He is so academic and been living in a sheltered environment. Knowing nothing on the real world not to mention even the i/o rules, customs requirements, bet he had never seen a snatch and run case or beat up on the street in his utopia.... etc.
Tell u what, your Shanghai friend if he/she had not been to Shenzhen before, he/she will also be shocked by what he/she sees in those markets. Shanghai is much more regulated and legal than in Shenzhen...
Many good opinions have been given to u here, I just want to add a few minor issues, the outside world is dangerous kid, u may not find police as helpful as what u think when u have a problem, do not assume the fact that waiving an American passport can get u out of any trouble.
I really think u should please go ahead and remember to update us, looking forward to hearing your big business success story! good luck!
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