CHINA'S stockmarket has often been called a casino, with share prices bearing little connection to underlying economic conditions. But while the market has strayed from growth trends in the past, its divergence over the past few months has reached new extremes. Economic growth in the first quarter fell to 7%, the slowest annual figure in six years, but stocks have more than doubled in value since the middle of last year. A shift to monetary easing and fiscal stimulus—and expectations of more of both—help explain why the rally began. But the longer it has continued, the more it has looked like a classic case of irrational exuberance.
Is the Chinese...Continue reading
from Economics http://ift.tt/1RljkSb
via IFTTT
No comments:
Post a Comment