as the Chinese stock market plummets in the summer of 2015
the summer of 2015
the summer of 2015 economists around the world wonder
economists around the world wonder
economists around the world wonder whether or not it will be able to
whether or not it will be able to
whether or not it will be able to recover welcome to watchmojo.com
we’re counting down ten crucial facts
we’re counting down ten crucial facts you should know about the Chinese
you should know about the Chinese
you should know about the Chinese economy number 10 what is China’s
economy number 10 what is China’s
economy number 10 what is China’s current market situation China’s is the
current market situation China’s is the
current market situation China’s is the world’s fastest growing economy as well
world’s fastest growing economy as well
world’s fastest growing economy as well as the world’s second largest economy
as the world’s second largest economy
as the world’s second largest economy with an estimated annual gross domestic
with an estimated annual gross domestic
with an estimated annual gross domestic product of over 11 trillion dollars
product of over 11 trillion dollars
product of over 11 trillion dollars trailing the US which generated about 17
trailing the US which generated about 17
trailing the US which generated about 17 trillion in 2013 throughout the first
trillion in 2013 throughout the first
trillion in 2013 throughout the first half of 2015 China saw a dive in its
half of 2015 China saw a dive in its
half of 2015 China saw a dive in its overall trade with imports falling as
overall trade with imports falling as
overall trade with imports falling as China attempted to steer its economy
China attempted to steer its economy
China attempted to steer its economy from one constructed on a high growth
from one constructed on a high growth
from one constructed on a high growth through big investment to one that is
through big investment to one that is
through big investment to one that is consumer based by July 2015
consumer based by July 2015
consumer based by July 2015 shanghai stocks had plunged more than 30
shanghai stocks had plunged more than 30
shanghai stocks had plunged more than 30 percent and Chinese companies had lost
percent and Chinese companies had lost
percent and Chinese companies had lost three point nine trillion dollars in
three point nine trillion dollars in
three point nine trillion dollars in value that’s 15 times the size of the
value that’s 15 times the size of the
value that’s 15 times the size of the Greek economy whose economic woes had
Greek economy whose economic woes had
Greek economy whose economic woes had received much more media attention
received much more media attention
received much more media attention during the same period number 9 how has
during the same period number 9 how has
during the same period number 9 how has China’s economy evolved although China
China’s economy evolved although China
China’s economy evolved although China currently holds the position as the
currently holds the position as the
currently holds the position as the world’s second largest economy it only
world’s second largest economy it only
world’s second largest economy it only began to rapidly grow beginning in the
began to rapidly grow beginning in the
began to rapidly grow beginning in the early 1920s and that despite numerous
early 1920s and that despite numerous
early 1920s and that despite numerous Wars and economic instability it
Wars and economic instability it
Wars and economic instability it suffered an economic downturn during the
suffered an economic downturn during the
suffered an economic downturn during the Great Leap Forward which ran from 1958
Great Leap Forward which ran from 1958
Great Leap Forward which ran from 1958 to 1961 led by Mao Zedong the founding
to 1961 led by Mao Zedong the founding
to 1961 led by Mao Zedong the founding father of the People’s Republic of China
father of the People’s Republic of China
father of the People’s Republic of China this campaign embodied the rapid
this campaign embodied the rapid
this campaign embodied the rapid transition from an agrarian economy to a
transition from an agrarian economy to a
transition from an agrarian economy to a socialist one this was to be achieved
socialist one this was to be achieved
socialist one this was to be achieved through an increase in industrialization
through an increase in industrialization
through an increase in industrialization and collectivization in order to
and collectivization in order to
and collectivization in order to encourage the sharing of agricultural
encourage the sharing of agricultural
encourage the sharing of agricultural tools and animals unfortunately it led
tools and animals unfortunately it led
tools and animals unfortunately it led to the great Chinese famine in which up
to the great Chinese famine in which up
to the great Chinese famine in which up to 45 million people died as a result of
to 45 million people died as a result of
to 45 million people died as a result of the radical change in agricultural
the radical change in agricultural
the radical change in agricultural practices the lack of economic
practices the lack of economic
practices the lack of economic management and
management and
management and persecution of those who refused to
persecution of those who refused to
persecution of those who refused to adhere to the campaign’s priorities and
adhere to the campaign’s priorities and
adhere to the campaign’s priorities and enforced policies number eight
enforced policies number eight
enforced policies number eight how has China’s economy evolved part two
how has China’s economy evolved part two
how has China’s economy evolved part two China’s economic reform began in the
China’s economic reform began in the
China’s economic reform began in the late 1970s with the first stage
late 1970s with the first stage
late 1970s with the first stage introducing foreign investment the D
introducing foreign investment the D
introducing foreign investment the D collectivization of the agricultural
collectivization of the agricultural
collectivization of the agricultural sector and the development of
sector and the development of
sector and the development of entrepreneurial businesses the later
entrepreneurial businesses the later
entrepreneurial businesses the later stage of reform began in the late 80s
stage of reform began in the late 80s
stage of reform began in the late 80s and included the privatization of
and included the privatization of
and included the privatization of state-owned industries and the reform of
state-owned industries and the reform of
state-owned industries and the reform of protectionist policies and regulations
protectionist policies and regulations
protectionist policies and regulations this launched unprecedented economic
this launched unprecedented economic
this launched unprecedented economic growth with China creating multiple
growth with China creating multiple
growth with China creating multiple special economic zones within the
special economic zones within the
special economic zones within the country thereby enabling foreign
country thereby enabling foreign
country thereby enabling foreign investment within these areas between
investment within these areas between
investment within these areas between 1978 and 2013 China’s gross domestic
1978 and 2013 China’s gross domestic
1978 and 2013 China’s gross domestic product increased around 10.5%
product increased around 10.5%
product increased around 10.5% annually leading the country to become
annually leading the country to become
annually leading the country to become an engine of economic growth both
an engine of economic growth both
an engine of economic growth both regionally and worldwide number seven
regionally and worldwide number seven
regionally and worldwide number seven who invested in the stock market in 2014
who invested in the stock market in 2014
who invested in the stock market in 2014 the Chinese government encouraged
the Chinese government encouraged
the Chinese government encouraged investing in the stock market and made
investing in the stock market and made
investing in the stock market and made the prospect more enticing by relaxing
the prospect more enticing by relaxing
the prospect more enticing by relaxing borrowing limitations and facilitating
borrowing limitations and facilitating
borrowing limitations and facilitating investing this caused widespread
investing this caused widespread
investing this caused widespread investment by the middle class and
investment by the middle class and
investment by the middle class and novice investors and led the Shanghai
novice investors and led the Shanghai
novice investors and led the Shanghai market to grow by more than 150 percent
market to grow by more than 150 percent
market to grow by more than 150 percent over two-thirds of new Chinese investors
over two-thirds of new Chinese investors
over two-thirds of new Chinese investors had never graduated from high school and
had never graduated from high school and
had never graduated from high school and most took on debt in order to invest so
most took on debt in order to invest so
most took on debt in order to invest so the 2015 stock market tumble has led
the 2015 stock market tumble has led
the 2015 stock market tumble has led many casual investors to fear investing
many casual investors to fear investing
many casual investors to fear investing in stocks again and could lead the
in stocks again and could lead the
in stocks again and could lead the overall population to question the
overall population to question the
overall population to question the ruling Communist government and their
ruling Communist government and their
ruling Communist government and their handling of the markets number six
handling of the markets number six
handling of the markets number six how has China’s housing market grown
how has China’s housing market grown
how has China’s housing market grown China experienced a real estate and
China experienced a real estate and
China experienced a real estate and property bubble from 2005 to 2013 but
property bubble from 2005 to 2013 but
property bubble from 2005 to 2013 but saw average housing prices in the
saw average housing prices in the
saw average housing prices in the country increased between 10 and 15
country increased between 10 and 15
country increased between 10 and 15 percent annually property developers
percent annually property developers
percent annually property developers continued to build commercial and
continued to build commercial and
continued to build commercial and residential properties despite the fact
residential properties despite the fact
residential properties despite the fact that there were an estimated 64 million
that there were an estimated 64 million
that there were an estimated 64 million vacant apartments the country is filled
vacant apartments the country is filled
vacant apartments the country is filled with ghost towns and malls that remain
with ghost towns and malls that remain
with ghost towns and malls that remain largely unoccupied for example in two
largely unoccupied for example in two
largely unoccupied for example in two thousand five China opened the world’s
thousand five China opened the world’s
thousand five China opened the world’s largest mall the new South China mall
largest mall the new South China mall
largest mall the new South China mall yet it remained a dead mall with a less
yet it remained a dead mall with a less
yet it remained a dead mall with a less than ten percent occupancy rate for
than ten percent occupancy rate for
than ten percent occupancy rate for years the housing market issue was
years the housing market issue was
years the housing market issue was further exacerbated by the fact that
further exacerbated by the fact that
further exacerbated by the fact that lower-income individuals were buying
lower-income individuals were buying
lower-income individuals were buying homes valued at eight times their annual
homes valued at eight times their annual
homes valued at eight times their annual income for context the guideline for
income for context the guideline for
income for context the guideline for property buying in the United States is
property buying in the United States is
property buying in the United States is three times your annual income yet there
three times your annual income yet there
three times your annual income yet there may be hope that the housing market is
may be hope that the housing market is
may be hope that the housing market is slowly recovering as it posted growth in
slowly recovering as it posted growth in
slowly recovering as it posted growth in national property sales for the first
national property sales for the first
national property sales for the first time in 15 months in April of 2015 this
time in 15 months in April of 2015 this
time in 15 months in April of 2015 this is especially important for the Chinese
is especially important for the Chinese
is especially important for the Chinese economy as housing and construction
economy as housing and construction
economy as housing and construction accounts for as much as 30 percent of
accounts for as much as 30 percent of
accounts for as much as 30 percent of the country’s gross domestic product
the country’s gross domestic product
the country’s gross domestic product number five what has China done to stem
number five what has China done to stem
number five what has China done to stem the stock market freefall since November
the stock market freefall since November
the stock market freefall since November of 2014 the Chinese government has cut
of 2014 the Chinese government has cut
of 2014 the Chinese government has cut interest rates four times and has
interest rates four times and has
interest rates four times and has reduced the amount of cash that banks
reduced the amount of cash that banks
reduced the amount of cash that banks are allowed to hold in order to push
are allowed to hold in order to push
are allowed to hold in order to push lending more than fifty percent of the
lending more than fifty percent of the
lending more than fifty percent of the companies listed on the Shanghai and
companies listed on the Shanghai and
companies listed on the Shanghai and Shenzhen composite indexes where China’s
Shenzhen composite indexes where China’s
Shenzhen composite indexes where China’s mainland stock exchanges occur have
mainland stock exchanges occur have
mainland stock exchanges occur have filed for a trading halt in an attempt
filed for a trading halt in an attempt
filed for a trading halt in an attempt to stop the losses as of July 2015 in
to stop the losses as of July 2015 in
to stop the losses as of July 2015 in order to stop the plummeting of the
order to stop the plummeting of the
order to stop the plummeting of the Chinese stock exchange the government
Chinese stock exchange the government
Chinese stock exchange the government has imposed harsh restrictions on listed
has imposed harsh restrictions on listed
has imposed harsh restrictions on listed company shareholders and managers
company shareholders and managers
company shareholders and managers furthermore those shareholders or
furthermore those shareholders or
furthermore those shareholders or managers who own over 5% of a company’s
managers who own over 5% of a company’s
managers who own over 5% of a company’s shares will not be able to sell their
shares will not be able to sell their
shares will not be able to sell their shares for six months the government has
shares for six months the government has
shares for six months the government has also restricted new initial public
also restricted new initial public
also restricted new initial public offerings for companies hoping to launch
offerings for companies hoping to launch
offerings for companies hoping to launch themselves onto the stock exchange
themselves onto the stock exchange
themselves onto the stock exchange number four how is China’s stock market
number four how is China’s stock market
number four how is China’s stock market different from the West the Chinese
different from the West the Chinese
different from the West the Chinese stock market is relatively new as its
stock market is relatively new as its
stock market is relatively new as its two main stock exchanges only began
two main stock exchanges only began
two main stock exchanges only began operating in the 1990s this is in stark
operating in the 1990s this is in stark
operating in the 1990s this is in stark contrast to the new york stock exchange
contrast to the new york stock exchange
contrast to the new york stock exchange this American Stock Exchange which was
this American Stock Exchange which was
this American Stock Exchange which was founded in 1817 is the world’s largest
founded in 1817 is the world’s largest
founded in 1817 is the world’s largest Stock Exchange and has a daily trading
Stock Exchange and has a daily trading
Stock Exchange and has a daily trading value of over 169 billion dollars the
value of over 169 billion dollars the
value of over 169 billion dollars the Shanghai and Shenzhen Stock Exchange’s
Shanghai and Shenzhen Stock Exchange’s
Shanghai and Shenzhen Stock Exchange’s are independently operated in the peak
are independently operated in the peak
are independently operated in the peak Republic of China or mainland China the
Republic of China or mainland China the
Republic of China or mainland China the Hong Kong Stock Exchange and the Taiwan
Hong Kong Stock Exchange and the Taiwan
Hong Kong Stock Exchange and the Taiwan Stock Exchange are also part of the
Stock Exchange are also part of the
Stock Exchange are also part of the Chinese stock exchanges despite the fact
Chinese stock exchanges despite the fact
Chinese stock exchanges despite the fact that they are not in mainland China
that they are not in mainland China
that they are not in mainland China territory furthermore those who trade in
territory furthermore those who trade in
territory furthermore those who trade in the Chinese market are typically
the Chinese market are typically
the Chinese market are typically ordinary people whereas in the United
ordinary people whereas in the United
ordinary people whereas in the United States institutional investors perform
States institutional investors perform
States institutional investors perform the majority of the transactions finally
the majority of the transactions finally
the majority of the transactions finally unlike the United States China’s stock
unlike the United States China’s stock
unlike the United States China’s stock market is insulated and not inextricably
market is insulated and not inextricably
market is insulated and not inextricably tied to the country’s overall economy
tied to the country’s overall economy
tied to the country’s overall economy about six percent of Chinese households
about six percent of Chinese households
about six percent of Chinese households have stock investments whereas over half
have stock investments whereas over half
have stock investments whereas over half of American households hold stocks in
of American households hold stocks in
of American households hold stocks in their investment portfolios number three
their investment portfolios number three
their investment portfolios number three is the potential Chinese stock market
is the potential Chinese stock market
is the potential Chinese stock market crash important economists have drawn
crash important economists have drawn
crash important economists have drawn stark comparisons between the 2015
stark comparisons between the 2015
stark comparisons between the 2015 economy of China and the economy of the
economy of China and the economy of the
economy of China and the economy of the United States starting in 1929 as this
United States starting in 1929 as this
United States starting in 1929 as this period marked the beginning of the Great
period marked the beginning of the Great
period marked the beginning of the Great Depression the Great Depression was a
Depression the Great Depression was a
Depression the Great Depression was a global economic depression that lasted
global economic depression that lasted
global economic depression that lasted for nearly a decade and saw both poor
for nearly a decade and saw both poor
for nearly a decade and saw both poor and rich countries loaded with high
and rich countries loaded with high
and rich countries loaded with high unemployment increased poverty failed
unemployment increased poverty failed
unemployment increased poverty failed banks and widespread homelessness in
banks and widespread homelessness in
banks and widespread homelessness in order to combat the 2015 Chinese stock
order to combat the 2015 Chinese stock
order to combat the 2015 Chinese stock market freefall a group of 21 Chinese
market freefall a group of 21 Chinese
market freefall a group of 21 Chinese brokerage firms pledged on July 4th 2015
brokerage firms pledged on July 4th 2015
brokerage firms pledged on July 4th 2015 to commit nearly 20 billion dollars to a
to commit nearly 20 billion dollars to a
to commit nearly 20 billion dollars to a stock fund in order to stabilize the
stock fund in order to stabilize the
stock fund in order to stabilize the shares this plan eerily mirrors the
shares this plan eerily mirrors the
shares this plan eerily mirrors the actions of 1929 when five of America’s
actions of 1929 when five of America’s
actions of 1929 when five of America’s most influential financiers met on Wall
most influential financiers met on Wall
most influential financiers met on Wall Street and constructed a plan to pool
Street and constructed a plan to pool
Street and constructed a plan to pool resources to stave off a fall in stock
resources to stave off a fall in stock
resources to stave off a fall in stock prices the plan soon failed however and
prices the plan soon failed however and
prices the plan soon failed however and led the Dow Jones to severely drop and
led the Dow Jones to severely drop and
led the Dow Jones to severely drop and launch the Great Depression number two
launch the Great Depression number two
launch the Great Depression number two could the potential crash affect the
could the potential crash affect the
could the potential crash affect the world economy due to the fact that
world economy due to the fact that
world economy due to the fact that mainland China has limited the amount of
mainland China has limited the amount of
mainland China has limited the amount of stocks a foreigner is allowed to
stocks a foreigner is allowed to
stocks a foreigner is allowed to purchase the possibility of contagion
purchase the possibility of contagion
purchase the possibility of contagion outside of China if the market were to
outside of China if the market were to
outside of China if the market were to continue its downward spiral would be
continue its downward spiral would be
continue its downward spiral would be minimal according to the Bank of America
minimal according to the Bank of America
minimal according to the Bank of America foreign investors own less than one
foreign investors own less than one
foreign investors own less than one percent of mainland China stocks
percent of mainland China stocks
percent of mainland China stocks yet a stock market crash could still
yet a stock market crash could still
yet a stock market crash could still have an impact on the world as China is
have an impact on the world as China is
have an impact on the world as China is home to the second largest economy and
home to the second largest economy and
home to the second largest economy and its consumers for example Chinese
its consumers for example Chinese
its consumers for example Chinese consumers represent a boon for overseas
consumers represent a boon for overseas
consumers represent a boon for overseas companies as they spend more on travel
companies as they spend more on travel
companies as they spend more on travel than any other country and they
than any other country and they
than any other country and they purchased twelve percent of the world’s
purchased twelve percent of the world’s
purchased twelve percent of the world’s luxury goods this could soon disappear
luxury goods this could soon disappear
luxury goods this could soon disappear as consumers are forced to restrict
as consumers are forced to restrict
as consumers are forced to restrict their spending in the future number one
their spending in the future number one
their spending in the future number one is this a slowdown or a meltdown
is this a slowdown or a meltdown
is this a slowdown or a meltdown despite the plunge in the stock market
despite the plunge in the stock market
despite the plunge in the stock market and the decline in the real estate
and the decline in the real estate
and the decline in the real estate property sector the Chinese economy
property sector the Chinese economy
property sector the Chinese economy continues to grow at a rate that
continues to grow at a rate that
continues to grow at a rate that outpaces the rest of the world yet it
outpaces the rest of the world yet it
outpaces the rest of the world yet it cannot afford the burst of a stock
cannot afford the burst of a stock
cannot afford the burst of a stock market bubble as its property market
market bubble as its property market
market bubble as its property market remains depressed and the country’s
remains depressed and the country’s
remains depressed and the country’s corporate and local governments hold
corporate and local governments hold
corporate and local governments hold debt that amounts to more than two
debt that amounts to more than two
debt that amounts to more than two hundred and eighty percent of the
hundred and eighty percent of the
hundred and eighty percent of the country’s GDP the world has largely
country’s GDP the world has largely
country’s GDP the world has largely relied on China to prop up the economy
relied on China to prop up the economy
relied on China to prop up the economy as it still recovers from the global
as it still recovers from the global
as it still recovers from the global financial crisis of 2008 this latest
financial crisis of 2008 this latest
financial crisis of 2008 this latest perceived market bubble could be the
perceived market bubble could be the
perceived market bubble could be the nail in the Chinese economic coffin and
nail in the Chinese economic coffin and
nail in the Chinese economic coffin and could lead to a total market meltdown or
could lead to a total market meltdown or
could lead to a total market meltdown or it could simply lead to a slowdown as
it could simply lead to a slowdown as
it could simply lead to a slowdown as the government transitions to a more
the government transitions to a more
the government transitions to a more efficient economy but only time will
efficient economy but only time will
efficient economy but only time will tell
tell
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