Posted on 08/21/2015 10:09:32 AM PDT by TigerLikesRooster
China stocks crash 11% in a week
By Charles Riley
China's beleaguered stock market endured yet another sell off on Friday, shedding 4% to wipe away the remaining gains from a dramatic market rescue launched by Beijing in early July.
The benchmark Shanghai Composite closed just north of 3,500 points, a level that many analysts believe Beijing will try to defend at all costs. Even with a late rush of buying, the index closed down more than 11% for the week.
(Excerpt) Read more at money.cnn.com ...
P!
Rut Roe Shaggy.
We’re close to -6 ourselves...
Unnnh...Me no know, kemosabe. It not look good.....
Interestingly, we haven’t heard much from the Chinese government on support measures over the past few days.
A week or two ago, they announced:
* A near ban on short-selling
* Major cash injections to financial institutions
* Allowing investors to use their home equity (!) as collateral for margin loans
* Devaluing the yen to stimulate the export economy (although that takes time)
... among other things. It yielded a bounce, but that’s fading. I wonder if they’ll try a raft of new measures next week, or let it take its course. After all, the Tianjin explosion, and recent news that 70% of industrial facilities in Beijing fail hazard inspections may have them focused somewhere else.
Devaluing the yuan... not the yen...so sorry
The problem was that the Chinese stock market had too many margin trades—essentially it got run in a matter of months what took the US stock market 2-3 years to do in the late 1920’s.
What’s your take on US markets? Will it be over when Janet agrees to keep interest rates where they are now?
My view?
I think the markets are overdue for a correction, but don’t know if it will be the big bear. Overdue... because they haven’t moved more than 5% all year.... which is unusual.
In 1999, PEs were huge, and tech was ridiculous. In 2007 it was financial problems. Now... well PEs are high, but not ridiculous, but part of the “E” is due to low borrowing rates for corporations. But we do have an oil bust that could propagate thru the market, and there’s China.
I don’t know what’s going to happen, but I’m worried.
Current S&P 500 PE Ratio: 20.03 -0.48 (-2.33%)
3:03 pm EDT, Fri Aug 21
Mean: 15.55
Median: 14.60
Min: 5.31 (Dec 1917)
Max: 123.73 (May 2009)
Thanks Pearls...
Sellers gonna sell.
Will it be a magic Monday or a blue Monday?
To soon to tell.
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