- Created: Wednesday, 29 July 2015 15:37
- Written by Trevor Rayne
US$3 trillion was wiped off the Shanghai and Shenzhen stock exchanges in June and first week of July 2015. The Shanghai exchange had risen 135% in a year and fell 30%. The Shenzhen exchange rose 150% and fell 37%. 11% of China’s 443 million households are reckoned to hold shares. The Chinese government encouraged people to gamble their savings on the stock markets: ‘4,000 [points on the Shanghai Corporate index] was just the beginning’, said the Chinese Communist Party newspaper People’s Daily in April. Dreams of quick and effortless money crashed into bitter recriminations: ‘I have lost two-thirds of my money…I really want it back and when I get it, I will never invest in the stock market again.’ A pensions expert at the Shanghai Institute of Finance and Law explained, ‘Old people often don’t understand economics. They are easily duped.’ The stock market crash demonstrates that China is not immune from the crisis of international capitalism and the credibility of the Communist Party and the Chinese state is now threatened.