Chinese See "Zero Risk" In Borrowing Money To Invest In Stock Market

[ByLoSellHi]

Quote from S2007S:

Deng says she was able to buy the car for three times her annual salary and purchase stocks after card issuers Bank of Shanghai, China Merchants Bank Co. and China Construction Bank Corp. gave her credit over the phone. While Deng broke no laws, many investors are illegally buying stocks with borrowed money.



This is why the world is full of debt. Imagine buying a car 3X your salary. How foolish can you be to take the rest and throw it into an already inflated stock market. This is not looking good. The signs are there.

She may have really bought Ford stock with that 25k. :eek:

 

[gnome]

Quote from ByLoSellHi:

She may have really bought Ford stock with that 25k. :eek:

Reminds me of when I bought my first BMW... later I was lamenting that I didn't buy Microsoft stock with the money.

 

[Ivanovich]

ÐÎ °ÙÃ× °Ù·ÖÊý ¶¯ ÊÒÄÚÕß !! $$

(translation: One hundred percent up room to go!! $$)

Use chinese simplified encoding in right click window)

 

[blast19]

Quote from S2007S:

Deng says she was able to buy the car for three times her annual salary and purchase stocks after card issuers Bank of Shanghai, China Merchants Bank Co. and China Construction Bank Corp. gave her credit over the phone. While Deng broke no laws, many investors are illegally buying stocks with borrowed money.



This is why the world is full of debt. Imagine buying a car 3X your salary. How foolish can you be to take the rest and throw it into an already inflated stock market. This is not looking good. The signs are there.

I'm a Gen-Xer and I can tell you that growing up in So. Cal there were a lot of guys dropping out of high school or not going to college so they could go straight to work and buy cars and put a bunch of plastic lights from China on them...it's not just a China problem.

 

[blast19]

Imagine buying a $12k subaru sedan and spending $20k in lights and seat covers! That's the American way!

 

[asap]

china is the next world economic super power, something that will take one or two decades to accomplish. i dont see a great depression in china in the short or mid term because they have some many cash in hand (biggest reserve) that they can pump their economy if the rest of the world became sluggish. moreover, they have comparative advantage against japan, eu and us, since their currency is undervalued and their wages are just a fraction of the average in developed economies. this means that they will continue to receive capital inflows (investment) which will add to their economic boom.

as far as their stock market is concerned, i believe it is really about enduring huge volatility and epic selloff along the way. that is not to say they wont get 50% corrections in the future, which would be amplified the magnitude of easy money poured into the stock market but as soon as the market cleanses itself up, it will eventually resume the uptrend based on fundamentals. obviously, along the way, many investors will lose their shirt but that always have been the history of stock exchanges around the globe.