from Wolf Street:
It could be that Chinese stock market participants have no idea that there is something wrong beneath the officially rosy covers. Or they might already know in granular unofficial detail, and fearing the worst, they’re wagering everything they have, plus some, on stocks to get rich quick while they still can. They’re opening up brokerage accounts at record pace and borrowing on margin to ride the wave. If the limits in China get in the way, they head to Hong Kong to set up trading accounts and borrow even more.
It has worked so far. The Shanghai Composite Index jumped 8.9% this week and 146% over the past 12 months. It closed above 5,000 for the first time since 2008. The valuation of companies with a primary listing in China skyrocketed by $4.7 trillion this year.
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