- BREAKING NEWS: Miss Japan, Riyo Mori, wins Miss Universe! See story.
- Remember the euphoria that gripped investors in the US in the late 90's? I still remember folks quitting their countertop installation jobs at the Home Depot to trade stocks full time. I remember sitting in the sports book at a casino during March Madness listening to the guys behind me talking about Cisco and AOL instead of the Duke point spread, and then asking the sports bar if they could "Just turn one TV to CNBC, please?!?!" Lets flash forward, LOST style, to China 2007.
The stock boom has attracted a flood of new money from millions of newcomers to the market, including elderly pensioners, students, maids, security guards, Buddhist monks, taxi drivers, and even young schoolchildren. A group of 9-year-old students at a primary school in Nanjing is among the latest stock investors. Some Chinese investors are borrowing large sums of money or pawning their possessions to gain money for buying shares.
Mr. Zhang, a 21-year-old security guard at the trading hall of a Beijing brokerage, is earning a monthly salary of less than 1,000 yuan after arriving fresh from the countryside of Hebei province. But he has already taken almost his entire savings - about 15,000 yuan - and sunk it into the stock market. "Some of my colleagues among the security guards have also bought stocks, and some of them have invested more than me," he said.
"The cleaning lady here has also bought stocks, and she earned more profits than me because her stock rose by three yuan while mine only rose by one yuan. I don't know much about stocks, but it's helpful to listen to the experienced investors here because I'm working here every day. I'm not worried about my investment - everyone says the stock market won't have any problems before the Beijing Olympics next summer."
Mr. Huang, a 71-year-old pensioner, is surviving on a pension of barely 1,000 yuan a month. But he has already invested 3,000 yuan in the stock market. He is planning to learn how to use a computer - a new skill - so that he can trade stocks on the Internet at home.
"I agree that the stock market is overheated," he said. "But when everybody around me has earned money from the stock market, why shouldn't I invest in it? It's better than putting my money in the bank. All of my friends have profited from the stock market."
- Let me ask you. Are you anxious to rush into Chinese market after reading that? How do you think it'll end for those folks? My guess is that it will end mostly the same as it did for the folks here in 1999. Now this doesn't mean China's market won't go higher. Maybe this time it is different. But while history may not repeat itself, it often rhymes.
- CNBC's Miss Finance, Erin Burnett, still concerned this morning that the SP500 hasn't closed above the previous all-time closing high of 1527.
- It's the first day back after a long weekend. I almost forgot to honor the search engine gods regarding Miss Japan and now Miss Universe Riyo Mori (nude, naked, topless, bikini, swimsuit, miss universe, miss japan, panties, smoking). That's better. Back in the groove.
- More later. Shaking off some long weekend cobwebs. Dumped a few more shares of mo-mo stocks this morning and raising more cash. I know we have the end-of-month strength period ahead, but I'm content and patient to be a little reserved here.