Dan David is cofounder of GeoInvesting, a Skippack firm that investigates and reports on China-based, publicly-traded companies, including those accused of falsifying investor information, for short-sellers and other investors. He agreed to talk today about the China stock market, whose benchmark Shanghai Stock Market Composite Index is off 32% since June 12. Transcript edited for clarity.
(Are you seeing all the companies you ever warned about plunging?) Yes. This is… related to the shenanigans coming from the government of China:
— 40% of companies on their exchanges have now requested a halt in trading their stocks to stem the ability of average investors to sell.
— And, in the most shocking move, the China regulators have enacted a rule that any shareholder owning 5% or more of a company cannot sell as of today for 6 months. Both of these issues are in my opinion an appalling manipulation of the global markets.
(Is this a short-term ‘correction’ or a long-overdue taking-out-of-the-trash?) This is a ‘long-overdue taking-out-the-trash’. However there is soo much trash they can’t possibly find a dump big enough.
To see more of Dan David’s answers, go here.