March 21, 2023

Changing of the Guard: Wary of Future, Professionals Leave China in Record Numbers

Like hundreds of thousands of Chinese who leave each year, she was driven by an overriding sense that she could do better outside China. Despite China’s tremendous economic successes in recent years, she was lured by Australia’s healthier environment, robust social services and the freedom to start a family in a country that guarantees religious freedoms.

“It’s very stressful in China — sometimes I was working 128 hours a week for my auditing company,” Ms. Chen said in her Beijing apartment a few hours before leaving. “And it will be easier raising my children as Christians abroad. It is more free in Australia.”

As China’s Communist Party prepares a momentous leadership change in early November, it is losing skilled professionals like Ms. Chen in record numbers. In 2010, the last year for which complete statistics are available, 508,000 Chinese left for the 34 developed countries that make up the Organization for Economic Cooperation and Development. That is a 45 percent increase over 2000.

Individual countries report the trend continuing. In 2011, the United States received 87,000 permanent residents from China, up from 70,000 the year before. Chinese immigrants are driving real estate booms in places as varied as Midtown Manhattan, where some enterprising agents are learning Mandarin, to the Mediterranean island of Cyprus, which offers a route to a European Union passport.

Few emigrants from China cite politics, but it underlies many of their concerns. They talk about a development-at-all-costs strategy that has ruined the environment, as well as a deteriorating social and moral fabric that makes China feel like a chillier place than when they were growing up. Over all, there is a sense that despite all the gains in recent decades, China’s political and social trajectory is still highly uncertain.

“People who are middle class in China don’t feel secure for their future and especially for their children’s future,” said Cao Cong, an associate professor at the University of Nottingham who has studied Chinese migration. “They don’t think the political situation is stable.”

Most migrants seem to see a foreign passport as insurance against the worst-case scenario rather than as a complete abandonment of China.

A manager based in Shanghai at an engineering company, who asked not to be named, said he invested earlier this year in a New York City real estate project in hopes of eventually securing a green card. A sharp-tongued blogger on current events as well, he said he has been visited by local public security officials, hastening his desire for a United States passport.

“A green card is a feeling of safety,” the manager said. “The system here isn’t stable and you don’t know what’s going to happen next. I want to see how things turn out here over the next few years.”

Political turmoil has reinforced this feeling. Since early this year, the country has been shocked by revelations that Bo Xilai, one of the Communist Party’s most senior leaders, ran a fief that by official accounts engaged in murder, torture and corruption.

“There continues to be a lot of uncertainty and risk, even at the highest level — even at the Bo Xilai level,” said Liang Zai, a migration expert at the University at Albany. “People wonder what’s going to happen two, three years down the road.”

The sense of uncertainty affects poorer Chinese, too. According to the Chinese Ministry of Commerce, 800,000 Chinese were working abroad at the end of last year, versus 60,000 in 1990. Many are in small-scale businesses — taxi driving, fishing or farming — and worried that their class has missed out on China’s 30-year boom. Even though hundreds of millions of Chinese have been lifted from poverty during this period, the rich-poor gap in China is among the world’s widest and the economy is increasingly dominated by large corporations, many of them state-run.

“It’s driven by a fear of losing out in China,” said Biao Xiang, a demographer at Oxford University. “Going abroad has become a kind of gambling that may bring you some opportunities.”

Zhang Ling, the owner of a restaurant in the coastal city of Wenzhou, is one such worrier. His extended family of farmers and tradesmen pooled its money to send his son to high school in Vancouver, Canada. The family hopes he will get into a Canadian university and one day gain permanent residency, perhaps allowing them all to move overseas. “It’s like a chair with different legs,” Mr. Zhang said. “We want one leg in Canada just in case a leg breaks here.”

Amy Qin and Patrick Zuo contributed research.

Article source:

The Media Equation: How Esquire Survived Publishing’s Dark Days

Amid the plague that hit the magazine industry back then, Esquire was worse off than most. Beaten up by a crop of lad magazines like Maxim, then hammered by the flight of advertisers and readers to the Web, Esquire suffered a 24.3 percent loss in advertising pages compared with 2008, which was almost as bad, by the way. A Web site for investors, 24/7 Wall Street, predicted in 2009 that Esquire would be one of “Twelve Major Brands that Will Disappear” the following year.

Worse still, guys like me who have a general interest in the general interest — politics, music, sports, and yes, good-looking women — were looking elsewhere for guidance on how to be a modern man. I didn’t fit the demo perfectly — my fashion look has been compared to a laundry basket that grew legs — but I still should have been an Esquire reader. Like so many others, however, I began assembling my own content, grabbing sports from Deadspin, political profiles from New York magazine, and music advice from sites like Pitchfork.

For long-form reading, I had a nightstand full of narrative heaves from The New Yorker, and celebrity news had become so ubiquitous that I found myself uninterested in Esquire cover articles about Angelina Jolie or Ben Affleck, no matter how good the writing was.

Though it continued to be a handsome, well-crafted magazine, amid the sparkle of all the saucy new media, Esquire began to look like your father’s Oldsmobile. And we all know what happened to that brand.

David Granger, the editor in chief of the magazine, said that during those grim days he fired 20 percent of his staff and slashed editorial pages.

“It was ugly around here,” he said, sitting in his 21st floor office in Midtown Manhattan looking out toward the buildings stacked in rows like dominoes. “I don’t think it was ever as dire as it was portrayed, but we had a deep recession in the magazine business, and the recovery has been a fragile one.”

Mr. Granger is known in the industry as a relentlessly decent, talented guy. Balding, with a mug that would not be out of place at a V.F.W. hall, he may wear custom-made shirts, but he will spend more time telling you the story behind the amazing woman who made them than how much they cost. He gets excited about stuff — stories, writing, cocktail recipes, shoes — in a way that is hard to resist.

But nice guy or no, he was up against it back then, hard, and changes had to be made. This would be the spot where the modern media executive jettisons tradition and dumps seasoned writers and editors overboard in favor of shiny faces with reduced price tags. He did none of that.

Esquire’s four narrative horsemen — Scott Raab, Tom Junod, Charles Pierce, and John H. Richardson, who have been turning out big, ambitious pieces for years — remain in place, as do the people who edited them, Peter Griffin and Mark Warren. Classy that, to stay with those that brought you even though your magazine is hemorrhaging money. But here’s the weird part, and no one is more surprised than I am.

Esquire is not dying — it is killing it. In 2011, a year when the magazine industry was flat to down a bit, Esquire was up 13.5 percent in ad pages from the previous year. This at a time when GQ was down 6.3 percent in advertising pages and Details was down more than 10 percent, according to the Publishers Information Bureau. David Carey, the chief of Hearst Magazines, said that the private company did not discuss profits, but added: “Relative to our other 20 businesses, Esquire was No. 1 in year-over-year performance. David has done an amazing job.”

Unpacking Esquire’s revival is complicated, but worth thinking through. As the magazine came under pressure from other publications and the Web, Mr. Granger departed from standard design templates and modernized the front of the magazine to reflect the growing interest in marginalia and small laughs, with goofy asides and in-jokes.


Article source:

Customers Feel Some Ripples From the Verizon Strike

Verizon acknowledges “minor” disruptions since the strike began on Aug. 7. But some customers of its landline telephone, Internet and cable television service are reporting significant delays getting current lines repaired and new ones installed.

Craig Schiffer, chief executive of a boutique investment bank in Midtown Manhattan, said his firm’s telephone service had been down for nine days, and he could not get an estimate from Verizon for when the phones would be working again — a big problem for a business that relies heavily on phone calls with clients.

Joey Kreger, a recent college graduate moving from Illinois to Morristown, N.J., said he was stunned when he ordered Verizon’s FiOS television and Internet service for his new apartment — and the company wrote back that it could install the service on Dec. 30, more than four months from now.

Competitors like Time Warner Cable and Cablevision have mobilized to take advantage of Verizon’s problems.

Time Warner, which operates in some of the East Coast markets affected by the Verizon strike, is running ads promising speedy service, and it has increased the number of field technicians so that it can do cable installations within 48 hours.

“When folks are in a time when they might not be able to get service, we are emphasizing not just the price but our high level of service,” said Todd Townsend, chief marketing officer for Time Warner’s eastern region.

Officials at the two unions on strike — the Communications Workers of America and the International Brotherhood of Electrical Workers — say they are certain that the walkout is causing delays in repairs and installations, but they acknowledge they do not know by how much.

“Historically we know that you can’t pull out of any system 45,000 people who are the hands and minds of the company’s product and expect to provide the same level of service as before,” said George Kohl, special assistant to the president of the C.W.A. “The managers who are replacing them don’t perform these functions nearly as efficiently.”

Verizon said that problems for existing customers had been minimal.

“We’re seeing some minor delays on a few repairs and installations,” said Christopher M. Creager, Verizon’s senior vice president for consumer and mass business markets. “The vast majority of our customers are not seeing any impact.”

Verizon officials acknowledge, however, that they decided not to take any new orders for the first two weeks of the strike so they could focus on serving their current customers.

“We are seeing some delays on the installation side if it’s a brand-new installation that requires technicians to come out,” Mr. Creager said. He explained that it was a mistake to tell Mr. Kreger that his installation date would be Dec. 30, saying the date would be well before that.

That has upset potential customers like Dylan Marsh, who are complaining about delays in obtaining FiOS service, which offers Internet, cable TV and phone service over high-speed fiber optic lines and competes with the services sold by cable companies like Time Warner and Comcast.

Mr. Marsh, who just graduated from Buffalo State College with a degree in urban planning, wanted to order Verizon’s FiOS Internet and television services for his new apartment on West 49th Street in Manhattan.

“They let me go through the whole signup and then at the end they said, ‘There are no installation dates available. Someone will contact you,’ ” Mr. Marsh said. “That was probably a week ago. They were trying to make it seem like everything is O.K., like the service is there but it’s not. I thought it would be a couple of weeks, but it might end up being a couple of months. I decided to go with Time Warner instead.”

Verizon said the company’s efforts to keep up had also been set back by numerous incidents of sabotage and by the huge rainstorm that struck the East Coast last weekend.

Verizon is pushing the unions to accept far-reaching concessions, including a pension freeze and fewer sick days, and asking that workers contribute far more toward their health coverage.

Negotiations between the two sides are continuing, but at the same time, both are preparing for a protracted strike.

In a recent move, Verizon has sought to step up pressure on the strikers by informing them that the company will cut off their medical, dental and optical benefits on Aug. 31.

Since the strike began, union officials have been eager to make the case that the company’s operations were being badly hurt. Meanwhile, the company has sought to bolster its position by asserting that the strike is having little impact on service.

“We have been preparing for this for months, and when the strike took place, we deployed thousands of managers from across the country to be able to handle customer service requests,” Mr. Creager said. “We made a commitment to take care of the customers we have.”

Mr. Schiffer, the boutique bank’s chief executive, said most phones at his nine-person firm, Sevara Capital Markets, had not been working since Aug. 9.

“This is really affecting our business,” he said. “Clients have been telling us they can’t get through.”

Asked about the repair delays faced by Sevara, Mr. Creager of Verizon said, “That is not typical of the vast majority of our customers.”

Richard Young, a Verizon spokesman, said the company had received hundreds of supportive e-mails from customers.

In one e-mail shared by the company, John Ness, a councilman in Townsend, Del., wrote last Sunday to thank two field technicians who repaired his phone, Internet and cable service several days before a scheduled appointment.

Article source:

DealBook: Citigroup’s Earnings Fall 32%

Vikram S. Pandit, Citigroup’s chief executive, has been engaged in an ambitious plan to overhaul the troubled bank.Tim Boyle/Bloomberg News Vikram S. Pandit, Citigroup’s chief executive, has been engaged in an ambitious plan to overhaul the bank.

7:45 p.m. | Updated

Citigroup took another halting step forward on Monday in its long march back from the brink, reporting a $3 billion profit in the first quarter, in spite of continuing losses in its mortgage unit and lackluster investment banking results.

The company earned 10 cents a share, a penny above analysts’ expectations, but down 32 percent from the comparable period a year earlier, when it earned its first profit since the financial crisis struck.

As has been the case for other financial giants, Citigroup’s revenue actually fell during the first quarter, as nearly every major region and business except Latin America experienced a slowdown from a year earlier. Over all, revenue declined 22 percent, to $19.7 billion. Expenses also continued to rise, in part because of new business investments as well as higher legal costs.

Citi’s results were buoyed by the release of $3.3 billion in reserves that had previously been set aside to cover losses on credit cards and other loans. That helped offset deeper losses in its domestic mortgage business and a weaker performance from its trading and investment banking groups.

“Our core businesses performed well despite the difficult economy,” Vikram S. Pandit, Citigroup’s chief executive, wrote in an internal memorandum to employees. “We’ve come a long way — and we continue to move forward.” Mr. Pandit is expected to give a fuller report on Thursday at Citigroup’s annual shareholder meeting in Midtown Manhattan.

The bank is also planning a 10-for-1 reverse stock split early next month that will almost certainly draw criticism from stockholders who argue it is little more than a symbolic effort to raise the bank’s stock price.

On Monday, when the broader markets fell sharply, the company’s stock was unchanged at $4.42 a share.

Citigroup’s earnings were tempered by the same factors that weighed on the earnings of Bank of America and JPMorgan Chase, which reported their first quarter results last week.

Traditional banking businesses have been hit by rising foreclosure costs, new financial regulations and a slowdown in growth for home loans. Wells Fargo and several big regional players are expected to report similar trends when they announce their results later this week.

But Citigroup, whose stock price plummeted to below $1 during the financial crisis, is under intense pressure to show improvement. For the last three years, Mr. Pandit has been engaged in an ambitious plan to overhaul the troubled company, streamlining its sprawling operations and changing it from a global financial supermarket into a leaner and more focused lender.

Citi is close to completing its plan to shrink its balance sheet. Today, the pile of assets that Citi plans to sell or divest is down to $337 billion, less than half of its peak of $827 billion in early 2008. CitiFinancial, its large consumer lending franchise, is one of its last major businesses to go on sale, and several private equity firms are in the final stages of bidding.

The bank also identified assets worth an additional $12.7 billion that it will sell in order to free up capital, resulting in a pretax charge of $709 million when it booked the assets at their current market value.

“We are very much on track,” John C. Gerspach, Citigroup’s chief financial officer, said on a conference call with reporters. “We are going to continue to make progress but it will be at a reduced pace from where we were in 2010.”

Federal regulators acknowledged Citi’s progress when they approved Mr. Pandit’s plan to reinstate the dividend in early May at a token one-tenth of a penny per share. But unlike several major competitors that announced large share buyback programs, Mr. Pandit has said that the bank is unlikely to buy back stock until sometime in 2012.

Meanwhile, the company faces rising costs, especially in its loan servicing business. And unlike JPMorgan Chase, Citigroup did not book a large upfront charge to reflect the higher operating costs required to meet the new servicing requirements outlined in a regulatory enforcement order issued last week.

Instead, Citi officials expect operating costs for the mortgage business to rise about $25 million to $35 million per quarter as it hires as many as 500 new employees to handle the increased volume of foreclosures.

The bank also expects to take additional charges tied to the overhaul of its servicing business, which could total as much as $40 million to $50 million over the next few quarters.

Citi, like most of its big competitors, also faces an array of legal claims from Fannie Mae, Freddie Mac and other investors who say that the bank sold them securities backed by faulty mortgage loans. Mr. Gerspach said Citi had added about $122 million to its reserves to cover those potential liabilities.

Citigroup’s investment banking profit fell by 46 percent, to $1.7 billion, from a year ago, when the trading environment was much stronger.

Investment banking fees fell 18 percent amid a slowdown in its merger advisory business as well as slower stock and bond underwriting.

Trading revenue from its fixed income, commodities and currency group, which long drove the bank’s growth, dropped 29 percent. Trading revenue from equities fell 19 percent.

Overseas, the news was mixed. For several quarters, the bank’s consumer businesses in Asia and Latin America have been one of the few bright spots.

Loan losses eased more quickly in those regions than in the United States, and corporate lending has been picking up in those areas. Nearly 70 percent of earnings from Citi’s core operations came from overseas in the first quarter.

This post has been revised to reflect the following correction:

Correction: April 18, 2011

An earlier version of this article misstated the size of the first-quarter loss at Citi Holdings. It reported a loss of $608 million.

Article source: