Analysts Urge China to Build ‘Good Bubbles’ as Wall Street Hits Record Highs
Updated
Updated · South China Morning Post · Jul 27
Analysts Urge China to Build ‘Good Bubbles’ as Wall Street Hits Record Highs
3 articles · Updated · South China Morning Post · Jul 27
Summary
Chinese analysts are urging Beijing to tolerate or foster “good bubbles” in capital markets, arguing that a more growth-friendly stance is needed to keep money from flowing to the US.
Record highs in the S&P 500, Nasdaq and Dow Jones Industrial Average have strengthened Wall Street’s pull on global capital, while China’s cautious approach has focused more on deflating excesses than promoting market wealth creation.
Xiao Geng of the Chinese University of Hong Kong, Shenzhen said regulators need a fundamental shift from pure risk prevention toward creating, accumulating and preserving wealth through capital markets.
The debate highlights a widening contrast: Washington is openly celebrating a stock boom as proof of economic revival, while Beijing rarely promotes its own exchanges and now faces pressure to engineer a rival rally.