Shanghai Stock Index Reached the Lowest Point in 43 months, Will it Break 2000 points?

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Recently, the Chinese stock market decreased continually.
On Thursday Sep.20th, it reached a new low point.
On Friday Sep. 21st, it opened low and slightly increased
later but had no power to rise higher.
The downturn atmosphere is still covering the market.

Earlier, some Chinese economic scholars said that the Chinese
stock market isn't short of money, but lack of confidence.
Many experts and industry insiders also thought that China
isn't short of money, but lack of confidence.

On Sep. 20th, the Chinese stock market fell to a new low.

The Shanghai stock index closed at 2024.84, the lowest in
43 months, and closed at 2000, a critical point.
In A stock market, the market value shrunk 500billion RMB
in one day, and the Shenzhen stock index decreased 2.72%.
On Friday, the stock market opened low,
but increased a little bit after a while.
Finally, all the Chinese stock indexes closed at the same level
as the beginning of the day.

Mr. Shi is an investment consulting manager, he told NTD on
Sep. 21st that in China the stock analyst or manager has no future because there's no future.
They only have 2000 RMB monthly income now.

Mr. Shi: "In the past two years, the customer has been losing
money and the stock analyst has nothing to do.
Because the customers were losing money, you can do nothing.
So, it's very hard to be a stock analyst now."

Some industry insiders said that from the funding level,

the central bank restarted to increase the investment
after three weeks' net recovery of funds.
On Thursday, it launched two types of reverse repurchase,
the total amount is 160Billion RMB.
The total net investment of this week reached 101Billion RMB,
which attracted outsiders' focus.

The economist Xie Tian is professor of Aiken Business School,
U.S. University of South Carolina. He told NTD that in fact,
the reverse repurchase is same as the QE3 (the third
Quantitative Easing) policy by the U.S. Federal Reserve.
It also means the CCP authority is giving the market cash
through buying the bonds.

Xie Tian: "One part of the money will be invested in
the real estate market and stock market.
It may stimulate the real estate market and stock market
a little bit but the key problem or the bigger impact is that
if the central bank invest in the market continually,
it will increase the inflation of China."

According to reports, no matter if in U.S. or in Europe,
the main stock indexes are rising in this year.
The lowest increase is 5.67%, and the highest is 25.30%.

Even in Asia market, the Nikkei 225 Index increased
by 7.47% this year;
Hong Kong's Hang Seng Index has increased by 11.70%.

In contrast, the China National Bureau of Statistics published
data that China GDP increased 8.1% in the first quarter and
7.6% in the second quarter. But the Shanghai index dropped
7.94% and the Shenzhen stock index decreased 8.03%.
And the A market value shrunk more than 1Trillion RMB.

Some so-called super-stock traders said continually that

the market is in the lowest point now and it's the best time
to enter. Mr. Shi though those words are fooling investors.

Mr. Shi: "The investors who bought many stocks can't
leave the market and have no solution.
The person who doesn't have any stock will not enter
the market casually.
Under the current situation, including many new investors,
few people think now they should go bargain-hunting.
People will think the investor has some spiritual disease
if they invests the stock market now. Certainly!"

The Chinese Communist Party (CCP) has dedicated
to whitewash prosperity. Why this time doesn't it work?
On Wednesday, Gu Shengzu, a member of Chinese Standing
Committee of the National People's Congress told the media
that China isn't short of money, but for China Capital market,
it's lack of confidence.

Xie Tian analyzed that CCP central committee relies on
printing cash to stimulate the economy, creating tremendous inflation.
Many local authorities use loans to pay salaries.
They are very lacking in money.

Xie Tian: "The normal people must be lacking in money
since house prices are so high, the cost of healthcare and
education are so high, the inflation has increased so fast,
people must be lacking money.
I think the people who have enough money are the princelings,
CCP senior officials and others who have special relationships with CCP senior officials.
These are the vested interest groups whose population
is about 0.5% of Chinese. They aren't lacking money."

China has law, but doesn't have a real law ruling system.

Xie Tian pointed out that in fact, the stock market is a tool
that the CCP use to collect money.
The interests of small investors or individual investors
can't be protected, and they can't make money.



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