The Fall of China’s Hedge-Fund King

I submitted this article also, with less luck in the up vote game.

It is really a great read! If anyone wonders how screwed up the Chinese stock market really is, this pretty much describe the core problems: it is basically an insider market where those with connections and power (e.g. the princelings) basically steal money away from naive and greedy retail investors by pumping and dumping (even government aided!). Basically, exactly what we've suspected all along!

The smart money attempts to ride the manipulated flows to profit, or just stays out of it and plays in the less (but still) manipulated real estate market.

>The ubiquity of wrongdoing, he said, did not make anyone safe.

This is a great companion piece to the recently updated (and ongoing) back-story with TrueCrypt. Lots of powerful people. The temptation of greed. Fascinating read and culturally quite enlightening about how 'red capitalism' seems to be working in this day and age. Worth the read.

Chinese investors are less educated in general. A lot of investors in the venture space are actually just wealthy people without a high level of education who is skeptical of the stock market. There is also a high level of fraud in Chinese startups.