Stock Market: Why The China Crash Will Be Short Lived

(Drivebycuriosity) - There is a lot ado about the China crash and at least one magazine lamented about the losses small investors are suffering. Really?

After years of neglection China´s stock market got suddenly discovered and jumped temporarely 150% (here the explanation driveby). Then a setback happened and stocks fell about 30% from the peak. Yesterday the Shanghai Composite Index, the gauge for the Chinese stock market, had still a plus of 20% yer--to-date and showed a gain of 89% for the recent 12 months.

So, people who have been investing continuously in the recent months have still solid gains. I believe that the Shanghai Composite will recover soon. China`s economy shows signs of stabilzation (tradingeconomics), the central bank reduced her interest rates again and the massive reform programs, a reason for the bull market, are continuing.