BRIC+
The death of the China bull run?
| Tuesday, 7 August 2007
Having conducted a number of Think Global BRIC Study Tours to China, and with one coming up in February 2008, we are constantly monitoring recent developments in China's stock market. Two articles - one from The Australian and the other published in The Economist illustrate distinctive approaches to understanding the nature of the Chinese economic developments, as well as the need for a balanced appraisal of the debate. The complicated nature of these discussions demonstrates that the dominant discussion, which frets over prophesies about the death of the bull run, is at best mistaken. Each article focuses on crucial, although often marginalised issues related to the direction of China's economy that should be could be more fruitfully considered.
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The boiling
point
Original article published in The Economist Print Edition | 21 Jun 2007 |
Deliberations over the fate of China's economy predicting the demise of the China bull-run are widely reported - views grounded in fears of a stock market bubble. The Economist dismantles the hysteria surrounding these claims by pointing out that "China's recent share-price boom is still relatively modest compared with [other great bubbles] such as the American NASDAQ in the 1990s." The article stresses that evidence suggests share prices have a significant capacity to steadily increase before a bubble burst, short of direct policy intervention. Full article >
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No end to
China's bull run
Original article by Rowan Callick | The Australian | 24 July 2007 |
Drawing on commentary by Morgan Stanley's Hong-Kong-based economists, this article stresses that a policy-induced economic downturn would be highly unlikely, given the current political climate - specifically The National Party Congress in October 2007 and the 2008 Beijing Olympics. The article convincingly asserts that concerns regarding strong growth figures are redundant, as it should be recognised that the loosening of political constraints on statisticians is the factor that has had an effect on published records, as they are able to "rectify previous inaccuracies." Full article >
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(Note, full
articles were free to air at the time this summary was published.)
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