China Stock Market Quotes

Nearly every time I strayed from the herd, I've made a lot of money. Wandering away from the action is the way to find the new action.

On Rachel's show for November 7, 2012: We're not going to have a supreme court that will overturn Roe versus Wade. There will be no more Antonio Scalias and Samuel Aleatos added to this court. We're not going to repeal health reform. Nobody is going to kill medicare and make old people in this generation or any other generation fight it out on the open market to try to get health insurance. We are not going to do that. We are not going to give a 20% tax cut to millionaires and billionaires and expect programs like food stamps and kid's insurance to cover the cost of that tax cut. We'll not make you clear it with your boss if you want to get birth control under the insurance plan that you're on. We are not going to redefine rape. We are not going to amend the United States constitution to stop gay people from getting married. We are not going to double Guantanamo. We are not eliminating the Department of Energy or the Department of Education or Housing at the federal level. We are not going to spend $2 trillion on the military that the military does not want. We are not scaling back on student loans because the country's new plan is that you should borrow money from your parents. We are not vetoing the Dream Act. We are not self-deporting. We are not letting Detroit go bankrupt. We are not starting a trade war with China on Inauguration Day in January. We are not going to have, as a president, a man who once led a mob of friends to run down a scared, gay kid, to hold him down and forcibly cut his hair off with a pair of scissors while that kid cried and screamed for help and there was no apology, not ever. We are not going to have a Secretary of State John Bolton. We are not bringing Dick Cheney back. We are not going to have a foreign policy shop stocked with architects of the Iraq War. We are not going to do it. We had the chance to do that if we wanted to do that, as a country. and we said no, last night, loudly.

By 2060, India’s economy is projected to be larger than China’s because of its greater population growth. India is forecast to produce about one-quarter of world GDP from 2040 through the rest of this century.

Americans tend to see themselves in control of their fate, while Chinese see fate as something external,” Lam, the professor, said. “To alter fate, the Chinese feel they need to do things to acquire more luck.” In surveys, Chinese casino gamblers tend to view bets as investments and investments as bets. The stock market and real estate, in the Chinese view, are scarcely different from a casino. The behavioral scientists Elke Weber and Christopher Hsee have compared Chinese and American approaches to financial risk. In a series of experiments, they found that Chinese investors overwhelmingly described themselves as more cautious than Americans. But when they were tested—with a series of hypothetical financial decisions—the stereotype proved wrong, and the Chinese were found to take consistently larger risks than Americans of comparable wealth.

the economy of China will become twice the size of the U.S. economy in 2025 if both countries’ per capita income continues to grow at recent rates.

China will be the world’s largest economy when its per capita income reaches 25 percent of that of the United States, which is forecast to occur around 2016.

Africa remains a small part of the world economy until 2070, when it begins to expand rapidly, reaching 14 percent, the same size as the economy of China, by the end of the century.

In short, then, state companies have most of the assets, fill oligopolistic and thus profitable economic positions, receive virtually all bank credit (and at preferential rates), represent most of the stock market capitalisation and generate most of the profit. Private enterprises constitute most of the companies, provide most of the jobs, dominate exports, represent over two-thirds of economic activity and drive the economy. When analysed, this presents a rather unusual picture and demonstrates why there is a strong lobby against further economic reform.

Driving the move is a focus by Beijing on the Internet and innovation-driven sectors to boost slowing growth by easing listing rules. Another factor is a stock rally that has seen the Shanghai Composite Index climb 43% this year, although it fell 6.5% on Thursday. Meanwhile, Chinese investors are pouring money into funds that target startups. In 2014, 39 angel investment funds were set up in China, raising $1.07 billion, a 143% increase from the previous high in 2012, according to investment database pedata.cn, which is run by Zero2IPO Research in Beijing. Angel investors typically provide personal funds to finance small startups. High valuations and the loosening of listing rules will draw more Chinese companies to their home market, said Jianbin Gao of PricewaterhouseCoopers in China. “We anticipate significant growth in technology listings on domestic exchanges,” he said.

As we see it, a single man-made stock-market crash, a single computer virus invasion, or a single rumor or scandal that results in a fluctuation in the enemy country’s exchange rates or exposes the leaders of an enemy country on the Internet, all can be included in the ranks of new-concept weapons.

The Global Financial Crisis of 2007–08 represented the greatest financial downswing of my lifetime, and consequently it presents the best opportunity to observe, reflect and learn. The scene was set for its occurrence by a number of developments. Here’s a partial list: Government policies supported an expansion of home ownership—which by definition meant the inclusion of people who historically couldn’t afford to buy homes—at a time when home prices were soaring; The Fed pushed interest rates down, causing the demand for higher-yielding instruments such as structured/levered mortgage securities to increase; There was a rising trend among banks to make mortgage loans, package them and sell them onward (as opposed to retaining them); Decisions to lend, structure, assign credit ratings and invest were made on the basis of unquestioning extrapolation of low historic mortgage default rates; The above four points resulted in an increased eagerness to extend mortgage loans, with an accompanying decline in lending standards; Novel and untested mortgage backed securities were developed that promised high returns with low risk, something that has great appeal in non-skeptical times; Protective laws and regulations were relaxed, such as the Glass-Steagall Act (which prohibited the creation of financial conglomerates), the uptick rule (which prevented traders who had bet against stocks from forcing them down through non-stop short selling), and the rules that limited banks’ leverage, permitting it to nearly triple; Finally, the media ran articles stating that risk had been eliminated by the combination of: the adroit Fed, which could be counted on to inject stimulus whenever economic sluggishness developed, confidence that the excess liquidity flowing to China for its exports and to oil producers would never fail to be recycled back into our markets, buoying asset prices, and the new Wall Street innovations, which “sliced and diced” risk so finely, spread it so widely and placed it with those best suited to bear it.

The circle between Madison Avenue and Wall Street was complete; they were inexorably linked, in a relationship developed in ten short years, during which the ad men had created an ambience invaluable to the continuing popularity of stock speculation. The limitless, desirable, and expensive goods coming onto the market—often products of companies quoted on the Stock Exchange—could only be sold by determined advertising campaigns. If those campaigns failed, the market would slump. To maintain his place in consumer society, a man was told he needed a car, radio, icebox, and refrigerator; his wife required a washing machine, automatic furnace, and one of the modish pastel-hued toilets. To complete their domestic bliss they would have the latest in bathrooms: a shrine of stunning magnificence, containing, among other items, “a dental lavatory of vitreous china, twice fired.” To buy it would cost the average American six months’ salary. But paying was no problem; there were the installment plans. It was also part of the advertising philosophy that it was no longer enough to buy a car, radio, or refrigerator. People must have the latest model—junking the old one, even though it was still useful. Failure to do so would cause factories to close from the Atlantic to the Pacific, ending what some newspapers called “the golden era.” To protect it, they told their readers, was the patriotic duty of every American; one way to express that was, “to buy until it hurts.

percent return, but international stocks returned 187 percent. The very fact that the returns differentials could be this large between U.S. and international stocks shows that you don’t get enough international exposure by just buying U.S. stocks. Faulty argument #2: One should overweight international stocks, because most of the world’s economic growth will come from overseas. I certainly agree with this argument, but that does not translate into international stocks outpacing U.S. stocks. That’s because it’s not exactly a secret that countries like China and India are growing faster than the United States, and this knowledge is already priced into the market. This is the same phenomenon as Google being priced at much higher multiples than Ford, because we know Google has better economic prospects. Remember that beaten-up value stocks tend to make better investments than the star growth stocks. The same may be true in that the fastest-

at any given time about 30 percent of the stocks on China’s markets are being manipulated.

Moreover, as much as a third of China’s reported FDI may in fact be “round-tripping”—investments by Chinese individuals and companies that are routed through companies in other jurisdictions, especially Hong Kong. Until about 2005, there was a strong incentive for round-tripping in order to capture tax breaks and other benefits reserved for foreign firms. Even as those preferences were phased out, other reasons for round-tripping remained. Some Chinese companies—such as Internet giants Alibaba and Tencent—are classified as “foreign” firms because they have set up offshore holding company structures in order to list on international stock markets. It may be that some investments of these firms wind up counted as “FDI.”11

China’s government is deeply concerned about any loss of confidence in the country’s fragile financial markets, both legitimate and shadow. If a financial crisis were to cause the economy to crash, it would jeopardise the Party’s hold on power, not to mention a huge writedown in the value of assets owned by the red aristocracy. When China’s stock market was crashing in June 2015, a directive was issued to state media ordering them to change their reporting so as to ‘rationally lead market expectations’.99 They were directed to halt all discussions and expert interviews. The directive went on: ‘Do not exaggerate panic or sadness. Do not use emotionally charged words such as “slump”, “spike”, or “collapse”.’ Two months after the crash, a reporter for the respected business magazine Caijing, Wang Xiaolu, was arrested on charges of ‘spreading rumors’.

Though he had started as a wizard of spreadsheets, he was rapidly distinguishing himself as a master politician who had forged global alliances with the presidents of both the United States and the People’s Republic of China. A single sentence from his mouth could send the world’s stock markets into free fall.

30 percent—Domestic equities: US stock funds, including small-, mid-, and large-cap stocks 15 percent—Developed-world international equities: funds from developed foreign countries, including the United Kingdom, Germany, and France 5 percent—Emerging-market equities: funds from developing foreign countries, such as China, India, and Brazil. These are riskier than developed-world equities, so don’t go off buying these to fill 95 percent of your portfolio. 20 percent—Real estate investment trusts: also known as REITs. REITs invest in mortgages and residential and commercial real estate, both domestically and internationally. 15 percent—Government bonds: fixed-interest US securities, which provide predictable income and balance risk in your portfolio. As an asset class, bonds generally return less than stocks. 15 percent—Treasury inflation-protected securities: also known as TIPS, these treasury notes protect against inflation. Eventually you’ll want to own these, but they’d be the last ones I’d get after investing in all the better-returning options first.

Chinese investors refer to their stock markets as “policy markets” for this very reason: they move on the expectation of government policy changes and not on news of company performance. The fundamental value-creation proposition in China is the government, not its enterprises

In surveys, Chinese casino gamblers tend to view bets as investments and investments as bets. The stock market and real estate, in the Chinese view, are scarcely different from a casino.

Yes, I know that Goldilocks got away with eating Papa Bear’s porridge, sitting in his big chair, and napping on his bed. But bears are not bulls. Don’t confuse your animals. Just because they get them mixed up in the stock market doesn’t mean you should get them mixed up in the office. Bears live in the woods, and sometimes go after honey. Bulls live on the farm, and sometimes go after pushy people. Bears can squeeze strangers hard in a spirit of fun, but they mean no harm. They’re playful. Bulls can destroy trespassers and china shops in blind fury, on purpose. They’re dangerous. End of zoology lesson.

Now, as traditional computing programs are displaced by the operation of AI algorithms, requirements are once again shifting. Machine learning demands the rapid-fire execution of complex mathematical formulas, something for which neither Intel’s nor Qualcomm’s chips are built. Into the void stepped Nvidia, a chipmaker that had previously excelled at graphics processing for video games. The math behind graphics processing aligned well with the requirements for AI, and Nvidia became the go-to player in the chip market. Between 2016 and early 2018, the company’s stock price multiplied by a factor of ten.

Foreign firms are often left with mild-mannered managers or career salespeople helicoptered in from other countries, people who are more concerned with protecting their salary and stock options than with truly fighting to win the Chinese market.

Three American business school professors decided to find out. In a first-of-its-kind study, they analyzed more than 26,000 earnings calls from more than 2,100 public companies over six and a half years using linguistic algorithms similar to the ones employed in the Twitter study. They examined whether the time of day influenced the emotional tenor of these critical conversations—and, as a consequence, perhaps even the price of the company’s stock. Calls held first thing in the morning turned out to be reasonably upbeat and positive. But as the day progressed, the “tone grew more negative and less resolute.” Around lunchtime, mood rebounded slightly, probably because call participants recharged their mental and emotional batteries, the professors conjectured. But in the afternoon, negativity deepened again, with mood recovering only after the market’s closing bell. Moreover, this pattern held “even after controlling for factors such as industry norms, financial distress, growth opportunities, and the news that companies were reporting.”8 In other words, even when the researchers factored in economic news (a slowdown in China that hindered a company’s exports) or firm fundamentals (a company that reported abysmal quarterly earnings), afternoon calls “were more negative, irritable, and combative” than morning calls.9 Perhaps more important, especially for investors, the time of the call and the subsequent mood it engendered influenced companies’ stock prices. Shares declined in response to negative tone—again, even after adjusting for actual good news or bad news—“leading to temporary stock mispricing for firms hosting earnings calls later in the day.” While the share prices eventually righted themselves, these results are remarkable. As the researchers note, “call participants represent the near embodiment of the idealized homo economicus.” Both the analysts and the executives know the stakes. It’s not merely the people on the call who are listening. It’s the entire market. The wrong word, a clumsy answer, or an unconvincing response can send a stock’s price spiraling downward, imperiling the company’s prospects and the executives’ paychecks. These hardheaded businesspeople have every incentive to act rationally, and I’m sure they believe they do. But economic rationality is no match for a biological clock forged during a few million years of evolution. Even “sophisticated economic agents acting in real and highly incentivized settings are influenced by diurnal rhythms in the performance of their professional duties.