As Chinese authorities hunt for imaginary culprits,investors should get used to wild stock market ridesGet used to the wild stock market rides. Tuesday’s action lacked the tall drama of Monday last week - there was no slump in Chinese share prices or opening 1000-point decline in the Dow Jones - but 3% off the FTSE 100 is fairly alarming enough. At least three things suggest the stormy weather is here to stay.
First, Beijing appears to have learned nothing during the last month. Their search for scapegoats has led to the ridiculous spectacle of a Chinese journalist at a respected publication “confessing on television to causing panic and disorder in the markets. There was no mention in Chinese state media, and of course,of the genuine sage - that over the course of a year, China’s authorities manufactured an extraordinary bull market that was bound to break down because valuations reached absurd levels.
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Source: theguardian.com