Chinese capital markets are about as developed as Wall Street was when Jack Perkowski started there in 1973.
Jack Perkowski: Well I have a blog, and I’ve actually written quite a bit on this because, if the US in capital markets in terms of sophistication are 10, China is a 2. Okay? So, China’s got a long way to go. The capital markets in China are like when I went on Wall Street in 1973, they’re about as developed as that was. Okay? So, that’s a negative in one sense. But I think that China can learn a lot from what’s happened over the last 10 days, 2 years, whatever you want to, whatever time frame you want to pick, because the US market has gotten so sophisticated, so big, so complicated, and now everybody is scratching their heads and say, “Hey, how do we regulate this? How do we control it? How do we prevent this from happening again?”
This gives China a gigantic opportunity to look at all those, what everybody’s going to be analyzing and studying about this whole crisis. And then, think themselves about how they then go about the process of taking their capital markets up the curve.
So in many ways, being the second or the last kid on the block is a lot of times an advantage because you get to kind of see where everybody else has gone through and kind of learn from their experience. And I think that that China will be well-served to really look very, very hard and really try to understand how these all happened. And then, to think about in the context to China and what that means for how China’s capital market should develop.
Recorded on: September 22, 2008