Chinese Stock Market At Bubbly Height
Posted by Frugal on May 7th, 2007
Do you know anything that can quadruple in about 2 years, and wouldn’t take a substantial fall? The rise of Shanghai stock market has every look of a bubble. I think that there is a possibility that international stock markets will fall together with the bursting of Chinese stock market.
Here is a chart of the 2000 high-tech bubble:
The important thing to note here is that it took about 1.5 year for the Shanghai index to double from 1000 to 2000. But it is only taking 0.5 year for it to almost double again from 2000 to 3841. If it’s 0.75 year (or in less than 3 months from now), this index would be on a super-exponential curve: the time for each doubling shrinks by half. In fact, the curve is closing to 4000 level faster than 3 months away. A super-exponential curve is destined to crash if you are familiar with my “Why stock markets crash” article.
Once again, stock markets are probably due a bigger fall in my opinion. Watch out below.
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May 7th, 2007 at 7:46 am
The Chinese Shanghai Stock Exchange (SSEC) is facing a multiple-year resistance point soon at around the 4189 level.
http://www.marketoracle.co.uk/Article838.html
Nasdaq in the Late 1990’s
and Shanghai Composite Today: Eerie Similarity
http://china.seekingalpha.com/article/34607
May 7th, 2007 at 7:47 am
A must-see video for gold-bulls.
DOW vs Gold …or…
Investment Price vs Investment Value
http://video.google.com/googleplayer…47195585759605
May 7th, 2007 at 8:05 am
Another “cheerful” article for us bears…
http://articles.moneycentral.msn.com/Investing/ContrarianChronicles/TheDowsDangerousWinningStreak.aspx
May 7th, 2007 at 1:28 pm
I own FXI. Go boy, up up up!
May 8th, 2007 at 7:35 pm
yikes!
May 9th, 2007 at 9:20 am
I just sold all my China shares today. Nice 13% profit for 3 months, and I don’t really care that I’m not making 55% of whatever profit because the bubble has been due to burst for years now and I think its finally going to happen, especially with news reports daily about shaky loans being made with Chinese consumers and businesses. Sometimes you need to know when to fold, it was a nice ride.