China’s Stock Market Back In Trouble

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Thanks to government support, the Shanghai stock index has rallied for the past few weeks after a month of losses. Today it plummeted again, apparently due to the government withdrawing its support. From the Wall Street Journal:

Authorities may want to “test whether the market has recovered its resilience,” said Fu Xuejun, a strategist at Huarong Securities. “The government wants to use state funds to stabilize the market, not to prop it back to 5000 points overnight.”

Well, I guess that test didn’t work. According to the Journal, Monday’s drop came as a big surprise. “I am positive that we will see state support emerging again in the next two days,” said Jacky Zhang. Maybe so. But if the fundamentals aren’t there, even the Chinese version of government support can’t keep things propped up forever. It’s only a matter of time until we see the market plummeting again.

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DEMOCRACY DOES NOT EXIST...

without free and fair elections, a vigorous free press, and engaged citizens to reclaim power from those who abuse it.

In this election year unlike any other—against a backdrop of a pandemic, an economic crisis, racial reckoning, and so much daily bluster—Mother Jones' journalism is driven by one simple question: Will America move closer to, or further from, justice and equity in the years to come?

If you're able to, please join us in this mission with a donation today. Our reporting right now is focused on voting rights and election security, corruption, disinformation, racial and gender equity, and the climate crisis. We can’t do it without the support of readers like you, and we need to give it everything we've got between now and November. Thank you.

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