Skip to main content Accessibility help
×
Hostname: page-component-cd9895bd7-lnqnp Total loading time: 0 Render date: 2024-12-23T08:09:23.274Z Has data issue: false hasContentIssue false

Chapter 11 - Casino Capitalism with Chinese Characteristics

Published online by Cambridge University Press:  06 August 2020

William Quinn
Affiliation:
Queen's University Belfast
John D. Turner
Affiliation:
Queen's University Belfast
Get access

Summary

Chapter 11 examines the stock market bubbles which occurred in China in 2007 and 2015. Between the end of 2005 and October 2007, the stock market soared by over 400 per cent. One year later, the market had fallen by 70 per cent. Similarly, in the year before June 2015, the stock market had increased by more than 150 per cent. It then collapsed by more than 50 per cent in under three months. The chapter discusses how, in the space of 20 years, China went from having almost no marketability to having heavily controlled marketability, and then near-free marketability. China also went from having virtually no middle class to having the world’s largest middle class, which then became the new speculating class. Thanks to margin lending, they were able to borrow heavily to finance their investments. Both bubbles are very clear examples of how and why governments engineer bubbles in the first instance. In 2007 the Chinese authorities needed to stimulate privatisation and in 2015 they needed to unwind the largest economic stimulus in history.

Type
Chapter
Information
Boom and Bust
A Global History of Financial Bubbles
, pp. 193 - 209
Publisher: Cambridge University Press
Print publication year: 2020

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×