19 March 2006

Hong Kong March 2006

Back in Hong Kong for a 25 hour lay-over. This wasn’t part of my original plan but Qantas offered a free upgrade combined with a better fare if I rerouted from my original plan to overnight in Sydney & Singapore on my way to Scotland.

I get a big kick out of Hong Kong now that I don’t have to live here. It is intense here. Driving to the hotel last night at midnight, I realised that I could still get in a solid nine hours of partying before having to hit my hotel room. Suppose that it is a bit like Vegas here in that respect.

I skipped the all-nighter and decided to get some sleep instead. It was 6am New Zealand time when I lay down so I didn’t get much in the way of quality shut eye.

Had a rude awakening when I found my first two Starbucks closed at 8am. Fortunately, a French-style café bailed me out with a monster latte before my run.

I could tell you all about my (very restful) day but Molina says that often I’m the only one that finds these things interesting. More specifically, he said that I should savour the fact that M is patient enough to listen to my training reports because, odds are, that might not be the case after five years of marriage. Although… I called my super-vet athlete last weekend and his wife gave me a run down of his bike session – he’s 68 so perhaps there is hope for me.

What I find interesting about Hong Kong is that a lot of people think that it is really good living here. I imagine that the lifestyle here represents what tens of millions of Asians aspire to achieve. Asia is quite useful for offering contrast and perspective – I recommend a trip through India or rural China for any Westerner that has a habit of complaining about their lot in life.

Back to Hong Kong (or Shanghai if you get there)… these cities are top of the heap in East Asia. Plenty of opportunities, lots of action, huge crowds – absolute craziness. I was driving in from the airport last night and realised that _everything_ I was seeing was less than twelve years old (about the time I arrived here for the first time). That included the airport, the highway, the two bridges I crossed, the tunnel I went through and enough housing to hold 250,000 people. They build a “Christchurch” each year here.

So I am thinking to myself…

What’s going to happen when little Hong Kong’s start popping up all over Asia. We’ve probably got over seven million people here going crazy. Twenty or thirty years from now – say a dozen HK-look-alikes with ten million people a pop. That is a whole lot of consumption. Not bad if you are into construction, infrastructure or consumer goods.

However… what struck me was the smoke that I was driving through. They talk about “hazy days” here but really it is simply smoky air that is full of dirt. I wonder how many days a year you can actually see across the harbour now?

I don’t want to deny anyone their desire to work, shop, consume and battle up the socio-economic ladder if they think that’s what they need to do. It’s just that the following struck me on my run.

Last year I sold my house in Christchurch – to get a similar standard of housing here would be 50 to 100 times the cost of my place in New Zealand. Then I tried to price out the “optional extras” that are required to live well in Hong Kong.

I’d need 24-hour security because organized gangs have a habit of breaking into detached houses in the middle of the night. Not sure what that would cost. Then I thought about the air that I would have to breathe. I couldn’t figure out how to price air quality. As well, if I had kids then it wasn’t clear to me how I would price the fact that they are likely to grow up with asthma. What are clean air and health worth?

Mulling this over made me really appreciate the simplicity and high quality of life that is available in Scotland, New Zealand or The Rockies. Perhaps that is a sign of getting older – when we are willing to trade economic opportunity for personal security, clean air and a beautiful environment.

When I am here, I like to run past my old street (Wilson Road) in Jardine’s Lookout. I run past the height of my personal Hong Kong property ambitions and smile. I had it all when I was thirty but I really had nothing. Had I stayed there for a further five years then I would have had even more (about triple my current NAV), but even less of what I truly value today.

The trouble that we often have with being dissatisfied is that we can’t figure out what will satisfy us. The lesson for me is simple: “Collect experiences, not objects”.

Make time for new experiences – you never know what is going to happen.

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Had an only-in-Hong Kong experience walking through Central this afternoon. They are redeveloping the Mandarin Oriental hotel. Right now they have eight story billboards for Christian Dior on the building.

They are making money from the demolition! That is one of the things I love about this place.

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I tend to get two types of questions from folks that relate to my time in Asia as well as my experience with “boom towns”.

The first is “do you miss it”?

There are times when part of me does miss aspects. Deals, fund raising, monitoring relationships, international structuring, learning about new industries – that was very challenging and, when you are with a good team, that provides near limitless opportunities for learning. The aspects of that life that I miss, I’ve been able to recreate in my current business. As a big bonus, I’ve managed to structure myself so that I can achieve the stimulating aspects while avoiding the need to live in a big city. I’ve been quite fortunate that my friends, and technology, have enabled that to happen.

Thinking back through the ten years that I lived in London and Hong Kong, the single best aspect was having had the opportunity to be part of an outstanding international team. Within the team, the most stimulating aspect was learning from these people and, with them, striving for investment excellence.

I’ve been reading the Essays of Warren Buffet. One of Buffet’s key points was that he wants his CEOs to act as it they own 100% of their companies. The first group of folks that I worked with where like that; they truly treated every bit of equity finance as if it was their own money. That culture of responsibility was instilled by the senior partners, a most effective use of leadership.

The second question I get a lot is from people living in boom towns that are familiar with my story is about leaving to try something different.

…I wonder if I would be happier elsewhere.
…I’m not sure if this is the life for me.

My friends and former colleagues that are still going full bore don’t ask this question much. So if you are frequently wondering what the heck you are doing working for an investment bank… or if you find yourself wondering why you are flying off on yet another consulting assignment… …then I’ll pass along a modified version of what the senior partners told me when I left London.

***Enjoy yourself – boom towns are unique places in unique times.

***Learn as much as you can – rapid growth provides rapid opportunity for learning and advancement.

***Meet as many people as you can – smart people (and con artists!) are attracted to booms.

***Make some money – take advantage of the opportunities to earn capital while learning and working hard. In the right team, you are being paid to learn from some of the best in the business.

***Get out – this didn’t make sense to me for many years but it does now. I’ll expand a bit.

If you are having fun, learning, building your network and making some money then the overall cocktail can be a heady mix, especially if you are in your 20s or early 30s (the area where I have some actual experience).

Some can manage to stay grounded through the successes; money; perceived increases in status; and power that accrue from working hard in favourable circumstances. My first boss is one of those guys. I just bumped into him at the lounge in Hong Kong and he looked the same as always. If you saw the three of us sitting there (his wife of 30+ years was with him) then you’d have no idea who he is or what he’s managed to achieve (two successful businesses from scratch, billions invested wisely).

He’s a unique guy, most beneficiaries of “success” are slowly changed over time and it wasn’t until I got out until I was able to see the changes – that is part of the reason for my wry smile each time I run past my old house on Wilson Road.

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I’ve been thinking about Pride a lot lately.

A positive aspect of pride is something that I cultivate in myself. I take pride in delayed gratification and enjoy my capacity for self-denial. Bit strange perhaps but, I imagine that, it is a key attribute in folks that are good at long term project management (personal finances, education, endurance athletics, employee development, investment management, parenthood).

I’ve been thinking about one goes about beating a superior adversary? Simple, you don’t. Your only hope is that circumstances result in the guy beating himself.

It happens to all of us. We all have areas in our lives and situations where we beat ourselves.

Why do we do that?
Pride.

As we improve, often a pride develops that has negative effects on our performance.

Training sessions become daily battles as the “stronger” athlete never wants to show that he’s “weak”. Races become mentally challenging because the joy of participating leaves and is replaced with an anxiety about relative performance. As fans, we directly contribute to this by projecting our “hero’s” athletic performances into our personal well being.

Helping athletes improve is one role of the coach. Helping athletes deal with the mental challenges presented by the public and private perception of this improvement is an even more challenging area. It is an area where I think that there is a lot more that I could do.

When we see excellent athletes struggle to repeat rookie year performances, I think that overcoming pride is the key element of recapturing what was “lost” after that first season.

Do you wonder why most elite athletes are pretty quiet on the internet? It’s because we are killing them, even when we love them.

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A few quotes that have been rattling around in my brain:

The only performance that truly matters is how we do relative to ourselves.

There will come a time where you have to release the pressure to perform and totally accept whatever happens.

The perfect race doesn’t exist. What does exist is clarity of process once when we get our minds out of the way of our bodies.

In all things, be strong at the end.

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