Friday, June 26, 2009
"With no eligible women in his village, Zhou Pin, 27 years old, thought he was lucky to find a pretty bride whom he met and married within a week, following the custom in rural China. ... Thanks to its 30-year-old population-planning policy and customary preference for boys, China has one of the largest male-to-female ratios in the world. Using data from the 2005 China census--the most recent--a study published in last month's British Journal of Medicine estimates there was a surplus of 32 million males under the age of 20 at the time the census was taken. ... Now some of these men have reached marriageable age, resulting in intense competition for spouses, especially in rural areas. It also appears to have caused a sharp spike in bride prices and betrothal gifts. ... Areas with more men than women, the study notes, also have low spending rates--suggesting that many rural Chinese may be saving up for bride prices. ... As in other parts of the country, village customs dictate the groom's family pay the bride's family a set amount--known as cai li--while the bride furnishes a dowry of mostly simple household items. ... The neighbors each paid 40,000 yuan in cai li. On Jan. 28, all these brides vanished, leaving the villagers reeling", original italics, my empahsis, Mei Fong, at the WSJ, 5 June 2009, link: http://online.wsj.com/article/SB124415971813687173.html.
China's bride market shows rising prices allocate scare resources. Look at our Ivy League Chickens, my 22 December 2008 post, link: http://skepticaltexascpa.blogspot.com/2008/12/ivy-league-chickens.html. Unlike our kidney market, link above. The market presents new opportunities. Instead of creating asset backed securities, Goldman Sachs (GSG) can securitize cai li loans. With "former" GSG executive Henry Paulson on tap, GSG should lock this market up. Rural China may become a preferred vaction spot for mate-starved Washington, DC ladies. As bride prices rise, Chinese farmers with low hurdle rates will prefer girl babies. Be patient. This will work out.