to

INVESTING IS COOKING. In this case, the participant has an active part only in identifying or “catching” a “black horse” or a “dragon head”, or in navigating his/her way

91 through “wild beasts and brambles”. Those that do so successfully not only gain economic rewards, but the admiration of their peers as alluded to in the final illustration. However, in these examples there appears to be more recognition of stocks and the Market as a natural entity which might be recognized but not controlled. Thus, once identified, or

“captured”, the investor must monitor their behavior and deal with it accordingly.

These metaphors, then, relate these natural and mythological images to stocks and the Market in the following way:

1. Stocks and natural or mythological entities can help or hurt the participant.

2. These natural or mythological entities are willful.

3. These natural or mythological entities can create good or bad opportunities.

4. The participant can actively identify those with good intentions.

5. The participant must understand these entities in order to be successful.

6. Those entities that create good opportunities will help the investor to create

something of value.

In a similar manner, relating the Market to an ocean or to the forces o f yin and yang implies that the participant has an active part in identifying the most auspicious times to buy and sell. However, once a decision is made, he/she must passively wait for the cycle to complete itself, or for these forces to follow their own course.

3 3 INVESTING IS WAR

This category is a less pervasive influence in describing Chinese Stock Market activity, but significant all the same. Several examples appear to be drawn directly fi-om

92 Sunzi’s influential text, “The Art of War” or on terms that developed during the violent years of the cultural revolution. Several examples are as follows:

(1) Canyu duyixia zi turanpengzhang, zai jia shang tumfang de ju e zijin..., shajin

Shanghai, shi “Dian Zhenkong” zhei Ag mingxing chongxin fachu guangcai lai le.

Participate degree brief suddenly expand, again add on south area FOSS large

amount funds. , invade Shanghai, make “Electric Vacuum” that star

anew give off brilliance out.

“(His) small degree of participation suddenly expanded, as a large amount of funds

from the south invaded Shanghai, and made “Electric Vacuum” a brilliant star

again.” (Lu, 1998: 6)

(2) Zheiwei nian yu huajia de gushi xin bingyi zhubu cheng shu.

That year exceed sixty years the Stock Market new soldier already gradually

become mature

‘That year, at more than sixty years of age, the Stock Market’s new soldier

gradually became mature ”(Lu, 1998: 6)

(3 ) Bu xing zaiyu fa dao di, mei you... zhiye chaoshou..., yong mouzhong lilun ba ziji

wuzhuang qilai yihou cai Jinru gushi.

Not luck depend on he to bottom not have...professional stirfiy hand, use certain

type theory self equip with arms up come after then enter stock market.

93 “Not depending on luck he reached bottom, (he) wasn’t a professional speculator,

and used his own special type o f theory to arm himself and then enter the Stock

Market.” (Lu, 1998: 5)

(4) Gushi "cki chiianlian’'.

Stock Market big make contact.

“Stock Market big overthrow.”'” (Lu, 1998: 40)

(5) M ingtian gitji Jiang hui dikai dizou, ruguo bu JiJia 1195 dian, faner gongke 1203

dian.

Tomorrow estimate can low open low go, if not hit home 1195 point, instead

attack capture 1203 point

“Tomorrow (I) estimate (the Market index) will open lower and go lower still, if

it doesn’t hit 1195, it will instead reach 1203.”

(6) Shi yi yuefen dapcoj nengfou tupo.

Eleven month Market cannot break (charge) through

“The eleven month technical indicator hasn’t crossed the moving average line.”

(7) Xiayi jieduan de hangqing, bu kengneng zai chuangxin gao, dan ye bu hui zai

chuang xin di, guji htu shou zai 1241 dian xiqfang.

Next stage market prices, not probably again blaze new trails high, but also not can

94 again blaze new trails low, estimate can stop at 1241 point lower.

“In the next stage for the Market index, it will probably not again reach new highs

or lows, (I) estimate it will stop at 1241 or lower.”

(8) Ta de chao gu geyan shi jingguo gaizao de (Sunzi bing fa) shang de hua:

Neng shengzhe bu bai, neng baizhe bu wattg.

His stirfiy stock proverb, is undergo transform the (Sunzi war method) on say:

Can win not fail, can fail not die.

“His proverb for Stock Market speculation is a transformation of a saying from

Sunzi’s “Art of War”:

If you know how to win you won’t fail,

if you know how to fail you won’t die.” (Lu, 1998: 2)

There are also a number of metaphors relating to being “trapped ” when a stock has been purchased and then depreciates in price. This concept was also likened to being strung up with a noose:

(9) Taozi yici you yici, ta zhongyu xuehui le ge rou, baohu shengli guo shi yaojin.

Noose one time, again one time, he/she finally learned cut meat, protect victory

finit real important.

“Afier his/her stocks depreciated several times, he/she finally learned to sell and

take the lose to preserve his/her profits ”

95 (10) Mai jin gupiao beitao le zenmeban? Yao you hao de xinli naishouli, jishi ge rou,

zai diwei shi zai Jin, mibu sunshi. "

Buy in stock trapped what to do? Want have good feeling endurance, right time

cut meat, at bottom is again in, make up lose

“When you buy a stock and it goes down what do you do? You want to have good

instincts and endurance, at the right time sell, and then buy it back again at the

bottom to make up the lose.”

(11) Tuijian "Lian Nong ” gufen yinwei you hen duo ren taozhe zai 20 yuatt de Jiawei

shang.

Recommend “United Farm” shares because have very many people noose reside at

20 yuan the price place on

“(I) recommend “United Farm” shares because there are a lot of people who have

a loss at the level of 20 yuan (and they will probably be selling).”

( 12) Xiazhou Shanghai gttshi fanji shangshen. you hen duo ren xianzai Jietao

Next week Shanghai Stock market counterattack rise, have very many people now

undo noose.

“Next week the Shanghai Stock Market will reverse and began to rise, and many

people will no longer be losing money.”

96 These conceptualizations appear to describe the investing process as Man

(investor) versus the Market. The implication is that investing is a zero sum game of “Man against Market” in which participants must use stratagem or artifice in order to “attack” the “enemy” (the Market). In turn, caution must be taken against a counteroffensive which may cause the participant to be “trapped” or “hung”. In this context, funds can “invade” the Market, which can, in turn, be “overthrown”. "

Thus, the use of INVESTING IS WAR metaphors reflect a number of ways in which participants see buying and selling stocks as similar to a military campaign.

1. The ob jective o f both investors and soldiers is to acquire something of value.

2. This value is not created, but rather acquired.

3. The participant must use strategic thinking in order to acquire the desired end

4. Once committed, the investor must be vigilant in order to detect and combat any

counteroflensives.

5. Successfully detecting and counteracting “enemy” actions will lead to acquiring

the valued end product.

6. These counteroffensives by the “enemy” are more eflfectiveiy resisted by cunning

rather than by force.

3 .4 INVESTING IS A GAME

The prevalence of metaphorical speech i.e. “playing with words” in reference to the Stock Market perhaps reflects the “game- like” nature o f Stock investing. However, unlike my own experience in the investment industry in the United States, metaphors

97 based on concepts familiar to followers of organized sports (such as baseball), so widely used in the U.S., were non-existent in China The few “game” or “sports” metaphors used in this context in China related primarily to mahjong or card games, both historically (and currently) popular past-times which often involve gambling/*

( I ) Cong mang mu bei gu dao ge rou huan chou.

From blind warm (bake) stock to cut meat change (mahjong) chip

“From blindly holding a stock to taking a loss (changing strategies)”

(2) Zui jin mei you ren gou zheng, suoyi bu bi zhao zhong qian.

Recently not have people enough recognize buy confirm, so no need find middle

bamboo slip.

“Recently there haven’t been enough people subscribing for new issues, so there is

no need to look for the lucky number.”’*

(3 ) Shouli de gupiao yao pai dui, buhao de yao JinJue paodiao, haode yao liu zai

shoitshang, dengdai hao de Jihui.

In hand stocks want line up, not good want firmly throw away, good want keep in

hand on, wait arrive good opportunity.

“(You) want to arrange the stocks (you) have in your hand, firmly get rid o f the

bad ones, keep the good ones in you hand and wait for a good opportunity .”

98 (4) Gushi zhong de Hong ci shengli chuju.

Stock market middle the two times victory out game

"Two times a victory in the Stock Market (then) out of the game.” (Lu, 1998; 1)

(5) Dahu peng chi hu, chenji wudao sanhu.

Large investors chance meet eat beard, take advantage mislead dispersed

investors.

‘Large investors take (mahjong) tiles from others, take advantage of and mislead

dispersed investors.”

(6) Ta zong xiang zai zhtio mi cang name hua liu liu di bu yuan qingyi jiufan.

It all appears at catch lose hide in that way slippery not easily caught.

“It (the Stock Market) appears to play hide and seek, it is slippery and not easily

caught.” (Lu, 1998: 6)

(7) Zai xianzai de hangqing xia, sanhu qianwan jizhu, bu neng zhui zhang.

At present the price index go down, dispersed door million and millions recognize

not able chase (price) level.

“Presently the price index is down, dispersed investors have millions invested and

are not able to buy stocks at this level.”

99 (8) Bu neng ba qucmbu zijin duo tou zaiyizhi gupiao shang, zui hao tiaoxuan 3-5 zhi

gupiao xingcheng yige touzi zuhe, zongde silu yinggai shi qi ruo chi qiang.

Not able to whole funds all invest in a stock on, most good select 3-5 stocks

form an invest combination, all think over certainly is discard weak, hold strong.

“(An investor) can’t put all of his funds in one stock, the best (strategy) is to select

only 3-5 stocks to form an investment combination, think it all over and discard the

weak, hold the strong.”

(9) Duiyu luixiu le de Wang Lao Xiansheng lai shuo, geng mei you xiang mai Jin pao

shou zuo cha Jia.

Concerning retired Wang Old Mr then said, even more not have think buy in

throw hand make difference price.

“Concerning (which) retired old Mr Wang said, (he) didn’t think buying (stock) or

throwing in his hand (selling the stock) would make a difference in the price.”'*

The most common reference in this category is to card games in which stock

holdings are likened to a hand of cards, and the best strategy for an investor is to discard

bad or “weak ” cards and “hold the strong”. In one instance. Market participation is

likened to a zero sum game between participants; that of large investors taking “mahjong tiles” from smaller investors. However, in most of these cases the individual investor is in rivalry with the metaphorical entity o f the Market.

100 Games o f cards and mahjong are likened to stock investing in several ways:

1. Investors and game players are both attempting to take something of value away

from the game

2. Players understand that there are elements of both luck and skill in playing the

game.

3. The players best chance of acquiring something of value is to outwit their fellow

players.

4. Players creatively or skillfully add and delete items to create the final product.

5. Luck influences the quality of the materials available.

6. Win or lose, the game is most often undertaken because it incorporates elements

of play.

This category perhaps best reflects the recognition of the presence of luck or fate throughout the entire process. Unlike the previous examples, game players must rely on the quality of materials externally presented to them, and then apply as much skill as possible to make the best of the situation.

3.5 MISCELLANEOUS METAPHORS

There are various categories of miscellaneous metaphors in which the examples are much less numerous, but nevertheless deserve mention. The first of these is a further elaboration of a metaphor which has recurred frequently in all of the previous categories, that of the THE MARKET OR STOCKS ARE GENERIC LIVING THINGS, which can be healthy or unhealthy, can throw, breath, hit, pull or tear. This is also an overarching

101 metaphorical conceptualization which exists in metaphorical descriptions of the Stock

Market in the U.S. James Carrier’s (1997, 18) reference to the Market Model in western

cultures as “...embodying essential humanity...” and “rooted in a conception of a

fundamental human nature”, appears to view this personification conceptualization as

fundamental to western economic behavior. The concurrent pervasiveness of this type of

metaphor in the Chinese context will be examined in Chapter Four o f this study.

Further examples o f the Market as a living entity are as follows.

(1) Shichang kuozhangde su dtt hui huan man, youliyu dapanJusu.

Market expansion POSS fast degree can slow down, benefit to Market come back

to life.

The Market’s fast degree of expansion can slow down, which will help to bring the

Market back to life ”

(2) Gumin hen bu manyi, yinxiang dao gushi de jiankangfazhan, gtiojia Ungdaoren

ye hen ji, jushuo you wangjiejue.

Stock people very not satisfied, influence toward Market POSS health develop,

country leaders also very worried, say have hope resolve.

“Stock investors are not very satisfied, which will influence the performance of the

market, the government is also very worried and say they have hope to resolve (the

Market’s problems) ”

102 (3) Lingwai zai xuanze gupiao shi, yao zhuyi xuanze hangye, biru qiche hangye gti

keyi xijin.

Otherwise at choose stock time, want pay attention choose industry, for example

auto industry stock can breath in

“Otherwise when selecting stocks, (you) want to pay attention to choosing and

industry, for example the auto industry has good potential.”

(4) Meiguo gushi, Riben huishi fan tan shangsheng, dai dong Xianggong gushi

shangsheng, zhi shi Shenzhen gttshi chuxian hui sheng hangqing, guji yott zeng

Hang z ijin jin r u .

American Stock Market, Japan Exchange Market oppose reverse launch rise, carry

move Hong Kong Stock Market rise, result cause Shenzhen Stock Market emerge

return upward price level, estimate have increase volume capital enter

“The American Stock Markets and the Japanese Foreign Exchange Markets are

reversing their price trends upward, prompting a rise in the Hong Kong Stock

Market, and also resulting in the Shenzhen market returning to upward trends in

prices, and (I) estimate there will be an increase in funds buying into the Market.”

(5) Cixin gu bankuai jiangyou jiao hao de sheng shi. muqian Shang shi de xin gu,

keneng hui la sheng dapatt.

New stock group future have comparatively good upward strength, presently

Shanghai Market POSS new stock probably can pull upward Market.

103 “The New Issue Stock group will have comparatively good performance in the

future, at present the Shanghai New Issue Stock group should probably be able to

enhance the performance of the whole Market.”

(6) Shichang zai mouge jieduan, mouge gupiao xian tai sheng, ranhou xia da.

Market at individual phase, individual stock first rise upward, after down hit.

“The Market is in a phase where individual stocks (not the whole Market) are

performing, and these individual stocks will first rise in price and then fall.”

(7) Wai Jie chuan yan JiangJinyibu Jiang xi, keneng hui dui gushi you yidian tuidong

zuoyong.

Outside world spread word cause further drop news, perhaps can toward Market

have a little spur action.

“Foreign sources spreading the word of a further drop perhaps will be a spur to

action for the Market.”

(8) Jintian gushi tiao kong le.

Today Stock Market jumped empty.

“Today the Stock Market index price level opened down (from the previous day’s

closing index level).”

104 (9) Jintian gushi tiao gao le.

Today Stock Market jumped high.

‘Today the Stock Market index price level opened up (compared to the previous

day’s closing index level).”

( 10) Kuai chu Ji 1400 dian, ta qtteren bu keneng zai dtt Jixu shangsheng de dui hou, ta

quan xian pao kong.

Quick touch reach 1400 point, he acknowledge not probably again once more

continue rise toward after, he all line throw empty

“(The Market index) quickly touched 1400, he acknowledged that it probably

wouldn’t rise again, so he sold all of his stocks.” (Lu, 1998: 6)

(11) Jing guo le zhengqitan jiaoyistto chengli de 12 yite, dao 1992 nian de 5 yue, yijing

yite shang le 2500yitan de gao wei!

In the past Stock Market established 12 month, to 1992 year 5th month, already

leap rise 2500 Yuan high position!

“When the Stock Market had been established 12 months, up until May of 1992, it

(the stock) had already risen (leaped) 2500 Yuan!” (Lu, 1998:5)

(12) Zhengqitan shichang qite quan xian fan le hong, yi 394 dian wei zhitan lie dian.

Stock Market yet all line turn red, at 394 point turning point.

“All the stocks in the Stock Market turned around and began going up after (the

105 Market index) reached 394.” (Lu, 1998: 6)

(13) Jintian "Dian Zhenkong” fan hong le.

Today “Electric Vacuum” portion red

“Today “Electric Vacuum” distributed dividends.”

( 14) Cong si yue zoudao xianzai. Zhongzu bankuai de hangqing zongde kan kaishi hui

luo, keneng tan di.

From 4 week until now. Heavy Industry group POSS price level all see start return

down, perhaps visit bottom.

“For the last four weeks, the Heavy Industry group’s price level has returned down

and perhaps hit bottom.”

There are also a few phrases which might be glossed as THE MARKET

(STOCKS) IS (ARE) A MACHINE, or perhaps IS A PHYSICAL SYSTEM.

(15) Guanli bumen JuedingJiang bai yuan mian e yi gu de "Dian Zhenkong ”, c h a i x i

w ai m ei g u y i yua n .

Manage department decide will hundred Yuan denomination a stock “Electric

Vacuum ”, disassemble every stock one Yuan

“The management department of “Electric Vacuum” decided to change the

denomination of their Stock from one hundred to one Yuan.” (Lu, 1998: 6)

106 ( 16) Tuijian “Lion Nong” gufen. Zui Jin zhege gupiao yijing qidong, chengJiao liang

zhubu kuo da, suiran Jiage yi shangsheng dao 12.2 Yuan, dan shangsheng kong

Jian hen da.

Recommend “Unite Farm” shares. Most recent this stock already start up, change

reach amount step by step expand big, although price already rise to 12.2 Yuan, but

rise empty space very big."

“(I) recommend “United Farm” shares. Recently the stock has been rising step by

step, but although the stock has already risen to 12.2 Yuan there is plenty of room

for further increases.”

( 17) Dapan caozuo silu yu wang nian bu long dian, Jigou dahu ganyu zai dapangu

shang touzi, caozuo, la sheng, zhuyao yuanyin shi Jin nian chuxian le yixie JiJin.

Market manipulate thinking and past year not same point, mechanism large door

dare to at Market on invest, manipulate pull upward, main reason is this year

emerge some funds.

“The thinking of the Market manipulators this year and last is not the same, the

mechanism the large investors are using is that they are daring to move the Market

upward, the main reason being that this year there will be a lot o f funds coming

into the Market.”

(18) Shang zheng zhibiao yijing cong zhei nian 5 yue de 1551 dian gei qiangxing xia

tiao le 48.3%.

107 Shanghai Stock index already from this year 5 month the 1551 point give force

down adjust 48.3%.

“ The Shanghai Stock Exchange Index as of the fifth month of this year has already

dropped 48.3% from 1551.

There are also several other miscellaneous phrases o f interest:

( 19) Yoiiyn xianzai dajia kan hao xia jieduan hangqing, dahu zhengzai Jihua caozuo,

shichang shang xianzai mei ycm kong fang.

Due to now everyone see good next stage price level, large account in process

plan manipulate. Market on now not have empty direction.

"Because everyone is optimistic about the next stage for price levels, and the large

investors are in the process of manipulating (the Market), the Market now has few

sellers.”

(20) Dahu xianzai caozuo, suoyi gushi you hen da duofang.

Large investors now manipulate, so Stock Market have large many direction.

“The large investors are manipulating the Market, so there are strong buying

forces.”

(21) “Chang Hong ’’ he “Shen Fazhan ” shi Zhongguo gushi de long tou. Yinwei

“ChangHong’' shi Minzu gongye de daibiao, er “Shen Fazhan” shi te quJingji

108 de chuang koti.

‘Long Rainbow’ and ‘Shenzhen Development’ are China Stock Market POSS

dragon head. Because Long Rainbow’ is minority company POSS representative,

and Shenzhen Development’ is special area economy POSS window opening.

“ Long Rainbow’ and Shenzhen Development’ are the stocks with the most

potential in the Chinese Stock Markets. This is because Long Rainbow’ is the

representative democratic company, and Shenzhen Development’ is the

representative for the special economic zone ”

(22) a lei gupiao shu yu “da xiang xing zheng li ”.

This type stock belong to “big box type straighten out”.“

“This type of stock is showing good technical indicators”

(23 ) Gushi rensheng de mu hou xi.

Stock Market life the curtain behind show.

“The life behind the curtain in the Stock Market.” (Lu, 1998; 1)

All of these miscellaneous examples are difficult to place strictly within the confines of the previous categorizations, but exhibit what could be called overlapping perceptual domains within those categories. For instance, “buying forces” {chio fang) and

“selling forces” {k o n g fa n g ) are difficult to translate into English, but imply a substantive entity similar to that implied elsewhere in references to the Market metaphor. The later

109 example refers to the Market as a theatrical production, but shares the conceptualization of investing as “play” as exhibited in the category glossed as INVESTING IS A GAME.

3 6 CONCLUSION

The preceding list is a comprehensive account of all of the metaphors encountered during my fieldwork which relate to the Stock Market and stock investing. The purpose is to provide an accurate sample o f all of the primary and secondary domains that might exist, and therefore illustrate all o f the culturally influenced “structures of comprehension” from which meaning is created and shared. As has been shown, the primary cultural categories include INVESTING IS COOKING, INVESTING IS NATURAL OR

SUPERNATURAL, INVESTING IS WAR, AND INVESTING IS A GAME. These four metaphorical categories emphasize and obscure various aspects o f the investing process.

For instance, INVESTING IS COOKING implies a large amount of personal efficacy in success or failure in investing, while INVESTING IS NATURAL OR SUPERNATURAL seems to relinquish control over outcome to corroborative entities. INVESTING IS WAR is conceptually quite similar to INVESTING IS A GAME in that both emphasize the importance of an individual’s skill in determining the result, and the adversary in both cases is primarily an autonomous, reified “Market”.

Each category also highlights a number of problems confronted by investors. The first domain, INVESTING IS COOKING infers that individuals may experience a number of difficulties, including.

110 1) an inability to acquire appropriate or good quality ingredients/information.

2) inappropriately or incorrectly combining/interpreting the ingredient/information.

3) not having sufficient heat to cook the prepared materials/ information

4) not acting quickly enough if the heat comes on or goes out.

5) letting the ingredients simmer too long, or taking the prepared

ingredients/materials off the fire too soon.-'

INVESTING IS NATURAL/SUPERNATURAL emphasizes:

1) the individual may not be lucky enough to gain or recognize a good opportunity

that is provided by these entities.

2) the individual may not be skillful or lucky enough find or identify these entities.

3) once control is given to a natural/supernatural entity, the investor has little

efficacy in producing the desired outcome.

INVESTING IS WAR and INVESTING IS A GAME emphasize several similar problems:

1 ) the individual may not have the skill or information necessary to outwit her

opponent/adversary.

2) the investor may not have sufficient physical resources for an effective

campaign/game.

3) the investor may not have sufficient fortitude or endurance to complete the

campaign/game.

Ill While all o f these categories recognize the importance of both luck and skill, they do so to varying degrees. Each category suggests the possibility of overcoming obstacles in the process through different strategies, but all of these strategies emphasis the use of instincts, cunning or skill, rather than physical strength or force, to achieve success

COOKING, for instance, requires knowledge and talent in combining ingredients/information, and then vigilance in monitoring the progress of the mixture.

Using NATURAL entities requires the ability to locate and enlist the support of beings which may or may not provide a good opportunity. WAR/GAMES almost completely suggests that successful investing is contingent on being able to outwit the opponent/enemy. All of these seem to require a certain innate “sense/instinct” or perhaps

“affinity” for successful investing.

112 CHAPTER THREE ENDNOTES

1. Although the term g e ro u means “cut meat” in a literal translation, a more accurate translation would be “make a sacrifice”. This relates to the story of a historical Chinese fable in which a warrior cut off his arm which had been pierced with a poison arrow, rather than allow himself to die fi'om the effects of the poison.

2. A market adjustment or correction generally refers to a period of “consolidation” after which the market is expected to return to higher index levels.

3. Related terms are p in g ca n g (hold the stock position), q in g c a n g (clear or sell the stock position), and bn ca n g (replenish or add to a stock position).

4. This list is modeled on Barbara Tomlinson’s analysis of cooking metaphors as they relate to the writing process, (see Tomlinson, 1986; 62).

5. H ei m a (black horse) was a fi’equently recurring symbol in popular, informal Stock Market publications and in conversation during my fieldwork in 1998. For instance, the Stock Club discussed in Chapter Two has a very large depiction of a black horse on one of its walls. The frequency of its occurrence could perhaps justify designating it as a “defining symbol” for Shanghai Stock Market investors. In a personal communication with Ellen Hertz, she indicated that she had not witnessed the use of this phrase at all during her study of the Shanghai Stock Market in 1992, which testifies to the recency of its creation or adoption. This phrase may be related to the term “dark horse” in reference to an unexpected winner in horse racing, a term quite common in the West.

6. This is perhaps reflected in a flyer I was given outside a shopping mall in Shanghai. The flyer was an advertisement for a new restaurant that was opening, which offered “Free Cock Tails and Snakes For You” in English translation. The Chinese text provided a more reassuring offer of free cocktails and snacks.

7. The terms bull market {niu sh i) and bear market {xiong shi) were used in formal Stock Market discourse, but I am not aware of any instances in which they were used informally.

8. The term lingtouyang (lead sheep) in reference to a stock which will lead the group or market is quite similar to the term “bellwether” stock used in U.S. stock investing vernacular.

9. Although used infrequently in the context of stock investing, x ia h a i is probably more commonly used in reference to those who leave a job at a State enterprise to enter private industry.

113 10. It was explained to me that “da chuaniian” was a term used during the Cultural Revolution when Beijing student came to Shanghai to help local students organize with the purpose of overthrowing local officials.

11. The term b eita o is, like many Chinese words, a d u o yisi (has several meanings). It can be translated as “quilt cover” but is quite often used in this context with the same meaning as ia o zi or “trapped”.

12. The three terms used here as examples (beitao, taozi, taozhxi) in addition to the term ta o la o are all used interchangeably and are similar in meaning.

13. Unlike Ellen Hertz’s (1994) observation that most participants saw the Market as a zero sum contest between participants themselves, or between participants and the State, these metaphors reflect only a “battle” between the participants and the Market. There were very few metaphorical phrases that I am aware of that reflect the process as she describes it. Those that did primarily alluded to the dahu, or large investors, taking advantage of the smaller investors..

14. Based on my observations in 1998 Shanghai, mahjong (at least on the street) was most popular with the older crowd, while card games (especially played for money) were highly popular with the younger set.

15. The term q ia n refers to bamboo slips that were historically used in gambling games.

16. In this case, p a o shou (throw hand) refers primarily to large quantities o f stock, a similar phrase p a o chu or throw out, is a more generic metaphor for selling stock that can be used interchangeably with the former term.

17. The signboards (zh a o p a i) in the trading rooms show the latest Market price or last trade (w ujia or g u jia ) for a stock in red if it is a higher price and green if the last trade was lower than the previous trade. This is probably the origin of the saying_/ÜM le h o n g (turn red).

18. The term q id o n g (translated here as the verb “to start up”) is most often used in reference to starting a motor or machine, and could also be translated as “kick start”.

19. The opposite of a lo n g to u is a k o n g to n (which could be translated as “empty head”). “Dragon head” was used very fi'equently in conversation, but “empty head” was never used during my fieldwork other than the one time when a Stock Market participant explained the meaning to me. The word for dragon also occurs in sh a lo n g , a transliteration of “salon”, used in reference to the meeting places of investment clubs.

20. Da Xiang xing zhengli translates directly as “big box type arrange” and refers to a chart where the average daily highs and lows are plotted. If the distance between the two lines is large (d a ), it is an indication that the market is very volatile during that period.

114 Conversely, a "small box” {xiao xiangxing} indicates less volatility.

21. This example is also very similar to that used by Tomlinson (1986; 74).

115 CHAPTER 4

METAPHOR AND WORLDVIEW

The following chapter explores the implications o f the “cultural scripts” exhibited in Chapter Three in order to gain some insight into the “ethos” of Chinese investors.

Again, any approach to this type of analysis should be done with the understanding that consistency in metaphor usage is rare, and cultural “categories” are used here for the purpose o f emphasis, rather than distinction. However, there is displayed a number of repeated patterns which give insight into what “gestalt structures” are used consistently as tools in the creation of meaning. This is particularly of interest in this case because the

Stock Market in Shanghai is a new institution in which a unique vernacular has been recently created. This has implications for analyses o f cultural stability and cultural change, as well as the effects o f globalization as will be discussed further.

This chapter begins by looking at what are called variously “root metaphors”

(Pepper, 1942) “dominant symbols” (Turner, 1967), or as “elaborating symbols”, defined as:

...vehicles for sorting out complex and undifferentiated feelings and ideas, making them comprehensible to oneself, communicable to others, and translatable into orderly action. Elaborating symbols are accorded central status in the culture on the basis o f their capacity to order experience; they are essentially analytic. Rarely are these symbols sacred in the conventional sense of being objects of respect or foci of emotion; their key status is indicated primarily by their recurrence in

116 cultural behavior or cultural symbolic systems...(Ortner, 1973: 1340).

These “root symbols” are the basis for the process of transformation in metaphorical usage, and define what is shared in experience to provide common strategies for meaning creation. This existence o f “root symbols” is illustrated by the consistency of their usage in the previous data.

The following analysis also includes a look at the “reification” of the Market in metaphorical usage, in a manner consistent with that observed by others in varying contexts. In contrast to this possible universality of metaphors of Markets, the unique characteristics of Chinese “cultural scripts” are then highlighted in reference to how metaphor usage reflects perceptions of risk, fate and “face”.

4 1 METAPHORS AND CHINESE WORLDVIEW

The following section looks at the primary domains or categories outlined in the previous chapter in light o f how these illustrate several primary themes in Chinese culture.

These themes, or “root metaphors” as Pepper (1942) characterizes them, not only illuminate primary themes in Chinese metaphorical usage in this context, but also form webs or matrices both among themselves, and with “deeper” domains of cultural associations. It is these themes in totality which comprise worldview; or how people with these associations in common tend to view and explain the world. And it should be noted, as Parry and Bloch (1989: 19) point out, that it is more important to look at how worldview instigates a particular way of organizing and understanding money and economic activity, rather than the inverse as has been the case in many studies. In other

117 words, the infiltration of “capitalism” into the Chinese psyche is not necessarily inclusive of personal attributes considered “necessary” for successful implementation of Western economic principles in the Weberian sense, but rather an adaptation of pre-existing values with a great deal of historical precedent

4 1.1 COOKING AND KINSHIP

Nakamura (1997: 205) makes the observation that “Metaphors used in Chinese literature are always linked with historical facts o f the past...” . And Francis L.K. Hsu

(1983: 349) observes that “...it is because o f the nature of the Chinese kinship structure and content that the system has lasted so long and developed in essentially the same terms for more than two thousand years. The stable and resilient cornerstone is the Chinese kinship system...”. It is the convergence of these two statements which provides a foundation for analysis of cooking metaphors as descriptions of Chinese investment activity.

Cooking and kinship are integrated in a complex web of relationships that incorporate elements inherent in all aspects o f Chinese social relationships. The most important of these elements is an orientation towards the long term; a perspective that sees consequences beyond the self, both synchronically and diachronically. As in the proverb

“The Old Man Who Moved the Mountain”,' the self is transcended by time and place, and one’s own actions are seen in light of their impact on future generations. In this context, the accumulation of wealth is not viewed as selfish or greedy, but rather as filial, and it is this accumulation of property which allows for the continuation of the family. It is the

118 “acquisition and maintenance of property which underlies the concept of //a” or household

(Gates, 1996:96). And it is reciprocity, or the sharing o f wealth, which is the basis for the

maintenance of, and expression o f affect in these relationships. The term for investors in

this context is an excellent illustration of this point, in that the etymology of the word hu

used in dahti (large investor) and x ia o h u (small investor) relates to the gate or door in the

wall which enclosed family compounds, and has come to mean simply “household” in

present day usage. Thus the terms could be translated simply as large or small household.

Feasting has historically been the primary means o f displaying family wealth, and

of developing and nurturing reciprocal relationships both within and external to existing

familial ties. Proper and sumptuous preparation of meals affirms not only filiality and

hierarchical roles within the household, but also respect and obeisance to guests.

Traditionally, adequate provisions derive not only from quantity, but also quality

characteristics particular to conceptualizations of Chinese cosmology. As Henderson

( 1984) observes:

Correlative cosmology even influenced the ways in which food was prepared and consumed at all social levels. For ideas o f proper nutrition and good taste in traditional Chinese cuisine were generally based on the conception that particular foods corresponded with certain cosmological categories, such as yin and yang, and the five flavors. Unless the foods correlated with the categories were set oflf or blended properly, the fare might be unhealthy or unpalatable or both. (Henderson, 1984: 53)

Similar to the more holistic and systemic methods of Chinese medicine, correct and adequate preparation of foods provides not only nurture to the body, but also to the

“body” of the family and extended social networks.

119 K.C. Chang (1977), in a lengthy discussion of the importance of food and food

symbolism in Chinese society notes that “...few can take exception to the statement that

few other cultures are as food oriented as the Chinese. And this orientation appears to be

as ancient as Chinese culture itself.” (Chang, 1977; 11). It is an index of economic class

such that the “Chinese way of contrasting economic classes is to contrast their food

styles”, which is implicit in the reference to lose of employment as ta po le fa n wan (he/she

has broken the rice bowl) (Chang, 1977: 14). This equation of food with money and

status, in turn acts as a form of communication, such that:

they inevitably use food - of which there are countless variations, many more subtle and more expressive than the tongue can convey - to help speak the language that constitutes a part of every social interaction... If the occasions are formal and the statuses socially prescribed, appropriate food must be served since the parties involved know exactly what is being said - be it correct, showing extraordinary effort, or insulting - ffom the kinds and the amount of food that is served. (Chang, 1977: 16)

This expression of status recognition extends to ritual preparation of food as offerings to gods as well, and the “scale along which the offerings differ is one of transformation from potential food in its natural state to edible food...” (Chang, 1977: 18), Thus, the lowest gods in the hierarchy receive food that is prepared much like that for human consumption, while those much higher in the hierarchy receive “the most untransformed food” (Chang,

1977: 18).

This correlation o f food preparation with the expression of affinity is dependent on the symbolism of these transformations. In ritual preparation for gods, it is the “reverse” of the purification process noted by Lévi-Strauss (1969) and later by Mary Douglas

120 (1978) in the expurgation of the polluting efibcts of the raw ingredients.^ In preparation

for human consumption, however, the cooking o f food not only purifies it, but does so by

transforming it into an instrument o f sociality Raw, perhaps unhealthy or at least

unpalatable foodstuffs are prepared, combined and then cooked in a manner which

provides for the health and well being of the individual and the family. As Chang (1977)

points out, ‘Tood not only affects health as a matter of general principle, the selection of

the right food at any particular time must also be dependent upon one’s health condition at

that time. Food, therefore, is also medicine” (Chang, 1977: 9). Thus we see the

transformations of food as not only a status marker, but also as a means for expression of

affect through concern for the health of the self and members in the social group.

The implications of the transformation of wealth (as symbolized by food) into

health and longevity is implicit in these examples o f metaphors. As an individual investor

seeks to ch ao g u , or stirfiy stocks, he is attempting to generate surplus which then

contributes to the maintenance of the household. As such, cooking and stock trading are

both forms of exchange which maintain social relationships and contribute to the

perpetuation of the household. The large number of investors who received their initial

capital from family working overseas, or fi'om pooled family funds, is evidence of this

cycle of exchange and reciprocity. And it is this cycle of reciprocity that mediates between

the short term and the long term; that transcends the individual in the long term

maintenance o f the larger entity o f the household (Parry and Bloch, 1989: 2). In this way, the “cooking” of money transforms it into an instrument of transcendence. As the short term acquisition of wealth is transformed into an instrument for maintenance and solidarity

121 of the household, it reinforces the existing social and moral order. This contrasts with the perspective of George Simmel (1978), the Formalist anthropologists, and others who traditionally viewed “capitalist” exchange in complex societies as necessarily corrosive of social relationships. Money in this case is “symbolically constructed” in a manner which transcends the individual, rather than reinforcing or creating individualistic values (Parry and Bloch, 1989. 23-30).

This corresponds well with traditional notions of wealth and wealth accumulation in China. In a sense this is an extrapolation of Geertz's (1963) “bazaar type”, or what could be called a “peasant type” of economy into the more complex “capitalist” model, two domains which have traditional been viewed as distinct. In this case, the accumulation of wealth within the context of what are viewed by westerners as “western capitalist” institutions, is simply an additional opportunity to exhibit traditional symbolic transformations o f wealth. Rather than exhibiting Weberian notions of “disquiet” with material acquisition, the kinship structure seems to allow for the unfettered pursuit of rational self-interest. In this case, the transformation o f wealth acquired by the individual into something which transcends the individual is a display of filiality. It is the transformation which removes the “tension” inherent in individual acquisition. As Geertz points out, the pursuit of rational self interest in this case is not tempered by the “charity ethic” of Islam or Christianity, but rather by a sense o f “moral self cultivation” (Geertz,

1963; 126). In this case the individual is aware that his actions will lead to a greater or lesser level of welfare for members of his “in-group”, or extended family group, and it is this concern with the welfare of the group that supports rather than distracts from

122 individual pursuits.

Potter and Potter (1990) endorse this view in their observations that, in contrast

to China, emotion is the primary legitimizing basis for relationships in the West, most

likely because of the view o f the domains o f work and home/family as discrete Therefore,

in the West, the work realm is impersonal/effective while the home is the center for

expression of the personal/affective. China, by comparison, does not distinguish between

these two realms. In this case, “social relationships persist legitimately without an

emotional basis . .Because they are assuming the existence of a continuous social order that

requires no affirmation in iimer emotional response, but only in behavior...” (Potter and

Potter, 1990; 183). The realm of work is incorporated within the domain o f family/affect

in such a way that expression of emotion is considered inconsequential to the status of

relationships, and the self is legitimized through action, rather than expression.

This is somewhat of a contradiction with Hill Gates (1996) discussion of the

development of what she calls “petty capitalism” in China. In her view, large scale

capitalism never arose in China because of the bureaucratic emphasis on policy which

reinforced the existing kinship model in society, which subsequently projected this basic

model onto larger institutions in society. It is this governmental support of the kinship

model which bred “forms of resistence” in the development of “petty capitalist” activity.

Rather than accepting this more linear assumption of cause and effect however, the

pervasive use of cooking/kinship metaphors and the observations of the lack of discreteness between the realms of affect and work indicate that it is more likely a combination of an existing model only reinforced by government policies, rather than

123 determined by them. This is supported by the persistence o f the kinship model in Taiwan

and in other expatriate Chinese communities. More likely, “petty capitalism” is bred from the desire to mediate between the short and long term out of a concern for maintenance

and longevity o f the household, rather than as resistance to government policies.

This also highlights another transformation in which money mediates between the

“inside” and the “outside”. This orientation toward the family group places government policy as just one more w ai re n (outsider) which, while certainly acknowledged to exist, is viewed as an entity to be scrutinized, and then used or subverted as circumstances warrant. Lam, Paltiel and Shannon (1994) make an interesting study of enterprises in

Taiwan which supports this contention. Rather than observing the Confrician reverence for authority that is cited by many as a barrier to modernization, they focus on the “other dimensions o f Chinese culture... which includes Taoist, Buddhist and other subcultures that are, in Western terms, countercultures, challenges (to) orthodox Chinese culture...(which) reject the primacy of central authority and legitimize rebellion as a means to escape domination” (Lam, Paltiel, and Shannon, 1994: 206-7). In their view, it is these

“countercultures” which have led to the development of what they call “guerilla” entrepreneurialism in Taiwan Again, 1 would agree with their observations that these

“countercultures” are not a barrier, but may actually be a boon to modernization. But in this case 1 would place the emphasis more heavily on the “ingroup/outgroup” focus of the kinship model (which incorporates elements of what they designate as both cultural and

“countercultural”). It is this loyalty only within the group, and mediation with other groups through reciprocal g u a n x i (relationship) ties, which is most highly instrumental in

124 what they observe to be the extremely high levels of subversion of government regulations concerning intellectual piracy in Taiwan. G uanxi ties, and their ability to facilitate monetary exchange, mediate between the “inside” and the “outside”, of which the government and government regulation is only one component “Resistence”, or what they consider to be an attitude that “the law is something to get around” fits well with the notion of familial loyalty above that to “outsiders” (Lam, Paltiel, and Shannon, 1994;

213). The emphasis here, therefore, is focused more on loyalty, rather than on resistance

Nan Lin (1988), in an examination of the holistic/individualistic dichotomy made by many scholars, agrees that loyalty to familial ties is a more accurate assessment of

Chinese worldview. Lin observes that many Chinese writers portray the individual Chinese in an extremely positive sense, while characterizing Chinese as a whole as “selfish, careless, cruel, morally decadent, lacking in public morals and respect for laws and incapable of cooperation for the common good” (Lin, 1988: 66). While perhaps a bit harsh, this is based on the observation that

. ...while the family is the reference point tor the self, once outside the family, Chinese become totally self-centered...When it comes to familial matters, Chinese are very group oriented and group conscious, (but), relationships with the larger entity and other individuals are maintained and promoted so long as they help maintain and promote self interest and, therefore, family interests. (Lin, 1988: 92, c.f. Oxfeld, 1992: 274).

In summary then, the pervasive use of cooking metaphors in descriptions of Stock

Market activity indicate a number of conceptual “webs” and transformations. “Cooking” stocks is the mechanism through which (hopefully) a surplus is generated which will contribute to the sustenance and maintenance o f the household. The similarity of this

125 process with the cooking of food is revealed in this analogy, as well as others Cooking (of both stocks and food) is not a simple procedure, but requires skill and careful preparation.

However, by extension, the use of cooking metaphors indicates how a number of mediations are achieved, both between the individual and the group, the short and the long term, and between the “inside” and the “outside”. It indicates a characteristically Chinese sense of “self’ as a microcosm of the group, and as a factor in the diachronic maintenance of a larger whole.

4.1.2 INVESTING AS PART OF THE NATURAL ORDER

Mark Elvin (1985) observes that, in both the writing of Mencius and of the

Daoists, there is no notion of the self as separate from the natural world. He observes that

“Mencius was...the first to see the individual as, in some sense, a microcosm. All things in the world,’ he said, ‘are complete in us”. And, in a similar vein, the writing of the Daoists see the world in terms of interpenetration, rather then separation, in that “things have neither development nor decay, but return into each other and interpenetrate to form a single whole” (Elvin, 1985. 166).

In an adulteration of the title o f Max Weber’s (1958) famous treatise, this discussion might be called “Daoism and the Spirit of Chinese Capitalism”. However, there are a number o f elements of Confucianism present in the hierarchical cosmology describing the relationship between mankind, heaven and the earth. In this traditional cosmology “heaven and earth were the cosmic parents of humankind, generating and nurturing, respectively” (Taylor, 1989:495). Heaven and earth are opposed to each other

126 in the same sense that the concepts of yang (male/light) and yin (female/dark) are opposed, but also interconnected and intermingling without any particular sense of finite demarcation. Humankind is the mediator between these conceptualizations, in a network of mutual interdependencies. What does not exist here is any sort of structuralist binary opposition, but rather an intermingling of elements in constant flux.

In this schema the individual is placed in both an external and internal, all- encompassing dialectic, in which nature participates in the moral order and facilitates or subverts human concerns. Morality is quite often predicated on the ability o f humans to gain the cooperation of external forces, and nature and the cosmos are primarily a conceptualization of the self and the family abstracted to a higher level. Consistent with this imposition of self family on the natural order, there is a “flow” or reciprocal relation between all of these natural entities, which requires that all of these conceptualizations be defined in terms of their relations with others. Thus there is no sense of discreteness or essentialism, but rather o f ambiguity, as these relationships constantly redefine both the relations themselves, and the entities involved. This leads to a circular conceptualization of process, rather than linear assumptions of cause and effect.

Francis L.K. Hsu (1983) uses observations o f traditional Chinese art to illustrate this cosmology. He observes that

...human subjects are as conspicuous on Western canvases as they are relatively scarce on Chinese papers...Even when Chinese artists do portray the human form, they either treat it as a minute dot in a vast landscape, or so heavily clothe it that the body is hidden. The facial expression o f such figures is nil. The viewer obtains a much better idea of the status, rank, prestige and other social characteristics of the subjects portrayed than he does o f their personalities. (Hsu, 1983: 176).

127 Thus, “in Chinese art, the important thing is the individual’s place in the external scheme of things” (Hsu, 1983; 177). This external schematic places the self in the larger order, which means that there is no discrete demarcation between the self, the larger social order, nature, and by a further extension, the supernatural/ This point is well illustrated by the use of natural/supematural metaphors to describe such a “this-worldly” activity as stock market investing.

One prominent symbol which appears several times in the metaphorical examples given in Chapter Three is that of the dragon (Jong). The pervasiveness and persistence of this symbol in Chinese discourse makes it an interesting example with which to analyze these characteristics of Chinese cosmology. In actuality, the term “dragon” is probably not a good interpretation of the word lo n g , given its depiction in Western literature as an aggressive, malevolent serpent-like creature The symbol of the dragon in traditional

Chinese lore is much more complex and multi-faceted. The original etymology for the

Chinese script for lo n g depicted a man rather than any caricature of an animal or combination of animals. According to Ong (1993: 72) this is a depiction of an ancient priest-king which was later appropriated as the symbol for Chinese emperors. But over the centuries, lo n g has taken on a multitude of meanings In F en g sh u i or geomancy, the lines which are thought to be the forces affecting human destiny are called “dragon lines”.

Probably the most common association for lo n g is as a bringer of rain. During the spring festival, a dragon was said to rise up to the sky to bring the first rains of the planting season, and many of the traditional rituals of this celebration originate in efforts to coerce the dragon into cooperating in bringing sufficient rainfall for a successful growing season.

128 The well known novel X i y o u j i describes a dragon who would not bring rain against the wishes of the emperor, and was beheaded only to haunt the emperor at night until guards were placed at his bedroom door to ward off the evil intrusion/

In every sense, lo n g could be described as an elaborating symbol for Chinese culture. It is present in many aspects of Chinese literature and occupies a significant place in the reflexivity of Chinese expression. What is quite interesting is how the dragon can also be described as a “polysémie” symbol, in the same way that Ohnuki-Tiemey (1987,

1990b) describes the monkey in Japanese culture/ In a similar manner, the symbol of the dragon acts simultaneously in a number of capacities. It is at once a mediator between man and nature as well as man and the imperial hierarchy; a scapegoat when nature does not behave as desired; and (in most cases) a remote “guardian” against malevolent forces that may act in the afifairs of men.

As a mediator, lo n g appears to be nature personified, in that it is traditionally depicted with the characteristics of a number of different animals/ And in a similar manner to a number of Chinese deities, the dragon is characteristically both good and evil, although it has a primarily benevolent distinction. As mediator, it illustrates the monolithic character o f Chinese cosmology - in its accessability it breaches the man/nature dualism.

By extension, then, it is the embodiment of man in, rather than apart ffom nature. As in

Ohnuki-Tiemey’s analysis of the monkey metaphor, it “enacts the transformation of a beast in ‘raw nature’ into a deity, that is, into the transcendental self of humans. . . the self objectified onto a higher level o f abstraction ” (Ohnuki-Tiemey, 1987:167). In a similar manner, its place as an auspicious symbol associated with emperors symbolizes the

129 man/ruler interface, a yin/yang type interconnection between man and government, and

man and the universe. Thus it could also be seen in a more dualistic fashion as the

mediator between man/family and the “outside”, with boundaries transgressed through a

process of negotiation

From a more functionalist perspective, Eberhard (1971: 7) observes that “To the

Chinese who is a believer in his system, his closeness to the supernatural provides a great

deal o f security, he knows how to ‘handle” the supernatural, while his Christian, Jewish, and Islamic counterparts are full of anxiety, being unable to understand the remote deity and his decisions”. I submit that this statement, while true, somewhat obscures the complex relationship between man/family and nature/ruler in the Chinese cosmology. This

“ethos” tends to reflect not only a sense of control, but also a perception of an ambiguous world - one in which one does one’s best but also understands that there are many forces that cannot be controlled by will. The use of natural metaphors in descriptions of stock market activity, as illustrated by the previous example, reflect this control/ambiguity dichotomy. Ong (1993: 70) describes it this way, that in its association with water and rain, “/o«g signifies the essence o f flux and change, therefore of life itself’.

4 1 3 WAR AND GAMES

This category, rather than representing a discrete type of “root metaphor”, serves to reinforce the previous discussions while providing some added dimensions of understanding. These metaphors continue to reflect the pervasive presence of historical narratives as a basis for shared meaning in current Chinese expression. Although less

130 prevalent than the two previous types o f examples, the use o f war metaphors reflect what

is most likely the militaristic perception of the cosmos that has historically been present in

Chinese popular religion. Fei Xiao Tong (1992: 101-2) for example, describes traditional

Chinese kitchen gods, as “agents of foreign occupation” in the household that embody the

evil spirits produced during the Qing dynasty in which imperial surveillance and

registration (b a o jia ) led to a number of violent incidents Rituals of appeasement, such as

offerings of food and drink are therefore necessary to appease the spirits fi'om taking

revenge on the welfare of the household.

Probably the best example for analysis in this category is that of Sunzi’s “War

Method ” {Sunzi Bingfa), more commonly translated as “The Art of War”. The primary tenets of this strategic manual can be summarized as follows:

1) B in g zhe, g n i d a o y e (Warfare is based on deception)^

2) Gu hing gui sheng, bu gut jiu (Aim for swift victory rather than a protracted war)

3) Zhi bi zhi ji (Know the enemy and know yourself)

4) Gu ming zhu shen zhi. HangJiang Jing zhi, ci cm guo quan Jun zhi dao ye. (A wise ruler should only go to war when necessary, and a good general should use cunning when conducting warfare. This is how a peaceful country and the military strength of the armed forces is maintained) (Sunzi, 1996)

This very basic summary corresponds well with the examples given in Chapter

Three As in the previous two sections of this chapter, the focus is not on aggression and control, but rather the use o f cunning and skill in outwitting the enemy. These basic principles could be applied to the analysis of game metaphors as well. In other words, as

131 an investor/soldier/game participant faces an opponent, there is only concern for the most expedient and skillful victory possible/

4 14 CONCLUSION

In contradiction to Max Weber’s ( 1958) contention that the impediments to the development o f capitalism must be sought primarily in the domain o f religion, these examples seem to indicate that there is little to be gained ffom attribution of causal relationships with any sort of formal religion Conversely, they perhaps indicate that it is more important to look outside the realm o f organized religion to find what might be called dis-impediments or facilitators to the development of capitalism. As Vera Schwarcz

(1994: 76) observes “In traditional China, history took the place o f religion. . .References to history were, and continue to be a fertile source of moral value, literary allusion and guidelines for self-cultivation” . And historically, it would be inaccurate to designate

Chinese society as “Confucian” or “Daoist”, or any other particularistic generalization. It would be more accurate to look at the Chinese as historically practicing what Marcel

Granet (1975: 143) calls “syncretic pragmatism”, in which “The Chinese...adopted a sort of superstitious positivism which accepted all religious formulae to the extent that they showed themselves effectual, which made use o f all of them to some degree... but which at bottom was concerned only with respecting tradition”. And in this tradition, the only real consistency was in ancestor worship and in familial orientation, with the hierarchies of the family imposed on the larger world in such as way that man and nature both interacted with, and addressed themselves primarily to human concerns. It is this pragmatic concern

132 with the “here and now”, in which both man and nature participate equally in the moral order which provides the essence of Chinese worldview.

This essence, then can be expressed more succinctly by the Chinese concept o f he, variously translated as equilibrium, harmony or peace As one informant told me, Chinese culture is best defined as zhongyongzhi dao, or “live the most appropriate way” . Both inter-related concepts imply a “system” of societal harmony with/in nature and with the supernatural (Li, 1981; 69). The concept of famflialism provides the basis for this understanding of reality, in terms of extension of the model onto nature and the universe.

It implies that the individual self must be vigilant in acting at the appropriate time, in the appropriate way, and under the most appropriate circumstances. There is an appropriate behavior for each person and circumstance in which “the natural, supernatural, the family, society, the state, and the universe were subsumed within a total cosmic plan that left little if anything unaccounted for^’(Cohen, 1994: 100). The desired components of happiness; health, wealth and longevity could only be achieved through the avoidance of luan or chaos, a state which must be recognized and avoided. Change is managed by adapting the new circumstances to existing, proven models. And the desired outcome was not achieved by forceful control, but rather by skill and manipulation.’ As will be discussed further, this

“ethos” or worldview may be significant in the development of successful, albeit alternative models of capitalism.

133 4 2 METAPHORS OF MONEY AND THE MARKET

Money itself can be viewed as a symbol or metaphor, in that it is a vehicle for cultural meaning. Money cannot exist without projected meaning; there is no intrinsic value in slips of paper or molded pieces of metal other than that instilled upon it by agreement. By extension then, the Market can be viewed as symbolic ritual, in which the act of exchange reinforces the shared perceptions of the participants Monetary exchange can be instrumental in creating, reinforcing or destroying social bonds. As such it is an expression of concern, respect, or even obeisance. Therefore, the significance does not lie in the money itself, or even what is done with it, but rather in the shared understandings and practices created by these understandings.

Parry and Bloch (1989: 3) observe that “Regardless of cultural context and of the nature of existing relations of production and exchange, it (money) is often credited with an intrinsic power to revolutionize society and culture”. Simmel (1978), Marx

(1976[1887]), and Polanyi (1968 [1944]) all saw money and “capitalist” market exchange as destructive to any type of communal moral order, which leads from the assumption of

“dichotomies - ‘traditional’ and ‘modem’, pre-capitalist and capitalist, gift economies and commodity economies, production for use and production for exchange - with money acting as a major catalyst of the great transformation’ between them, or at least as a telling index of it” (Parry and Bloch, 1989: 7). They further point out how the

“questionable appropriateness o f (money) as a gift” in Western culture reflects this notion of dis-embeddedness and the assignment of monetary exchange to a sphere of relationships which are impersonal, transitory, or perhaps even amoral (Parry and Bloch,

134 1989: 8).

It is difficult to use these assumptions accurately in the Chinese context, wherein

“Money imagery permeates every sphere of Chinese life” (Gates, 1996: 168). In an ultimate expression o f the use of money as a communicative act (see Douglas and

Wildavsky, 1982: 23), the burning o f ritual money has traditionally been the means of opening a dialogue with the various hierarchies of gods, who are then cajoled, beseeched, or simply appeased In this context there is no perception of money as something

“contaminating, dirty, or evil. Indeed money purifies. It represents in straightforward fashion the exchange o f properties in the market” (Gates, 1996. 169). And this exchange

“purifies” in all ritual transitions in life, from reproduction, to birth to death. In this way, it is a “symbolic connector” in times o f transition, which reinforces interpersonal and supernatural bonds based on assumptions of the interactions of fates. Ellen Oxfeld witnessed this in her fieldwork among the Dhapa Chinese of India. After observing an extremely elaborate and expensive funeral ceremony, that most certainly served well to reinforce not only the social status of the participants, but also their filiality, she concluded that:

The use of monetary symbolism is not unique to the Dhapa Chinese, for the metaphor of money and monetary relations is a pervasive concept in Chinese popular religion, especially in expressions o f the soul’s relationship to its incarnations. After the introduction of Buddhism into China, the belief that a person’s soul is reincarnated in another being after death became infused in popular religious thought. But in its Chinese variant, this belief in reincarnation took on a curiously monetary expression - souls do not just get reincarnated, they need funds to do so. (Oxfeld, 1993: 101)

135 This is an example of what Francis L.K. Hsu (1983) describes as the conversion of paper money into affect, which he sees as an equation to the attributes of the “father-son dyad: continuity, inclusiveness, authority and asexuality” (Hsu, 1983: 272) All of these elements are seen as necessary for the long term continuation of the family line. Therefore, marriage, for instance, is not based on 'love" or affect, but rather on “qualifications such as ability, money, health, family reputation, severity or kindness of the boy’s mother, etc”

(Hsu, 1983: 274 ).In this context, young men are encouraged to resist temptation and

“keep their mind on weightier matters such as passing the imperial examinations...(and) A

Chinese husband who works hard at his office or in his school room does not have to worry about neglecting his wife at home (Hsu, 1983: 275). This trans-temporal orientation, therefore, produces not only an equation o f money with affect, but an orientation toward the transformation of the short-term into the long term, which in turn requires an emphasis on continuity and inclusiveness."

The way in which money expresses relationships is evident in the metaphors outlined in Chapter Three of this study. The most obvious association is that which has been previously discussed; in the association o f buying stocks with getting something to eat, and then by extension (with the convergence of affect and wealth), the performance of filial behavior which contributes to the long term welfare of the family. This was quite evident in my fieldwork. Despite the number of metaphors equating stock investing with games, the attitude of the participants indicated that this was a very serious business for them. It was almost impossible to engage any investor in a lengthy conversation during trading hours, and after hours conversation revolved around stock selection and the

136 impact of the overall economic situation. Most often, if I was not instrumental in

providing stock “tips” based on my “expertise”, I was dismissed and the conversation was

discontinued.

Another important conceptualization is the equation of the Market to a living or natural entity. References to the Market as a dragon, an ocean, or to a wild, untamed landscape coexist with implications that the Market is a living thing that can breath, throw, or play “hide and seek”. This appears to be a “meta-fetishization” that goes beyond the simple transformation of labor value and raw materials into “signs” (see Appadurai, 1986 and Baudrillard, 1996). It is more anthropomorphic, a personification metaphor that ontologically places the market in communication with, or in opposition to the subject.

Similar to Lakoff and Johnson’s (1980. 33-4) example of INFLATION IS A PERSON, it allows the participant to understand “nonhuman entities in terms of human motivations, characteristics, and activities” (Lakoff and Johnson, 1980; 33). But beyond personification, inflation as well as the Market in Shanghai are viewed as potential adversaries, that “not only give us a very specific way of thinking about inflation (the

Market) but also a way of acting toward it. We think of inflation (the Market) as an adversary than can attack us, hurt us, steal from us, even destroy us” (Lakoflf and Johnson,

1980: 34). This seems to correspond well with the conceptualizations described as

INVESTING IS WAR, in which the Market is an adversary to be outwitted and defeated.

However, contrary to Lakoff and Johnson’s (1980) inflation examples, in which inflation is

‘Tbught” as this metaphorical conceptualization ‘justifies political and economic actions on the part of our government” (Lakoflf and Johnson, 1980: 34) , the Market in Shanghai is

137 seen as an entity which can be “returned to health” via government policy (See example 2, section 3 .4 ), which implies that government is an ally in the “war” against the Market.

James Carrier (1997) discusses how the fetishization of the “Market model”, has come to pervade every aspect of Western life in a way that is has become an expression of what is considered to be “essential humanity” (Carrier, 1997: 18). He asserts that “during the long 1980's the notion of the Market became as important for understanding the West as ie is for understanding Japan or n if \s for understanding the Kabyle” (Carrier, 1997: 1).

This is a nice contrast to the evidence in this case, in which the Market has been reified, but not extended as in Carrier’s depiction o f the Market model. Rather, the Market model seems to have been easily incorporated into an existing set of moral standards and priorities. This suggests that in this absence o f “dis-embeddedness” and the tension which this produces as the opposing realms of affect and effect compete for priority, that the

Market model in China may be facilitated rather than impeded.

4.3 RISK AND OUTCOME

Chinese have been known for centuries as gamblers. Stewart Culin (1891: 15) notes how, in the last part of the 19* century, the “custom of gambling is often looked upon as one of the distinctive traits of the Chinese” and that Chinese have a tendency to

“cluster in cities near their gambling houses, and to give permanency to their settlements”.T h ere is also a description o f visits to the shrine of Kuan Di, the god of war, to bum spirit money, candles and incense to enhance the chances o f winning (Culin,

1891: 16-7) .'^ Ellen Oxfeld Basu, in her description of the Dhapa Chinese notes that

138 “gambling - in many varieties and taking place in a number of different settings - is almost as deeply embedded and widespread in this community as are rotating credit associations or the investment in new machinery for an enterprise” (Basu, 1991; 228). And Bond

(1991: 91) reports that “the average person in Hong Kong bet more at the racecourse in

1989 than the average person in China earned during the same year”

While literature, and therefore, definitiotis of what constitutes gambling behavior is sparse, researchers tend to view it in terms o f voluntarily assumed risk (Lewis, Webley and

Fumham, 1995, Heimer, 1988). More than likely, this dearth of literature on the subject is due, in part, to the lack of an appropriate paradigm for analysis of the behavior. As

Heimer (1988: 509) points out, “expected utility theory.. .implicitly assumes that risk is a bad thing”, so it is of little use in explaining why people actively pursue risky behavior.

Approaches in other fields, such as engineering, ecology, economics, psychology and decision sciences tend to isolate risk from other factors in their analyses. And the focus has traditionally been on universal and systematic biases, rather than on specific characteristics of various cultures. What is needed then is a more “embedded” approach which views the behavior in terms of the larger moral and political context (Douglas,

1992: 50).'^

From an anthropological perspective, I submit that there are three primary factors which impact the risk perceptions of Chinese investors, and by extension, Chinese entrepreneurs. These are: 1) the security of^ and orientation towards, the family structure

(which was discussed previously in the Section 4.1, see also Hsu, 1983), 2) Chinese conceptualizations of luck and fate (which is discussed in the next section of this chapter),

139 and 3) a relatively high comfort level with ambiguity, as evidenced in Chinese philosophy

and language.

The primary method used in stock selection for all of the Stock Market

participants which were interviewed was ganjue, which could be translated as “feeling” or

“intuition”. While it could be argued that this is a function o f a lack of primary and

secondary information available for use in stock selection, along with other structural

factors, I would argue that it also reflects characteristics of Chinese worldview. Using

language as a “window” on this orientation, there are a number of examples of how

ambiguity in language may reflect a somewhat ambiguous worldview. For instance, Paul

Friedrich (1991; 21) concludes that “probably the main problem in Chinese translation...is

the disambiguation o f what is [and often is meant to be] ambiguous: singular/plural,

present/past, definite/indefinite, proximal/distal, and so forth”. Although it is difficult to

say with certainty that Chinese is more ambiguous than English (this would require an

infinite number of examples), most scholars tend to agree with this observation. Ho (1993)

observes that “meaning takes precedence over form” in Chinese, and that “an analogy can

be made: English, which requires rigorous agreement between sentence elements, is the

natural-science type language, while Chinese, whose rules are few and vague, and more

subject to pragmatic manipulation, is the humanities-type language. In such a humanistic

language, options and subtleties abound...” (Ho, 1993: 69). ** This ambiguity in the language further extends to unique characteristics of Chinese logic and problem-solving,

as Ho (1993) describes Kaplan’s (1966) observations that:

...the strategy that is adopted in Chinese and some other oriental languages,

140 such as Korean, is that the development of ideas turns in a widening circle. The circles turn around the subject and show it from a variety o f angles, but the subject is never looked at directly. Things are developed in terms of what they are not, rather than in terms o f what they are. It is noticeable that when approaching a question, the Chinese tend to provide an item-by-item list of justifications and rationales with a lot of minute details thrown in before giving the most important information that is being sought In evolving a particular idea, speakers of Chinese tend to link a single example to multiple examples and take into account facts that are at variance with or contradict it. Terms are understood on the basis of a large number of contextual factors. It is for this very reason that the Chinese are regarded as inscrutable by many Westerners (Ho, 1993; 134).

Michael Bond also describes the results of Rorschach ink-blot tests on both

Taiwanese and American children The Taiwanese children tended to group the cards based on similarities in the total appearance or assumed relationships (i.e. this man and woman are married) , while American children tended to group according to specific attributes, such as “these animals are furry". The results tend to support the traditional whole/part dichotomy as it relates to traditional Chinese logic, in that American children related objects only after breaking them into parts, while Chinese children tended to relate objects as a whole (Bond, 1991: 24). What this indicates is an ability to understand concepts in terms of multiple and varying relationships, rather than as direct relationships between specific components or combinations o f components. This fits well with the previously discussed conceptualization of man “within” rather than “apart” from nature and the universe. In other words, the traditional emphasis has been on the maintenance of harmony within the world/universe, rather than on control over an “external” world.

The relative absence or presence o f concern for linear consistency and objectivity has several potential implications for analysis of risk and conceptualizations of what is

141 desirable or acceptable in both societies. Assumption o f risk is determined to some extent

with the level o f comfort in relinquishing actual or perceived control. Thus, a more risk

averse personality would be less inclined to buy volatile stocks or to buy stocks in a

volatile Market. More control can be achieved (or is perceived) when a stock’s

movements allow for more reaction time in making buying and selling decisions. It would

stand to reason, then, that there may be some sort of relationship between acceptance of

ambiguity in perceptions o f the worid, and acceptance with a relatively high level o f risk

(and lack of control) in stock investing. This seems to be particularly true in Shanghai, one of the most volatile Stock Markets in the world, and also one in which companies provide a relatively small amount o f information to participants.'^ The whole/part orientation allows for acceptance of a multitude of contradicting factors, in constant flux, to be considered in the equation. And this acceptance of the fact that there is much more than a linear, cause and effect relationship of factors to the performance of stocks allows for ganjue to be highly operative in decision making. Which also leads to a degree o f comfort with (what Americans might consider to be) vague feelings of having considered the available information and then trusting feelings or emotions in making the decision.

From a more functionalist perspective, however, there are several factors which somewhat contradict this analysis. The prevalent use of technical analysis leads one to assume that there is a certain degree of desire for control and relief ffom anxiety. Similar to game theory matrices or even invocation o f favors from ritual gods, technical analysis provides a sense that the individual has been “doing all that anyone is capable of doing, and hence can await the result without anguish or recrimination” (Goffinan, 1967; 179).

142 The use o f technical charts, although interpreted subjectively, gives many the sense of

making decisions based on objective data In other words, what is interpreted as a

“breakout” or a “morning star” can provide the sole basis for making an investment decision. And, because the determination of what constitutes a “breakout” or “morning star” pattern can vary ffom person to person, it can provide a basis for a resulting

“cognitive dissonance”, in which future stock behavior is interpreted in a manner consistent with the original decision Thus, the existence of “false breakouts” and other such elements of technical nomenclature reinforce the legitimacy o f the original decision

Another element which is important for inclusion in this discussion is the way in which the excitement of gambling contributes to the utility of the process. Lewis, Webley and Fumham (1995; 89) note that “attempts to find a link between measures of risk taking and gambling have not been very successful, but one consistent finding is that horses with low odds (favorites) are underbet and outsiders are overbet...this implies that there must be some non-pecuniary advantage of betting on outsiders, which is most probably that it is more exciting”. The fact that these investing activities occur in spatially segregated rooms in a highly social context only contributes to this sense of individual and collective excitement. Similar to the recent phenomenon in the U.S. of Internet day trading, conducted in specially equipped trading rooms and discussed in cyberspace “chat” rooms, the sociality of these settings imparts what Erving Goffinan (1967) terms

“consequentiality”. This refers to how gambling in these settings is done for much more than the actual amount of the winning, or gain (Goflftnan, 1967: 159). The actions become

“fateful” in that they are “...socially defined as ones an individual is under no obligation to

143 continue to pursue...No extraneous factors compel him to face fate in the first place; no extraneous ends provide expediential reasons for his continued participation (Goffinan,

1967; 185). Money earned in this way is viewed differently than money earned from work, for instance. In the later case, “The outcome of one’s activity may not be clear for years or even decades”. In the “action” of games and contests, such as gambling, the “outcome is determined and payoff rewarded all in the same breadth of experience”(Goffinan 1967:

156)." And the social setting allows “the gambler to demonstrate a variety of personal attributes”, thus they become a “fateful context for displaying competence” (Goffinan,

1967: 196). In my experience, there is also a sense of “engagement” such that when a person buys a stock or bets on a horse, it becomes “theirs” to a certain extent. Thus when the stock or horse performs well, there is a feeling similar to that achieved when one’s child performs well in school, for example. This could be seen as an additional factor in

Goffinan’s “display of competence ”

Lewis Webley and Fumham (1995) make a similar observation to Goffinan s, that

“monetary payment is secondary to involvement” , and that “People treat money differently depending on where it comes from, whether it is a windfall or whether it is

‘earned’. Meaning is added to this neutral medium o f exchange ’(Lewis Webley and

Fumham, 1995: 10-3). In this type o f arena, money is devalued, or removed ffom its equivalency status as the price of some consumer good, for example. As a gambler gets into the “flow” of “fateful ” action, he/she begins to experience feelings similar to those in a game or contest, in which money is secondary to the thrill of winning, and therefore gaining “face”. The activity is undertaken for purposes of display, and the accumulation of

144 wealth is secondary.

This would certainly seem to be true for investors in China to a certain extent.

Seen from an “anomie” perspective, the Stock Market serves as the only source of excitement for many people (as well as the only chance for earning extra money).*’ And, similar to several studies of the social aspects o f investing in the U.S., the sense of canjia

(joining in) catalyzes this excitement. In the self-contained, affective settings of the zhengquansuo (trading rooms), there is a definite sense of camaraderie and group- centeredness. And the sociality o f these settings may contribute to the volatility of the

Stock Market. As Baker observed in his 1984 study of the Stock Options Market in the

U.S.; “Trading among actors exhibited distinct social structural patterns that dramatically impact the direction and magnitude of option price volatility” (Baker, 1984a: 807). What he concludes is that, contrary to Micro-Economic theory, price volatility increased as the crowd became larger on the floor of the exchange. He also notes that as the Market becomes more volatile, risk “assumer” type personalities are attracted to participate, which exacerbates the situation even further (Baker, 1984: 807-8). Therefore, if it is true that Chinese tend to have relatively risk assuming personalities, as witnessed by the volatility of the Stock Market and propensity toward an entrepreneurial “ethic” (see Potter and Potter, 1990: 339; and Basu, 1991: 252), then the social aspects of the “focused gatherings” in the zhengquansuo may exacerbate this further.

As such, participation in the Market aligns well with these conceptualizations of the Chinese “ethos”; displays of character in a social setting that are not directly competitive, and therefore does not endanger reciprocal social ties, and the accumulation

145 of wealth in an entrepreneurial manner which demonstrates filiality. What this behavior also displays is most likely a universal feeling of excitement in undertaking “fateful” action, and the desire for hope in an uncertain world

4 4 FATE AND FACE

Included in this matrix of conceptualizations are Chinese notions of fate (m ing) and luck (yun). It is the combination and inter-relationsbip of these two notions o f destiny that are highly instrumental in Chinese worldview For instance, Chinese fate and fatalism is often described as a conceptualization of a life in which even the best o f efforts may result in failure and “that even the most moral and diligent human beings carmot necessarily guarantee their own success...” (Harrell, 1987: 101). However, in contrast to

George Foster’s description of fatalism as “something that inspires resignation, passivity, and content with one’s present existence, something that discourages ‘hard work, energy and thrift’” (Foster, 1965: 306, c.f. Harrell, 1987: 97), the Chinese are known for their hard work and “entrepreneurial ethic” (see Harrell, 1987; Freedman, 1959; Oxfeld, 1993).

This is where the concept o îy u n is instrumental.

While m ing (also translatable as “üfe”) implies that one’s circumstances in life

(particularly in the material realm) are consigned at birth, yun describes more short-term variances in an individual’s fortune. Fate im ing) is “the entire picture”, a sort of “post hoc rationalization” that carmot really be determined “until that person dies”, while is the short term, more controllable variance within that long term “umbrella” (Harrell, 1987:

100-3). Thus, for instance, fate figurers can be used to determine the most important short

146 term strategies within the context of a person’s lifelong fate. M ing, as such, is limiting and predetermined, but can be over-ridden by efforts made at auspicious times as determined by yim . And these auspicious times (as stated in I Ching) are determined by “by the constellation of forces prevailing at that time, or alternatively the result of the pattern that energy assumes at the particular time” (Porkert, 1988: 67).

Within this conceptual framework, there is no ambivalence towards, or tension created by the acquisition o f wealth. Fate and wealth are directly linked, such that “talking about a good fate is just another way of talking about a good life or a comfortable life, devoid of any mystical implications... simply another way o f commenting, seriously or casually, on one’s own or another’s material station in life” (Harrell, 1987: 94-5).Wealth and prosperity were traditionally the rewards of the gods for an honest, upright life, and for those unable to attain these rewards through the preferred tradition of Confucian officialdom, monetary rewards could be channeled toward the education of children and grandchildren so that they might do so. As such, the acquisition of money and wealth moves beyond provision for subsistence, and becomes a primary component in “social capital” (Bourdieu 1986), and this “social capital ” becomes an outward sign of superior morality. In China, as in Parry’s (1989) observation o f Indian notions of theodicy, or the doctrine of karma, the rich are perceived to “deserve and have earned their good fortune”

(Parry, 1989: 78).

Therefore, in stock investing, as in entrepreneurial activity, there is an understanding that one’s best efforts and skill are instrumental in success, but there is also an acknowledgment that even these best efforts may fail. This makes an interesting

147 contrast with notions of luck and self-determination in the West. For instance, Fumham and Bond (1986) did a study comparing explanations of wealth using both British and

Hong Kong respondent samples While “having a lucky break” ranks number one in Hong

Kong, it was ranked fifth overall in Great Britain And the fact that “Being bom with good business sense” ranks number two in Hong Kong (number one in Britain), shows well the conceptualization of luck in the Chinese cosmology (Fumham and Bond, 1986; c.f Lewis

Webley and Fumham, 1995; 149). This study most likely shows different perceptions o f luck as mirrored in how English speakers talk about their own fates. In English, luck is something that can be acquired, like a person or a substance, for example an English speaker can “be out of luck” or “get a break” with the implication that the extemal existence of this “substance” or “person” is primarily random. Thus the existence or non­ existence of fortune is something to be ignored in favor of effort and self-determination.

The American saying that “you create your own luck” is an obvious example. The Chinese conceptualization o f luck is more intemal, a part of the self, such that its existence is acknowledged and deemed manipulable. One does the best one can under the circumstances, and this allows for the fact that life is partly pre-determined and partly self- created by a long series of actions that have accumulated and are interacting to impact one’s present circumstance. This retums to the previous discussions of Westem conceptualizations o f linear cause and effect relationships, versus the more dynamic interaction of Chinese conceptualizations of predestiny intermingling with forces created by self-determination. Bond (1991) seems to agree with this analysis, stating that “the

Chinese have a rather affectionate relationship with Fate, the great leveler, Westemers are

148 very combative with Fate, regarding her...as the measure of their ignorance and their

inability to bend Nature to their wills...” (Bond, 1991; 61).

This perspective also has implications for the acquisition and maintenance o f the very important Chinese concept of “face” (jnianzi). Goffinan (1967) cites (Hu, 1944) and

Yang (1945) in defining this concept as “the positive social value a person effectively claims for himself by the line others assume he has taken during a particular contact. Face is an image of self delineated in terms o f approve social attributes...’’(Goffinan, 1967: 5).

In the “arena” of the trading room Fate is the “great leveler”, hvXynn is also the great teacher. In contrast to Foster’s (1965) description of “limited good” in which the world is seen as competition for limited resources which breeds resentment, in this context there seems to be little animosity towards those who have been successful investors in their

“own” arena. On the contrary, there is exhibited a great deal of respect and admiration for those have displayed knowledge o f the skills necessary for “luck” in stock investing.

“Face ” or prestige seems to be acquired not so much by the willin^ess to take extraordinary risks, as observed in some gambling arenas (see Heimer 1988), but rather in successfully negotiating the uncertainty o f the marketplace. Because the act o f investing is not seen as a zero sum game, the social qualities of investing do not reflect a contest between participants, but rather a contest between participants and the Market (or in some cases the large, primarily invisible investors who may be manipulating the Market). Fate’s role in determining outcome removes the qualities of aggression or competition between individuals, and with aggression channeled toward the entity of the Market, there is no loss of “face ” when investing efforts are unsuccessful. Simply participating in these

149 "Tocused gatherings” to the extent that one can be identified as an ‘‘insider’' allows all a certain measure of “face”, as well as yuan or afiSnity with fellow participants.

In this context then, displays of wealth coincide with displays of skill and good luck, which produce not resentment, but rather provide reinforcement and hope for those whose immediate fortunes are not quite as auspicious This sense of community in these microcosms of Chinese life reflect the idea that “Chinese culture is dominated by the idea o f harmony in the universe. If an individual can place himself to ensure the most harmonious relationship possible, he can hope for good fortune...” (Douglas, 1978. 84).

150 CHAPTER FOUR ENDNOTES

1. The story relates how an old man decided to move a mountain because it was blocking the sun. After working many years with a bucket and shovel, one of his neighbors told him he was foolish, that he was old and could never finish moving the mountain by himself before he died The old man replied that he had no worries, since his sons and his sons sons could finish the job.

2. Metaphors which are indicative of the impurity o f money used by English speakers (for example, “filthy lucre” or “stinking rich”) were not present in the expressions of Chinese speakers during the gathering of this data. It would be an interesting study to look more specifically at these types o f metaphors in Chinese (if they exist) and relate them, (or the lack o f them) to the Chinese attitudes towards wealth discussed in this section.

3. This cosmology is also evident in the preparation o f food as discussed in the previous section, i.e. that the correct combinations of elements, such as cold and hot, be incorporated for the food to be healthy, palatable or both.

4. This is said to be the origin of door gods placed in fi-ont o f the doors o f temples, as well as hanging red banners on each side of the door at New Year’s. (Ong, 1993:82)

5. Ohnuki-Tiemey (1987: 9-10) defines polysemes as “pools of meaning...from which participants draw at times the same meaning and at other times different meanings”.

6. Ong (1993:60) describes /ong as a composite o f nine different animals, with a head like a camel, horns o f a deer, eyes of a rabbit, ears of a cow, neck o f a snake, belly of a frog, scales of a fish, legs and claws of a hawk, and the palms of a tiger. In addition it has a distinctly serpentine shape, and some depictions include wings.

7. The character gui can also be translated as deceit, trickery or cunning.

8. It is interesting that there is little indication of a concern for preservation of “face” for the opponent as might be expected in the examples here and in Chapter Three.

9. I am grateful to my advisor. Professor Chung-Min Chen (who learned it fi'om his teacher. Professor Li Yiyuan), for introducing me to the concept of he as a root metaphor for Chinese culture.

10. This orientation was still quite evident in Shanghai during my fieldwork in 1998. For example a young Ph D student described her experiences with xiang qin, in which family members and fiiends introduce suitable couples to each other. She indicated that this was her only really acceptable way of meeting potential marriage partners.

151 11. I would prefer to subsume the last two elements in Dr Hsu’s schema (authority and asexuality) under the category of hierarchy, or the understanding and performance of designated roles both within and extemal to the family association.

12. Culin mentions a number of interesting natural metaphors in his description. These include kao U (dog’s tongue) which was used to slide money toward the desired number in the game of fan t’an, and what he calls “pak chu and hak chu ”, which mean white pearl and black pearl and were counters or chips worth 10 cents and 1 dollar respectively.

13. There was no such concern with Kuan Di (the god of war) during my fieldwork in 1998, however, jade amulets portraying Kuan Yin (the goddess o f benevolence) were common both in and out of the zhengquansuo.

14 . As evidence that definitions of danger (and risk) are socially constructed, Mary Douglas (1992; 14) notes that “it appears in Japanese there are words for danger, damage, harm, also the full vocabulary for probability analysis, but no word for risk”. This may be inherent in O’Barr’s interviews of American institutional investors who perceived the Japanese Stock Market o f the late 1980's and early 1990's as “this great big casino ” that “aren’t necessarily value-driven markets ” As O’Barr points out, “the Japanese may see it as rational” to have a Stock Market price to earnings ratio of 60 (O’Barr and Conley, 1992: 215-6).

15. A good illustration o f the relative difiSculty English speakers have in dealing with ambiguity is a joke told to me by a Chinese fiiend. While not particularly funny when translated into English, it tells of an American woman who attempted to cook using a Chinese recipe, and became extremely finstrated when the recipe called for a “little of this” and “a little more of that” ingredient, rather than the measured portions characteristic of American recipes.

16. This somewhat contradicts Douglas and Wildavsky’s (1982: 14) institutional approach when they assess social risk perception in terms of institutions and peoples perception of them, stating that “the more they trust in them, the more risk acceptance; the less trust, the more risk rejection.”

17. O’Barr and Conley (1992) make the observation that intuition is quite often instrumental in the decisions of American institutional investors as well, although the fact is rarely made explicit. See also Chapman and Buckley (1997: 241) in their discussion of American production managers.

18. There is a definite sense of investing as “play” in Shanghai as witnessed by the examples of metaphors relating to games in Chapter Three. However, I never heard the expression wan gu (play stocks) described by Ellen Hertz in her 1994 study.

19. One Chinese fiiend characterized Chinese society as xin p a sui (broken spirits) in reference to people’s reaction to years of constantly changing and sometimes brutal

152 governmental economic policies

20. Adler and Adler (1984b) describe a study conducted by Click (1957) concerning the social aspects of the Chicago Mercantile Exchange, concluding that “Due to the pervasive uncertainty inherent in the market setting, however, an informal social system arises which partly complements, but largely supplants, the formal system. This informal social system reduces people’s uncertainty by providing them with a stable social psychological environment which guides their actions. Traders motivations are shown to be ...emotional as well as unconscious, and oriented toward deriving gratification fi'om the system of social relationships existing within the Exchange.” (Adler and Adler, 1984b: 5-6).

153 CHAPTERS

CONCLUSION

The goal o f this study is to place culture at the center of the analysis of economic activity, rather than at the periphery as occurs in most other fields. This has required a different philosophical grounding than other approaches, such as Structuralism or

Marxism, which tend to look for, or assume more universal human tendencies ' In order to uncover the “lebenswelt”, or the underlying basis of shared meaning and expression described by the German philosophers, it is understood that a comprehensive “many world” or relativistic approach is necessary to avoid naive ethnocentricity in the analysis of meaning and truth. And that in translating distinctive sets o f cultural schema, it is important to look beyond the evaluative contexts of Westem culture. This is not to deny that universal tendencies exist; the examples of personification metaphors of the Market in

Chapter Three would seem to bear witness to this fact. However, the emphasis here is on the unique conceptual schemes of Chinese investors, and to understand “rationality” and by extension morality in this unique context. It this case, the examples of metaphors which are presented seem to provide evidence for cultural continuity, but also (to a limited degree) cultural change. It would be quite interesting to look at metaphorical usage in

154 similar realms as comparison, such as stock investors in Taiwan and Hong Kong, or small

business owners in China as a further indication of cultural continuity and change.

How these Shanghai stock investors structured their perceived world was more

generally suggested rather than directly stated, and therefore required a fairly rigorous

“decoding” process. However, in this context there appears to be fairly definite indications

of what is appropriate for mapping between domains in metaphorical usage. For instance,

reference to a “dragon head” in the jargon o f American investors would most likely sound

strange and awkward, whereas even a Chinese non-investor would probably be able to

discern its meaning. The key to interpretation here lies more in the “essence” o f the

concept, rather than in strict literal interpretation. U.S. investors would most likely

associate a “dragon” with malevolence, or would consider the use of this symbolism

strange and inappropriate since the “dragon” does not hold a central place in American

conceptual schemes. Chinese investors, on the other hand, would most likely recognize a

symbol used pervasively throughout Chinese culture, and by extension associate it’s use

with mediation, benevolence and perhaps nobility. This shows how meaning can be shared

in one context, but requires extensive translation across a number of different conceptual

mappings for more than a superficial understanding in other cultural contexts.

This is not to say that the discourse of Chinese investors is completely constrained

by traditional conceptualizations. An excellent example here is the use of “black horse”

(Jiei ma) to mean not only a stock that will increase in value, but also as what has become a defining symbol for the Stock Market in Shanghai. The symbol appears everywhere, on books, magazines, and on the wall of investor’s clubs, although it is nowhere to be found

155 in the official and more formal literature. Extensive research shows little historical precedent for the use of black horses in traditional Chinese thought - It is most likely that this is a testament to the creativity and dynamic nature of metaphorical usage. This example fits in well with the pre-existing schema of natural references, but the specific reference to a “black horse” has also developed as a new, foundational metaphorical and physical symbol for the new institution o f the Stock Market /

While these metaphors are only one “window” on culture, they do seem to reinforce other more general observations about Chinese culture. Pepper’s (1942) characterizations of “contextualism” and “organicism”, for instance, would coincide well with the primary schema exhibited in these metaphorical examples. As discussed, the prevalence of “natural” metaphors in these examples would tend to support observations of the whole-part cognitions implicit in the “organicism” and “contextualism” designations. That these discourse forms are structured in terms of man “in” nature indicates a perception of self as a microcosm of a larger whole, rather than as discrete entity. It would also serve to reinforce the coerciveness of historicity, in the mapping of these traditional discourse forms into this new vernacular of investors.

On the other hand, the existence of several examples best characterized as revealing mechanistic orientations, in which reality is described as having machine-like qualities, may reveal either cultural assimilation, or that this orientation is implicit in

Chinese culture itself. However, the extremely small number of these examples, and their extremely limited usage, suggest that the former is most likely the case. The most probable scenario is that their usage has been adopted from Westem sources, such as the discourse

156 of formalist economics, which may serve to give an “air” of legitimacy to informal presentations by stock “experts”/

As the symbolic anthropologists, such as Victor Turner (1967, 1974) have discussed, ritual and symbols most often indicate transition or transformation. One could say that these metaphorical examples, which show the mapping of existing cultural symbolic concepts onto the new domain o f the Stock Market, are similarly indicative of change and transformation, intertwined with cultural continuity. The intense and game-like atmosphere of the stock rooms has the resonance of a festival, in the sociality and ritual­ like behavior of the participants. Just as gambling or cooking at family gatherings allows public displays of character and renewal of affective ties, the behavior of Stock Market participants reinforces the bonds between “insiders” and provides an arena for the display of character. There is a sense of camaraderie in joint participation in “man against the

Market” as reflected in the use of military and game metaphors. And the morally neutral character of money in Chinese society allows this focus to be sanctioned and even supported. These Chinese investors have not developed a rhetoric of individualism and competition, but rather have built new metaphorical structures on the existing domains of family, the entrepreneurial ethic, and cooperation in a natural order. It is the incorporation of these traditional domains which reflects the sanctioning of the pursuit of wealth within the new realm of the Market.

This embedding of new metaphorical expressions in traditional domains reflects the continuity of traditional conceptualizations of money and exchange. Just as “time is money” depends on intrinsic cultural value judgements for interpretation in Westem

157 cultures, INVESTING IS COOKING serves to reveal a root paradigm that intertwines in

a web of relationships with the other Chinese conceptual categories discussed in this study. A more complete understanding can be achieved if the meaning in each of these categories is not viewed as atomistic, but is understood in relation to each other, and to more “submerged” cultural elements In this case, money is transformed symbolically into food, which is then transformed into a substance which serves to promote the health and permanency of the household. The household itself reflects the organization of the larger natural order, and the relationship between man and nature. Thus money allows mediation between the inside and the outside of the basic household structure, as do other natural entities. In this way, money, like feasting and other types of ritual, acts as a form of communication and mediation. Money brought into the household is a display of filiality, just as burning ritual money opens communication and reinforces relationships with the traditional gods of popular Chinese religion.

Once transformed into sustenance of the household, money then acts as mediator between the short term and long term. It is this long term mediation which somewhat contradicts many assessments of the tension created by emphasis on the importance of //.

Often translated as propriety or principle, // refers to the illegitimacy o f the pursuit of riches in Confucian doctrine. In this “high” cultural tradition, the most respected pursuit was that of education which enabled talented scholars to enter officialdom and therefore enhance not only their own social status, but that of their kin ties. As Hill Gates ( 1996) points out, however, this was not an accessible aspiration for most with limited economic resources to educate their children. Most often, it was only through entrepreneurship and

158 “petty capitalism” that families could hope to acquire the economic surplus necessary for

funding education, and this was often undertaken with the understanding that this may not

be accomplished for several generations Thus, in a dialectical manner, the pursuit of

riches became legitimized for the economically disadvantaged, through its facilitation of

long term goals for the household In this case, the principle o f // is extended to account

for the belief that material rewards will be given to those who display “honesty and uprightness in human transactions” (Gates, 1996: 173). This “uprightness” implies that consumption is condoned only in as much as it provides for the needs of the household but also that only exploitative profit is to be avoided Outside of these parameters, the pursuit of profit and accumulation of wealth are sanctioned and even respected, as reflected in the fact that “money imagery permeates every sphere of Chinese life” (Gates, 1996: 168). This moral orientation towards money and wealth shows in “quid-pro-quo” transactions with gods, and in the “near universal Chinese anxiety about ghosts” (Gates, 1996: 34). As Hill

Gates sees it, “ghosts represent perhaps the ultimate fear in Chinese life, that of being alone in an exacting, competitive world, with no economic base. Their lack of human connection to material resources makes them essentially evil” (Gates, 1996: 34).

Thus money mediates between the individual and the family, the family and the larger social sphere, and between the family and the larger natural/supernatural order.

Transactions and communication can occur between all of these realms through the process of economic exchange. And the communication is reciprocal, as natural and supernatural forms act to facilitate or subvert human interests in material accumulation. In this way, symbols project and express lived experience, which is the source o f the affective

159 quality of these metaphorical expressions. In this context, then, rather than acting as transgressors of categorical boundaries, this metaphor usage implies more of a symbolic correspondence between interacting entities Similar to the polarity/non-polarity of the concepts of yin and yang, communication and interaction of some sort is possible and even necessary between all o f these domains in order to facilitate human concerns.

Li Yiyuan (1981) supports this in his discussion of the traditional Chinese concept of r/on re/7/re >7, translated as th e ‘‘harmonious umty of heaven and mankind”. In his discussion, he articulates how this fundamental concept is expressed in popular culture through the ritual balancing o f the “five elements” (yvii xing), constituted by water, wood, metal, fire and earth. When a child is bom, the eight characters of the horoscope {ba zi) determine his/her fate, or ming. As a person’s life proceeds, however, these ba zi continually change linkages in ways that determine a person’s >7//7, or short term opportunities. Both of these concepts are based on the existence of dissonance or harmony, with harmonious linkages as the harbringer of good luck. Much of traditional

Chinese ritual stems ffom the desire to achieve this harmony, and is the basis for these

(often monetary) forms of communication and mediation in order to “change fate” {gai ynn). This is expressed spatially in the practice of fe n g shui, which places man in balance with his physical environment by arranging physical components in the correct order o f the

“five elements” (wu xing). Internally, the correct balance can be maintained by correct proportions and preparation of food “types” (such as “hot” or “cold” foods), or by actually adding a character to the name which will bring the “five elements” back into correct balance and restore the harmony of ihe yun. This addition o f characters can also

160 achieve the maintenance or restoration o f harmony between humans, both living and dead.

These objectives are all accomplished through the harmonizing of mind and body (through

qi, or ‘lifeforce”) with the entire natural system.

The perpetuation o f the family is the primary concern in this pursuit of harmony

(he). In this schema, heaven and earth are the cosmic parents between which humans are

the mediators who work to maintain this harmony. All of these factors of interdependence

must be considered, including relationships with the self, the family, others and the

environment. Money developed as a primary tool in this process of mediation and

facilitation, most likely because of its association with reproduction and sustenance.

Money transforms into “social capital” which allows the expression of gii rou zhi qing

(flesh and blood feelings) - that close and harmonious family relations are the primary goal

in life (Gao and Ting-Toomey, 1998; 13).

Thus, the existence here of Geertz’s (1963: 44) “bazaar economy ethic” as an

“expression of the essential self' implies a facilitation of the development of Chinese modernity. Here, the moral power of money and exchange is revealed in how it is symbolically depicted, showing that the “spirit” of capitalism may have fewer obstacles to overcome without tension or ambivalence towards material acquisition. Just as concepts such as “risk” are socially constructed based on differing personal and societal guidelines

(Gofifinan, 1967: 157), so too is the rationality of utility maximization in dififering social contexts. In this case, rather than the traditional perspective of money giving rise to a particular worldview as was the case in the many earlier anthropological representations, worldview is perceived as the impetus for particular monetary symbolic representations

161 and processes of exchange. Which leads to the conclusion that there will most likely not be a true “convergence” of China with Euro-American modernity This in turn indicates the need for understanding of unique notions of rationality and value. For instance, a relatively high price to earnings ratio, which may seem highly irrational and speculative to

American investors, may seem perfectly rational in a cultural context in which ambivalence and uncertainty is more acceptable. This supports the understanding that money and investing is partly cultural in reality, and that ethical “goods” o f the “Market model”, such as autonomous markets unencumbered by government intervention, may not be entirely realistic in other cultural contexts. As Eric Wolf (1982) points out, Euro-American models of capitalism may be developing significant and distinct rivals in these “odd-looking” capitalisms of Asia.

162 CHAPTER nV E ENDNOTES

1. One example would be LakofTand Johnson’s (1980) focus on universal metaphorical orientation toward describing abstract concepts in terms of more immediate physical experience (such as spatial orientations). This study tends to focus on the unique cultural concepts used to describe the concrete in terms of the more abstract.

2. One of the few examples of the occurrence of the symbol is in the rituals of the Zhou dynasty emperors who were “...charged with the maintenance ofNatural Order and calendric Regularity...”, and were therefore required to bring about winter “...when, dressed in black, with black stones at his belt, using black horses, a dark carriage, a black standard, the king took up position at the NW comer of the Ming T’ang and ate millet and pork...” (Granet, 1975: 68)

3. The “black horse” symbol is most often portrayed dramatically as the fi'ont half of a horse in silhouette, with head raised and the front legs rearing up.

4. In contrast to the numerous and repetitive usage of natural and cooking metaphors, these machine metaphors were only each used once that I was aware of, and only in the context of presentations at the Stock Club rather than in everyday usage.

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182 APPENDIX A

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