Is China’s Stock Market Really Circling The Drain?
While the world may be watching what’s going in Greece this week, apparently the Chinese stock market is undergoing a hell of a crash. When I say crash, I really mean that their market is undergoing some 1929, major economic depression, people jumping out the windows to their own death style crash. Since June 12, approximately $2.7 trillion in stock value has just gone poof. Why has this happened? From what my feeble economic mind can tell. It’s like any other market crash. People invest with credit instead of real money, the bubble rises, then for whatever reason the bubble deflates, causing financial panic. The Chinese government in the mean time is trying to inflate the bubble by encouraging investors to invest everything, all the while even going so far as to go all in on their own by investing the national pension fund, all to no avail.
Meanwhile, China has a shit pot full of money invested in American markets.Will their crash affect our economy as well? I would think so. Global markets being as they are right now, I would think that the world’s second largest economic power would set off a domino effect, much different, and perhaps way more catastrophic and real than the so called Domino Effect of Communism,that supposedly was going on in South East Asia in the 50’s. Red China was really no threat, Broke China, could pose a very real threat.
In addition, our corporate/military machine has started to place a lot of focus on China, in order to once again try to contain them. There continues to be a large military build up in the South Pacific, as the good old US of A is leaning heavily on our “allies” to place even more troops and equipment in and around the South China Sea. As a result, China has massively improved upon, and continues to spend billions their military build up. The U.S. military is steadily encroaching on China’s holdings in the South China Sea, as well as sending a lot of money and arms to China’s nearby pain in the ass, Taiwan.
I don’t know; I can’t help but think that China’s economic distress and our military build up in the region is not a coincidence. Obviously I’m no expert, but something about this whole scenario just smells bad, not stinky bad, but scare me enough to make me shit my pants bad. Although I suppose that would qualify as stinky bad too, wouldn’t it?
Needless to say, I won’t be investing in Ali Baba stocks any time soon.