Monday, May 28, 2007

The Ayis Indicator

Historically, a consistent characteristic of financial bubbles are the labor market distortions that develop around them. In the late 90's, thousands of people in the U.S. quit their jobs to trade stocks, and many millions of others spent large chunks of time "monitoring their portfolios" while at real jobs. Before the subprime real estate bubble burst recently, Las Vegas strippers were flipping condos and daylighting as real estate agents. From the FT:
The explosion in day-trading has created some unintended consequences in Shanghai in the form of unwashed dinner dishes, badly ironed shirts and dusty floors. In recent weeks the city has developed a shortage of ayis, the domestic helpers who do chores in the homes of middle-class families, because some have found more gainful employment playing the market.

Sheng Min, who runs a Shanghai agency that recruits ayis, says it started to face problems finding new domestic helpers in April because of the stock market fever and now has 50 per cent fewer women on its books than usual.

"We occasionally receive phone calls from employers complaining about their ayis," he says. "Some of them seem to be more interested in chatting about stocks with their friends than working."
Full article here. Since the eventual denouement (possibly later rather than sooner) will have obvious geopolitical implications, it's worth watching even for those not interested in the financial markets.


Post a Comment

<< Home