OK, since the Internet earthquake crisis is locking me out of many offshore news services, not to mention my own blog, we’ll stick with Xinhua for a while today and see if I get lucky posting this stuff – strategically done in one big post. This is the first time I’ve been able to actually get on all week. Let’s hope this will all be over soon, and we can pretend it was just a bad dream.

First off, the bond market. This lovely headline, “Record number of bonds issued in China this year,” says very little. Turns out that a majority of bonds issued were from the central bank and were necessary because of all the excess currency floating around out there.

Because China has a large amount of forex coming in from its current account surplus, it doles out huge amounts of RMB in exchange. This would mean a tremendous increase in the amount of RMB in circulation if the central bank did not practice sterilization, in short selling bonds and soaking up excess liquidity.

So the increase in central bank bonds out there this year is not necessarily a good thing; instead of signaling a healthy bond market, it could be a sign of a worsening financial imbalance.

One more thing. Only 6.77 percent of the bonds issued were from private enterprises. This number has gone up recently, among State-owned enterprises, but this is still a tiny amount. The country needs a real bond market, and this number will have to go up much higher before we can say significant progress is being made.

Second, the bull market.  I recall writing some time ago that some analysts were worried that a rebounding stock market might work to the detriment of the domestic banking industry. The banks are already worried about foreign competition, and with a hot stock market, there would be even more investment choices out there for individuals.

Well, it looks like it might actually happen. Deposits have apparently slowed this year, and there are two popular explanations. One, the fervent hope of many economists around the world, is that China’s savings rate will fall, domestic consumption will rise, and that China’s current account deficit will shrink. Lots of people in the U.S. are praying for this to happen. Two, funds that would have gone to deposits are being used to buy stock instead. There are differing opinions on this right now, particularly since the slow growth in deposits for November represents only one month of slowdown, hardly a trend. Something to keep in mind for 2007, however.

Third, this is my favorite ‘unnecessarily obvious’ headline of the day (so far): “Ministry says China’s service trade still lags behind goods trade.” And it is still light during the daytime, too. The contents of the story are not so interesting, but in the interest of full disclosure, here it is.

I’ve been effectively locked out of my U.S.-based ISP since the earthquake off Taiwan cut several fiber optic cables. It will be a miracle if this post gets on.

Rumor has it that service will be mostly restored some time tomorrow.  One can only hope.  No international Internet is a real bummer.

This is a really fun debate, I have to say. It’s got politics, culture, religion (sort of) and economics. What more could you ask for?

Here’s the issue: is the celebration of Christmas in China, which is definitely on the rise, a good or bad thing? Some say it is harmless fun that also benefits the economy, while others see it as a symbol of Western cultural dominance, particularly among China’s youth.

The debate went into overload this weekend after the publication of an open letter on the ‘Net by a bunch of Chinese PhD students. It’s always students, isn’t it? Troublemakers, every last one of them.

The letter decries the popularity of Christmas in China and calls on people to put their celebratory energy towards more Chinese cultural traditions. Some excerpts are in China Daily here along with some other media reactions here. The Washington Post picked up the story on Saturday with an article by Edward Cody, who I think is based in Beijing.

Before I do the opinion thing, some items to disclose. First, being a Jew, I could care less about Christmas – rather a blunt statement, but essentially true. Second, I’m just old and grumpy enough to get annoyed at all the Christmas paraphernalia out there in whatever country I’m living in. Younger people, even Jews, don’t seem to care so much.

All righty, then. I am sympathetic to a certain degree with these students, although they really need to get a life. The only thing worse than a bunch of students wasting their valuable time debating the cultural importance of Christmas in China is someone commenting on the meaningless debate. {mea culpa}

The idea of millions of people running around celebrating a holiday about which they know exactly nothing seems really silly. I have always thought of Christmas as a religious holiday, despite being told by countless Americans that it is just a secular celebration. That seems self-evident to your average American who is a Christian by default and doesn’t really believe in anything. From my perspective as a Jew who doesn’t really believe in anything, Christmas does not seem to be such a nice default celebration. Look, to be blunt again, the name of the freakin’ holiday has "Christ" in it and the holiday purports to celebrate his birth. Do I need to go on? To my twisted perception, all of you Chinese folks who profess to be atheist and yet go out there and celebrate Christ’s birthday look really foolish. So yeah, I am sympathetic to the students in that sense.

However, is the celebration of Christmas really a triumph of Western cultural imperialism? I think that’s taking things a bit too far, don’t you? I have been talking to Chinese people about this issue for many years, and not only is there an absence of any religious overtones associated with this holiday, but neither is there much of a notion that the holiday is good because it is foreign. So what is the fundamental reason for the increase in Christmas celebrations? Many will undoubtedly argue with me, but in my opinion it’s simply a nice excuse for a party, one that has been marketed worldwide for a long long time (i.e. good brand recogition).

Look, it’s really tough for Chinese nationals who work at a foreign company to see management mysteriously vanish for a couple days or weeks for Christmas. Why do the foreigners get to take time off but the local staff does not? That party going on over there looks pretty good, why can’t I join in? Gift giving, that sounds damn good to me, count me in. My clients and trading partners are all on holiday, so it’s a good time to get drunk and visit the relatives.

Case in point. Every year my wife grumpily questions why I am the only foreigner working in the firm on Christmas day. I tell her about my proud Jewish upbringing (OK, I usually embellish this part) and how it is a badge of honor to work on Christmas, a sign of our other-ness. This does not go over so well, and in typical Chinese fashion she cuts to the chase and says that she could care less about the proud Jew stuff. The bottom line for her? If it means getting the day off, partying, and getting gifts, I should stop complaining and join in.

Some of the comments in China Daily suggest that Christmas has become popular here not because it lacks spiritual aspects, but because of them. I will end this post on that absurd notion. I do not embrace Christmas because of its religious origins. On the other hand, I am not so addle-minded to think that the masses out there are flocking to the shopping malls and getting drunk on egg nog because of some spirtitual void that Christmas is filling. Psychological and emotional, perhaps, but not religious.

Christmas is popular here not because of religion, and not because people worship everything foreign, but because people like to have a good time. It’s cold outside, a party sounds like a good idea, and all of our factories are already churning out a lot of tinsel and santa hats. Sounds logical to me.