Teresa Poole on the craze to invest in parrots that is turning China's black economy rainbow-coloured
AMID Asia's collapsing stock markets, Peking's inveterate speculators have identified an alternative investment opportunity. Forget about disappointing returns from shares and stamps, brightly-coloured birds are now the commodity in which to put your money. But instead of making a killing, investors could end up burning their fingers with "stir-fried parrot".

This winter, "phoenix" parrots are all the rage in the bird markets of China's capital. Their forebears may possibly, as claimed, have hailed from Africa, but these rainbow-coloured birds are now bred strictly for profit in the apartment blocks of suburban Peking.

Going for a song they are not: prices have almost doubled since the summer, as the craze for this potential money-making bonanza has taken hold. "It is a good investment. But it is just like gambling or buying shares. The risk is also very high," said Lao Zhu, a 49-year-old local government official who has been breeding birds for years in his ample spare time.

"Investment is shifting from the stock and stamp markets into the bird market, and the price of phoenix parrots has gone up rapidly" said the Peking Youth Daily, which estimated that 100,000 of the city's families are breeding parrots for profit. "Not even the snow and cold wind can cool the bird market," it reported.

There is a bull market in birds, so to speak. At the Guanyuan Bridge open-air market, where about a hundred bird traders gather, a green-faced phoenix parrot which sold for 120 yuan (pounds 9) two years ago, would now fetch 1,500 yuan (pounds 115), said Mr Zhu. "I make more money from trading birds than from my job," he admitted. He earns a good salary by local standards, around 25,000 yuan, or pounds 1,900 a year, but some families are said to be earning hundreds of thousands of yuan annually from parrots.

The market is being driven by mass redundancies from loss-making state enterprises. Thousands of laid-off workers have turned to birds to eke out a living, pushing up prices for breeding stock. One 28-year-old driver laid off by a state-owned enterprise was trying to sell a pair of the most common "brown head" parrots for pounds 30. The birds had fabulous investment potential, he said. "In one month they will have eggs. Eight eggs each time. They are easy to hatch, and you can sell the babies for 400 yuan a pair."

The danger is that the Chinese are suffer from the herd instinct when it seems there is money to be made. First it was the over-heated stock markets and the problem of so-called chao gu piao (stir-fried stocks) as share prices soared to ridiculous levels. Then everyone piled into stamps, driving up prices and creating the chao you piao (stir-fried stamp).

So what are the financial forecasts for this developing market? "Unemployed people are doing it now, so there is more competition," said a 60-year- old, who was selling a pair of blue silver crown parrots for pounds 540. With big profits to be made, there is also a new problem of "shoddy birds", sub-standard models or even fakes. "Some sellers dye the feathers," explained the old-timer. "They use high technology." Only when the feathers moult do the buyers realise they have been sold a pup.

Newspapers are now warning the unemployed that the bird market bubble may be about to burst.

"According to the rules of the market economy, there will soon be an oversupply of phoenix parrots in the market," said the Peking Youth Daily. And that means an imminent case of chao yingwu - "stir-fried parrot".