broadsword
Brigadier
The market is making a bottom so don't be surprised if it pulls back tomorrow. Resistance is around 4,272.
Chinese Economics Thread
- Thread starter Norfolk
- Start date
The market is making a bottom so don't be surprised if it pulls back tomorrow. Resistance is around 4,272.
They have thrown the kitchen sink at it in order to stop the selling on the stock markets. That's a bad idea. They should have sit back and told the people that the stock markets went up 150% over the past year and that a 25 to 30% correction is normal. Which it is. They overreacted on what is a normal event. Now with this the people will get the impression that the government won't allow a big crash and that the government have got their backs covert when they are buying stocks. This moral hazard could create a bigger bubble in the future. Not to mention that they are throwing good money after bad at the present.
Thats isnt very surprising, taking into account that there are a lot of restrictions right now in the stock market. For exemple, right now more than half of the listed chinese companies have their stocks suspended from trading, among other harsh restrictions.
When you have a state capitalism economy, you can do things other normal capitalist economies cant. Of course, in the long term, what will be the consequences?
SamuraiBlue
Captain
The major stock holders that holds more than 5% of any one company is restricted from selling it for the next six months. Those guys are going to lose a lot of money during this prohibition period. These guys are going to unload a lot of real estate(ie. condos) to maintain liquidity. In return the real estate market is going to be dragged down. I also believe the shadow bank funds are going down as well.
Jura The idiot
General
That's the government's intervention, not a rebound...
Jura The idiot
General
but whatever, the dude said what I quoted right above, I didn't believe it then
but I decided I would check on this prediction, which I did
manqiangrexue
Brigadier
Are you gonna be the Gordon Chang of this discussion, trying to spin everything to sound like China's gonna collapse? LOL Statistically speaking, in the past 3-4 decades, how many Gordon Changs have been right, and how many have been completely wrong? It sounds like you're Gordon Chang'ing it pretty hard.
Amen to every bit of that.
Wise advise...and it is not country/nation-centric. It applies to all IMHO.
Not saying that china is going to colapse, but regarding prices going down in china because of stock market crash, perhabs you should look at this article:
In the end, it is mentioned that everyone staring at their screens in the trading floor was dumbfounded. Perhabs that is one of the reasons why the chinese government was very determined to stop the stock market crash.