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The Bubble Theorists Have Shanghai Wrong

Great piece indeed. People can make a "bubble" case any way they want based on any theory they can think of. But the fact of matter is, Shanghai stock just doesn't go down, period! Took yesterday as an example, all kinds of so called bad news, including Mr. Greenspan's comments, made many people take profits in China markets. But the buyers were just as determined to take the advantage of the rare price drops. The result was that a huge amount of stocks were traded hands, another volume record was created, yet the market were ended up just down a mere 0.5%. That actually generated a healthier upward momentum for the near term, as many profit-takers are out of the picture. In fact, today’s Shanghai market behaved much smoother, with a bit less volume, the index recovered all the losses from yesterday, and then some. Not only that, reports showed that some mutual funds, including some QFIIs, that had been prematurely cashed out and stayed on the sidelines in the previous months have once again started to come back into A-share markets. That to some degree explained the huge volumes in the past couple days. Several other reports have pointed out that, due to the overwhelming warnings from all over the world, a major chunk of money, some estimated at 2/3’s of trading cash, has been sitting on the sideline waiting for the market to go down and get back in at cheaper level. Well, as we all know that, when everyone is worrying about a market, it is the safest time to buy, so called "Wall Street climbs on the wall of worry", right? So, after this week’s fierce fights between buyers and sellers, some latest analysts comments have all pointed to a smoother, calmer and steadier upward trend for the China markets in the near term, with some predicting 4300 by the end of next week, and 4500 by the end of June. But in my mind, the easiest money that can be made now is not in China, but rather right here in US. You can buy CAF at 20% discount of the real SSE market thanks to the fears created by Mr. Greenspan and pretty much all other western analysts. Where can you get this fantastic deal?