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Efforts to rein in short term borrowing using riskier bonds as collateral for short term loans. Large increase in the use of margin financing creates problems of speculation. In one month alone, for November 2014, the Shanghai Stock Exchange composite makes a gain of 25%.
Grouped Articles
Chinese Stock Slump Contributes to Global Market Weakness
New York Times 12/09/2014
To Calm Its Markets, China Helps Guide a Sell-Off
New York Times 01/19/2015
Margin Trading Adds to Risks in China
Wall Street Journal 02/05/2015
China’s stockmarket: Skyward march
Economist 04/25/2015
China’s Stock-Market Boom Won’t Erase Bad Debts
Wall Street Journal 05/13/2015
China Shares Suffer Worst Week Since 2008
Wall Street Journal 06/19/2015
China's Shanghai Composite Index declined by 8.5% to 3725 on July 27, 2015. About two thirds of the 1114 companies on the Index declined by over 10%, the maximum allowed under the market rules. Many of China's largest companies are listed on the Index. The Shenzhen Index declined by 7%. China's effort to prop up the market have failed.
Grouped Articles
China Stocks Tumble 8.5%, Calling Into Question Beijing’s Market-Rescue Effort
Wall Street Journal 07/28/2015
Wall Street Journal 07/28/2015
China’s Response to Stock Rout Exposes Regulatory Disarray
Wall Street Journal 08/05/2015
Chinese Retail Investors Flee Plunging Markets
Wall Street Journal 08/05/2015
Wall Street Journal 08/07/2015
China Woes Send Stocks Into Tailspin
New York Times 08/20/2015
Grouped Articles
China’s Response to Stock Rout Exposes Regulatory Disarray
Wall Street Journal 08/05/2015
Wall Street Journal 08/07/2015
China Woes Send Stocks Into Tailspin
New York Times 08/20/2015
China to Flood Economy With Cash as Global Markets Lose Faith
Wall Street Journal 08/24/2015
China’s economy is in big trouble. But it is not collapsing. - The Washington Post
Washington Post 08/25/2015
U.S. stocks rebound after punishing day, but China’s market slides again - The Washington Post
Washington Post 08/25/2015
Grouped Articles
U.S. stocks rebound after punishing day, but China’s market slides again - The Washington Post
Washington Post 08/25/2015
China Again Cuts Interest Rates as Concerns Mount Over Economy
New York Times 08/25/2015
China Eases but Stench of Crisis Remains
Wall Street Journal 08/26/2015
Why China’s Market Fell So Much
Wall Street Journal 01/05/2016
Uncertainty About Stock-Selling Ban Clouds China’s Markets
Wall Street Journal 01/06/2016
The Quiet Side of China’s Market Intervention
Wall Street Journal 01/13/2016
Grouped Articles
Why China’s Market Fell So Much
Wall Street Journal 01/05/2016
Uncertainty About Stock-Selling Ban Clouds China’s Markets
Wall Street Journal 01/06/2016
China’s Stock-Market Interventions Postpone Grim Reality
Wall Street Journal 01/06/2016
World stock markets slide as panic in China spreads - The Washington Post
Washington Post 01/07/2016
China Stocks: Trading Called Off for Second Time This Week
Wall Street Journal 01/07/2016
Why China’s Market Illness Has Gotten More Contagious
Wall Street Journal 01/12/2016
Wang is former head of the Bank of China, one of four large state owned banks. A WSJ report shows that under Wang as CEO of the bank in 2009 it was the least profitable and the most likely to ramp up lending at the government's request. As a savy politician he was appointed to the Party Central Committee in 2012 and to the position at the regulatory body in March 2013. In efforts to meet party directions Wang has moved in conflicting directions, clamping down on margin financing and as the market selloff worsened even loosened restrictions for loans on homes to invest in the market. The huge surge in the market and the Shanghai and Shenzen stock exchanges is now followed by a selloff in July 2015, which the government has no experince in handling following China's experiment with its own state oriented form of capitalism since 1990. The government plans to allow state owned enterprises with large debt to reduce the debt by investing in a surging market may be based on an erroneous assumption on how equity markets work. Lack of prior experience with equity markets on the downside is another handicap in China.
Grouped Articles
The Man Tasked With Stopping China’s Stock Selloff
Wall Street Journal 07/08/2015
Beijing’s Response to Stock Selloff Reveals Deep Insecurity
Wall Street Journal 07/08/2015
Why China’s Stock Market Bailout Just Might Work
New York Times 07/09/2015
Memo to China: Your Market Moves Are Doomed to Fail
Wall Street Journal 07/10/2015
Cooling of China’s Stock Market Dents Major Driver of Economic Growth
New York Times 07/15/2015
Wall Street Journal 07/28/2015
Linked Articles
Uncertainty About Stock-Selling Ban Clouds China’s Markets
Wall Street Journal 01/06/2016
China’s Stock-Market Interventions Postpone Grim Reality
Wall Street Journal 01/06/2016
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