https://orcid.org/0000-0001-9255-0613
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ABSTRACT
By describing features of Chinese financialisation through en masse stock market trading, the article concerns the development of a Chinese financial ecology of expertise. This indicates a new precarious knowledge regime in which the relationship between the state and the financial subjects it fosters is increasingly defined through financial terms. It argues that the Chinese financialisation should be investigated alongside the state's project directed at financialising human capital and encouraging stock trading as a reaction to an increasingly contractualised labour market and vanishing welfare state. By observing investing strategies of both formally trained expert investors and untrained investors, it emerges how the preeminence of investing activities in the market risks exceeding that of waged labour. The Chinese stock market becomes a site to observe not only the reworking of the relationship between money and wages in China, but also the formation of a financialised redistributive regime in which the state's legitimacy becomes increasingly dependent on its capacity to jiushi—rescue the market in times of crisis.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes on contributor
Giulia Dal Maso is a postdoctoral researcher at the University of Bologna. Her research examines historical and contemporary dimensions of financialisation with a particular focus on post-socialist contexts. She has published in South Atlantic Quarterly, Historical Materialism, Social and Cultural Geography and her forthcoming book “Risky Expertise in Chinese Financialisation: Returned Labour and the State-Finance Nexus” will be published by Palgrave Macmillan in 2020.
Notes
1 I interviewed 23 haigui for this research and 11 of them were actively investing or had done so at least once.
2 Danwei were, for many decades, the key reference for Chinese people in nearly all life events, acting as both a resource and a constraint. In the gradual process of dismantling the danwei, all these traditional social safeties were eroded. Thus, the population was mobilised to huan naozi ‘change the brain,’ that is, change the way of thinking (Gamble Citation1997).
3 Given the process of Chinese fiscal decentralisation and the numerous fiscal cuts the state has advanced to boost internal consumption, in recent years state fiscal profits have been in decline. (Pan et al. Citation2017)
4 Although statistics from the time are inconsistent ‘total of approximately 25 million SOE workers were laid off between 1993 and 1999, and that probably almost 40 million workers were laid off in urban China’ (Naughton Citation2003, 16).
5 The household’s income growth has been a staggering phenomenon inextricably linked to urbanisation. While in 1999 urban population only was 2% (29 million), it grew to 39% (531 million) fourteen years later. Currently, the annual income of this new-born urban population has grown to USD 7,250/6,500 up to USD 30,000 (CEIC Citation2019).
6 To manage ‘popular expectation about a prolonged economic slowdown, and to create a culture of [mass] entrepreneurship rather than a culture of employment, Xi Jinping announced that ‘innovative entrepreneurship’ is the ‘new economic normal’ for Chinese citizens’ (Lee Citation2019, 148). This led to the mushrooming of new precarious contracts and the creation of almost 4 million new startups between 2014 and 2015.
7 In fact, this is one of the few semi-tolerated forms of street demonstrations in China (called shangfang ‘petition to the authorities’).
8 Interview with Jin, February 2016, Shanghai.
9 Shares had been overvalued, fueled by practices of margin trading (when investors use borrowed money to buy stocks) that the government had initially encouraged, but which quickly turned into a bubble that burst.
10 ‘Chinese national team’ (Zhongguodui), a sport term commonly used in Chinese stock market jargon to refer to the 500 biggest Chinese banks and SOEs, plus a few private mega-companies, the major economic players.
11 Interview with Mrs. Lai, February 2016, Shanghai.
12 In Chinese xiahai refers to Deng’s encouragement to risk individually by ‘jumping into the sea [of commerce]’.
13 Interview with Cai, 12 May 2013, Shanghai.
14 Chinese shadow banking is, as elsewhere, the sector outside the formal banking sector. In China it operates in the context dominated by large state-controlled banks, submitted to many state constraints. Yet, too prevent speculation, after the 2015 crisis, supervisory bodies intervened poring public money into shadow banking channels.
15 The Thousand Talent Plan aimed to attract about 1,000 high-level foreign-educated skilled Chinese. The recruits are expected to work at national research centres or laboratories, central government and state-owned financial enterprises, and to lead innovative projects to boost China’s development. (Hao & Welch Citation2012, p. 246).
16 zhangting, an abbreviation for zhangdie tingban (limit-growth and drop lists), plus gansidui (dare-to-die bunch) (‘go-for-max kamikaze squad’ in the FT translation and ‘rise to ceiling.’)
17 The term is used to cover all financial intermediaries that perform bank-like activity but are not regulated as one. These include mobile payment systems, pawnshops, peer-to-peer lending websites, and mostly hedge funds, the industry Xun was working for.
18 Interview with Zhuang and Lai, February 2017, Shanghai
19 Interview with Zheng, 3 September 2013, Shanghai.
20 Interview with Fei, 7 June 2013, Shanghai.
21 These practices are indeed not to be referred to as just ‘Chinese.’ Investigations on financial experts acting in Western markets have shown how embracing a cynical attitude towards, and distance from formal financial training is a crucial part of the development of the financial system and financial policy making (Holst & Moodie Citation2015, p. 44).
22 Guojia zhuren (master of the state) is a much-used expression in Chinese political lexicon, referring to the role of the ‘mass of the people’ as ‘the creators of history’ and holders of ultimate authority (He Citation2001).