to justify this crash, quite a lot fund managers are now in prison, who became the scapegoat for the government--the real one initiated all this mess.
Believing the proposition that one can control something as complex as an economy requires a certain amount of arrogance and/or hubris, neither of which are in short supply in the States. But from one naïve American's perspective, the Chinese leadership act like it's their divine right of nature.
The Yankee propaganda machine is smooth and suave so we hardly realize it exists. It makes the Chinese look heavy handed by comparison, and our Overton window is much wider than theirs. But don't confuse that suavity and width with the absence of propaganda.
[0] http://www.newyorker.com/magazine/2013/09/16/hitler-in-holly...
[1] http://www.poynter.org/2014/covering-china-for-foreign-and-d...
[2] https://cpj.org/blog/2015/03/how-china-uses-j-visas-to-punis...
[3] http://america.aljazeera.com/articles/2015/8/27/chinese-jour...
[4] http://www.nytimes.com/2012/10/26/world/asia/china-blocks-we...
Want to get access to high ranking officials? Same thing.
Instead of throwing anyone in jail it's a matter of strangling them of access so competitors gets important information first or gets to be the ones askin their questions.
Occasionally it doesn't work. Like when a newspaper gets hold of something important enough to be willing to risk their access (such as the Snowden documents). But for tilting the day to day reporting of politics these methods have been honed to a level where they are remarkably effective.
An American reporter can freely be critical of the government. They can even publish Snowden documents, which put the government in a very bad light. Nobody even considers harassing them, let alone jailing them. (In fact, legally, they can't.) This fact is huge; it is an essential difference.
I think I finally figured out how the Communist Party deals with information control. They simply state whatever they wish were actually true as if it were true, and then bully, punish, jail, block or otherwise try to stamp out any other perspective.
So, they say "Taiwan is part of China" when it manifestly is not part of China, and they encourage an angry response to anyone who says it is not true. But other than national messaging, it seems like the State media actually does their own stories, because you often see it run a story which then gets deleted off the web site a couple hours or a day later, after the government decides what the message should be.
From the outside looking in, China and Taiwan are merely part of a long running civil Cold War.
I don't think you should read too much into names. Taiwan is neither internationally recognized as part of China nor does it function as part of China in any way.
I guess I'll be moving to Iceland.
Lots of people consider what happened there good because with our western view bankers never pay for their mistake and they do in iceland, blissfully ignoring the action from their government that triggered them and helped them get there.
At their height, the Icelandic banks possessions was worth eleven times the GDP of Iceland, and were in part fueled by promise of their government to other countries, promise that they went back on the moment things went south.
Imagine if another country did that to yours, say a Chinese bank buy a bank where your country's citizens have deposits and then the chinese govenment reneg their promise and let creditors in your country either lose their money or be repaid by your own government, would you consider the chinese government "the good guys who stood up to bankers" ?
> On 6 October, the Icelandic legislature instituted an emergency law which enabled the Financial Supervisory Authority to take control over financial institutions and made domestic deposits in the banks priority claims. In the following days, new banks were founded to take over the domestic operations of Kaupthing, Landsbanki and Glitnir. The old banks were put into receivership and liquidation, resulting in losses for their shareholders and foreign creditors. Outside Iceland, more than half a million depositors lost access to their accounts in foreign branches of Icelandic banks. This led to the 2008–2013 Icesave dispute, that ended with a ESA ruling that Iceland was not obliged to repay Dutch and British depositors minimum deposit guarantees.
> In 2001, banks were deregulated in Iceland. This set the stage for banks to upload debts when foreign companies were accumulated.
> his inflation was exacerbated by the practice of the Central Bank of Iceland issuing liquidity loans to banks on the basis of newly issued, uncovered bonds effectively, printing money on demand.
> In response to the rise in prices – 14% in the twelve months to September 2008, compared with a target of 2.5% – the Central Bank of Iceland held interest rates high (15.5%). Such high interest rates, compared with 5.5% in the United Kingdom or 4% in the eurozone for example, encouraged overseas investors to hold deposits in Icelandic krónur, leading to monetary inflation: the Icelandic money supply (M3) grew 56.5% in the twelve months to September 2008, compared with 5.0% GDP growth
Again, not saying the bankers weren't responsible. They were. But I don't like the praise to how the icelandic government handled it because they were just as responsible and then turned around and beat their accomplice while trying to make themselves appear the good guys.
> to justify this crash, quite a lot fund managers are now in prison, who became the scapegoat for the government--the real one initiated all this mess.
Furthermore, why do you think the FED should've raised raters earlier? Supporting the stock market is not their mandate and it is thus not directly relevant whether and how long has the current bull market lasted. A big market crash just a few years after 2008 (and 2011) would've certainly had a dampening effect on recovery so they might have felt justified in increasing the money supply. Inflation is running low, economic growth and labor markets were very weak for many years after the 2008 crash. They had pretty good reasons to be supportive.
Most normal people buy and hold. (Personally I have a mix of bond and stock index funds)
But for a day trader, decent sized jump could be a problem. I don't have a ton of sympathy though since day trading is basically gambling.
An ill-sighted policy, but striving at a wealth effect. The housing market was already crashing in 2012, and gold was booming so much so it seemed like a peak. Wages were stagnant and had been for some time. So where to encourage people to have a feeling of generating wealth? A stagnant stock market.
I have a feeling the Chinese leadership, as a body that agrees on consensus, understand western economic and political history better than anywhere else in the world. They also have a sense of control over messages that get sent out by official media.
This combination led to a belief that nothing can go wrong when the 2 are put together: in this case a stampede to the stock market and quite a few savvy investors recognising this.
This search for a wealth effect reflects something much deeper, however: There is deep malaise in China's economy which is felt across the board, and there is a desperate desire to keep the ball that has rolled for the past 20 years to continue rolling.
In the past 20~ years the leaders in China are graduated from the best engineer school in China, the current one is far from that, somehow he became overly confident and to some extent reckless, I feel that's one way to explain what are happening there nowadays, including this busted stock cycle.
China is still a heavy-handed command economy in many ways. The Communist Party's reputation and 'people authority' is directly tied to the economy delivering continual material progress gains (which the party then takes a lot of credit for, with the downside being the implied responsibility if things go badly). The desperation stems from 2007-2009, when the global economy crashed, and ended their over-boom (some of it was fake, backed by highly leveraged consumers and a slightly cheap currency that had been pegged to an artificially cheap dollar). At that point, China made a decision to inflate bubbles rather than accept much slower growth. The real estate bubble bought them a couple of years before it turned back against them.
China is now eating through their capital reserves rapidly, while trying to prop up the most over-valued stock market on earth, and simultaneously dealing with a manufacturing sector that has been shrinking for five straight months (to go with the big bust in several specific segments like steel). They're trying to fight reality, when they should have instead learned from Japan's similar past mistakes in trying to prop up fake growth with bubbles (China is even making the same zombie corporation mistakes that Japan did).