Posted on 07/27/2015 12:41:05 AM PDT by Citizen Zed
Uh oh. Here we go again.
China's Shanghai Composite shed 8.5% on Monday, a bone-rattling decline that raises questions over the efficacy of the dramatic stock market rescue that Beijing executed in late June and early July.
Losses on both the benchmark Shanghai index and the Shenzhen Composite accelerated into the close. The smaller Shenzhen index, which is heavy on tech stocks, closed down 7%.
The sharp declines come amid increased concerns over the health of China's economy.
Industrial profit data released Monday indicates that factories in the world's second-largest economy are losing momentum. Profits dropped 0.3% in June, compared to the same period last year, the government said.
On Friday, an early measure of China's manufacturing activity for the month of July came in below analyst expectations. At 48.2, the flash reading was the lowest in 15 months.
China's stock markets have been extremely volatile in recent months.
(Excerpt) Read more at money.cnn.com ...
Mmmmmm....
I wonder if investors are betting on a President Trump who will put end to the economic shenanigans between USA and China. The gravy train is over, time to sell, sell, sell!
Or on the other hand, maybe it’s just that the bubble is in the process of bursting...
I don’t know how they survive this. They already put a lot of extreme measures into their market just to keep it crashing before, even forbidding CEOs from selling stocks and ordering folks to buy. I don’t see how they can keep the farce floating.
they’ve sold a huge amount of our treasury bonds the past 6 months or so. I suspect a bunch of the proceeds went to pump up their market but thats just the conspiracy theorist in me.
When China’s stock market collapses, where will the money flow? Will the Dow Jones benefit?
Golly maybe its a reaction to being THREATEND WITH ARREST for selling?
The Chinese have gone heavy into real estate as well as foreign asset development. A lot of liquidity has left the markets and the in come stream is not there either
Japan used to own lots of our Real estate back in the day.
How dumb are humans? Artificially trying to prop up and manipulate markets has been a failure since the beginning of time. Yet society continues to insist on trying it.
If govs stop printing the stuff, I wonder how much money will be invested in anything. When a market collapses, the first out get money. The money of everyone who doesn't get out in time evaporates.
Actually, manipulating markets is a proven winner for the manipulators in the short run (pun) the consequences to society be damned. There are always the Soros/Hillary types who would rather make themselves monarchs and rule over a kingdom of ruins than face the competition of a free market which, when actually put into practice creates many more winners and a healthy middle class - albeit a small population of losers as well.
Look at the futures. Not today.
A lot of this is margin debt that is being wiped out, requiring the sale of assets to cover the losses.
Their stock market is still up 70% compared to where it was a year ago.
Rationality returns ... lots of margin debt ,, much of it illegally authorized by brokerages to accountholders that didn’t meet requirements and beyond the 2:1 ratio limit imposed by the Chinese Gov’t. This will NOT benefit any other markets.. many will be wiped out.. if you have liquid funds I’d short Chinese companies on US exchanges because this is far from over... Next comes a Chinese Real Estate crash and commodity prices will continue down... especially industrial metals.
Just 2 weeks ago Cisco said it would invest 10 billion USD in China in the next few years because China embargoed USA Tech over the NSA spying. Cisco lost over 5% of sales.
China’s own Router/switch maker has been stealing western designs and selling in China and elseware, and like Trump said the Trade is all one sided.
I hope this hurts their tech Clones.
I'm no guru either, but that sounds like they're contributing to the problem, not the solution.
When they get really desperate, look out. A common last ditch remedy is war.
One of my objections to how we record inflation in the US is that it was missing the “China crap” element. Sure, you could buy an umbrella made in China for $2.00 at Dollar Tree, but the one that sold for $12.00 made in America probably lasted 2 years, while the one from China lasted barely a month. Yet the government rather lie to us month after month.
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