Thursday July 16, 2015
China's stock market intervention might do more harm than good
The Chinese stock market started on a steep, downward slide in June -- wiping out thirty per cent of its wealth, or some three trillion dollars, in just four weeks.
At one point a billion dollars was being lost every minute, prompting the Chinese government to pull out all the stops -- including some dramatic interventions, such as banning large shareholders from selling their stocks.
That emergency treatment put a temporary stop to the bleeding, but in recent days, stocks have been moving downward once again.
Zhiqiang Li is one of the 90-million or so Chinese people who do own shares, and have seen their savings take a hit. He says he's lost 100,000 yen, or $20,000 Canadian dollars in the past few weeks. Zhiqiang Li is an officer a Chinese media company in Beijing, and we spoke with him earlier, through a translator.
"I've lost so much money that I've worked so hard for. We don't earn much. It was all savings from our hard work. " -Zhiqiang Li
It's not just Chinese investors like Zhiqiang Li who are watching and waiting to see if the market can climb back up --
It's the whole world.
- Sherry Cooper is the Chief Economist at the Dominion Lending Centre in Toronto.
- Jia Wang is the Deputy Director of University of Alberta's China Institute in Edmonton.
This segment was produced by The Current's Sonya Buyting and Daisy Xiong.
♦ China's Stock Market Is Falling Again - Slate
♦ 3 charts that explain China's stock market fall - Business Insider
♦ China Crash Is 'Way Bigger Than Subprime' - Bloomberg
♦ Investors Doubt Beijing's Help - The Wall Street Journal