Yi Xianrong's Irrational Prosperity Of China's Stock Market

In the face of the craziness of China's A share index and volume, the market is surely worried that why the crazy bull market has not only stopped its pace but is more frenzied. Is China's stock market irrational prosperity? If this irrational boom once ebbed, will it lead to the collapse of China's stock market bubble and the outbreak of China's financial crisis and economic crisis? How can investors share the fruits of China's A share growth and avoid the possible disaster brought by the stock market?

It can be said that at present, the government has the intention to destroy the "national bull market" to save the economy. As long as this intention has not changed, the mad cow of China's A shares can not stop.

For example, the recent official media are fully supporting the stock market up, and pointed out that China's economic operation is facing greater pressure this year, especially the stock market to support the economy, so maintaining the stable operation of the stock market is crucial.

That is to say, the government needs a "national bull market" to save the economy. It will certainly introduce policies and manufacture themes to make China's A shares up. It is estimated that the mad bull of A shares will not end in the short term, only to see how crazy the "national bull market" is.

Investors should see that the current frenzy of bull market can not be predicted or explained by any existing theory or mode, nor is there any macro data or economic index to support it.

Therefore, many people believe that this is a bull market without economic growth or without any reason.

So when someone uses traditional

It is out of date to judge the rationality and irrationality of this bull market.

For example, if we only use the usual indicators to see the current domestic stock market, China's stock market is at a high risk. For example, from the current A share price earnings ratio (PE), the average PE of the Shanghai composite index is 17 times, which is reasonable, just higher than the Hongkong stock market, but the average PE48 times of the small and medium board index.

The average PE of the index is as high as 90 times.

But domestic investors have not withdrawn from these markets because of these surprising indicators.

The Shanghai composite index has reached 4000 points yesterday.

But at this time of 2014, the Shanghai composite index was still hovering around 2000, but the index rose more than 100% a year later.

Traditional wisdom will think that such a stock market growth is not too fast, is it a bit crazy?

But the market may think that after the 2008 financial tsunami, the world's stock market rose much more than the Chinese stock market.

For example, the US stock market has already exceeded the level before the financial tsunami, and has always hit a record high, and the Nikkei index has also risen by more than 50% because of Andouble economics. So is the European stock market.

Therefore, even though China's A share index is above 4000 points or 5000 points, it is still low compared with 6124 in October 2007, so there is still room for China's stock market to rise.

However, the comparison is not only of little significance, but also falls into the stereotype of traditional wisdom.

In fact, the current situation of China's A shares lies in the government's policy intentions.

As long as the government's intention to destroy the "bull market" does not change, the bull market of China's A shares will not end.

And this point can not be analyzed with any recurrent indicators and traditional wisdom.

And the stock market index continued to rise, the stock market's money effect immediately emerged.

This will surely attract more funds and investors into the market, further pushing up share prices and creating bull markets.

For example, in the first quarter of this year, Shanghai and Shenzhen

Only 33 of the 2327 stocks fell.

This means that almost all the stock prices are rising in the first quarter, and nearly 2000 of them rise by more than 10%.

That is to say, any investor in the A share market has a 10% return on buying a stock for a quarter.

There are also 235 stocks rising by more than 100%.

That means investors who buy 10% of these stocks can double their earnings in the first quarter.

With this kind of money making effect, how can domestic investors not enter the stock market to consider the stock market risk? This is the reason why the stock market is mad now, and the irrational prosperity of stock market in traditional wisdom.

Because, whether from China's real economy itself or the needs of the real economy, the expansion of China's stock market is bound to be a trend.

Otherwise, it can not support such a huge scale of China's real economy and market.

And to do that, it is not only to find the growth point of the domestic real economy, but also to create a new engine for economic growth.

Such as China's Internet plus area, and so on, and whether there are major breakthroughs in China's stock market reform, such as whether the issuance system is really turning to registration system, whether the basic system of new stock market operation rules, investment concepts and investor protection system is really established, is it a fair and fair stock market established and effective operation?

Only in this way can China's stock market lead to rational prosperity rather than irrational prosperity.

The Shanghai and Shenzhen stock markets both opened high, but the Shanghai composite index once fell, but quickly recovered. The financial and oil shares took the lead. The Shanghai composite index rose to 4000.22 points, rising by 0.84% on the whole day, at 3994.81 points and a 7 year high.

Capital withdrawal from gem, the index fell 2.7%, the Shenzhen composite index also fell 0.7%.

With the influx of capital into the market, the total turnover of the two cities has reached a record high of 15544 billion yuan, breaking the record of 14394 billion yuan set for 24 days in March.