Why don't the government take measures to rejuvenate the stock market?

Why don't the government take measures to rejuvenate the stock market?
Apr 11, 2008 02:34
gueststock	Many investors in Chinese stock market complain that their shares' value has shrunk near 50 percent and require the government to take measures to cheer up the market, for example, cutting the stamp tax on stock transfers. However, it seems that the government won't intervene in the stock market. Some people's suggestion to cut the stamp tax on stock transfers hasn't been approved yet. Why don't the government take measures to save the market? What are you comments on this matter?

Apr 11, 2008 02:34

gueststock

Many investors in Chinese stock market complain that their shares' value has shrunk near 50 percent and require the government to take measures to cheer up the market, for example, cutting the stamp tax on stock transfers. However, it seems that the government won't intervene in the stock market. Some people's suggestion to cut the stamp tax on stock transfers hasn't been approved yet.

Why don't the government take measures to save the market? What are you comments on this matter?

Apr 11, 2008 08:23

APAULT
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Join Date: Mar 11, 2006
Status: Offline

Excellent: the government won't intervene! It shouldn't. Peopel purchased shares in the expectation of above average gains - fair enough because the economy is growing so fast. But too many people saw it as a way to quick riches. If you know what you are doing it might be, but most people are simply gambling without understanding the market. get rich quick schemes are always high risk.

If the government should intervene it is in the regulations relating to the purchase of shares, especially money being lent for such speculative 'investment'. My recollection is that the government did exactly that, but maybe not enough.

Reducing the duty is irrelevant and might even add to the problem. Maybe what the government should do is put a significant tax on invetsment or on capital growth. That will cool it a bit.

If you have bought shares and face losses, you should look at what you see for the future of teh companies you are invested in. If the shares are worth buying at that price, hold on, if not sell and accept the losses before they get bigger. If they are substantial companies, you wil see a useful profit in a few years time.

Apr 13, 2008 22:40

KEVIN0518
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Join Date: Mar 13, 2007
Status: Offline

Paul, some people say that Chinese stock market is "policy driven" market. That means the real master of the market is the government. Personally, I think that the government should have changed its role, being a supervisor instead of the manipulator. What they should do is to improve the related rules, policies and laws to avoid speculation. They shouldn't use their power to influence the market. For those who want to be quick riches, they should bear in mind that the risk is too high.

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