It seems the “irrational exuberrance” in Chinese domestic stock market finally got a reality check. Here is an excellent article from MarketWatch. Again quoted from the article:
“There was a story on the front page of The Wall Street Journal about a group of little old ladies in the Midwest who soured on their boring portfolio as they watched dot-com investors get rich. The good ladies had traded their utilities for the shares of technology firms.
That was during the interlude between the bubble’s first leak in March, 2000, and the loud pop some nine months later. We know how that movie ended, with two big sevens. Total stock market worth shrunk by about $7 trillion before the subsequent bear market was over. Almost seven years after the top, the Nasdaq Composite Index is worth about half what it was then. Now: pushing 2,500. Then, topping at 5,000.
The sequel is starring homeowners in Shanghai, who are taking out second mortgages to buy stocks of fast-growing Chinese firms, as The Journal reported this week.”